RENDERED: JANUARY 21, 2022; 10:00 A.M.

NOT TO BE PUBLISHED

Commonwealth of Kentucky

Court of Appeals

NO. 2021-CA-0374-MR

MEGAN WEBB AND KAYLA WEBB APPELLANTS 

v. 

APPEAL FROM MONTGOMERY CIRCUIT COURT

HONORABLE WILLIAM EVANS LANE, JUDGE

ACTION NO. 20-CI-90134

KENTUCKY FARM BUREAU 

MUTUAL INSURANCE COMPANY APPELLEE 

OPINION

AFFIRMING

**   **  **

BEFORE: CLAYTON, CHIEF JUDGE; CETRULO AND McNEILL, JUDGES.

CETRULO, JUDGE: This is an appeal from a Montgomery Circuit Court order 

granting a summary judgment for declaratory relief. The circuit court found the 

appellants, Megan and Kayla Webb (“the Webbs”), were operating a 

childcare/daycare business out of their home when a child was allegedly injured 

while on their premises and under their care. The trial court found the appellee, 
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Kentucky Farm Bureau Mutual Insurance Company (“KFB”), is not required to 

provide liability coverage to or defend the Webbs in the underlying cause of action

(a personal injury suit) because the circumstances surrounding the alleged injury

were excluded by the terms and conditions of their homeowner’s insurance policy. 

We AFFIRM.

FACTUAL AND PROCEDURAL BACKGROUND

The facts are straightforward, but troubling. In January 2017, the 

Webbs began offering childcare services in their home. The Webbs owned the 

home and had purchased homeowner’s insurance prior to starting this business 

venture. The Webbs advertised through word of mouth and on social media. The 

Webbs charged $20 per child per day or $100 per child per week.

In September 2017, a mother arrived at the Webbs’ home to find her 

five-month-old child with an indented skull and facial bruising. While denying the 

injury occurred on the premises within the context of the civil lawsuit, Megan 

Webb pled guilty to criminal abuse in the second degree in the criminal case. 

After the child’s injury, a lawsuit was filed against the Webbs on 

behalf of the injured child. The Webbs notified their insurer, KFB, of the claim.

The insurer provided counsel to defend the Webbs in the underlying litigation but 

then filed this separate action for declaratory judgment pursuant to three 

homeowner’s insurance policy exclusions: (1) no liability coverage for the 
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operation of a “business” on the insureds’ property, (2) no liability coverage for the 

operation of an “at-home daycare” on the insureds’ premises, and (3) no liability 

coverage for bodily injury caused by intentional acts.

The relevant Homeowner’s Policy terms and conditions provide as 

follows: 

SECTION II EXCLUSIONS

1. Coverage E - Personal Liability . . . does not apply to 

“bodily injury” or “property damage:”

a. Which is expected or intended by one or more 

“insureds”;

b. Arising out of or in connection with a 

“business” engaged in by an “insured.” This 

exclusion applies but is not limited to an act or 

omission, regardless of its nature or 

circumstance, involving a service or duty 

rendered, promised, owed, or implied to be 

provided because of the nature of the 

“business”;

. . . . 

n. Arising out of the home day care business. If 

an insured regularly provides home day care 

services to a person or persons other than 

insureds and receives monetary or other 

compensation for such services, that enterprise 

is a business pursuit. Mutual exchange of 

home day care services, however, is not 

considered compensation. The rendering of 

home day care services by an insured to a 

relative of an insured is not considered a 

business pursuit.
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Therefore, with respect to a home day care 

enterprise which is considered to be a business 

pursuit, this policy: 

1) Does not provide SECTION II - LIABILITY 

COVERAGES because business pursuits of an 

insured are excluded under exclusion 1.b. of 

Section II Coverages - Exclusions[.]

The Webbs challenged the enforceability of the exclusions of the 

homeowner’s insurance policy, but the trial court found the exclusions to be valid 

and applicable, granting KFB’s motion for summary judgment “against both 

[Webbs] on the business and child-care exclusions and on the physical abuse 

exclusion as to Megan Webb.”

STANDARD OF REVIEW

The Kentucky Supreme Court clearly states the applicable standard of 

review: 

In cases in which the trial court has granted summary

judgment in a declaratory judgment action and no bench 

trial is held, we use the appellate standard of review for

summary judgments. 

When reviewing a trial court’s grant of summary

judgment, we determine whether the record supports the 

trial court’s conclusion that there is no genuine issue as 

to any material fact and the moving party is entitled to 

judgment as a matter of law. Because summary

judgment does not require findings of fact but only an 

examination of the record to determine whether material 

issues of fact exist, we generally review the grant of

summary judgment without deference to the trial court’s
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assessment of the record or its legal conclusions. The

interpretation of insurance contracts is a matter of law, so 

our review is de novo.

Foreman v. Auto Club Property-Casualty Insurance Co., 617 S.W.3d 345, 349 

(Ky. 2021) (internal quotation marks and citations omitted). See also Kentucky 

Rule of Civil Procedure (CR) 56.03.

ANALYSIS

The Webbs argue that their homeowner’s insurance policy exclusions 

should be nullified because the contract is an adhesion contract with ambiguous 

and/or conflicting terms. “A contract of adhesion is a standardized contract, 

which, imposed and drafted by the party of superior bargaining strength, relegates 

to the subscribing party only the opportunity to adhere to the contract or reject 

it.” Schnuerle v. Insight Communications Co., L.P., 376 S.W.3d 561, 576 (Ky. 

2012) (quoting Patterson v. ITT Consumer Financial Corp., 14 Cal. App. 4th 

1659, 1664, 18 Cal. Rptr. 2d 563, 564 (1993)). Courts have been willing to

scrutinize adhesion contracts and have refused to enforce egregiously abusive ones. 

Schnuerle, 376 S.W.3d at 576 (citing Jones v. Bituminous Casualty Corp., 821

S.W.2d 798 (Ky 1991)).

Specifically, the Webbs argue that their contract includes two separate 

lists of exclusions, on two different pages, several pages apart. They argue the 

contract provided “no definitions or other clarifying language, which would
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explain to a consumer with ordinary experience and education, the difference in the 

two lists of exceptions.” (Emphasis omitted.) The Webbs refer this Court to 

Schnuerle, 376 S.W.3d 561; however, in Schnuerle the Kentucky Supreme Court 

held that adhesion contracts can be subject to abuse but are not per se improper. 

Id. at 576. In fact, the Court upheld the contract in Schnuerle because the clause 

was not concealed or disguised, and the contract was written so a person of 

ordinary experience and education could understand it. Id. The Webbs’ 

exclusions included herein are likewise clear and in plain language to provide the 

homeowners with knowledge that certain actions would be excluded from 

coverage.

Further, the fact that exclusions appear on different pages of the 

policy is certainly not grounds to find a conflict or to conclude that the insureds 

were not fully advised of the exclusions under the policy. The Webbs cite to no 

law in support of this argument and we have not found any either.

The Webbs recognize the similarities of this case with the opinion of 

this Court in Holzknecht v. Kentucky Farm Bureau Mutual Insurance Company, 

but they assert that the facts are distinguishable. 320 S.W.3d 115 (Ky. App. 2010). 

We do not find the cases disparate; rather, we find Holzknecht to be consistent and 

dispositive herein. In Holzknecht, the insureds were similarly operating an athome daycare business on the insured premises. A dog kept at the home attacked a 
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child who was there for daycare services. As in this case, the mother of the child 

filed suit and KFB provided a defense under reservation of rights before moving 

for a declaratory judgment action stating that there was no coverage. It is clear 

from a reading of that case that the policy exclusions were equivalent to those 

contained in the Webbs’ policy. In Holzknecht, the trial court granted KFB

summary judgment and this Court agreed, holding that “[t]he terms of the policy 

are unambiguous and specifically exclude the coverage that Holzknecht seeks.” 

Holzknecht, 320 S.W.3d at 119. 

KFB points this Court to the three policy provisions that specifically

exclude coverage for the Webbs: (1) the on-premise “business” exclusion, (2) onpremise “at-home daycare” exclusion, and (3) bodily injury caused by intentional 

acts exclusion. The Webbs do not specifically dispute the applicability of these 

three exclusions.

First, KFB argues the Webbs’ daycare was an on-premise business 

excluded by their policy; we agree. In Eyler v. Nationwide Mutual Fire Insurance

Company, 824 S.W.2d 855, 859 (Ky. 1992), the Kentucky Supreme Court adopted 

a two-part test for determining whether activities may be considered business 

pursuits: 

To constitute a business pursuit, there must be two 

elements: first, continuity, and secondly, the profit 

motive; as to the first, there must be a customary 

engagement or a stated occupation; and as to the latter, 
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there must be shown to be such activity as a means of 

livelihood, a gainful employment, means of earning a 

living, procuring subsistence or profit, commercial 

transactions or engagements.

Id. (quoting Krings v. Safeco Ins. Co., 6 Kan. App. 2d 391, 628 P.2d 1071, 1074 

(1981)). 

We find the daycare business to be both continuous and profit driven. 

The Webbs started offering childcare services after Megan Webb quit her job; the 

daycare operated continually with seven to ten children in attendance in their home 

per week; and the Webbs charged a flat fee per child. We see no reason to believe 

the Webbs’ daycare was not a “business” falling within the terms of the policy. 

Second, the Kentucky Supreme Court has also found insurance 

policies excluding childcare services to be valid. Thomas v. State Farm Fire and

Casualty Co., 626 S.W.3d 504 (Ky. 2021). In Thomas, the Kentucky Supreme 

Court found the childcare exclusionary language was not ambiguous and concurred 

with the holding in Holzknecht. Thomas, 626 S.W.3d at 508-09.

Third, we agree with the trial court that liability coverage is further 

excluded under this policy for “bodily injury that is the result of expected or 

intended injuries by one or more of the ‘insureds.’” As to Megan Webb at least, 

there was a criminal conviction on a guilty plea. Intentional acts are expressly 

excluded from the homeowner’s policy and this Court has previously held that 
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intention can be inferred in a case such as this.1 Walker v. Economy Preferred Ins. 

Co., 909 S.W.2d 343, 345 (Ky. App. 1995). 

Even adhering to the long-held standard that when we interpret

insurance contracts, perceived ambiguities and uncertainties in the policy terms are 

generally resolved in favor of the insured (Kentucky Association of Counties All

Lines Fund Trust v. McClendon, 157 S.W.3d 626, 630 (Ky. 2005)), we find the 

exclusions listed in the Webbs’ homeowner’s policy do deny them coverage 

herein. We believe that the aforementioned authorities, interpreting identical or 

nearly identical exclusions in homeowner’s insurance contracts, confirm that the 

exclusions are valid, enforceable, and not disguised or ambiguous. One does not 

have to be an attorney to understand that operating a daycare business within one’s 

home and pleading guilty to causing an injury to a child would not fall within the 

reasonably expected coverages insured by a homeowner’s insurance company. We 

do not find the Webbs’ homeowner’s insurance policy to be procedurally 

unconscionable or egregiously abusive. 

1 This Court has recognized that intent may be inferred as a matter of law in certain 

circumstances. For example, in Walker, this Court upheld a summary judgment applying a 

policy exclusion to deny coverage to the plaintiff who was injured after being hit in the face by 

the insured. Walker, 909 S.W.2d 343. This Court observed in Walker that striking another in the 

face is “an act so certain to cause a particular kind of harm that we can say a person who 

performed the act intended the resulting harm[.]” Walker, 909 S.W.2d at 345 (citing Clark v.

Allstate Insurance Company, 22 Ariz. App. 601, 529 P.2d 1195, 1196 (1975)).
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CONCLUSION

Having reviewed the record, we find no genuine issues as to any 

material fact. KFB is entitled to judgment as a matter of law, and therefore, we 

AFFIRM the Montgomery Circuit Court.

ALL CONCUR. 

BRIEFS FOR APPELLANT:

Robert W. Miller

Grayson, Kentucky

BRIEF FOR APPELLEE:

R. Craig Reinhardt

Lexington, Kentucky