Defendants are insured by two commercial liability insurance policies
through Plaintiffs.'° Plaintiffs have the “duty to defend the insured against any
‘suit? seeking damages for . . . ‘bodily injury.’”'! However, both policies have a
Liquor Liability exclusion (“Exclusion”) in them that removes insurance
coverage.” This Exclusion removes coverage for “bodily injury” when an insured
may be held liable by reason of:

(1) Causing or contributing to the intoxication of any
person;

(2) The furnishing of alcoholic beverages to a person
under the legal drinking age or under the influence of
alcohol; or

(3) Any statute, ordinance or regulation relating to the
sale, gift, distribution or use of alcoholic beverages."

This Exclusion applies only if the insured is “in the business of manufacturing,
distributing, selling, serving or furnishing alcoholic beverages.”"*

On July 8, 2015, Plaintiffs filed a declaratory law suit contending that they
are not obligated to defend Defendants in the underlying suit because the

Exclusion applies.'> On July 5, 2016, Plaintiffs filed their Motion for Summary

Judgment. On August 4, 2016, Defendants filed their response to Plaintiffs’

1° D1. 57, at Exs. 1, 2.
iat Id.

12 Id.

13 Td.

14 Id.

SDI 1, at9.


because they may be held liable for furnishing alcoholic beverages to a person
under the legal drinking age. Accordingly, Plaintiffs’ Motion for Summary
Judgment is GRANTED, and Defendants’ Motion for Summary Judgment is

DENIED.

IT IS SO ORDERED.

Ferns W. Wharton, Judge

10


Capozzoli does not own the premises, does not hold the sole liquor license, does
not employ the bartenders, and does not receive the proceeds from the service or
sale of liquor on the premises,” Defendants argue that they cannot be in business of
furnishing alcohol.”
IV. STANDARD OF REVIEW

Summary judgment is appropriate when there is “no genuine issue as to any
material fact” and “the moving party is entitled to a judgment as a matter of law.”
When considering a motion for summary judgment, the Court’s function is to
examine the record to determine whether genuine issues of material fact exist “but
not to decide such issues.”“ In the event that the parties have filed cross motions
for summary judgment and have not argued that a genuine issue of material fact
exists, “the Court shall deem the motions to be the equivalent of a stipulation for
decision on the merits based on the record submitted with the motions.””> If the
Court finds that there are no genuine issues of material fact, summary judgment
will be granted in favor of one party.”

V. DISCUSSION

The legal principles for interpreting insurance policies are well-settled in

Delaware. An insurance policy should be given its ordinary and usual meaning

22

3 Super. Ct. Civ. R. 56(c).

4 Merrill v. Crothall-Am., Inc., 606 A.2d 96, 99 (Del. 1992).

5 Super. Ct. Civ. R. 56(h).

26 See Emmons v. Hartford Underwriters Ins. Co., 697 A.2d 742, 744-45 (Del. 1997).

7


Motion for Summary Judgment as well as their own Motion for Summary
Judgment. The parties appeared before the Court for oral argument on the Cross
Motions on September 26, 2016.

Ill. THE PARTIES’ CONTENTIONS

Plaintiffs argue that the Exclusion applies because Defendants are in the
business of furnishing alcohol.'® Notably, Plaintiffs argue that Defendants are in
the business of furnishing alcohol because Defendants advertise bar options online,
negotiate bar options directly with customers, and collect money from customers
for alcohol and bartenders.'’ Additionally, Plaintiffs contend that Defendants are
in the business of furnishing alcohol because Defendants admit that their ability to
provide alcohol at events is “integral” to their business success.'*

In contrast, Defendants argue that the Exclusion should be construed in their
favor because the word “furnish” is ambiguous in this factual context.’
Specifically, Defendants argue that they are not in the business of furnishing
alcohol because they do not serve alcohol—Local No. 74 hires bartenders who
serve alcohol.” Furthermore, Defendants do not hold the liquor license, and they

receive none of the proceeds from the sale of alcohol on the premises.”’ “Since

; DL. 61, at 56.

18 Td.
D1. 57, at J 10.
20 Id.

21 Td. at J 13.


physically handing something to another. Instead, one can furnish something to
another by providing the means for that person to obtain it.

While it is true that Defendants neither physically pour the alcoholic
beverages nor hold the liquor license, Defendants are directly responsible for
making alcohol available at events. Defendants are in the business of catering
social events at the Center, and they advertise their business online.” Interested
customers, who see the advertisements, contact Defendants to book an event.
While booking an event, customers tell Defendants which bar service, if any, that

33 Customers do not

they want, and Defendants provide that service accordingly.
discuss anything about bar services with Local No. 74, which provides the
bartenders. As these facts illustrate, an important part of Defendants’ business is
contracting with interested customers about which bar services will be offered at
events.*> Therefore, the Court finds that Defendants are in the business of
furnishing alcohol because a part of their business is to arrange for alcohol to be
served at events.
VI. CONCLUSION

The Court finds that the Exclusion is applicable in the underlying case

because Defendants are in the business of furnishing alcoholic beverages and

32 See Billet Dep., D.I. 57, at 14:11-21; 25-26.

% See id. at 29.

4 See Capozzoli Dep., D.I. 57, at 13:10-24.

35 Defendants admit that serving alcohol is an important feature of their catering business. See
Billet Dep., D.I. 57, at 37:16-21; Capozzoli Dep., D.I. 57, at 32:17-22.

9


IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

HARLEYSVILLE PREFERRED
INSURANCE CO. and NATIONWIDE
MUTUAL INSURANCE CO.,

Plaintiffs,

v. C.A. No. N15C-07-068 FWW
EXECUTIVE BANQUET AND
CONFERENCE CENTER,
CAPOZZOLI CATERING OF
DELAWARE, INC., THETA CHI
FRATERNITY, ALPHA

EPSILON PHI SORORITY, and
BRYAN CONNOLLY and SUSAN
CONNOLLY, individually and

as co-administrators of the

ESTATE OF ETHAN P. CONNOLLY,

wwe wee we wwe SS Se SSS SS SS SS SD

Defendants.

Submitted: September 26, 2016
Decided: November 21, 2016

MEMORANDUM OPINION AND ORDER

Upon Plaintiffs’ Motion for Summary Judgment
GRANTED.
Upon Defendants’ Motion for Summary Judgment
DENIED.

Nicholas E. Skiles, Esquire, Swartz Campbell LLC, 300 Delaware Avenue, Suite
1410, P.O. Box 330, Wilmington, Delaware 19801; William T. Salzer, Esquire,
Swartz Campbell LLC, Two Liberty Place, 50 S. 16th Street, 28th Floor,


when the provisions contained therein are clear and unambiguous.”’ When the
language of an insurance policy is clear and unambiguous, “a party will be bound
by its plain meaning because creating an ambiguity where none exists could, in
effect, create a new contract with rights, liabilities and duties to which the parties
had not assented.””8

Moreover, courts in this jurisdiction have found that an insurance policy is
not “rendered ambiguous simply because the parties do not agree upon its proper
construction.””? An insurance policy is ambiguous “only when the provisions in
controversy are reasonably or fairly susceptible of different interpretations or may
have two or more different meanings.””°

Applying these principles here, the Exclusion shall be construed according
to its ordinary and usual meaning because the word “furnish” is unambiguous in
this context. According to Webster’s Concise Dictionary, the word “furnish”
means “to supply; provide,” and “to supply” something means “to make it

31

available.””’ Despite Defendants’ arguments to the contrary, an ordinary reading

of these definitions makes clear that furnishing something is not limited to one

27 See Rhone-Poulenc Basic Chems. Co. v. American Motorists Ins. Co., 616 A.2d 1192, 1196
(Del. 1992) (citing Johnston v. Tally Ho, Inc., 303 A.2d 677, 679 (Del. Super. 1973)).

*8 Id. at 1195-96 (quoting Hallowell v. State Farm Mut. Auto. Ins. Co., 443 A.2d 925, 926 (Del.
1982)).

? Id. at 1196.

°° Id. (citing Hallowell, 443 A.2d at 926).

3! Webster's Concise Dictionary (ed. 1997).


from Plumbers & Pipe Fitters Local No. 74 (“Local No. 74”).2 The lease
agreement between Capozzoli and Local No. 74 states that Local No. 74 “shall
maintain the sole liquor license for the Premises and, in accordance therewith, will
be solely responsible for distributing any and all alcohol . . . from the bar.”

On October 17, 2013, Capozzoli catered an event for Alpha Epsilon Phi
sorority at the Center.’ In accordance with the lease agreement, Local No. 74
provided bartenders to serve alcohol at the event.> Ethan Connolly (“Connolly”),
who was a minor at the time, allegedly attended the event and was served alcohol
at the bar.’ Soon thereafter, Ethan allegedly left the event intoxicated and
attempted to cross the road when he was fatally struck by oncoming traffic.”

On August 1, 2014, Connolly’s parents filed a wrongful death lawsuit
against several parties, including Defendants.’ Connolly’s parents contend that
Defendants proximately caused Connolly’s death due to Defendants’ negligence in
failing to maintain the premises and in failing to ensure that underage patrons were

not being served alcohol.”

> See id, at 16:11-18.

3 Defs.’ Mot. Summ. J., D.I. 61, at Ex. 1.

* Pls.’ Mot. Summ. J., D.I. 57, at Ex. 5.

5 See Billet Dep., D.I. 61, at 45:11-19.

° DL. 57, at Ex. 3.

"Id.

5 Id. See Connolly v. Theta Chi Fraternity, N14C-08-006 (Del. Super.).
Id.


I. INTRODUCTION

Before the Court are Harleysville Preferred Insurance Company and
Nationwide Mutual Insurance Company’s (“Plaintiffs”) and Capozzoli Catering of
Delaware, Inc. (“Capozzoli”) and Executive Banquet and Conference Center’s
(“Center”) (collectively referred to as “Defendants”) Cross Motions for Summary
Judgment regarding an insurance coverage dispute. These parties request the
Court to determine whether Plaintiffs are obligated to insure Defendants in a
wrongful death suit that is pending before the Court. To resolve this dispute, the
Court must determine whether Defendants are in the business of furnishing
alcoholic beverages.

Applying Superior Court Civil Rules 56(c) and 56(h) to the Cross Motions
for Summary Judgment, the Court finds that Plaintiffs are not required to insure
Defendants in the wrongful death suit because Defendants are in the business of
furnishing alcoholic beverages. Therefore, Plaintiffs’ Motion for Summary
Judgment is GRANTED, and Defendants’ Motion for Summary Judgment is
DENIED.

Il. FACTUAL AND PROCEDURAL CONTEXT
Capozzoli is in the business of planning and catering various social events at

the Center, which is located in Newark, Delaware.' Capozzoli leases the Center

' See Billet Dep., D.I. 57, at 14.


Philadelphia, Pennsylvania 19102; Attorneys for Plaintiffs Harleysville Preferred
Insurance Company and Nationwide Mutual Insurance Company.

Melissa L. Rhoads, Esquire, Jason J. Cummings, Esquire, Tighe & Cottrell, P.A.,
704 N. King Street, Suite 500, P.O. Box 1031, Wilmington, Delaware 19801;
Attorneys for Defendants Capozzoli Catering of Delaware, Inc. & Executive
Banquet and Conference Center Catering of Delaware.

Vincent J. X. Hedrick, II, Esquire, Beverly L. Bove, Esquire, 1020 West 18th
Street, P.O. Box 1607, Wilmington, Delaware 19899; Attorneys for Defendant
Connolly.

Kevin J. Connors, Esquire, Marshall Dennehey Warner Coleman & Goggin, 1007
N. Orange Street, Suite 600, P.O. Box 8888, Wilmington, Delaware 19899;
Attorney for Defendant Alpha Epsilon Phi Sorority.

Megan T. Mantzavinos, Esquire, Emily K. Silverstein, Esquire, Marks, O’ Neill,
O’Brien, Doherty & Kelly, P.C., 300 Delaware Avenue, Suite 900, Wilmington,
Delaware 19801; Michael C. Osborne, Esquire, Jennifer A. Riso, Esquire, Archer
Norris, One Embarcadero Center, Suite 360, San Francisco, California 94011;
Christopher K. Trembley, Esquire, Archer Norris, 777 Figueroa Street, Suite 4250,
Los Angeles, California 90017; Attorneys for Defendant for Theta Chi Fraternity.

WHARTON, J.