United States Court of Appeals

For the First Circuit

No. 11-1316

VALLEY FORGE INSURANCE CO.; AMERICAN CASUALTY OF READING, PA,

Plaintiffs, Appellees,

v.

CAROL FIELD; THE CARSON CENTER FOR HUMAN SERVICES, INC.,

Defendants,

DAVID MURPHY, as Guardian of the Child's Estate,

Defendant, Appellant.

No. 11-1337

VALLEY FORGE INSURANCE CO.; AMERICAN CASUALTY OF READING, PA,

Plaintiffs, Appellees,

v.

DAVID MURPHY, as Guardian of the Child's Estate,

Defendant,

CAROL FIELD; THE CARSON CENTER FOR HUMAN SERVICES, INC.,

Defendants, Appellants.

APPEALS FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Michael A. Ponsor, U.S. District Judge]
Before

Lynch, Chief Judge,

Howard and Thompson, Circuit Judges.

Robert J. Gilbert, with whom Rickey G. Glover and Gilbert &

Renton LLC were on brief, for appellant David Murphy.

James P. Hoban, Thomas J. Conte, Lynette Paczkowski, and

Bowditch & Dewey, LLP, on brief for appellants The Carson Center

for Human Services, Inc., and Carol Field.

Michael P. Tone, with whom Kimberly E. Rients Blair, Wilson,

Elser, Moskowitz, Edelman & Dicker, Amy E. Goganian, and Goganian

& Associates, LLC, were on brief for appellees.

February 22, 2012
LYNCH, Chief Judge. An eleven-year-old child (the child)

suffered from long-term horrific abuse and on September 11, 2005,

was beaten nearly to death by her adoptive mother and stepfather. 

The child's legal guardian, David Murphy, brought suit in the

Superior Court of the Commonwealth of Massachusetts against several

defendants including the Carson Center for Human Services, Inc.

(Carson Center), and one of its employees, licensed social worker

Carol Field, whose patient the child was during this period. The

complaint alleged that they failed to detect or report to state

authorities signs of ongoing physical abuse of the child. That

state court suit led to this insurance coverage litigation in

federal court.

The federal plaintiffs are Valley Forge Insurance Company

and American Casualty of Reading, PA, the insurers of the Carson

Center and, as such, of Field as an employee of the Carson Center. 

The insurers sought a declaratory judgment that the allegations

against the insureds in the underlying suit fall within exclusions

to coverage. The district court granted the request for

declaratory judgment. Valley Forge Ins. Co. v. Carson Ctr. for

Human Servs., No. 09-cv-30038, 2011 WL 864802 (D. Mass. Mar. 10,

2011). The insureds and Murphy appealed.

The issue is one of policy language interpretation. It

is whether the policy language of an Abuse or Molestation Exclusion

in a Professional Liability Coverage part and an Abuse or

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Molestation Exclusion in a Commercial Umbrella Coverage part

precludes coverage. The language of these Exclusions precludes

coverage for abuse that occurs to anyone in the insureds' "care,

custody or control." The question is whether the Exclusions apply

where, as here, at the time of the abuse the victim was not in the

physical custody of the insureds and had been receiving bi-weekly

outpatient therapeutic services from them for fourteen months

covered by the policies in question. We conclude, as did the

district court, that the word "care" in the Exclusions is

unambiguous. We reject the defendants' arguments, including that

the term is limited to situations in which there is also "custody"

and "control." As a matter of undisputed fact, the child was in

the care of the insureds as a long-term patient, and the plain

terms of the Exclusions exclude liability on the part of the

insurers. We affirm.

I.

Murphy filed the underlying suit in Superior Court on

October 18, 2007. The complaint alleged that the Carson Center,

Field, and other providers had a doctor-patient relationship with

the child and that in each case the providers knew or should have

known that the physical injuries sustained by the child while she

was in their care were the result of systematic abuse by her

parents. Those injuries included head injuries from a baseball

bat, severe burns on her legs from standing in scalding hot water,

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toenails that had been pulled off, beatings, chipped teeth, and

numerous cuts, scrapes, and bruises that required sutures or had

become infected.

Murphy's complaint further alleged that the negligent

failure to suspect or report such abuse on the part of the Carson

Center, Field, and the other providers culminated in the near-fatal

brain injury the child sustained as a result of abuse by her

parents on September 11, 2005, and that breach of their duties of

reasonable care were substantial contributing factors to the

child's serious injuries. The child's physical injuries, including

paraplegia, are permanently disabling, and she has been left with

significant and permanent mental deficits, for all of which she

will require lifetime care.

Field was a social worker and therapist at the Carson

Center in Westfield, Massachusetts, when she met the child on

October 30, 2002. The Carson Center is a non-profit facility that

provides psychiatric, mental health, rehabilitation, and family

stabilization services to the community. Field provided

therapeutic services to the child over the course of the next

thirty-five months. In the state suit, Field recalled

approximately fifty-one in-person counseling sessions with the

child; approximately twenty different meetings or telephone

conferences with the child's adoptive mother; at least four

meetings with the child's other health care providers; involvement

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in four of the child's hospitalizations; eleven telephone

conferences with the child's medical providers; at least four

telephone conversations with the child's school counselors; and

four conferences with the Massachusetts Department of Social

Services. Field's treatment of the child continued until the child

suffered her catastrophic injuries on September 11, 2005.

This action for declaratory judgment is concerned only

with Murphy's claims in the underlying Superior Court suit for the

years 2002 and 2003. All told, during the period of October 30,

2002, through December 19, 2003, Field saw the child about twentyfive times, which averages to a visit nearly every other week.

The plaintiffs insured the Carson Center from December

19, 1998, through December 19, 2003. At issue is the policy

provided by Valley Forge for the period December 19, 2001, through

December 19, 2002, and the policy provided by American Casualty for

the period December 19, 2002, through December 19, 2003. Each of

these policies had five different coverage sections, for which a

single premium was paid and which contained a single policy number. 

The coverage parts at issue are the Professional Liability and

Commercial Umbrella coverage parts. These coverage parts each

contained an Abuse or Molestation Exclusion. The parties do not

dispute that, absent these Exclusions, the policies would provide

coverage to the Carson Center and Field for the underlying suit.

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Murphy has been named as a defendant in the federal suit

along with the insureds and, not surprisingly, has argued that the

exclusions do not apply. His arguments overlap with those of the

insureds.

II.

We review the district court's grant of summary judgment

de novo, assessing the facts and the inferences to be drawn from

them in the light most favorable to the non-moving party. Sparks

v. Fid. Nat'l Title Ins. Co., 294 F.3d 259, 265 (1st Cir. 2002). 

The interpretation of an insurance policy is a question of law for

the court. Bos. Gas Co. v. Century Indem. Co., 910 N.E.2d 290, 304

(Mass. 2009). Massachusetts law applies, Lexington Ins. Co. v.

Gen. Accident Ins. Co. of Am., 338 F.3d 42, 46 (1st Cir. 2003), and

requires that "we construe an insurance policy de novo under the

general rules of contract interpretation." Brazas Sporting Arms,

Inc. v. Am. Empire Surplus Lines Ins. Co., 220 F.3d 1, 4 (1st Cir.

2000). We look first to "the actual language of the policies,

given its plain and ordinary meaning." Id. The insurer bears the

burden of demonstrating that an exclusion exists that precludes

coverage, and "any ambiguities in the exclusion provision are

strictly construed against the insurer." Id. Ambiguity does not

exist simply because the parties disagree about the proper

interpretation of a policy provision; rather, "[a]mbiguity exists

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when the policy language is susceptible to more than one rational

interpretation." Id. at 4-5.

The pertinent part of the Abuse or Molestation Exclusion

to the Professional Liability Coverage reads:

EXCLUSION - ABUSE OR MOLESTATION

This endorsement modifies insurance provided

under the following:

PROFESSIONAL LIABILITY COVERAGE FORM

The following exclusion is added to paragraph

2., Exclusions of Section I - Coverage:

This insurance does not apply to damages

arising out of:

1. The actual or threatened sexual or physical

abuse or molestation by anyone to any person

while in the care, custody or control of any

insured; . . . .

The parallel exclusion in the Commercial Umbrella Coverage part is

essentially identical to the Professional Liability Exclusion and

reads:

ABUSE OR MOLESTATION EXCLUSION

The following paragraph is added to 2.

Exclusions, SECTION I - Coverages:

This insurance does not apply to "bodily

injury", "property damage", "advertising

injury" or "personal injury" arising out of:

1. The actual, alleged or threatened abuse or

molestation by anyone of any person while in

the care, custody or control of any

insured; . . . . 

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No one argues that these Exclusions should be interpreted

differently from one another, so we will follow the district court

and the parties in referring to a single Exclusion.

Exclusions of this type for sexual or physical abuse or

molestation are not uncommon for these types of insurance policies

for those who have care of others. Such exclusions appear to have

been in use since 1987. See Harper v. Gulf Ins. Co., No. 01-CV201-J, 2002 WL 32290984, *6 (D. Wyo. Dec. 20, 2002) (abuse or

molestation exclusion was promulgated by the Insurance Service

Office, Inc., in 1987). The court in Harper cites to an insurance

reporter series entitled Commercial Liability Insurance, published

by the Insurance Risk Management Institute. Id. at *6 n.9. The

quoted section of that reporter makes explicit that these

exclusions are used with "[o]rganizations that have care or custody

of others -- schools, hospitals, nursing homes, day care centers,

etc." Id. The reporter then goes on to advise: "This endorsement

eliminates coverage for an insured organization's liability in

connection with abuse or molestation committed by someone other

than that insured." Id. The case law has adopted this concept. 

See Lincoln Cnty. Sch. Dist. v. Doe, 749 So.2d 943, 946 (Miss.

1999) (en banc) ("[T]he molestation exclusion accordingly serves to

exclude from coverage all classifications of damages arising out of

incidents of molestation.").

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Exclusions of this sort have generally been found to be

unambiguous in the face of attacks on various parts of the language

used, and the insureds in these cases have included medical or

therapeutic care providers, health care centers, summer camps,

schools and preschools, job training programs, churches, and the

like. See, e.g., Nautilus Ins. Co. v. Our Camp Inc., 136 F. App'x

134 (10th Cir. 2005) (underlying suit alleged child attending

insured's summer camp was sexually abused by co-camper); Insights

Trading Grp., LLC v. Fed. Ins. Co., Civil Action No. RDB-10-340,

2010 WL 2696750 (D. Md. July 6, 2010) (underlying suit alleged

enrollee in insured's job training program was assaulted by another

enrollee in the program); Erie Ins. Exch. v. First United Methodist

Church, 690 F. Supp. 2d 410 (W.D.N.C. 2010) (underlying suit

alleged abuse of children at insured's preschool by another child

at the preschool); TIG Ins. Co. v. Smart Sch., 401 F. Supp. 2d 1334

(S.D. Fla. 2005) (underlying suit alleged teacher sexually abused

two of the school's students); TIG Ins. Co. v. Martin, No. CV 00-

5766, 2003 WL 25796732 (E.D.N.Y. Feb. 28, 2003) (underlying suit

alleged child attendee at insured's baseball camp was sexually

assaulted by an intruder); Children's Aid Soc'y of Montgomery Cnty.

v. Great Am. Ins. Co., Civ. A. No. 91-7778, 1995 WL 251374 (E.D.

Pa. Apr. 28, 1995) (insured Children's Aid Society agreed to

provide care services to child and underlying suit alleged insured

allowed child to be placed in abusive foster care situation); Sarah

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G. v. Me. Bonding & Cas. Co., 866 A.2d 835 (Me. 2005) (judgment

creditors of insured motel and its owners sued insurer seeking to

collect damages from underlying suit alleging motel owner sexually

exploited minor children at the motel); Cmty. Action for Greater

Middlesex Cnty., Inc. v. Am. Alliance Ins. Co., 757 A.2d 1074

(Conn. 2000) (underlying suit alleged sexual molestation of female

child who attended insured's preschool by three young boys who also

attended the preschool); Lincoln Cnty. Sch. Dist., 749 So.2d 943

(exclusion precluded coverage where male student of insured school

raped female student in school restroom).

Both sides argue that the Abuse or Molestation Exclusion

here is unambiguous, offering competing interpretations of its

language. That competing interpretations are given does not make

an exclusion ambiguous. Cont'l Cas. Co. v. Canadian Universal Ins.

Co., 924 F.2d 370, 374 (1st Cir. 1991) ("[A]mbiguity is not created

simply because a controversy exists between parties, each favoring

an interpretation contrary to the other's." (alteration in

original) (quoting Jefferson Ins. Co. of N.Y. v. City of Holyoke,

503 N.E.2d 474, 476 (Mass. App. Ct. 1987)) (internal quotation

marks omitted)). The defendants contend that "care, custody or

control" should be given the meaning "physical dominion or

control." The insurers argue that "care" should be given its

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plain, ordinary meaning. There is no dispute that the child was 1

not in the physical dominion or control of either Field or the

Carson Center at the time any of the abuse took place, and it is

not a prerequisite to the application of the Abuse or Molestation

Exclusion that an insured be the abuser, nor is it necessary that

the abuse occur on the insured's premises.

Under Massachusetts law, whose canons of construction

dictate the outcome, we must give the term "care" its plain and

ordinary meaning. In Hingham Mutual Fire Insurance Co. v. Smith,

865 N.E.2d 1168 (Mass. App. Ct. 2007), the Massachusetts Appeals

Court denied coverage to homeowners whose son was sued for sexually

abusing other children, based on an exclusion for sexual

molestation from the definition of bodily injury. In doing so, the

court reiterated the state interpretative rule that "[w]ords in

exclusionary clauses of insurance contracts should be construed in

their usual and ordinary sense," id. at 1172 n.6 (alteration in

original) (quoting Bagley v. Monticello Ins. Co., 720 N.E.2d 813,

816 (Mass. 1999)) (internal quotation marks omitted), and rejected

a reading that would "distort the plain meaning of the clause," id.

In this context, the plain meaning of "care" in the Abuse

or Molestation Exclusion here accords with the dictionary

To the extent the insurers suggest on appeal that because 1

Field, who saw the child extensively, was in a position to

recommend the child be removed from the parents and so had

"control," we disregard that argument, which was not presented to

the district court.

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definition that being "in the care of" includes "charge,

supervision, management: responsibility for or attention to safety

and well-being." Webster's Third New International Dictionary 338

(1993) (illustrating the definition of "care" by using it in the

phrase "under a doctor's care"). The underlying complaint alleges

the child was not only a patient of the insureds, but also that she

was in the care of the Carson Center and Field when she was abused,

and there is no serious dispute about this. The dispute is whether

as against the facts alleged in the complaint, the term "care" as

used in the Exclusion should have a more limited meaning.

A second canon of construction refutes the defendants'

attempt to limit the term "care." "Every word in an insurance

contract must be presumed to have been employed with a purpose and

must be given meaning and effect whenever practicable." Bos. Gas,

910 N.E.2d at 304 (quoting Allmerica Fin. Corp. v. Certain

Underwriters at Lloyd's, London, 871 N.E.2d 418, 425 (Mass. 2007))

(internal quotation marks omitted). The term "care" must be given

a meaning and effect apart from the term "custody" and the term

"control." The three words are connected by the disjunctive "or,"

signalling they are to be read separately. See Miller v. Miller,

861 N.E.2d 393, 401 (Mass. 2007) ("[T]he word 'or' is disjunctive

unless the context and the main purpose of all the words demand

otherwise." (quoting Bleich v. Maimonides Sch., 849 N.E.2d 185, 191

(Mass. 2006)) (internal quotation marks omitted)). It is self-

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evident that a person may be "in the care" of another, without

being "in the custody" of or "in the control" of another. Because

the language of the Exclusion is clear, we do not construe it

against the insurers. See Bagley, 720 N.E.2d at 816 n.2.

The core argument of the defendants is that, regardless

of common meaning, the word "care" in the phrase "care, custody or

control" should be treated as an insurance industry term of art,

across all types of coverage, meaning "physical dominion or

control." We disagree. In the context in which it is used, the

term "care" is not a technical term of art at all. Further, it is

not appropriate, in any event, to turn to definitions purported to

be terms of art in property insurance law to define the term. The

defendants rely on certain constructions of the phrase from

property and construction law, not on constructions of the

Exclusions for sexual and physical abuse from liability insurance

for care givers. They cite to cases and insurance treatises for

the propositions that "[p]hysical control is the hallmark of 'care,

custody, and control'" and that "[t]he control exercised by the

insured must be exclusive." (Quoting 9 Couch on Insurance § 126:22

(2011)). Those cases and treatises, however, all concern the

"care, custody or control" of property, not persons.

The portions of both treatises defendants quote in

support of their argument explicitly are concerned solely with the

"care, custody or control" of property. They make no mention of

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the application of that three-part term to persons. Defendants

quote from a section in Couch on Insurance but omit its heading. 

The heading is "IV. Coverage Limitations Based on Insured's

Relationship to Property. B. Phrased in Terms of Insured's Care,

Custody, Control, Charge, and Similar Concepts." (Emphasis added) 

From that section defendants quote: "Physical control is the

hallmark of 'care, custody, and control . . .'" but they again omit

the end of that sentence: ". . . of another's property." 9 Couch

on Insurance § 126:22 (emphasis added). In a related section in

the same subchapter, the treatise states that "[p]olicies of

liability insurance, especially those covering the operations of

contractors and similar businesses, commonly contain provisions

specifically excluding from coverage liability for injury or damage

to property in the 'care, custody, or control of the insured.'" 

Id. § 126:20 (emphasis added).

The defendants also cite to the Construction Law volume

of the Massachusetts Practice Series, which states that "[f]or

property to be considered within the care, custody or control of

the insured, the insured must have been in charge of the property

or exercised dominion or control over the property at the time when

the property was damaged." 57 Massachusetts Practice: Construction

Law § 8.29 (2009-2010); see also id. ("One of the most common

exclusions in a CGL insurance policy applicable to construction

disputes is the 'care, custody, or control,' or 'owned property,'

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exclusion."). By their terms, these treatise definitions of the

phrase do not apply to the policies at issue here, which are

concerned with the care, custody or control of a person. 

The defendants also contend that Massachusetts courts

have consistently interpreted "care, custody or control" to require

physical dominion or control. All of the cases they cite save one

concern policy language in which the exclusion is by its terms

limited to the care, custody or control of property and so are not

on point. See Rogala v. Farm Family Cas. Ins. Co., No. 0700049,

2009 WL 2231161, at *1 (Mass. Super. Ct. Mar. 23, 2009) (exclusion

for damage to "[p]ersonal property in the care, custody or control

of" insured applied where insured damaged truck (alteration in

original)); Commerce Ins. Co. v. Empire Fire & Marine Ins. Co., No.

04-00825, 2006 WL 2439991, at *2 (Mass. Super. Ct. Aug. 9, 2006)

(exclusion for "'[p]roperty damage' to . . . property owned or

transported by the 'insured' or in the 'insured's' care, custody or

control" applied where insureds damaged rental cars (alterations in

original)), aff'd, 879 N.E.2d 1272 (Mass. App. Ct. 2008); Murray v.

Noone, No. 9241, 1994 WL 69565, at *2 (Mass. Dist. Ct. Feb. 24,

1994) (exclusion for "injury or destruction of . . . property

rented to or in the care, custody or control of the insured"

applied where insured damaged vehicle). Further, defendants do not

establish that even in the property context the term "care" is

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necessarily limited to situations where there is also custody or

control, but even if they did, that would not alter our analysis.

The one Massachusetts case defendants cite where a care,

custody or control exclusion was applied to a person, and not to

property, also does not advance their case because the harm befell

someone in "custody." In Jefferson Insurance Co. of New York v.

City of Holyoke, suit was brought after a woman in the "protective

custody" of the Holyoke police department committed suicide. 503

N.E.2d at 475. The appeals court, in denying coverage based on an

exclusion, held that the insurance policy contained a clause that

excluded from coverage "claims arising from events during which the

injured party was in the care, custody or control of any Insured

under this policy other than during an overt attempt to escape from

care, custody or control." Id. at 475. This case assists neither

side because "there [was] no dispute that [the decedent] was in the

'care, custody or control' of the police department at the time she

committed suicide." Id. at 477. The appeals court in Jefferson

had no occasion to rule on whether a person in the care of an

insured -- but not under the insured's custody or control -- is to

be considered in the insured's "care, custody or control."2

Cases defendants cite from other jurisdictions applying the 2

"care, custody or control" exclusion to a person are similarly not

on point because they involve the question of custody or control of

a person, not a situation, as here, where a person was allegedly

under an insured's care only. See Am. Family Mut. Ins. Co. v.

Nunley, No. CV 07-2276, 2009 WL 775424, at *5-6 (D. Ariz. Mar. 23,

2009) (holding that where employee of insured physically restrained

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By contrast, when we review case law concerning

exclusions for sexual and physical abuse of persons, cases from

other jurisdictions give the word "care" its plain, ordinary

meaning when used in abuse or molestation exclusions similar to

that at issue here. In McAuliffe v. Northern Insurance Co. of New

York, 69 F.3d 277 (8th Cir. 1995), an insurer refused to pay claims

related to a priest's abusive sexual relationship with a

parishioner, invoking an abuse or molestation exclusion essentially

the same as the one in the present case and containing a "care,

custody or control" clause. The court held that because the priest

"was counseling the parishioner on a number of personal and

spiritual issues . . . the parishioner was in [the priest's] care

when the abuse occurred," id. at 279, and the exclusion applied. 

Although the victim in McAuliffe was abused by the same person she

was in the care of, that distinction is irrelevant to a

determination of what "in the care of" means.

In Children's Aid Society of Montgomery County v. Great

American Insurance Co., the court considered an abuse or

independent contractor on insured's premises, independent

contractor was not in insured employer's "care, custody or

control"); Conn. Ins. Guar. Ass'n v. Daigle, No. CV054013240S, 2007

WL 806375, at *5 (Conn. Super. Ct. Feb. 21, 2007) (finding the

phrase "care, custody or control" in an exclusion to be ambiguous

and interpreting it not to exclude coverage where insured police

officer misled three young women to pose for nude photographs as

part of a fictitious sting operation, and stating the young women

"were always free to leave, free to stop participating in the

'sting operations' and do not seem to be in any way in the custody,

control or care of" the insured).

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molestation exclusion which was substantially identical to the one

at issue here and contained a "care, custody or control" clause. 

The court applied those terms "according to their usual English

definitions" and determined that "[t]he dictionary definition of

'care' that is most applicable to the instant case is 'charge,

supervision[,] management: responsibility for or attention to

safety and well-being,'" 1995 WL 251374, at *4 (quoting Webster's

Third New International Dictionary 338 (1986)), the same ordinary

meaning we give "care." In that case, the insured agency had

agreed to "provide child care services to children and youth

referred to it by" Montgomery County, to provide "each child with

the care needed," and to share responsibility with the county for

the children's medical care and clothing. Id. The court held the

insured "exercised a significant amount of care, custody and

control over the foster children." Id. The court also emphasized

that "under any conditions, [the insured] need only have exercised

'care, custody or control' over [the child victim of abuse] for the

exclusion to be applicable." Id. The court held that the

exclusion precluded coverage.

In Nautilus Insurance Co. v. Our Camp Inc., the court

held that an abuse or molestation exclusion like the one here

precluded coverage of an insured summer camp operator where a child

attending the summer camp was abused by a co-camper. The court

stated that "[t]he express language of the exclusion is worded

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broadly," 136 F. App'x at 137, and that "[t]he exclusion . . .

unambiguously excludes coverage for all types of negligent conduct

arising out of the abuse or molestation by anyone of any person

while in the care, custody or control of any insured. To conclude

otherwise would torture the plain language of the parties'

agreement," id. at 138 (citation omitted). See also Erie Ins.

Exch., 690 F. Supp. 2d 410 (holding that terms "abuse" and

"molestation" in abuse or molestation exclusion were unambiguous

and applying exclusion to preclude coverage of claims arising out

of abuse of children at a preschool by another child at the

preschool).

Defendants rely on the doctrine that "technical terms and

words of art are given their technical meaning when used in a

transaction within their technical field." Restatement (Second) of

Contracts § 202(3)(b). This is a canon of construction accepted by

Massachusetts courts, see W. Alliance Ins. Co. v. Gill, 686 N.E.2d

997, 999 (Mass. 1997), and it does not support the defendants'

arguments here. The technical field at issue here is the provision

of care to patients, not environmental damage, as in Gill. In that

case, the court considered the term "pollutant" and related terms

in a pollution exclusion to be "terms of art in environmental law

which generally are used with reference to damage or injury caused

by improper disposal or containment of hazardous waste." Id. The

Massachusetts court was careful to say that terms were "terms of

-20-
art in environmental law." Id. (emphasis added). Thus, the type

of hazard covered and type of insurance involved was important to

whether the terms were technical terms of art. The court held that

carbon monoxide produced by a malfunctioning or improperly operated

oven in a restaurant was not a "pollutant" as that term was used in

the exclusion. Id. at 1000-01.

Gill is a far different case from this. Gill does not

support defendants' argument that the term "care" in the context

not be given its ordinary meaning, or that it must be viewed as a

technical term of art, much less that its meaning must be taken

from another area of insurance law covering different hazards. Nor

does Gill purport to establish a rule governing interpretation of

Professional Liability and Commercial Umbrella Coverage, much less

for Abuse or Molestation Exclusions. 

Other Massachusetts cases that cite the rule that

technical terms of art should be given their technical meanings

also support our conclusion. Atlantic Mutual Insurance Co. v.

McFadden, 595 N.E.2d 762 (Mass. 1992), invoked the rule and was,

like Gill, concerned with a pollution exclusion in an insurance

policy and held that the terms "'discharge,' 'dispersal,'

'release,' and 'escape,' are terms of art in environmental law." 

Id. at 764 (emphasis added). McFadden does not support defendants'

argument for the same reasons Gill does not.

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In City of Springfield v. Department of

Telecommunications & Cable, 931 N.E.2d 942 (Mass. 2010), the

Supreme Judicial Court invoked the technical term of art rule in

interpreting a technical provision in a cable television service

provider license and did so by resort to use of a definition from

a state agency with telecommunications expertise. The court held

that first, resort must be made to the ordinary language of the

contract. Id. at 946. The court went on: "However, where, as

here, we consider a specialized contract subject to a complex

regulatory scheme, we recognize that language that appears to have

an ordinary meaning may carry a technical meaning not obvious to a

layperson." Id. at 947. The court addressed the question whether

the term "pass through" was a technical term of art as applied to

the treatment of franchise-related costs under renewal licenses. 

In answering that question, the court relied on the expertise of

the state Department of Telecommunications and Cable, which had

concluded that the term was a term of art. Id. at 947. The court

accepted the department's view, "in light of the deference [the

court] give[s] to the department's expertise and experience,

particularly where this interpretive question arises under a

complex statutory and regulatory framework." Id. 950. In the

present case, we are not considering "a specialized contract

subject to a complex regulatory scheme." City of Springfield

supports our analysis.

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Indeed, City of Springfield cites to Davis v. Dawson,

Inc., 15 F. Supp. 2d 64 (D. Mass. 1998), which concluded that the

term "deliver" in an agreement in the context of the delivery of a

complete and accurate accounts receivable schedule did not have a

technical meaning. Id. at 121. Applying the rule that the usual

and ordinary meaning controls, the court gave "deliver" its common

meaning. Id. at 122.

These cases reinforce that the plain and ordinary meaning

rule applies and that the preconditions for applying the technical

term of art rule are not met here. Further, they support our view

that the technical term of art rule applies to the specific field

of expertise involved, and does not justify abandonment of the

ordinary meaning rule where that specific technical field is not

involved. Indeed, in City of Springfield, the SJC cited to the

Restatement (Second) of Contracts, see 931 N.E.2d at 947, which

states that "technical terms and words of art are given their

technical meaning when used in a transaction within their technical

field" unless a different intention is manifested. Restatement

(Second) of Contracts § 202(3) (emphasis added). As we have said,

a body of law has developed around Abuse or Molestation Exclusions

that is separate from the body of law regarding "owned property"

exclusions upon which defendants rely.

Further, as the district court stated, "[t]he use of the

word 'care' in relation to a physical object is necessarily much

-23-
different from the use of the same term in relation to a child

receiving medical or therapeutic services." Valley Forge, 2011 WL

864802, at *3. Defendants admit this difference, stating "[t]here

is no such thing as non-possessory 'care' of personal property." 

Non-possessory care of a person is an ordinary event.

Moreover, we reject the defendants' related argument that

because other coverage clauses in the policies are concerned with

property damage, we must adopt their two-step proposition that (1)

in property damage coverage the term "care" can never mean anything

other than "custody" and "control," and (2) because the different

coverage parts are all contained in one policy, the terms "care,

custody or control" must have the same meaning throughout all the

types of coverage provided in the same policy. As to the first

premise, we have no occasion to pass on the terms of the property

damage coverage which are not at issue in this case. As such, the

second step does not necessarily follow from the first. Even more

importantly, the argument is barred by the Massachusetts ordinary

meaning rule and as the defendants must admit, the ordinary meaning

of care of persons is different.3

The defendants make a separate argument from their

technical term of art argument. They argue the district court's

By contrast with property cases, it would be rare in 3

ordinary usage for property to be "in the care" of another without

the other's having some sort of custody or control over the

property.

-24-
construction of "care" requires that word to be construed one way

in the Professional Liability Exclusion and another way in an

endorsement to the Commercial General Liability (CGL) Coverage. To

be precise, they point to the CGL Coverage part and to the Sexual

or Physical Abuse or Molestation Specified Liability Coverage

Endorsement. The CGL endorsement excludes coverage for "'bodily

injury,' 'property damage,' or 'personal and advertising injury'

arising out of . . . [t]he actual or threatened abuse or

molestation . . . of a 'patient' or 'resident' of the insured while

in the care, custody or control of any insured."

While the argument is unclear, defendants appear to argue

that the definition of "patient" in the CGL endorsement refers to

recipients of care and that use of the ordinary meaning of the term

"in the care of" renders the word "patient" surplusage. They

invoke two Massachusetts cases, J.A. Sullivan Corp. v.

Commonwealth, 494 N.E.2d 374, 378 (Mass. 1986) ("[E]very phrase and

clause must be presumed to have been designedly employed, and must

be given meaning and effect, whenever practicable, when construed

with all the other phraseology contained in the instrument, which

must be considered as a workable and harmonious means for carrying

out and effectuating the intent of the parties." (alteration in

original) (quoting Charles I. Hosmer, Inc. v. Commonwealth, 19

N.E.2d 800, 804 (Mass. 1939)) (internal quotation marks omitted)),

and S.D. Shaw & Sons, Inc. v. Joseph Rugo, Inc., 180 N.E.2d 446,

-25-
449 (Mass. 1962) ("An interpretation which gives a reasonable

meaning to all of the provisions of a contract is to be preferred

to one which leaves a part useless or inexplicable." (quoting

Sherman v. Emp'rs Liab. Assurance Corp., Ltd., 178 N.E.2d 864, 866-

67 (Mass. 1961)) (internal quotation marks omitted)), for the

proposition that terms should not be interpreted to create

surplusage. "Patient" is defined in the CGL endorsement as

"mentally, physically, developmentally disabled, mentally disabled

and /or economically disadvantaged persons who are non-resident

recipients of the care services provided by" the Carson Center. 

Defendants argue that if "care" is construed to mean the outpatient

care provided by the insureds, the use of "care" in this

endorsement is surplusage because a "patient" is necessarily in the

"care" of a person providing treatment.

We go back to what we said at the start -- defendants'

reading both departs from the ordinary meaning rule and equates

care with custody or control and so renders "care" in that threepart term meaningless. The defendants' precise argument assumes

that under Massachusetts insurance law, the ordinary meaning rule

is trumped by a no-surplus-language rule. But we see no basis for

that assumption, and the cases cited to us do not stand for that

proposition. The test is not one of redundancy, but of

meaningfulness. Terms in a contract may, when applied to certain

factual scenarios, sometimes overlap. But those terms still have

-26-
different, independent meanings. The plain, ordinary meaning given

to "in the care" of does not render either of the two terms of the

CGL endorsement "meaningless." S.D. Shaw & Sons, 180 N.E.2d at

449.4

In any event, we disagree, as did the district court,

that there is surplusage here. As the district court recognized,

a patient who received "care services" on only a single occasion or

infrequently is not necessarily "in the care" of a provider in

relevant terms. Valley Forge, 2011 WL 864802, at *4. We do not

need to decide at what point a recipient of "care services" is

considered to be "in the care" of a treatment provider; we only

decide that on the facts alleged by Murphy in the underlying suit,

the child was clearly in the care of Field and the Carson Center.5

Finally, the defendants present arguments that the

Exclusions make coverage illusory and leave them stripped of

coverage that an objectively reasonable person would have expected

Further, the rule of giving meaning to every phrase is

4

still governed by two other principles: that it be done "whenever

practicable" when construed with other terms and that the

construction be "a workable and harmonious means for carrying out

and effectuating the intent of the parties." J.A. Sullivan Corp.

v. Commonwealth, 494 N.E.2d 374, 378 (Mass. 1986) (quoting Charles

I. Hosmer, Inc. v. Commonwealth, 19 N.E.2d 800, 804 (Mass. 1939))

(internal quotation mark omitted). Our construction is in

accordance.

The variant of this argument as to Coverage D of the CGL 5

Coverage fails for similar reasons. The parties agree Coverage D

is inapplicable to this matter, and it is not contained in the

Umbrella policies.

-27-
to have. See McGregor v. Allamerica Ins. Co., 868 N.E.2d 1225,

1227 (Mass. 2007) ("When interpreting an insurance contract,

[courts are to] 'consider what an objectively reasonable insured,

reading the relevant policy language, would expect to be covered.'"

(quoting Hazen Paper Co. v. U.S. Fid. & Guar. Co., 555 N.E.2d 576,

583 (Mass. 1990))). Defendants suggest that at least the

Professional Liability Coverage has no value to them if coverage

for this type of physical abuse is excluded. See Liberty Mut. Ins.

Co. v. Tabor, 553 N.E.2d 909, 912 (1990) ("A provision in an

insurance policy that negates the very coverage that the policy

purports to provide in the circumstances where the person is liable

is void as against public policy."). 

That is simply not so. There are many instances of

professional malpractice that are covered, which are not concerned

with sexual or physical abuse. Indeed, many usual professional

malpractice claims are in that first category and are covered. The

Exclusion precludes coverage on the limited occasions where the

damages flow from sexual or physical abuse by another of someone in

the care of the insured. As explained earlier, that is the very

purpose for the Abuse or Molestation Exclusion since its creation. 

Nor is this a case in which application of the Exclusion defeats an

objectively reasonable policyholder's expectations of coverage. 

-28-
Since the Exclusion was not ambiguous, the Carter Center and Field

had no reasonable expectation of coverage.6

In short, we agree with the reasoning of the district

court and affirm. No costs are awarded.

-- Dissenting Opinion Follows –-

We also note the tension between this argument by 6

defendants and their argument that the term "care, custody or

control" must not be given its plain and common meaning, but its

"accepted meaning in the insurance industry" as to property

insurance. We have rejected the term of art argument, reinforcing

the conclusion that there could be no reasonable expectation of

coverage. See Aguiar v. Generali Assicurazioni Ins. Co., 715

N.E.2d 1046, 1049 (Mass. App. Ct. 1999). And we have explained

that these Exclusions are well recognized in their own branch of

insurance law.

-29-
THOMPSON, Circuit Judge, dissenting. The insurers'

interpretation of the phrase "care, custody or control," which the

majority has adopted, is certainly rational. However, I am not

persuaded that the policy language indisputably supports this

interpretation. In my view, the interpretation offered by the

defendants is equally (if not more so) rational. Because I think

my colleagues got it wrong when they disregarded the defendants'

interpretation - rendering erroneous their conclusion that there is

no insurance coverage - I dissent. 

I.

Under Massachusetts law, ambiguity exists when the

language in an insurance policy "is susceptible to more than one

rational interpretation." Brazas Sporting Arms, Inc. v. Am. Empire

Surplus Lines Ins. Co., 220 F.3d 1, 4-5 (1st Cir. 2000). I discern

such an ambiguity here. As I said, the insurers' 7

The majority cites to a string of cases for the proposition 7

that abuse and molestation exclusions are generally found to be

unambiguous. I do not find these cases particularly helpful. Two

of the cases dealt with exclusions that did not contain the

critical language. See Insights Trading Grp., LLC v. Fed. Ins.

Co., Civil Action No. RDB-10-340, 2010 WL 2696750 (D. Md. July 6,

2010); Lincoln Cnty. Sch. Dist. v. Doe, 749 So.2d 943 (Miss. 1995). 

While the remaining cases did involve exclusions containing the

"care, custody or control" requirement, the courts (with the

exception of one, discussed below) did not specifically consider

the phrase. Further, whether there was care, custody or control

was not an issue because the abuse took place on the insured's

premises. See Nautilus Ins. Co. v. Our Camp Inc., 136 F. App'x 134

(10th Cir. 2005) (abuse occurred at the insured summer camp); Erie

Ins. Exch. v. First United Methodist Church, 690 F. Supp. 2d 410

(W.D.N.C. 2010) (abuse occurred at insured preschool); TIG Ins. Co.

v. Smart Sch., 401 F. Supp. 2d 1334 (S.D. Fla. 2005) (abuse

-30-
interpretation of "care, custody or control" is sound. There is a

cogent argument that "care, custody or control" is not a term of

art outside the property context and therefore the phrase should be

treated as purely disjunctive with an ordinary meaning applied to

the word "care." However, defendants' position is likewise

logical. A compelling argument can be made that "care, custody or

control" is an insurance industry term of art, in both the context

of property and persons, which requires physical dominion or

control. And in fact, I am surprised at how readily the majority

disregarded this reasoned argument. Since the majority has adopted

the insurers' position and set forth its reasons for doing so, I

will not rehash this point. Let me focus on why the defendants'

interpretation is rational.

occurred at insured school); TIG Ins. Co. v. Martin, No. CV 00-

5766, 2003 WL 25796732 (E.D.N.Y. Feb. 28, 2003) (abuse occurred at

insured's baseball camp); Sarah G. v. Me. Bonding & Cas. Co., 866

A.2d 835 (Me. 2005) (abuse occurred at insured motel); Cmty. Action

for Greater Middlesex Cnty., Inc. v. Am. Alliance Ins. Co., 757

A.2d 1074 (Conn. 2000) (abuse occurred at insured's preschool

program). 

The only case that did involve consideration of the verbiage

"care, custody or control" was Children's Aid Soc'y of Montgomery

Cnty. v. Great Am. Ins. Co., Civ. A. No. 91-7778, 1995 WL 251374

(E.D. Pa. Apr. 28, 1995). The court there found no ambiguity in

the exclusion (though its ambiguity analysis actually focused on

the term "damages") and its reading of "care, custody or control"

was consistent with the majority here. Id. at *3-5. I disagree

with the first premise but do not quibble with the second. 

However, I do not think the majority's reading is the only rational

one. 

-31-
II. 

In the property context, courts have consistently read

the expression "care, custody or control" to denote physical

dominion or control. See, e.g., Acadia Ins. Co. v. Peerless Ins.

Co., 679 F. Supp. 2d 229, 241 (D. Mass. 2010) (applying New

Hampshire law); Factory Mut. Ins. Co. v. Liberty Mut. Ins. Co., 518

F. Supp. 2d 803, 810 (W.D. Va. 2007). The treatises cited by the

defendants and considered by the majority reflect this. See, e.g.,

9 Couch on Insurance § 126:22; 57 Massachusetts Practice:

Construction Law § 8.29 (2009-2010). This was the district court's

reading as well, and further seems to be a proposition accepted by

the insurers. Nonetheless (though it does not cite to any case law

or treatises in support) the majority does not accept that this

phrase has such a set meaning in the property framework. I do not

think I need to spend much time on this proposition. It seems

beyond dispute that the expression "care, custody or control"

routinely (if not always) signals physical dominion or control when

pertaining to property. That being said, the question is whether

the defendants' contention that this meaning should be extended to

persons holds water. 

The majority says it does not, dismissing the

Massachusetts cases that defendants cite to as inapplicable because

they only address "care, custody or control" of property or

because, with respect to the one case that involved "care, custody

-32-
or control" of a person, custody was not disputed. However, I take

something different from these cases. In particular, this case law

demonstrates that in the instances where Massachusetts courts have

applied an exclusion that required "care, custody or control," the

insured actually exercised physical dominion or control over a

person or property. See Jefferson Ins. Co. of N.Y. v. City of

Holyoke, 503 N.E.2d 474, 477 (Mass. App. Ct. 1987) (woman who

committed suicide was in the custody of insured police department);

Rogala v. Farm Family Cas. Ins. Co., No. 0700049, 2009 WL 2231161

(Mass. Super. Ct. Mar. 23, 2009) (damaged truck was possessed and

controlled by the insured business owner); Commerce Ins. Co. v.

Empire Fire & Marine Ins. Co., No. 04-00825, 2006 WL 2439991 (Mass.

Super. Ct. Aug. 9, 2006), aff'd, 879 N.E.2d 1272 (Mass. App. Ct.

2008) (damaged rental cars were in the possession of insured

renters/drivers); Murray v. Noone, No. 9241, 1994 WL 69565 (Mass.

Dist. Ct. Feb. 24, 1994) (damaged vehicle was physically controlled

by insured driver). Notably, of all the cases cited by the

majority where an abuse or molestation exclusion served to bar

coverage, just one involved a situation where "care" alone was

provided. See McAuliffe v. Northern Ins. Co. of N.Y., 69 F.3d 277

(8th Cir. 1995) (exclusion applied where priest abused a

parishioner that was under his care). All the others involved

scenarios where some type of custody or control was exerted over

the victim. 

-33-
 Further endorsement for defendants' standpoint is found

in the fact that Massachusetts courts accept the canon of

construction that technical terms and words of art are given their

technical meaning when used within their technical field. See

Davis v. Dawson, Inc., 15 F. Supp. 2d 64, 109 (D. Mass. 1998); City

of Springfield v. Dep't of Telecomm. & Cable, 931 N.E.2d 942, 947

(Mass. 2010); W. Alliance Ins. Co. v. Gill, 686 N.E.2d 997, 999

(Mass. 1997); Atlantic Mut. Ins. Co. v. McFadden, 595 N.E.2d 762,

764 (Mass. 1992). Moreover, the courts have applied this canon to

the interpretation of insurance policy exclusions. See W. Alliance

Ins. Co., 686 N.E.2d at 999; Atlantic Mut. Ins. Co., 595 N.E.2d at

764. Nonetheless the majority dismisses this canon's

applicability. I am not persuaded by their reasoning. 

First, the majority distinguishes the various

Massachusetts cases that apply the canon because they either

involve a different technical field, see W. Alliance Ins. Co., 686

N.E.2d at 999 (involving environmental law); Atlantic Mut. Ins.

Co., 595 N.E.2d at 764 (same), or a specialized contract governed

by regulations, see City of Springfield, 931 N.E.2d at 947

(involving a cable television service provider license). This

seems beside the point to me. It does not matter that we are

dealing with a different technical field; these cases still have

bearing on our analysis as they are examples of Massachusetts

courts applying a technical meaning to a term of art contained in

-34-
an insurance policy or contract. Second, the majority emphasizes

the district court's finding that "care" of an object is

necessarily different than the type of "care" provided to a

recipient of medical or therapeutic services. I do not disagree,

but it seems the majority and I are of two minds on the

significance of this point. The defendants' position is that

"care" should not be read alone but as part of the phrase "care,

custody or control" - an insurance industry term of art. As I have

likely made clear at this point; this makes sense.

What is more, this ordinary meaning reading of "care"

advocated by the majority is not ironclad. "Words in an agreement

are given their ordinary and usual sense 'unless it appears that

[the words] are to be given a peculiar or technical meaning.'" 

City of Springfield, 931 N.E.2d at 947 (quoting Davis, 15 F. Supp.

2d at 109). And insurance policy language is interpreted based on

both the common and the technical understanding of the words. See

id. at 947 (citing Lodge Corp. v. Assurance Co. of Am., 775 N.E.2d

1250, 1252 (Mass. App. Ct. 2002)). One could certainly see how

this interplay between common and technical understandings would

lend itself to the formulation of two (not one) rational readings

of the verbiage "care, custody or control."

As for the majority's slant that the word "care" must be

given meaning and effect separate from "custody" and "control";

such a reading is certainly consistent with canons of construction. 

-35-
Nonetheless, crediting the rationality of the defendants' position,

which I have, this canon is inapplicable since the phrase "care,

custody or control" needs to be read as a whole and treated as a

term of art. Furthermore, the corresponding position taken by the

majority that the word "or" should be treated as disjunctive

"unless the context and the main purpose of all the words demands

otherwise," Miller v. Miller, 861 N.E.2d 393, 401 (Mass. 2007)

(quotation marks and citation omitted), is equally supportive of

the defendants' and the insurers' position. Defendants say context

demands otherwise; insurers say the opposite. The majority has

disregarded defendants' position as without merit and again, on

this point, we part ways.

The majority also made quick time with the defendants'

argument that the Exclusions must be read in conjunction with the

other policy provisions that used the phrase "care, custody or

control" but I think the argument is compelling. Courts must

construe an insurance contract as a whole. See Am. Home Assurance

Co. v. Fore River Dock & Dredge, Inc., 321 F. Supp. 2d 209, 216 (D.

Mass. 2004); Hakim v. Mass. Insurers' Insolvency Fund, 675 N.E.2d

1161, 1166 n.11 (Mass. 1997). In this case, each of the policies

at issue contained the expression "care, custody or control" at

least a dozen times. With the exception of the various abuse and

molestation provisions (and one provision regarding dogs), the

phrase was used exclusively in the context of property. And as

-36-
noted, the insurers appear to concede that "care, custody or

control" has a certain meaning in the property context. Applying

this meaning throughout the policies is consistent with

Massachusetts law that contracts be read as a whole. See Am. Home

Assurance Co., 321 F. Supp. 2d at 216; Hakim, 675 N.E.2d at 1166

n.11.

Finally, I agree with the defendants that the insurers'

tack - now the majority's holding - defeats the reasonable

expectation of an insured. When construing insurance polices,

Massachusetts courts "consider what an objectively reasonable

insured, reading the relevant policy language, would expect to be

covered." McGregor v. Allamerica Ins. Co., 868 N.E.2d 1225, 1227

(Mass. 2007). It seems to me that a reasonable insured would

expect to be covered in precisely the facts at hand. By nature of

the services it offers, the Carson Center undoubtedly provides

service and treatment to those who are suffering physical and

sexual abuse. A reasonable insured would expect that errors that

occur during the assistance and treatment of these persons -

including the negligent failure to recognize the signs of abuse -

would be fully covered by professional liability insurance. In

this final respect, defendants' interpretation of the phrase "care,

custody or control" is once again solid. 

-37-
III.

This brings me to the end result. Where there are two

rational interpretations of policy language, the insured is

entitled to the benefit of the one that is more favorable to it. 

See Makrigiannis v. Nintendo of Am., Inc., 815 N.E.2d 1066, 1071

(Mass. 2004) (citing Trs. of Tufts Univ. v. Commercial Union Ins.

Co., 616 N.E.2d 68, 72 (Mass. 1993)). Furthermore, "[c]onsistent

with the Massachusetts general rule favoring insureds in policy

interpretation," ambiguities in policy language are strictly

construed against the insurer. Brazas Sporting Arms, Inc., 220

F.3d at 4. And finally, "[e]xclusionary clauses must be strictly

construed against the insurer so as not to defeat any intended

coverage or diminish the protection purchased by the insured." 

City Fuel Corp. v. Nat'l Fire Ins. Co. of Hartford, 846 N.E.2d 775,

777 (Mass. 2006).

These canons of construction point in only one direction. 

Faced with two rational interpretations of an exclusionary clause,

we must strictly construe the Exclusion against the insurers,

applying the interpretation of "care, custody or control" that is

most beneficial to the defendants (i.e., the phrase requires

physical dominion or control). Because neither Field nor the

Carson Center exercised any such dominion or control over the child

at the time the abuse took place, the Exclusion does not apply and

coverage for the claims asserted exists. I therefore dissent.

-38-