Opinion ID: 1790960
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Heading: commercial umbrella liability coverage form

Text: SECTION ICOVERAGE    b. This insurance only applies to: (1) Bodily injury or property damage: (a) Occurring during the policy period; and (b) Caused by an incident that takes place in the coverage territory; (2) Personal injury caused by an incident:    SECTION VIDEFINITIONS 6. Incident means: a. An accident, including continuous or repeated exposure to the same general harmful conditions, that results in bodily injury or property damage. All damages arising from continuous or repeated exposure to the same general harmful conditions shall be deemed to arise from one incident. b. An offense that results in advertising injury.    ¶ 10. The exculpatory language provides: This insurance does not apply to: a. Expected or Intended Injury Bodily injury or property damage expected or intended from the standpoint of the insured. This exclusion does not apply to bodily injury resulting from the use of reasonable force to protect persons or property. ¶ 11. Thus language in both policies provides that bodily injury or property damage must be caused by either an incident or an occurrence. The policies define occurrence and incident, respectively, as an accident. The exclusion in both policies mandates that coverage does not apply to bodily injury or property damage that is expected or intended from the standpoint of the insured. An accident by its very nature, produces unexpected and unintended results. It follows that bodily injury or property damage, expected or intended from the standpoint of the insured, cannot be the result of an accident. We have held that unless the clause of an insurance agreement is ambiguous it should be enforced as written. Gulf Guar. Life Ins. v. Duett, 671 So.2d 1305, 1308 (Miss.1996); Nationwide, 636 So.2d at 662. Based upon the foregoing analysis, there is no ambiguity in the policy language, and OmniBank's argument is without merit.
¶ 12. Under Mississippi law, the determination of whether a liability insurance company has a duty to defend depends upon the language of the policy. Sennett v. United States Fid. & Guar. Co., 757 So.2d 206, 212 (Miss.2000). The obligation of the insurer to defend is to be determined by analyzing the allegations of the complaint or declaration in the underlying action. Id.; see also Delta Pride Catfish, Inc. v. Home Ins. Co., 697 So.2d 400, 403 (Miss.1997); State Farm Mut. Auto. Ins. Co. v. Taylor, 233 So.2d 805, 808 (Miss.1970). OmniBank submits that USF&G's obligation to defend is triggered by the characterization of the claims contained in the complaint: since the complaint alleges negligence, OmniBank submits that USF&G owes a duty to defend. The complaint reads as follows: The Defendants, jointly and severally, and in concert each with the other, negligently and/or intentionally chose an insurer which charged an exorbitant rate for collateral protection insurance which provided protection only for OmniBank. ¶ 13. The complaint further alleges that OmniBank engaged in a course of conduct which constituted a negligent disregard for the right of the Plaintiffs. (emphasis added). ¶ 14. Mississippi federal courts have held that an insurer has a duty to defend when there is a basis for potential liability to the insured under the policy for the claims alleged against the insured. See Merchants Co. v. American Motorists Ins., 794 F.Supp. 611, 617 (S.D.Miss.1992). ¶ 15. In Allstate Ins. Co. v. Moulton, 464 So.2d 507, 510 (Miss.1985), we found that there was no coverage for unintended damages arising out of a malicious prosecution claim. Id. at 507. The insured, Moulton, swore out a complaint asserting that the defendant, Walls, stole her dog. Id. Walls was acquitted and subsequently sued Moulton for malicious prosecution. Id. Moulton then requested a defense from her insurer asserting that she did not intend for Walls to suffer the humiliation and embarrassment associated with her complaint. Id. We observed that, in determining whether there has been an occurrence, [t]he only relevant consideration is whether, according to the declaration, the chain of events leading to the injuries complained of were set in motion and followed a course consciously devised and controlled by [the insured] without the unexpected intervention of any third person or extrinsic force. Id. at 509. ¶ 16. We held that the term accident, as defined by the policy, referred to Moulton's action and not to whatever unintended damages flowed from that act. Id. at 510. Although Moulton did not intend Walls to suffer humiliation or embarrassment, she did intend for him to arrested. Id. Thus, her actions were not accidental, and as such the insurer was under no obligation to defend. Id. ¶ 17. Here, OmniBank intended to make a loan to Ramsay, intended to require Ramsay to maintain insurance, intended to place collateral protection insurance provision in the loan agreement, and intended to include the premium in the finance charge. This chain of events was set in motion and followed a course consciously devised and controlled by Omni-Bank, without the unexpected intervention of any third person or extrinsic force. Clearly under the rationale of Moulton, USF&G is under no duty to defend against the complaints alleged in the Ramsay lawsuit. ¶ 18. We must now reconcile Moulton with our decision in Southern Farm Bureau Cas. Ins. Co. v. Allard, 611 So.2d 966 (Miss.1992). There, Allard, the insured, following an altercation, shot his brother-in-law in the leg. Id. Allard claimed that he did not intend to shoot his brother-in-law and did not intend to injure him. Id. at 968. He testified that he intended to pull the trigger and fire a warning shot in his brother-in-law's general direction, but his brother-in-law unexpectedly stepped into the path of the shot and was injured. Id. Allard's insurance policy contained the same exclusion as the instant case, providing that the coverage does not apply to bodily injury or property damage which is expected or intended by the insured. Id. The jury found that the shooting was unintentional. Id. ¶ 19. We noted that an act is intentional if the actor desires to cause the consequences of his act, or believes that the consequences are substantially certain to result from it. Id. quoting Coleman v. Sanford, 521 So.2d 876, 878 (Miss.1988); Stevens v. FMC Corp., 515 So.2d 928, 931 (Miss.1987). The facts of the shooting created a question for the jury as to whether the victim was intentionally harmed. Allard, 611 So.2d at 968. Having resolved that question in favor of the insured, we affirmed the judgment of the trial court. Id. Contrary to OmniBank's position, Allard does not constitute a change in the law. Allard emphasized that a fact issue existed as to whether the insured intended to harm the victim. Id. This is relevant because the scope of our query was whether such act constituted an occurrence or incident, as defined in the policies. We did not address whether specific damages must have been intended in order for the intentional acts exclusions of the policy to be applicable. Moulton held that the term accident refers to Mrs. Moulton's action and not whatever unintended damages flowed from that act. Moulton, 464 So.2d at 510. Thus, Allard and Moulton are consistent in that they both address the nature of the insured party's conduct, not the resulting damages of that conduct. ¶ 20. OmniBank would have us declare that an insured has coverage for intended acts so long as there is no intent to cause bodily injury or property damage. Mississippi federal courts have correctly held that a claim resulting from intentional conduct which causes foreseeable harm is not covered, even where the actual injury or damages are greater than expected or intended. See Nationwide Mut. Fire Ins. Co. v. Mitchell ex rel. Seymour, 911 F.Supp. 230 (S.D.Miss.1995); New Hampshire Ins. Co. v. Vardaman, 838 F.Supp. 1132 (N.D.Miss.1993).