Opinion ID: 76012
Heading Depth: 2
Heading Rank: 4

Heading: Titan I and Titan II

Text: 30 We recognize that Titan Indemnity Co. v. Riley, 641 So.2d 766, 768 (Ala.1994) ( Titan I ) and the subsequent case of Titan Indemnity Co. v. Riley, 679 So.2d 701 (Ala.1996) ( Titan II ), did involve the interpretation of two insurance clauses similar to those in dispute here. Titan II, 679 So.2d at 705. However, as explained below, the solution to the issue here is not clear from those decisions. 31 The underlying facts in Titan I and Titan II are the same. Titan Indemnity Company brought a declaratory action seeking a determination of whether Titan was obligated to defend ( Titan I ) and indemnify ( Titan II ) four City of Montgomery police officers in connection with a 42 U.S.C. § 1983 action based on violation of the plaintiff's constitutional rights. The insurance policy in question covered Personal Injury, which the policy defined as, inter alia, [v]iolation of civil rights, and limited the definition of insured to [law enforcement officers] ... but only for acts within the scope of their duties for [the City]. Titan II, 679 So.2d at 703 & n. 1 (citing Titan I, 641 So.2d at 768). In Titan I, the Alabama Supreme Court concluded that the language of the policy d[id] preclude coverage for intentional acts, but it also specifically provide[d] coverage for ... offenses that require proof of intent ... [and] specifically provide[d] coverage for claims brought under the Federal Civil Rights Act. Titan I, 641 So.2d at 768. As a result, the conflict between the provisions created an inherent ambiguity within the policy. Id. This conflicting language and resulting ambiguity in the policy, when interpreted in favor of the insured, resulted in coverage for the defense of the 42 U.S.C. § 1983 claims against the officers. Id. 32 Titan II followed two years later and concluded that Titan Indemnity Company must also indemnify the employees for any monetary claim paid in settlement of the § 1983 claim. The Alabama Supreme Court rejected the argument, which EMCC makes on appeal here, that a scope-of-duties limitation restricts coverage for constitutional or civil rights violations, stating as follows: 33 Specifically, [Titan Indemnity Company] argues: 34 The Titan policy expressly requires that the matters for which coverage is sought must result from law enforcement activities, and that no person claiming coverage is an insured unless the acts complained of are acts within the scope of their duties for the City of Montgomery. The allegations made against the Defendant officers in no way can be construed to be in the furtherance of law enforcement activities or within the scope of their duties for the City .... 35 We are unpersuaded by these arguments — they are essentially restatements of the ones Titan relied on in [ Titan I ]. 36 Titan II, 679 So.2d at 705 (citing Brief for Titan Indemnity Co. at 58). Based on the above quoted passage, Shrader and Livingston argue that in Titan II, the Alabama Supreme Court considered and rejected the argument that a scope of duties limitation in the definition of insured can limit broader insurance policy provisions providing coverage for violations of constitutional and civil rights. 37 The basis for this rejection, however, is unclear. As EMCC points out, another section of the Titan II opinion appears to indicate that the Alabama Supreme Court rejected this argument based only on a law-of-the-case ground. In this regard, the Alabama Supreme Court stated as follows: 38 Given our conclusion in [ Titan I ], it would be inconsistent for us to hold in this case, that the officers, who committed the conduct, were not covered. Otherwise stated, if the conduct giving rise to this dispute was covered as to Titan's duty to defend, that same conduct also provides the basis for imposing on Titan a duty to indemnify. We conclude, therefore, that Titan I establishes the law of this case as to Titan's liability for indemnification under the policy. 39 Titan II, 679 So.2d at 705. Thus, it is unclear in Titan II whether the Alabama Supreme Court rejected Titan Indemnity Company's arguments on the merits, concluding that coverage was required due to the ambiguity in coverage, or whether the court simply was bound by the prior ruling in Titan I. 6 As a result, this Court faces an unsettled issue of Alabama law that is determinative of the issue in this appeal. We, therefore, certify this question for resolution by the Alabama Supreme Court. 40