Opinion ID: 2510374
Heading Depth: 2
Heading Rank: 2

Heading: Vandalism and Malicious Mischief as Ambiguous Terms

Text: {7} The insurance policy at issue did not define vandalism and malicious mischief and it failed to mention arson. These terms are essential in determining whether the exclusion was applicable in this case. If arson constitutes vandalism and malicious mischief, then the exclusion precludes coverage because it is undisputed that the dwelling was vacant for more than thirty consecutive days. {8} The Court of Appeals stated that an insurance policy is not rendered ambiguous merely because a term is not defined; rather, the term must be interpreted in its usual, ordinary, and popular sense. Battishill, 2004-NMCA-109, ¶ 11, 136 N.M. 288, 97 P.3d 620. We agree and hold that the common and ordinary meaning of vandalism, malicious mischief, and arson may be ascertained from a dictionary. See, e.g., Estes v. St. Paul Fire & Marine Ins. Co., 45 F.Supp.2d 1227, 1229 (D.Kan.1999) (relying on Webster's Third New International Dictionary's definitions of vandalism and arson to determine that [a]rson of a private dwelling clearly is within the plain and ordinary meaning of vandalism). {9} Webster's Third New International Dictionary defines vandalism as willful or malicious destruction or defacement of things of beauty or of public or private property. WEBSTER'S THIRD NEW INT'L DICTIONARY 2532 (2002). It defines malicious mischief as willful, wanton, or reckless damage or destruction of another's property. Id. at 1367. Arson is defined as the willful and malicious burning of or attempt to burn any building, structure, or property of another (as a house, a church, or a boat) or of one's own usu[ally] with criminal or fraudulent intent. Id. at 122. Burning is a form of damage, destruction, or defacement. From these definitions, we conclude that arson is a form of vandalism and malicious mischief. See Am. Mut. Fire Ins. Co. v. Durrence, 872 F.2d 378, 379 (11th Cir.1989) (per curiam) ([A] common sense interpretation of the insurance contract's `Vandalism or Malicious Mischief' provision which contains the `vacancy' exclusion, suggests that it would apply to a fire set in a vacant house by an unknown arsonist or vandal.); Costabile v. Metro. Prop. & Cas. Ins. Co., 193 F.Supp.2d 465, 478 (D.Conn.2002) (predicting that the Connecticut Supreme Court would conclude that arson ... is a type of vandalism); United Capital Corp. v. Travelers Indem. Co. of Illinois, 237 F.Supp.2d 270, 274 (E.D.N.Y.2002) (Although there is somewhat conflicting case law on the issue, courts generally agree that the ordinary use of the word vandalism would include an arson.); Brinker v. Guiffrida, 629 F.Supp. 130, 136 (E.D.Pa.1985) (Willfully and intentionally damaging a dwelling by setting it on fire is certainly damaging the dwelling by vandalism and malicious mischief, as well as arson.). {10} Although the Court of Appeals recognized that arson may be considered a type of vandalism, it also reasoned that apart from the dictionary, there exists a sense that the common and ordinary meaning of vandalism is something different than that of arson. Battishill, 2004-NMCA-109, ¶ 13, 136 N.M. 288, 97 P.3d 620; see also id. ¶ 17 (While vandalism can also be read to generally and broadly mean willful or malicious destruction of a dwelling, its common and ordinary meaning is not necessarily or only defined that way.). The Court of Appeals noted that `arson' and `vandalism' have been described as `distinct perils' in the general view of `ordinary business people.' Id. ¶ 13 (quoting MDW Enter., Inc. v. CNA Ins. Co., 4 A.D.3d 338, 772 N.Y.S.2d 79, 83 (2004)). We believe that it may be necessary to look beyond the dictionary definition to ascertain the common and ordinary meaning of a word or words in some cases; however, in this case, the dictionary provides appropriate common and ordinary definitions of vandalism, malicious mischief, and arson. {11} We are not persuaded a historical examination of the term vandalism is appropriate. The common and ordinary meaning of an undefined term should be based upon contemporary usage, where possible, because the issue is how a reasonable insured would understand the term at the time of purchase. See, e.g., Gen. Accident Fire & Life Assurance Corp. v. Azar, 103 Ga.App. 215, 119 S.E.2d 82, 85 (1961) (Certainly it does not seem logical that the classic definition was intended by either the insurer or the insured in this case . . . .). We agree with Farmers Alliance, who argued that the ancient connotations of `vandalism' have given way, in modern usage of the term, to a very broad meaning of the word that includes the destruction of property generally. {12} Even if historically the term vandalism was limited to behavior primarily directed at property having artistic, historical, architectural, literary, musical, personal or emotional significance or value and to damage that is not devastating, Battishill, 2004-NMCA-109, ¶¶ 17, 21, 136 N.M. 288, 97 P.3d 620, in contemporary usage, the terms vandalism and malicious mischief are not so limited. See, e.g., Gen. Accident Fire & Life Assurance Corp., 119 S.E.2d at 84-85 ([I]n ordinary usage [vandalism] is not limited to destruction of works of art, but has been broadened in its meaning to include the destruction of property generally.). Both definitions specify certain states of mind (willful, malicious, wanton, or reckless) and address certain types of results (destruction, defacement, or damage) to property, while neither definition limits the types of property or extent of damage. {13} The Court of Appeals rejected contemporary usage because it did not believe that this usage was correct in the context of dwelling insurance, purchased to insure against the dreaded risk of fire. Battishill, 2004-NMCA-109, ¶ 14, 136 N.M. 288, 97 P.3d 620; see also id. ¶ 21 ([T]o a reasonable insured, the desire to have fire coverage, unquestionably extremely important for an insured, predominates.). We acknowledge that an insured's purposes in purchasing insurance are important considerations. Our interpretation of language within an insurance policy, however, is not based on a subjective view of coverage, but rather our focus must be upon the objective expectations the language of the policy would create in the mind of a hypothetical reasonable insured who, we assume, will have limited knowledge of insurance law. Computer Corner, Inc. v. Fireman's Fund Ins. Co., 2002-NMCA-054, ¶ 7, 132 N.M. 264, 46 P.3d 1264. When the terms used have a common and ordinary meaning, that meaning controls in determining the intent of the parties. We believe that contemporary usage provides the common and ordinary meaning that is appropriate on these facts. {14} The common and ordinary meaning of the terms used in the all-risk coverage section results in broad coverage and a narrow exclusion. This section covers fire, including arson, as a form of direct physical loss to the dwelling, unless an enumerated exclusion is applicable. The exclusionary clause precludes coverage when the loss was caused by [v]andalism and malicious mischief if the dwelling has been vacant for more than 30 consecutive days immediately before the loss. Battishill, 2004-NMCA-109, ¶ 4, 136 N.M. 288, 97 P.3d 620. We have concluded that arson is a type of vandalism and malicious mischief. Moreover, the vacancy requirement was met. Consequently the exclusionary clause applies and precludes coverage. We next address the Court of Appeals' conclusion that when the policy is read as a whole, structural similarities between the all-risk and named perils coverage support a different interpretation.