Court Opinion

ID: 9753889
Source: CourtListenerOpinion
Date Created: 2023-08-28 19:34:13.075245+00
Date Added: 2024-06-11T07:27:44.720553
License: Public Domain

WATHEN, C.J.
[¶ 1] Defendant Richard 0. Lambert appeals from a summary judgment entered in the Superior Court (Cumberland County, Mills, J.) in favor of his insurer, plaintiff York Insurance Group of Maine, ruling that it had no duty by virtue of a policy of homeowner’s insurance to defend Lambert in an underlying probate action. Because the court erred in considering evidence beyond the pleadings, we vacate the judgment.
[¶ 2] The facts as developed for purposes of summary judgment may be summarized as follows: Margaret Umbaugh, individually as an heir-at-law entitled to an intestate share, and together with David Lambert, as co-special representatives of the Estate of Hugh A. Graff, brought an action in York County Probate Court against Lambert. The complaint alleged the following facts: Lambert was the stepson of Hugh Graff. Prior to his death, Hugh Graff was incompetent. For a period prior to decedent’s death, Lambert had a confidential or fiduciary relationship with the decedent. During that time period *985Lambert exercised control of the decedent’s person and his property, obtaining a power of attorney from decedent and using the power of attorney to transfer tangible and intangible personal property from decedent to himself. The complaint included, inter alia, claims for breach of fiduciary duty (constructive trust), conversion, and interference with an expectancy of inheritance.
[¶ 3] York Insurance filed a declaratory judgment action requesting the court declare that its insurance contract with Lambert did not cover the allegations contained in the complaint. York Insurance filed a motion for summary judgment, together with a supporting memorandum of law and a statement of material facts. The statement of material facts was supported by answers to interrogatories. After hearing, the court entered an order granting York Insurance’s motion for summary judgment. The court ruled, based on the answers to interrogatories, that York Insurance did not have a duty to defend Lambert in the underlying probate action on the basis that the damages sought were economic damages, which are not covered by the homeowners insurance policy. From this ruling, Lambert appeals.
[¶ 4] “ ‘Whether an insurer has a duty to defend in a particular case is a question of law.’ ” Penney v. Capitol City Transfer, Inc., 1998 ME 44, ¶ 4, 707 A.2d 387, 388 (citations omitted). The longstanding rule is that we “‘determine the duty to defend by comparing the allegations in the underlying complaint with the provisions of the insurance policy.’” Id. (citations omitted). A duty to defend exists “ ‘[i]f a complaint reveals a “potential ... that the facts ultimately proved may come within the coverage.” ’ ” Id. (citations omitted).
[¶ 5] Lambert contends that the court erred when it looked beyond the pleadings and considered evidence extrinsic to the complaint. We. agree. We recently restated the general rule as follows: “ ‘Except in limited circumstances, we have held that an insurer cannot avoid its duty to defend by establishing, before the underlying action has concluded, that ultimately there will be no duty to indemnify.’ ” Penney, 1998 ME 44, ¶ 5, 707 A.2d at 388-89 (citations omitted). We explained the reason for the rule as follows:
To secure the just, speedy and inexpensive determination of an action involving a duty to defend and a duty to indemnify and avoid a duplication of trials requires that courts proceed in the following order: the determination of a duty to defend, then the determination of liability in the underlying action, and finally the determination of the duty to indemnify.
Id., 707 A.2d at 389 (citation omitted). We have also explained the rationale as follows:
If we were to look beyond the complaint and engage in proof of actual facts, then the separate declaratory judgment actions ... would become independent trials of the facts which the [insured] would have to carry on at his expense .... We see no reason why the insured, whose insurer is obligated by contract to defend him, should have to try the facts in a suit against his insurer in order to obtain a defense.
Elliott v. Hanover Ins. Co., 1998 ME 138, ¶ 7, 711 A.2d 1310, 1312 (citation omitted). “The duty to defend is broader than the duty to indemnify, and an insurer may have to defend before it is clear whether there is a duty to indemnify.” Penney, 1998 ME 44, ¶ 15, 707 A.2d at 389. As in Penney, the present case offers no reason for deviating from the pleading comparison test that has long been the rule in Maine.
[¶ 6] The underlying complaint includes allegations for breach of a fiduciary duty (constructive fraud), conversion, and interference with an expectancy of inheritance. York Insurance argues that the underlying complaint does not include a claim for bodily injury or property damage, and more specifically that neither the claims asserted nor the facts alleged give *986any suggestion of bodily harm, sickness or disease.
[¶ 7] Confining our review to an examination of the complaint and the homeowners insurance policy, we conclude that a potential exists that the facts alleged may result in bodily injury within the coverage of the homeowners policy. For example, although on its face the complaint does not specifically include allegations of emotional distress or emotional pain and suffering, the general allegations of the interference with an expectancy of inheritance claim carry the possibility of an award for emotional distress. See Restatement (Second) of Torts §§ 774B cmt. e, 774A(l)(c) (1979).
[¶ 8] We have held that “[u]n-less excluded, a claim for emotional distress triggers an insurer’s duty to defend under ‘bodily injury’ coverage if the emotional distress is caused by an ‘accident or occurrence’ within the meaning of the policy.” Vigna v. Allstate Ins. Co., 686 A.2d 598, 600 (Me.1996). We explained the reasoning in a claim for wrongful termination of employment that “it is possible, albeit remotely so, that there would be coverage if the plaintiff can establish that he suffered ‘bodily injury, sickness or disease’ as a result of emotional distress caused by his discharge.” Maine Bonding & Casualty Co. v. Douglas Dynamics, Inc., 594 A.2d 1079, 1081 (Me.1991) (citation omitted). Thus, we need not address Lambert’s other contentions that the breach of fiduciary duty and conversion claims also contain allegations of and requests for damages that could potentially be characterized as “bodily injury” or “property damage.” As in Penney, “[e]ven though evidence beyond the pleadings may later establish the absence of a duty to indemnify, that evidence is not properly considered in determining the duty to defend.” Penney v. Capitol City Transfer, Inc., 1998 ME 44, f 7, 707 A.2d 387, 389 (citation omitted).
The entry is:
Judgment vacated. Remanded to the Superior Court for further proceedings consistent with the opinion herein.