Court Opinion

ID: 9490537
Source: CourtListenerOpinion
Date Created: 2023-08-05 13:46:16.668889+00
Date Added: 2024-06-11T17:54:09.378283
License: Public Domain

*836MAGILL, Circuit Judge.
In response to an Arkansas state court action brought by Garnette Bell on behalf of herself and her son, Kenyatta Williams, Allstate Insurance Company (Allstate) brought this declaratory judgment action against its insured, Joel Mark Burrough, and against Bell in order to ascertain Allstate’s obligation to provide coverage to Burrough. Burrough was named as one of the defendants in Bell’s state court action for tort damages because of Burrough’s involvement in the accidental shooting of Williams. The district court2 granted summary judgment in favor of Allstate, ruling that a criminal acts exclusion in the policy underwritten by Allstate excluded coverage. Allstate Ins. Co. v. Burrough, 914 F.Supp. 308, 310, 314 (W.D.Ark.1996). Bell appeals, and we affirm.
I.
The material facts of this ease are undisputed. The district court recounted the events leading up to the accidental shooting of Williams as follows:
The record shows that in August or September of 1993, defendant [Burrough], who was approximately 14 at the time, stole a .22 caliber handgun from his grandfather’s residence and took it home. Over the next couple of months he showed it to his friends, including Jeremiah Hauser and Christopher Beck. Sometimes they would shoot the gun into the ground in a storage shed on defendant’s property. On one occasion, while the gun was being handled by a friend of defendant’s named Chad Coleman, the gun misfired even though Chad had not touched the trigger or cocked the hammer. Still, defendant and his friends thought the gun was “cool.”
In addition to playing with guns, defendant and his friends would pass the time by “cruising Grand [Avenue].” Grand is a long, wide street in Fort Smith, Arkansas, populated with numerous fast food restaurants and like business establishments. Many teenagers would cruise up and down the street for hours. Also, teenagers would hang out in the parking lots of the business establishments along Grand and drink beer, smoke pot, and not infrequently, get into fights. Apparently, there was even some gang-like activity on Grand, or at least defendant and his friends thought that the “Bloods” hung out there wearing red bandannas and gang-like athletic wear. Also, teenagers who defendant and his friends believed to be involved with gangs had harassed them on one or two occasions prior to the night of the shooting.
Id. at 313.
The shooting occurred on October 22,1993. On that day, Williams was on foot in the parking lot of a Harvest Foods grocery store in Fort Smith, Arkansas. In that same parking lot, Beck and Hauser were in a car driven by Beck. On the floorboard of Beck’s car was the .22 caliber handgun that Bur-rough had stolen from his grandfather. As Beck and Hauser drove by Williams, Beck “flashed” the .22 caliber handgun towards Williams. The handgun accidentally discharged, shooting Williams in the neck. The bullet severed Williams’s spinal cord and left him a quadriplegic.
Beck, who was sixteen years old at the time of the shooting, had received the .22 caliber handgun from Hauser. Hauser, who was fifteen or sixteen years old at the time of the shooting,3 had obtained the handgun from Burrough approximately two weeks pri- or to the shooting. Burrough was fourteen years old when he gave the gun to Hauser.
In a deposition, Burrough later testified that he gave the handgun to Hauser because Hauser was concerned that Burrough would be caught with the handgun in Burrough’s possession. See Joel Mark Burrough Dep. *837(Feb. 20, 1995) at 22, reprinted in Appellee’s App. at 19. Burrough also testified that he expected Hauser to return the handgun to him. Id. In addition, Burrough claimed that he could not remember any conversations with Hauser or Beck prior to the accidental shooting incident. See id. at 29-30, reprinted in Appellee’s App. at 26-27. However, Burrough also testified that, prior to the shooting incident, Hauser and Beck told him that “they had gotten in a fight at school or something, or almost got in a fight, and they said something about something on Grand____” Id. at 29, reprinted in Appellee’s App. at 26. Finally, Burrough testified that, when he gave the gun to Hauser, it was loaded with several rounds of ammunition. See id. at 30, reprinted in Appellee’s App. at 27.
Bell filed her Arkansas state court action on behalf of herself and Williams, naming Beck, Hauser, and Burrough as defendants. In her complaint, Bell alleged that Beck negligently and recklessly shot Williams, proximately causing damage to her and Williams. She further alleged that Hauser and Bur-rough acted negligently and recklessly in providing Beck with the .22 caliber handgun, which also proximately caused damage to her and Williams. Allstate subsequently filed this declaratory judgment action in the district court against Burrough and Bell. Allstate seeks a declaration that, under the terms of a homeowner’s insurance policy purchased by Burrough’s father, Allstate has no obligation to provide coverage for Burrough’s acts and that Allstate consequently has no duty to defend Burrough in the state court action.
The parties agree that at all relevant times Burrough was covered by the Allstate homeowner’s insurance policy purchased by Bur-rough’s father. The policy obligates Allstate to pay, “[sjubjeet to the terms, conditions and limitations of this policy, ... damages which an insured person becomes legally obligated to pay because of bodily injury or property damage arising from an occurrence to which this policy applies.... ” Allstate Deluxe Plus Homeowners Policy, § II, Coverage X Family Liability Protection (Policy), reprinted in Appellee’s App. at 6 (emphasis in original). The policy further provides that “[i]f an insured person is sued for these damages, we [Allstate] will provide a defense with counsel of our choice, even if the allegations are groundless, false or fraudulent.” Id. (emphasis in original).
In its declaratory judgment action, Allstate moved for summary judgment, asserting that, although Burrough was insured under the policy at the time of Williams’s shooting, coverage was excluded by operation of the policy’s criminal acts exclusion. The criminal acts exclusion provides that:
Losses We Do Not Cover Under Coverage X:
1. We [Allstate] do not cover any bodily injury or property damage intended by, or which may reasonably be expected to result from the intentional or criminal acts or omissions of, any insured person. This exclusion applies even if:
a) such insured person lacks the mental capacity to govern his or her conduct;
b) such bodily injury or property damage is of a different kind or degree than that intended or reasonably expected; or
e) such bodily injury or property damage is sustained by a different person than intended or reasonably expected.
This exclusion applies regardless of whether or not such insured person is actually charged with, or convicted of a crime.
Id., reprinted in Appellee’s App. at 6-7 (emphasis in original).
The district court concluded that, although the state of Arkansas never pressed criminal charges or adjudged Burrough to be a juvenile delinquent, Burrough committed a criminal act under Arkansas law. Burrough, 914 F.Supp. at 311-12. Specifically, the district court found that Burrough had committed the offense of furnishing a deadly weapon to a minor, in violation of Arkansas Code Annotated § 5-73-109. Burrough, 914 F.Supp. at 311-12. In addition, the district court concluded that “[Burrough] should have reasonably expected that someone might be killed or injured when [Burrough] committed the criminal act of providing a minor[, Hauser,] *838with a firearm.” Id. at 314. Accordingly, the district court held that Allstate is not obligated to provide coverage for Burrough’s role in the accidental shooting incident. Id. The district court also held that Allstate has no duty to defend Burrough in the action brought by Bell. Id. Bell appeals.
II.
On appeal, we review the district court’s grant of summary judgment to Allstate de novo. See McCormack v. Citibank, N.A., 100 F.3d 532, 537 (8th Cir.1996). Summary judgment is appropriate only if the record, viewed in the light most favorable to the nonmoving party, presents no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Id.; see also Fed.R.Civ.P. 56(c). A grant of summary judgment is proper “[w]here the unresolved issues are primarily legal rather than factual____” Bank of America Nat’l Trust & Savings Ass’n v. Shirley, 96 F.3d 1108, 1111 (8th Cir.1996).
A federal court’s interpretation of an insurance policy in a diversity case is governed by state law, and accordingly, our interpretation of Allstate’s insurance policy in this ease is governed by Arkansas law. See Dupps v. Travelers Ins. Co., 80 F.3d 312, 313 (8th Cir.1996). “We review the district court’s interpretation of Arkansas law de novo.” Id.
Under Arkansas law, “an insurance policy, having been drafted by the insurer without consultation with the insured, is to be interpreted and construed liberally in favor of the insured and strictly against the insurer.” Noland v. Farmers Ins. Co., 319 Ark. 449, 892 S.W.2d 271, 272 (1995). However, the Arkansas Supreme Court has cautioned that “[t]he terms of an insurance contract are not to be rewritten under the rule of strict construction against the company issuing it so as to bind the insurer to a risk which is plainly excluded and for which it was not paid.” Smith v. Shelter Mut. Ins. Co., 327 Ark. 208, 937 S.W.2d 180, 182 (1997) (quotations and citations omitted). Rather, we must “adhere to the longstanding rule that, where the terms of the policy are clear and unambiguous, the policy language controls .... ” Id. 937 S.W.2d at 181.
Under Arkansas law, “absent statutory strictures to the contrary, exclusionary clauses are generally enforced according to their terms.” Id. Although ambiguous language in an exclusionary clause “should be construed in favor of the insured,” State Farm Fire & Cas. Co. v. Midgett, 319 Ark. 435, 892 S.W.2d 469, 471 (1995) (quotations omitted), such “ambiguity exists ... only when a provision is susceptible to more than one reasonable interpretation.” Id. “The initial determination of whether a contract is ambiguous rests with the court, and when a contract is unambiguous, its construction is a question of law for the court.” Hartford Fire Ins. Co. v. Carolina Cas. Ins. Co., 52 Ark.App. 35, 914 S.W.2d 324, 326 (1996).
To prevail on its summary judgment motion in this declaratory judgment action, Allstate had the burden of proving as a matter of law that Burrough fell within the criminal acts exclusion. See Arkansas Farm Bureau Ins. Fed’n v. Ryman, 309 Ark. 283, 831 S.W.2d 133, 134-35 (1992) (holding that an insurer has the burden of proving that an insured fell within an insurance policy exclusion). To fit within the terms of the criminal acts exclusion, Allstate needed to prove (1) that Burrough committed a “criminal act” and (2) that Burrough could have reasonably expected Williams’s injury to have resulted from that criminal act.4 Bell first presents two related arguments that challenge the first prong of this two-part analysis.
A.
Bell argues that, although furnishing a gun to a minor is a criminal act under Arkansas law when committed by an adult, it is merely a delinquent act when committed by a minor. According to Bell, it is therefore unclear whether Burrough, a minor when he gave the handgun to Hauser, committed a *839criminal act for purposes of Allstate’s criminal acts exclusion. Bell thus argues that the criminal acts exclusion is ambiguous and should be construed against Allstate to find coverage for Burrough’s act of furnishing a handgun to Hauser. We disagree.
Under § 5-73-109(a) of the Arkansas Criminal Code, Ark.Code Ann. §§ 5-1-101 to 76-106 (Michie 1993 & Supp.1995), “[a] person commits the offense of furnishing a deadly weapon to a minor when he sells, barters, leases, gives, rents, or otherwise furnishes a firearm or other deadly weapon to a minor without the consent of a parent, guardian, or other person responsible for general supervision of his welfare.” Ark.Code Ann. § 5-73-109(a) (Michie 1993). A minor is “any person under eighteen (18) years of age.” Ark.Code Ann. § 5-73-101(2) (Michie 1993).
In the present action, it is undisputed that Burrough furnished a .22 caliber handgun to Hauser, who at the time was a minor. It is also undisputed that no responsible adult consented to the transfer. Consequently, Burrough’s act of giving the handgun to Hau-ser satisfied all the elements of the criminal offense of furnishing a deadly weapon to a minor.
We recognize that Burrough, who was fourteen years old when he handed over the handgun to Hauser, could not be charged with or convicted of a § 5-73-109(a) offense in a criminal proceeding. Arkansas’s juvenile courts would have exclusive jurisdiction over Burrough with respect to a § 5-73-109(a) offense. Compare State v. Gray, 319 Ark. 356, 891 S.W.2d 376, 377 (1995) (holding that the “jurisdiction of the juvenile court is exclusive and original with respect to all offenses charged against a juvenile who is fourteen years old at the time of the commission of those offenses, with the exception of certain offenses enumerated in Ark.Code. Ann. § 9-27-318(b)(1) (Repl.1991)” (emphasis in original)) with Ark.Code Ann. § 9-27-318(b)(1) (Michie 1993) (granting prosecutorial discretion to charge fourteen-year-olds as adults with certain enumerated offenses, not including § 5-73-109(a)). Therefore, for the act of furnishing a deadly weapon to Hauser, Burrough could only be adjudged a juvenile delinquent in a juvenile court. See Arkansas Juvenile Code of 1989, Ark.Code Ann. § 9-27-301 to -352 (Michie 1993) (setting forth provisions dealing with juvenile delinquency).
Although Burrough’s status as a juvenile prevents him from being tried as an adult, the offense he committed is still a criminal act. Neither § 5-73-109(a) nor the provisions dealing with juvenile delinquency incorporate an age-based exception to the offense of furnishing a deadly weapon to a minor. Instead, § 5-73-109(a) applies to any “person” who furnishes a deadly weapon to a minor, see § 5-73-109(a), and the Arkansas Criminal Code recognizes that a minor, such as Burrough, is a “person.” See § 5-73-101(2).
Regardless of whether he could be tried as an adult or be adjudged a juvenile delinquent, under the plain language of the Arkansas Criminal Code, Burrough committed an act defined as criminal. Hence, he committed a criminal act for purposes of Allstate’s criminal acts exclusion. Cf Butler v. State, 324 Ark. 476, 922 S.W.2d 685, 689 (1996) (construing Ark.Code Ann. § 9-27-318(a) (Michie 1993) to hold that the state prosecutor had to file “theft charges” in juvenile court against a minor who was fifteen years old at the time that he committed offenses in violation of the Arkansas Criminal Code before the prosecutor could move to transfer the “charges” to circuit court); Eichelberger v. State, 323 Ark. 551, 916 S.W.2d 109, 110-12 (1996) (In holding that application of a newly-enacted, punitive law “increased the burden of the punishment” to juveniles and thereby violated the Ex Post Facto Clause because application of the newly-enacted law “makes more burdensome the punishment for a crime, after its commission,” the court impliedly recognized that two minors, who had been adjudged delinquent, had committed a crime, (emphasis in original)); Johnson v. State, 319 Ark. 3, 888 S.W.2d 661, 661 (1994) (“Appellant was adjudged a juvenile delinquent for committing the crimes of rape and robbery.”).
Given Allstate’s clear intention to exclude coverage for criminal acts, Bell cannot create an ambiguity merely by drawing a distinction based on the potential consequences that flow from Burrough’s conduct. Nearly every *840reported federal court decision interpreting Allstate’s criminal acts exclusion has also concluded that the criminal acts exclusion applies to minors. See Allstate Ins. Co. v. Green, 831 F.2d 145, 147 (6th Cir.1987) (“Under this language it is clear that if young Robertson[, a fourteen-year-old boy,] had raped the girl himself, his act would have been an intentional or criminal act of an insured person and there would have been no coverage for either of the Robertsons.”) (Michigan law); Allstate Ins. Co. v. Cutcher, 920 F.Supp. 796, 798-99 (N.D.Ohio 1996) (holding that, under Ohio law, criminal acts exclusion is applicable to a juvenile adjudged to be delinquent); Allstate Ins. Co. v. Dillard, 859 F.Supp. 1501, 1504 (M.D.Ga.1994) (holding that, under Georgia law, criminal acts exclusion applies to acts of a minor), aff'd, 70 F.3d 1285 (11th Cir.1995); Allstate Ins. Co. v. Carmer, 794 F.Supp. 871, 873 (S.D.Ind.1991) (holding that criminal acts exclusion applies to acts committed by a fourteen-year-old boy because those acts constitute a violation of the Indiana Criminal Code); but see Allstate Ins. Co. v. Lewis, 732 F.Supp. 1112, 1114-15 (D.Colo.1990) (holding that, under Colorado law, criminal acts exclusion does not apply to the acts of a minor).
Finally, it makes no difference whether Burrough was, or ever will be, adjudged a juvenile delinquent or criminally convicted. Under the terms of the criminal acts exclusion, coverage for bodily injury reasonably expected to result from a criminal act is excluded “regardless of whether or not such insured person is actually charged with, or convicted of a crime.” Policy, reprinted in Appellee’s App. at 7 (emphasis omitted). Thus, as long as Williams’s injury was the reasonably foreseeable result of Burrough’s criminal act, coverage is excluded regardless of whether the state of Arkansas ever takes action against Burrough.
B.
Bell also argues that a reasonable insured, in purchasing a homeowner’s insur-anee policy from Allstate, would not understand or realize that the criminal acts exclusion contained in that policy excluded coverage for the act of furnishing a handgun to a minor. Consequently, Bell argues that the criminal acts exclusion should be construed against Allstate. We disagree.
As a party to a contract governed by Arkansas law, a reasonable insured would understand that a criminal acts exclusion would exclude coverage for acts defined as criminal by the Arkansas Criminal Code. Under the Arkansas Criminal Code, moreover, a violation of § 5-73-109(a) is not such a minor offense that an insured could not reasonably understand that offense to be criminal. At the time Burrough gave the .22 caliber handgun to Hauser, a violation of § 5-73-109(a) was defined as a Class A misdemeanor, see Ark.Code Ann. § 5-73-109(b), punishable by up to one year in prison. Ark.Code Ann. § 5-4-401(b)(l) (Michie 1993).5 Although Burrough, as a minor, would not have faced the same sentence if he had been adjudged a delinquent, the juvenile court could at its discretion have committed him to a youth services center, see Ark.Code Ann. § 9-27-330(3) (Michie 1993), or placed him on probation. See Ark.Code Ann. § 9-27-330(4) (Mi-chie 1993).
Given the potential loss of liberty for furnishing a handgun to a minor, a reasonable insured would realize that such an act is a criminal act. Any other interpretation of the criminal acts exclusion by this Court would rewrite the clear terms of Allstate’s policy and force Allstate to bear a risk “which is plainly excluded and for which it was not paid.” Smith, 937 S.W.2d at 182 (quotations and citations omitted).
III.
Bell argues that Allstate did not meet its burden of proving as a matter of law that Burrough could have reasonably expected Williams’s injury to have resulted from his act of furnishing a handgun to Hauser. We disagree.
*841To determine whether Allstate met its burden, we must determine whether a reasonable person would find that Williams’s injuries were the natural, probable, and foreseeable consequence of Burrough’s actions. Cf. CNA Ins. Co. v. McGinnis, 282 Ark. 90, 666 S.W.2d 689, 690-91 (1984) (applying an objective standard in construing “an [insurance policy] exception excluding coverage for personal injury which is ‘expected or intended’ by the insured” to mean “the policy exception excludes coverage for injuries which the average run of reasonable people would expect or intend to inflict by engaging in the conduct in question”); Mahan v. Hall, 320 Ark. 473, 897 S.W.2d 571, 573 (1995) (applying objective definition of negligence); Bushong v. Garman Co., 311 Ark. 228, 843 S.W.2d 807, 812 (1992) (applying objective definition of unreasonably dangerous); Allstate Ins. Co. v. Brown, 16 F.3d 222, 225 (7th Cir.1994) (holding that, under Indiana law, an objective standard must be applied to interpret a criminal acts exclusion nearly identical to the criminal acts exclusion at issue in the present action and that “[t]he phrase [‘reasonably expected’] is meant to ensure that the policy’s exclusions apply only to those injuries most likely to result from the insured’s intentional or criminal conduct.”).
The undisputed material facts demonstrate that a reasonable person would have expected Williams’s injuries to result from the act of furnishing Hauser with a loaded .22 caliber handgun that had previously misfired. Based on past experience, Burrough knew that Hauser and Beck were likely to cruise up and down Grand avenue where teenagers hang out in the parking lots, drink beer, smoke marijuana, and get into fights. Furthermore, Burrough knew that, on at least one previous occasion, Burrough and his friends had been harassed by teenagers believed to be involved in gangs. Finally, Bur-rough knew that the gun had misfired on at least one previous occasion and that the gun was loaded when he handed it over to Hau-ser.
Given this knowledge, a reasonable insured would have expected that something would go awry after handing over a loaded, malfunctioning handgun to Hauser. A reasonable insured would find Williams’s injuries to be the natural, probable, and foreseeable consequence of furnishing Hauser with a loaded, malfunctioning handgun. We reach this conclusion, notwithstanding the fact that Beck, rather than Hauser, was the one who accidentally fired the gun. Regardless of which one of Burrough’s friends held the gun when it misfired, once Burrough handed over a loaded, malfunctioning gun to Hauser, Bur-rough should have reasonably expected that an incident like the one that took place would happen.
IV.
For the foregoing reasons, we affirm.

. The Honorable H. Franldin Waters, Chief Judge, United States District Court for the Western District of Arkansas.

. The district court found that Hauser "was approximately 16 at the time of the shooting," Allstate Ins. Co. v. Burrough, 914 F.Supp. 308, 310 (W.D.Ark.1996), but according to Hauser’s voluntary statement to the police given on October 23, 1993, he was fifteen years old at the time. See Jeremiah Hauser Voluntary Statement (Oct. 23, 1993) at 1, reprinted in Appellee’s App. at 30.

. Allstate has not argued that Williams’s injuries were the intended or expected result of an intentional act committed by Burrough.

. Currently, furnishing a handgun to a minor is classified as a Class B felony, see Ark.Code Ann. § 5-73-109(b)(1) & (9) (Michie 1993 & Supp. 1995). A person criminally convicted of such an offense faces a sentence of imprisonment of "not less than five (5) years nor more than twenty (20) years." Ark.Code Ann. § 5 'l 401(a)(3) (Michie 1993).