Court Opinion

ID: 5488107
Source: CourtListenerOpinion
Date Created: 2022-01-10 02:19:55.350271+00
Date Added: 2024-06-11T08:33:42.483484
License: Public Domain

Smith, J. (concurring).
I concur in the result, and join section III of the plurality opinion. I think, generally for the reasons explained in Judge Graffeo’s opinion, that there was only one occurrence here, not several. But because that occurrence took place continuously over several years, the resulting injury must be allocated on a pro rata basis to each of the years, and one retention applied to each year’s injury.
I am not sure why the plurality reaches the allocation issue. On the plurality’s multiple-occurrence hypothesis, there is no possible allocation that can help plaintiff in this case. If each act of abuse was a separate occurrence, “allocation” is a factual question: how much injury is attributable to each act? I see no possible argument for allocating all the loss to one year, as plaintiff asks, if there were as many occurrences as there were acts of abuse.
On the other hand, on the hypothesis, which I believe correct, that there was a single occurrence extending over a multi-year period, allocation of the loss resulting from the occurrence presents a question of law—one that the plurality decides correctly. Under our decision in Consolidated Edison Co. of N.Y. v Allstate Ins. Co. (98 NY2d 208, 221-225 [2002]), when injury from a single covered accident or occurrence is incurred over a period to which several policies are successively applicable, each policy can be charged only with the portion of the injury that was suffered while that policy was in force. The retention in each policy should be applied against the injury allocated to it.
This reasoning leads to the same result reached in two federal cases involving coverage of claims for alleged sexual abuse by priests, Interstate Fire & Cas. Co. v Archdiocese of Portland in Or. (35 F3d 1325 [9th Cir 1994]) and Society of R.C. Church of Diocese of Lafayette & Lake Charles, Inc. v Interstate Fire & Cas. Co. (26 F3d 1359, 1361-1367 [5th Cir 1994]). Both the *156plurality and Judge Graffeo, I believe, err in their discussions of the Archdiocese of Portland case. The plurality mistakenly thinks that case supports a multiple-occurrence theory here (plurality op at 152-153 n 5). Judge Graffeo correctly says that it supports a single-occurrence theory, but argues that it is distinguishable from the present case on the allocation issue (concurring and dissenting op at 162-163).
I see no critical distinction. I admit there is a difference: in Archdiocese of Portland, as in Society of R.C. Church, the court read the policy language to mean that a priest’s acts of abuse, though constituting only one “occurrence” in any year, became a new “occurrence” when a new policy year began. I read the Consolidated Edison case to imply, and I would hold here, that under the policies now before us a new retention applies to the “injury” suffered each year. But the difference between “occurrence” and “injury” is inconsequential because, in sexual abuse cases, the abuse and the resulting injury are simultaneous. Thus whether it is the “occurrence” or the “injury” that is spread pro rata among policies will not alter the result in any case involving multi-year sexual abuse.
Judge Graffeo argues that, because the retentions in our case are identified as “per occurrence” retentions, only one retention can be credited against a multi-year occurrence, even though the injury is allocated pro rata over several years. But the better reading of the policies is that, even when an occurrence continues from year to year, a new retention becomes available each year. This would be obvious if different insurers issued identical policies in successive years; it would be wrong to let one insurer and not the others get the benefit of a retention. The happenstance that successive policies are issued by a single insurer should not change the outcome.
Though I reach the same result as the plurality here, my difference with both the plurality and Judge Graffeo would be significant in other cases. To clarify the point, imagine a case where a priest committed 20 acts of abuse of one victim over five years, and five one-year policies were successively in force, each with a self-insured retention. How many retentions are to be applied? The plurality’s logic gives the answer 20. Judge Graffeo would say one. The Ninth and Fifth Circuits would say five, and I think they are correct.