Court Opinion

ID: 9723125
Source: CourtListenerOpinion
Date Created: 2023-08-26 10:03:04.142977+00
Date Added: 2024-06-11T18:24:44.939566
License: Public Domain

Archer, J.

(concurring in part and dissenting in part).

INTRODUCTION
I respectfully dissent from the lead opinion’s application in Metropolitan Property & Liability Ins Co v DiCicco, of an objective standard to an insurance exclusionary clause regarding coverage of an insured’s behavior which results in "bodily injury or property damage which is either expected or intended from the standpoint of the insured.” In Allstate Ins Co v Freeman, I concur with the conclusion of the lead opinion that the exclusionary clause at issue mandates the application of an objective standard of review, thus relieving the insurer of a duty to defend against Alonda Freeman’s actions. However, I dissent from its finding that the insurer does not have a duty to defend Marshall Freeman on the basis of a co-insured’s intentional acts. Accordingly, I would *722affirm the result of the Court of Appeals in Metropolitan Property & Liability Ins Co v DiCicco. I would also affirm the decision of the Court of Appeals in Allstate Ins Co v Freeman with regard to Alonda Freeman. However, I would reverse the decision of the Court of Appeals with regard to Marshall Freeman, and remand this portion of the case to the trial court for consideration on the separate question of the insurer’s liability for Marshall Freeman’s alleged negligence.
I. METROPOLITAN INSURANCE CO V DlCICCO
I accept the recitation in the lead opinion of the factual background giving rise to the instant case.
A
In Fresard v Michigan Millers Mutual Ins Co, 414 Mich 686, 693-695; 327 NW2d 286 (1982), this Court succinctly stated the oft-cited rules concerning the construction of insurance policy provisions:
This Court recently reiterated that "[a]ny clause in an insurance policy is valid as long as it is clear, unambiguous and not in contravention of public policy.” Raska v Farm Bureau Mutual Ins Co of Michigan, 412 Mich 355, 361-362; 314 NW2d 440 (1982). The Raska majority noted that the only pertinent question was "whether the exclusionary clause in this contract is ambiguous, for if it is not ambiguous we are constrained to enforce it.”
When examining the language of this or any other insurance policy, we are mindful of several other principles of construction so rudimentary as to be axiomatic:
The contract should be viewed as a whole.
The intent of the parties should be given effect.
*723An interpretation of the contract which would render it unreasonable should be avoided.
Meaning should be given to all terms.
Ambiguities should not be forced.
Conflicts among clauses should be harmonized.
The contract should be viewed from the standpoint of the insured.
The insurer should bear the burden of proving an absence of coverage.
The use of standard policies presents a unique situation in which the precise language we are asked to analyze already has been interpreted by courts in other jurisdictions. The existence of so many opinions is both an advantage and a disadvantage. The benefit, of course, is the insight provided by learned jurists in other states and in the federal courts. The danger is that weight unfairly may be accorded a view merely because it has withstood attack for a period of time or because it is embraced by the majority of jurisdictions.
Mindful of these rules of construction, we turn first to the development of the exclusionary clause itself.
The insurance industry has employed standardized general liability insurance policies for over four decades.1 Fresard, supra at 691. The instant exclusionary clause is the product of sweeping *724revisions in standardized general liability policies undertaken in 1966. Upon examination of commentary issued contemporaneously with its introduction, it is clear the provision was primarily designed to resolve the controversy concerning the requirement under then-prevalent general liability insurance policies, that bodily injury or property damage be caused "by accident.”2 However, the term "accident” was rarely defined by the policy, thus producing contradictory constructions in the instances of an insured’s alleged intentional behavior. As a result, the courts focused alternatively on an accident’s presence either from the standpoint of the victim, in furtherance of a public policy not to reward an insured for intentional tortious actions, or from the standpoint of the insured party, in order not to penalize the injured party and effectuate the remedial purposes of insurance coverage.
In response to the judicial impasse concerning the construction of the term "accident,” the 1966 drafters premised an insurer’s duty to defend and to provide coverage upon the more expansive concept of an "occurrence” which, as correctly noted by the majority, is inclusive not only of the commonly understood meaning of "accident,” but also of intentional actions.3 However, the drafters also provided that the physical injury or property loss *725must neither be expected nor intended from the standpoint of the insured. While this language answered the question of the perspective from which an occurrence was to be considered, the inclusion of the terms "expected” and "from the standpoint of the insured” within the exclusionary provision left unresolved the two issues before us today.4 First, whether the construction of pre-1966 insurance exclusionary clause language is applicable to the instant provision. Second, whether examination of the instant clause entails an objective or subjective standard of review.5
B
I concur that an insurer’s duty to defend is triggered by the determination of whether an occurrence is in fact present. The concept of an occurrence is appropriately broadly construed, and I accept that in the instant case an occurrence is in fact present for purposes of Metropolitan’s insurance policy. However, while I also find that the *726instant exclusionary clause is unambiguous as a matter of law, I disagree as to the conclusions to be drawn from its nonambiguity:6
The word "occurrence” instead of the word "accident” in the insuring clause means that the word "occurrence” is in fact broader than the word "accident” and is so intended by the insurer. In such case, the intent of the policy is to insure the acts or omissions of the insured, including his intentional acts, excluding only those in which the resulting injury is either expected or intended from the insured’s standpoint.
It is clear therefore, that the insured here would be debarred from coverage in those cases where his deliberate acts or assaults resulted in injuries which would be expected or intended by him to result from his deliberate acts. But what about coverage where the results of his acts (even though deliberate) are unexpected or not intended by the insured? The answer under which a policy provision is that (1) the event is an occurrence; (2) since it results in bodily injury it is an accident under the definition of the policy, and (3) since it is unintended or unexpected, it is within the coverage of the policy.
Such a construction of the insurance policy is not strained or forced, but rather is an interpretation of the plain, ordinary and popular meaning of *727the words used by the insurer in defining the coverage extended. It should be interpreted in that sense. . . . We do not consider this provision to be ambiguous; the possibility of unintended bodily injury brings that result within the policy coverage .... [Northwestern Nat'l Casualty v Phalen, 182 Mont 448, 455-456; 597 P2d 720 (1979). Emphasis added.]
As noted in the lead opinion, prior to the introduction of the 1966 revisions, this Court required under language involving injury or property loss incurred "by or at the direction of the insured,” a showing both of subjective intention to commit the act in question and a comparable state of mind to the harm inflicted. Clearly, this requirement becomes unnecessary under the standard espoused in the lead opinion which is satisfied where the bodily or property damage injury need only reach a threshold of natural and foreseeable consequence.7 However, I must dissent from the interjection in the lead opinion of an objective standard of reason-*728ability in the absence of clear language so dictating. See, e.g., Health Care & Retirement Corp v St Paul Fire & Marine Ins Co, 621 F Supp 155, 161 (W Va, 1985):
[T]he majority rule with respect to intentional injury exclusions is that the exclusion applies if the insured intended to do a particular act, and intended to do some harm, even if the harm actually done was radically different from the harm intended. Yet, on the other hand, an intentional injury exclusion will not apply if the insured intentionally does an act, but has no intent to commit harm, even if the act involves the foreseeable consequences of great harm or even amounts to gross or culpable negligence. . . . Without such a distinction, the policy language referring to "the standpoint of the insured” is rendered meaningless. [Emphasis added.]
Further, while I agree with the observations in the lead opinion that the terms "intended” and "expected” are not synonymous, this does not logically mandate an objective standard of review8
to the extent that "expected” may be defined in terms of anticipation and that a lesser degree of proof may be required to establish expectation than to establish intent. However, we reject the view that expectation is to be judged on an objective standard. The word "reasonable” is not employed in the exclusion in question, and we reject [the insurance company’s] plea that we read in a reasonableness standard. It was [the insurance company] which drafted the policy and if it wanted *729an objective standard to apply, it could have drafted its policy accordingly.[9] [Aetna Casualty & Surety Co v Dichtl, 78 Ill App 3d 970, 977; 398 NE2d 582 (1979).]
As the lead opinion argues against rendering the term "expected” superfluous by equating it with the term "intended,” I similarly find that the application of an objective standard of review places this Court in the position of redacting the phrase "from the standpoint of the insured” from the instant exclusionary clause. This Court is bound by the language of the exclusionary clause and should be reticent to introduce concepts of foreseeability, more appropriate in the arena of tort actions than in the realm of insurance.
I would also note that the lead opinion cites a number of decisions by the Court of Appeals, in addition to decisions from other jurisdictions, which have found it unnecessary in certain factual situations to engage in a subjective analysis and have inferred either an intent or expectation to injure as a matter of law. However, I disagree that the import of these decisions constitutes an engagement in theoretical exercise seeking to avoid a determination of an insured’s subjective intentions.10 Upon examination of these decisions, I observe that within the areas of child molestation and certain violent assaultive actions, because of the nature of the act itself, a number of , courts *730have found that the insured fell within the instant exclusionary clause as it was nearly impossible, even under a subjective standard, to find that the party could not have either intended or expected the harm which had been inflicted. However, while there are limited factual scenarios which may arguably lend themselves to such a determination, this does not erase the clear language of the exclusionary clause or the remaining multitude of instances in which a determination of the insured’s subjective state of mind is necessary. Further, the lead opinion fails to cite any authority that these decisions are indicative of an unworkable subjective standard, or that its approach is an exception which threatens to engulf the rule.
Accordingly, in the absence of explicit policy language to the contrary, I would hold that the appropriate standard of review to construe the instant exclusionary clause must be subjective:
[W]e decide that the "exclusion” from the foundational personal liability coverage afforded Dodge by his policy, as the exclusion is stated in the language "bodily injury . . . which is either expected or intended from the standpoint of the Insured,” refers only to bodily injury that the insured in fact subjectively wanted ("intended”) to be a result of his conduct or in fact subjectively foresaw as practically certain ("expected”) to be a result of his conduct. [Patrons-Oxford Mutual Ins Co v Dodge, 426 A2d 888, 892 (Me, 1981).]
See also Northwestern Nat'l Casualty, supra; Alabama Farm Bureau Ins v Dyer, 454 So 2d 921 (1984); Health Care & Retirement Corp v St Paul Fire & Marine Ins Co, supra; Vanguard Ins Co v Cantrell, 18 Ariz App 486; 503 P2d 962 (1972); MacKinnon v Hanover Ins Co, 124 NH 456; 471 A2d 1166 (1984); Rodriquez v Williams, 107 Wash *7312d 381; 729 P2d 627 (1986). Thus, the finder of fact may exclude coverage either for actions in which the insured subjectively expected injury or loss or where the loss is the consequence of the insured’s subjective intention both to the act itself and the resultant harm.11
c
I concur with the statement in the lead opinion of the appropriate standard of review by this Court of the trial court’s grant of declaratory judgment in favor of the insurer.12 Upon review of the lower court record, it is clear the trial court applied an objective standard of review to the instant exclusionary clause:
There appears to be a conflict [by panels of the Court of Appeals] whether there need be a specific showing of intent to injure regardless of which type of contract language is used.[13] Faced with the choice of this conflict, this Court prefers the reasoning of Frankenmuth Mutual Ins Co v Kompus [135 Mich App 667; 354 NW2d 303 (1984)], and its progeny. The apparent intent of the policy language excluding coverage for intended or expected injury is to avoid the subjective analysis inherent in the question whether there was an actual intent to injure.
*732As the trial court below explicitly eschewed the application of a subjective standard of review, I would hold that the trial court must apply the standard espoused within this opinion. If there is a question of fact as to the intention or expectation on the part of the insured from a subjective standpoint, a grant either of a directed verdict or summary disposition is clearly incorrect. Accordingly, I would affirm the result reached by the Court of Appeals and would remand the case to the trial court for reconsideration not inconsistent with this opinion.
II. ALLSTATE INS CO V FREEMAN
A
I concur with the result reached in part iii(b) of the lead opinion that the insurer had no duty to defend Alonda Freeman. In contrast to the exclusionary clause at issue in Metropolitan Ins Co v DiCicco, the instant exclusionary clause contains explicit language relating to the relevance of the reasonableness of the insured’s actions and clearly dictates an application of an objective standard of review.14
B
However, I respectfully dissent from the conclusion in the lead opinion that Allstate had no duty to defend Marshall Freeman.
Initially, with regard to the analysis of the lead opinion in examining the underlying cause of action as determinative of the instant coinsured’s entitlement to coverage, I disagree with the depiction of a cause of action of negligent entrust*733ment constituting a derivative action. It is well settled that a cause of action for negligent entrustment is a separate cause of action in negligence for the defendant’s failure to prevent dangerous instrumentalities from falling under the control of persons incapable of proper usage.15 See 2 Restatement Torts, 2d, § 390, pp 314-318, and Prosser & Keeton, Torts (5th ed), § 33, pp 197-203.
However, irrespective of the action alleged against Marshall Freeman, the question here turns upon whether the instant exclusionary clause’s reference to the acts of "an insured person” is clearly understandable and not subject to reasonable variances in interpretation so that a lay insured would equate the term "an” with "any” and would conclude that the acts of any person insured under the policy would serve to relieve the insurer from a duty to defend all the remaining insured individuals. Although I concur with the observation that this Court, in an examination of an insurance provision, should decline to create an ambiguity where none exists, unlike the lead opinion, I do not find that the provision is unambiguous as a matter of law and decline to *734adopt its conclusion that "an insured” unambiguously means that coverage was excluded for damages caused by the intentional wrongful act of any insured (either Alonda or Marshall).16
The lead opinion adopts the result found in Allstate Ins Co v Gilbert, 852 F2d 449 (CA 9, 1988), in support of its construction of the instant exclusionary clause. Gilbert, in turn, relied on Allstate Ins Co v Condon, 198 Cal App 3d 148, 153; 243 Cal Rptr 623 (1988), in determining that "an insured” refers to all insureds under the policy. The Condon court held:
"A person insured” logically refers to any one of all the persons insured under the policy [as distinguished from "the insured” which refers only to a particular insured.] [Id.]
However, one year prior to the Gilbert decision, in American States Ins Co v Borbor, 826 F2d 888, 894 (CA 9, 1987), Judge Thompson, who wrote Gilbert, stated that "[h]ad American States intended that the wrongful act of any insured would void the policy, it could have unambiguously *735drafted and included such language in the contract.” The result was that an innocent spouse was not excluded because of the intentional wrongdoing of her husband. The court reasoned that no uncertainty or ambiguity would have existed if the policy exclusion would have referred to "any insured” rather than "an insured.” Accordingly, the provision was construed in favor of the insured.17
One year later in Condon, the California Supreme Court drew support from the California Insurance Code, § 11580 (West Supp, 1988), which codified the definition of "an insured” as meaning "any insured,” in an attempt to construe the import of these modifiers.
Insurance Code section 11580.1, subdivision (c)(8) provides another analogous definition. The section reads, in pertinent part:
"The term 'the insured’ as used in paragraphs (1), (2), (3), and (4) shall mean only that insured under the policy against whom the particular claim is made or suit brought. The term 'an insured’ as used in paragraphs (5) and (6) shall mean any insured under the policy . . . .” Thus, "an insured” is defined as referring to all insureds under the policy, contrasted to one insured person when identified as "the insured.”
It is true the Allstate policy herein refers to "a person insured.” "A” and "an” are analogous modifiers; one or the other is used dependent upon whether the word it modifies begins with a consonant or a vowel sound. Words beginning with consonant sounds are properly modified by "a.” "An” is used to precede words beginning with vowel sounds. If Allstate had used the term "an person insured,” the policy provision would have *736been grammatically incorrect. Because proper grammar necessitated this deviation from the precise statutory language, for purposes of section 11580.1, subdivision (c), "a person insured” is the functional analog of "an insured person.” The Insurance Code thus defines "a person insured” as "any person insured under the policy.” [Condon, supra at 153-154.]
I find it instructive that the decision primarily relied upon by the lead opinion found it necessary to draw from an opinion which sought guidance from a comparable statutory provision in order to construe what is today characterized as unambiguous language. Accordingly, I would adhere to the admonition of the Borbor court that an insurer may void a policy by using appropriate language, i.e., "any insured,” in its policy exclusion. 826 F2d 894. If Allstate had meant "any,” it should have said "any,” not "an.” Rather than engage in an exercise in semantics, I find that "an” is not synonymous with "any,” and conclude that "an insured” should apply to Alonda Freeman alone. Thus, Marshall Freeman should not have been excluded under the terms of the policy’s exclusionary clause.
CONCLUSION
Accordingly, in Metropolitan Ins Co v DiCicco, I would affirm the result of the Court of Appeals, and would remand the case to the trial court for consideration of the action alleged against DiCicco pursuant to the subjective standard of review announced in this opinion. In Allstate Ins Co v Freeman, I would affirm the decision of the Court of Appeals denying coverage with regard to Alonda Freeman on the basis of an objective standard of review. However, I would reverse the *737decision of the Court of Appeals with regard to Marshall Freeman and remand the case to the trial court for consideration of the negligence action against him.

 See also Wendorff, The new standard comprehensive general liability insurance policy, ABA Section on Ins, Neg, & Comp Law (1966 Proceedings), pp 250-251.
The National Bureau of Casualty Underwriters, a rating organization composed of stock insurance companies, and the Mutual Insurance Rating Bureau, a rating organization composed of mutual insurance companies, have developed through the joint efforts and co-operation of their Underwriting and Policy Forms Committees so-called “standard” general liability and automobile policies which their member companies are required to use. These policies are not "standard” from the standpoint of being a statutory policy, such as the fire policies. Insurance companies which are not members of either of these rating organizations may, of course, prepare their own policy *724forms. However, the "standard” policies which have been promulgated by the two rating organizations under their National Standard Policy Provisions Program have become a standard of comparison for other "nonstandard” policies. . . . [M]any of the nonbureau or independent insurers use the "standard” general liability and automobile policies with little or no variation.

 See WendorfF, n 1 supra; Tarpey, The new comprehensive policy: Some of the changes, 33 Ins Coun J 223, 224 (1966); Obrist, New comprehensive general liability insurance policy, pp 6-7 (Defense Research Institute, 1966).

 See ante, pp 668-672.

 See Even, The corporate insurance administrator—problems with the 1966 revised liability policy, 3 Forum 95 (1968), for an overall criticism of the 1966 standardized revisions.

 See Iowa Kemper Ins Co v Kasper, 419 Mich 924, 926; 355 NW2d 109 (1984) (Levin, J.):
This Court has held . . . that a clause excluding coverage for injury "caused intentionally by or at the direction of the insured” does not exclude coverage for intentional acts with unintended results.
The instant exclusionary clause pertains to injuries that were "expected,” as well as those "intended.” The question is whether this change in language justifies a departure from this Court’s earlier construction. . . .
While an objective standard may be appropriate for tort liability, it is not necessarily appropriate when construing or applying an insurance policy. In this context, the expectations and intentions of a reasonable person may not be material; arguably only the actual subjective expectations and intentions of the insured should be considered.

 I note that at least one jurisdiction has criticized the finding of an insurance provision’s ambiguity as result orientated. See Transamerica Ins Group v Meere, 143 Ariz 351, 355; 694 P2d 181 (1984):
Of course, a finding of ambiguity is the easy way out since it permits the court to create its own version of the contract and. to find, or fail to find, ambiguity in order to justify an almost predetermined result. This is an approach which we have abandoned. See Darner Motor Sales v Universal Underwriters Ins Co, 140 Ariz 383; 682 P2d 388 (1984). We believe the proper methodology is to determine the meaning of the clause—where it is susceptible to different constructions—by examining the purpose of the exclusion in question, the public policy considerations involved and the transaction as a whole.

 The use of the "natural and foreseeable” approach was also used in pre-1966 judicial decisions attempting to define parameters for the term “accident.” See Even, n 4 supra at 101:
There is a definite split of authority, however, as to what acts of negligence result in liability covered by the terms of such a policy. Some courts have held that such policies do not cover liability for the natural and probable consequences of negligence of the insured or his agent. These courts reason that since everyone is responsible for the natural and probable consequences of his acts, injury and damage which is the natural and probable consequences of the negligence is itself not caused by accident. These courts conclude negligence-caused injury or damage is not caused by accident unless an unprecedented or unforeseeable event is an immediate or concurrent cause of the loss so that the loss is not the natural and probable consequence of the negligent act. The difficulty with this interpretation is that it so greatly restricts the insurer’s liability as to render the policy valueless, and even meaningless; and denies coverage for what is the predicate of any likely liability against the insured.

 See ante, pp 676-678. I would further suggest that while the terms are not synonymous, I cannot accept the position that the inclusion of this term in conjunction with the remainder of the exclusion speaking to the insured’s standpoint, has so enlarged the scope of the exclusion so as to merit the encroachment of a tort-like standard in the context of insurance. Accord Patrons-Oxford Mutual Ins Co v Dodge, 426 A2d 888 (Me, 1981); State Farm Fire & Casualty Co v Muth, 190 Neb 272; 207 NW2d 364 (1973).

 I acknowledge that ratification of a uniform insurance policy provision is a time-consuming process as evidenced by the only four major revisions undertaken in standardized policies since 1940. See Fresard, supra at 691. However, it is obvious the industry is capable of drafting such language as evidenced by the provision considered in Allstate Ins Co v Freeman.

 The advocation of a subjective standard does not necessarily imply the adoption of an inference of an insured’s intent as a matter of law. See MacKinnon v Hanover Ins Co, 124 NH 456, 460-461; 471 A2d 1166 (1984), for an example of a jurisdiction applying a subjective standard of review, yet rejecting an inference of intent or expectation as a matter of law.

 I wish to make it clear that the insured need not intend the actual bodily injury inflicted in order to fall within the instant exclusionary clause. It is sufficient that the factfinder conclude the insured subjectively expected some type of harm reasonably foreseeable from the insured’s standpoint. Accordingly, I would reverse the Court of Appeals remand to the trial court on the question whether DiCicco intended to stab Gravenmier.

 I note that in the instant case, both parties had stipulated to the determination of the case in this nonjury trial solely on the basis of the information contained within the deposition obtained prior to trial.

 The language referred to by the trial court includes that at issue in the instant case and policy exclusions which relieves an insurer for injury "caused by or at the direction of the insured.”

 See text ante, p 685.

 The lead opinion cites the decision of the Court of Appeals in Michigan Mutual Ins Co v Sunstrum, 111 Mich App 98; 315 NW2d 154 (1981), in support of the idea that the cause of injury is controlling in the determination of spousal coverage under homeowners insurance.
In Sunstrum, the Court of Appeals denied coverage to a father where it was alleged that he had negligently entrusted his truck to his son. However, the Court held that the clear language of the exclusionary clause disavowed coverage where an accident occurred away from the homeowner’s premises and resulted from the use or operation of a motor vehicle. Unlike the case at bar, the policy in this case prevented coverage for bodily injury arising out of the use, etc., of " 'any motor vehicle owned or operated by, or rented or loaned to, any Insured.”’ Id. at 101. These words are unambiguous. "Any insured” obviously means each insured operating a motor vehicle. Therefore, I find Sunstrum to be distinguishable and not supportive with respect to the majority’s interpretation of the exclusionary clause in the present case.

 See 2 Couch, Insurance, § 15:84, pp 416-419:
The test to be applied by the court in determining whether there is ambiguity is not what the insurer intended its words to mean, but what a reasonably prudent person applying for insurance would have understood them to mean. The criterion is ambiguity from the standpoint of a layman, not from that of a lawyer.
The fact that courts of the several jurisdictions have arrived at different constructions as to the meaning of the words in a provision or exclusion of a policy, and even in some instances have taken almost opposite views, is some indication that the terms are ambiguous.
However, aside from the question of ambiguity, I would reject, in the absence of clear language to the contrary, holding an individual coinsured liable for another’s independent intentional acts.

 It should he noted that the exclusionary clause in Borbor referred to the actions of "the insured.” 826 F2d 890. We note also that the lead opinion similarly finds persuasive decisions discussing the distinctions between "the insured” versus "a” or "an” insured. See lead opinion ante, p 693, n 27.