SAFECO INSURANCE COMPANY OF AMERICA, Plaintiff and Appellant, v. ROBERT S. et al., Defendants and Respondents.
In this declaratory relief action, plaintiff and appellant Safeco Insurance Company of America (“Safeco”) appeals from the summary judgment granted in favor of defendants and respondents, Robert S., Velvet S., Kelly S., and Christy Mitchell, as well as from the order denying Safeco's motion for summary judgment. Safeco argues that, as a matter of law, it has no duty to defend or indemnify Robert, Velvet, and Kelly in a wrongful death action brought by Christy and Timothy Mitchell arising out of an incident in which Kelly accidentally shot and killed their son, Christopher.1 Safeco asserts that the trial court erred in finding as a matter of law that the “illegal acts” exclusion in its homeowners policy was ambiguous, and should therefore be construed to provide coverage to Safeco's insureds, Robert, Velvet, and Kelly. We agree. We therefore reverse the summary judgment in favor of respondents and direct the trial court to enter judgment in favor of Safeco.
FACTUAL AND PROCEDURAL BACKGROUND
On March 10, 1995, 16-year-old Kelly and several of his friends went to Kelly's home. Kelly found his mother Velvet's .22 caliber Beretta handgun in the pocket of a coat in her closet. Kelly removed the clip from the handle of the gun and pulled the slide back, which caused the hammer to be cocked, believing that the gun would then be unloaded.2 Kelly held the gun straight out, pointing the gun over his friends' heads, and pulled the trigger. Christopher was struck by a bullet and killed.
A petition was filed in the juvenile court pursuant to Welfare and Institutions Code section 602.3 The petition alleged that in shooting and killing Christopher, Kelly had committed involuntary manslaughter. (Pen.Code, § 192, subd. (b).) 4 In September 1995, the juvenile court found Kelly to be a person described by Welfare and Institutions Code section 602, and sustained the petition as to the count for involuntary manslaughter, finding the offense to be a felony. Kelly was placed in the custody of the probation officer, and placed in his parents' home.
In July 1995, Christopher's parents, Timothy and Christy, filed a wrongful death lawsuit against Kelly and his parents, Robert and Velvet.
Safeco insured Robert under a homeowners insurance policy, under which Velvet and Kelly were also insured.5 Robert, Velvet, and Kelly (“the insureds”) tendered defense of the action to Safeco, which accepted defense of the action pursuant to a reservation of rights.
In November 1995, Safeco filed the declaratory relief action now before us, naming as defendants the insureds and Christopher's parents, and seeking a declaration that it had no duty to defend or indemnify the insureds in the wrongful death action.6
Safeco filed a motion for summary judgment in July 1996, contending that it had no duty to defend or indemnify the insureds because coverage is precluded by Civil Code section 1668 and the “illegal act” exclusion in the policy, the language of which is set forth below in the discussion section. After hearing, the trial court denied Safeco's motion for summary judgment. Safeco filed a petition for writ of mandate in this court, which was denied. Its petition for review to the Supreme Court was also denied.
In April 1997, Christy Mitchell filed a motion for summary judgment contending, as a matter of law, that Safeco had a duty to defend and indemnify the insureds in the underlying wrongful death action. Robert, Velvet, and Kelly joined in the motion. Safeco filed opposition to the motion. After hearing argument and taking the matter under submission, the trial court granted the motion by minute order of June 24, 1997. Judgment was entered on August 27, 1997, and this appeal followed.
The homeowners policy at issue contained the following coverage language for “personal liability”: “If a claim is made or a suit is brought against an insured for damages because of bodily injury or property damage caused by an occurrence to which this coverage applies, we will: [¶] 1. pay up to our limit of liability for the damages for which the insured is legally liable; and [¶] 2. provide a defense at our expense․”
Under a separate section entitled “exclusions,” the policy states that the personal liability coverage (and coverage for medical payments to others) do not apply to bodily injury “which is expected or intended by an insured or which is the foreseeable result of an act or omission intended by an insured.” The policy states an additional exclusion that the personal liability coverage does not apply to “Liability ․ arising out of any illegal act committed by or at the direction of an insured.”
The trial court granted summary judgment in favor of the respondents on the basis that “the ‘illegal acts' exclusion is ambiguous. The provision does not indicate as to whether it encompasses unintentional acts in addition to intentional acts. It is undisputed that Kelly S[.] did not intend to cause harm to Mitchell's son or that [Kelly] did not intend to commit an unlawful or ‘illegal’ act. As such, the court resolves the ambiguity in favor of coverage.” Appellant Safeco challenges the trial court's conclusion that the “illegal act” exclusion is ambiguous.
On a motion for summary judgment, a trial court must decide if a triable issue of fact exists. If none does, and the sole remaining issue is one of law, it is the duty of the trial court to determine the issue of law. On appeal, we conduct de novo review to determine whether there are any triable factual issues and whether the moving party is entitled to judgment as a matter of law. Because the interpretation of an insurance policy is a question of law, we must make an independent determination of the meaning of the language used in the contract under consideration. (Western Mutual Ins. Co. v. Yamamoto (1994) 29 Cal.App.4th 1474, 1481, 35 Cal.Rptr.2d 698.)
“Under statutory rules of contract interpretation, the mutual intention of the parties at the time the contract is formed governs interpretation. (Civ.Code, § 1636.) Such intent is to be inferred, if possible, solely from the written provisions of the contract. (Id., § 1639.) The ‘clear and explicit’ meaning of these provisions, interpreted in their ‘ordinary and popular sense,’ unless ‘used by the parties in a technical sense or a special meaning is given to them by usage’ (id., § 1644), controls judicial interpretation. (Id., § 1638.) Thus, if the meaning a layperson would ascribe to contract language is not ambiguous, we apply that meaning. (See, e.g., Reserve Insurance Co. v. Pisciotta (1982) 30 Cal.3d 800, 807, 180 Cal.Rptr. 628, 640 P.2d 764 ․; Crane v. State Farm Fire & Cas. Co. (1971) 5 Cal.3d 112, 115, 95 Cal.Rptr. 513, 485 P.2d 1129․)” (AIU Ins. Co. v. Superior Court (1990) 51 Cal.3d 807, 821-822, 274 Cal.Rptr. 820, 799 P.2d 1253.) “ ‘An insurance policy provision is ambiguous when it is capable of two or more constructions both of which are reasonable.’ ” (Bay Cities Paving & Grading, Inc. v. Lawyers' Mutual Ins. Co. (1993) 5 Cal.4th 854, 867, 21 Cal.Rptr.2d 691, 855 P.2d 1263, italics in original.)
“In order to conclude that an ambiguity exists which will be construed against an insurer, it is necessary first to determine whether the coverage under the policy, which would result from such a construction, is consistent with the insured's objectively reasonable expectations. (Cooper Companies v. Transcontinental Ins. Co. (1995) 31 Cal.App.4th 1094, 1106 [37 Cal.Rptr.2d 508]․) In order to do this, the disputed policy language must be examined in context with regard to its intended function in the policy. (Bank of the West v. Superior Court [ (1992) ] 2 Cal.4th , 1265 [10 Cal.Rptr.2d 538, 833 P.2d 545]․) This requires a consideration of the policy as a whole, the circumstances of the case in which the claim arises and ‘common sense.’ (Id. at p. 1276 [10 Cal.Rptr.2d 538, 833 P.2d 545]․)” (Nissel v. Certain Underwriters at Lloyd's of London (1998) 62 Cal.App.4th 1103, 1111-1112, 73 Cal.Rptr.2d 174, italics in original.)
We must determine what meaning a layperson would ascribe to the term “illegal act” in the context of the policy at issue and considering the circumstances of the case. Webster's Ninth New Collegiate Dictionary (1989) at page 599 defines “illegal” to mean “not according to or authorized by law: unlawful.” We find this definition to be accurately descriptive of the layperson's understanding of the word. Contrary to the trial court's assumption, the common definition of the term “illegal act” does not imply anything about the actor's state of mind. Therefore, we find that the term “illegal act” is not ambiguous and the exclusion to which it applies should not be construed adversely to Safeco.
Our conclusion is reinforced when one considers the policy exclusion for bodily injury “which is expected or intended by an insured or which is the foreseeable result of an act or omission intended by an insured.” The exclusion for “illegal acts” would be rendered superfluous and redundant if it was interpreted as excluding only intentional illegal acts, which would merely be a subset of those intentional acts already removed from coverage by the other exclusion.
We find that under the specific circumstances of this case, an insured could not objectively, reasonably expect coverage to be provided for involuntary manslaughter in the face of an exclusion for any illegal act committed by an insured. Kelly's conduct in shooting Christopher would be considered by the average layperson to be an “illegal act” although such conduct was a result of gross negligence rather than malicious intent. Manslaughter is commonly understood to be a violation of the penal law of this state, even as applied to minors through the juvenile court. No rational person aware of the “illegal act” exclusion could objectively expect coverage for the commission of this crime.
The parties argued at length regarding the collateral estoppel effect of the juvenile adjudication regarding Kelly. We do not find it necessary to discuss the issue of collateral estoppel. For purposes of the summary judgment motion brought by Safeco, respondents conceded that Kelly was found by the juvenile court to have violated Penal Code section 192, subdivision (b) when he shot and killed Christopher, which offense was found to be a felony. It makes no difference that Welfare and Institutions Code section 203 specifies that “[a]n order adjudging a minor to be a ward of the juvenile court shall not be deemed a conviction of a crime for any purpose, nor shall a proceeding in the juvenile court be deemed a criminal proceeding.” The exclusion here did not preclude coverage only for liability arising out of a criminal conviction or criminal act, but extended to all “illegal acts.”
We cannot agree with respondents' argument that “[i]f Safeco is permitted to insert an illegal acts liability exclusion into every insurance policy, liability coverage will cease to exist as a practical matter.” As examples, respondents state that normally coverage is not barred for automobile accidents involving a violation of the Vehicle Code, for premises liability actions involving a municipal building and safety code violation, or for dog bite cases involving negligence on the part of the owner. We note that generally under homeowners policies, including the one at issue here, coverage is excluded for injury or damage arising out of the use or ownership of motor vehicles. (See Croskey, Kaufman et al., Cal. Practice Guide: Insurance Litigation (The Rutter Group rev. # 1, 1997) § 7:2254 at p. 7I-20.) In any event, the law of this state provides for the imposition of civil remedies by which one is held responsible for injury occasioned to another by one's want of ordinary care, in the form of liability to compensate for such injury. But while failure to exercise ordinary care may result in the imposition of an obligation to provide compensation for any loss caused by one's negligence, such failure to exercise ordinary care is not “illegal.” (See Civ.Code, § 1714, subd. (a) which provides: “Every one is responsible, not only for the result of his willful acts, but also for an injury occasioned to another by his want of ordinary care or skill in the management of his property or person․ The extent of liability in such cases is defined by the Title on Compensatory Relief. [Civ.Code, § 3281 et seq.]” Civ.Code, § 3274 provides that “compensation is a relief or remedy provided by the law of this State for the violation of private rights, and the means of securing their observance.”) The specific act at issue in the present case, involuntary manslaughter, falls into an entirely different category, involving as it did gross negligence and the commission of a punishable, public offense.
Moreover, we emphasize that insurers have the right to limit policy coverage in plain and understandable language and can limit the character and extent of the risk assumed. (Shell Oil Co. v. Winterthur Swiss Ins. Co. (1993) 12 Cal.App.4th 715, 749, 15 Cal.Rptr.2d 815.) Insurers are not required by Insurance Code section 533,7 as argued by Robert and Kelly, to provide coverage for nonwillful acts. (Ibid. [“The second clause of section 533 simply excludes any form of negligence from the category of willful acts. [The insured] provides no authority for the argument that section 533 requires nonwillful acts to be covered and vitiates any contrary policy language.”] ) Insurers are free to limit the scope of coverage even under circumstances in which a reasonable insured would otherwise expect coverage, so long as they do so in a manner that is conspicuous, plain, and clear. (Gray v. Zurich Insurance Co. (1966) 65 Cal.2d 263, 271, 54 Cal.Rptr. 104, 419 P.2d 168.) Respondents do not argue that the exclusion was not conspicuous, plain, and clear.
We note that under the language of the policy at issue which excludes coverage for liability “arising out of any illegal act committed by or at the direction of an insured,” coverage is also precluded for innocent co-insureds such as Robert and Velvet, even though their liability is based on a theory of negligent supervision. (Italics added.) (Fire Ins. Exchange v. Altieri (1991) 235 Cal.App.3d 1352, 1360-1361, 1 Cal.Rptr.2d 360; Western Mutual Ins. Co. v. Yamamoto, supra, 29 Cal.App.4th at pp. 1486-1487, 35 Cal.Rptr.2d 698.)
Having concluded that the “illegal act” exclusion in Safeco's policy precludes coverage for the insureds in the Mitchell wrongful death action, we find it unnecessary to address Safeco's additional argument that coverage is precluded by Civil Code section 1668.
We find that, as a matter of law, Safeco has no duty to defend or indemnify its insureds in the Mitchell wrongful death action, and that Safeco is entitled to judgment in its favor. Accordingly, we find that the trial court erred in denying the motion for summary judgment brought by Safeco, which order is within our purview on appeal from the final judgment in favor of respondents. (See Aas v. Avemco Ins. Co. (1976) 55 Cal.App.3d 312, 323-324, 127 Cal.Rptr. 192; Code Civ. Proc., § 906.) The summary judgment entered in favor of respondents is reversed.
The summary judgment entered in favor of respondents is reversed, and the trial court is directed to enter judgment in favor of Safeco. Safeco is to recover its costs on appeal.
1. Timothy Mitchell apparently was not a party to the summary judgment motion brought by Christy Mitchell and the insureds. However, to the extent that he was a defendant in this declaratory relief action and was designated as such in Safeco's motion for summary judgment which is also now before us, we will consider him to be a respondent in the present appeal.
2. Kelly's father Robert had trained Kelly on the use of a 9 millimeter Beretta handgun; Kelly did not understand that the two guns differ in the way a round is removed from the chamber.
3. Welfare and Institutions Code section 602 provides: “Any person who is under the age of 18 years when he violates any law of this state or of the United States or any ordinance of any city or county of this state defining crime other than an ordinance establishing a curfew based solely on age, is within the jurisdiction of the juvenile court, which may adjudge such person to be a ward of the court.”
4. Penal Code section 192 provides that “[m]anslaughter is the unlawful killing of a human being without malice.” Subdivision (b) provides that involuntary manslaughter occurs “in the commission of an unlawful act, not amounting to felony; or in the commission of a lawful act which might produce death, in an unlawful manner, or without due caution and circumspection.”
5. The policy provided: “Insured” means you and the following residents of your household: [¶] a. your relatives; [¶] b. any other person under the age of 21 who is in the care of any person named above.”
6. Robert was appointed guardian ad litem for Kelly.
7. Insurance Code section 533 provides: “An insurer is not liable for a loss caused by the wilful act of the insured; but he is not exonerated by the negligence of the insured, or of the insured's agents or others.”
CHARLES S. VOGEL, P.J.
HASTINGS, J., and CURRY, J., concur.