MAINE SUPREME JUDICIAL COURT Reporter of Decisions Decision: 2016 ME 181 Docket: And-16-76 Argued: November 9, 2016 Decided: December 20, 2016
Panel: SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, JABAR, HJELM, and HUMPHREY, JJ.
BARNIE’S BAR & GRILL, INC.
v.
UNITED STATES LIABILITY INSURANCE COMPANY
GORMAN, J.
[¶1] Barnie’s Bar & Grill, Inc., appeals from the entry of a summary
judgment in the Superior Court (Androscoggin County, MG Kennedy, J.) in
favor of United States Liability Insurance Company (“USLIC”) on a complaint
by Barnie’s Bar seeking declaratory relief and damages for a breach of
contract. The Superior Court concluded that USLIC had no duty to defend
Barnie’s Bar in an underlying negligence action because policy exclusions for
assault and battery applied. We affirm the judgment.
I. BACKGROUND
[¶2] The facts in this case are undisputed. On July 14, 2014, Maurice
Beaulieu filed a civil lawsuit in the Superior Court seeking compensatory
damages, interest, and costs from Barnie’s Bar in Lewiston for its alleged 2
negligence. In his complaint, Beaulieu alleged that he “was violently attacked
by a group of [other] patrons” while he “was a customer, licensee and invitee”
at the bar. He asserted that Barnie’s Bar was liable for the attack for two
reasons. First, Beaulieu contended that, although Barnie’s Bar “had general
and specific notice of the risk that an assault was imminent,” Barnie’s Bar
breached its duty of care to prevent or interfere with the assault by “failing to
summons law enforcement and otherwise failing to interfere with the assault
and battery.” Second, Beaulieu claimed that Barnie’s Bar breached its duty of
care “not to create a dangerous circumstance on its premises” by
“affirmatively ejecting” him and his assailants into the parking lot at the same
time.
[¶3] At all relevant times, Barnie’s Bar held an insurance policy from
USLIC that included both commercial general liability and liquor liability
coverage. Both coverage portions, however, contained comprehensive
exclusions for assault and battery. The commercial general liability coverage,
in relevant part, excluded
Any claim, demand or “suit” based upon any actual or alleged “assault” or “battery”, or out of any act or omission in connection with the prevention or suppression of any “assault” or “battery” . . . whether caused by or at the instigation or direction of an insured, its “employees”, agents, officers or directors, patrons or any other person. Further, no coverage is provided for any claim, 3
demand or “suit” in which the underlying operative facts constitute “assault” or “battery”.
This exclusion applies to all “bodily injury”, “property damage” or “personal and advertising injury” sustained by any person, including emotional distress and mental anguish, arising out of, directly or indirectly resulting from, in consequence of, or in any way involving “assault” or “battery” whether alleged, threatened or actual including but not limited to “assault” or “battery” arising out of or caused in whole or in part by negligence or other wrongdoing with respect to:
. . . .
b. investigation or reporting any “assault” or “battery” to the proper authorities; or
c. the failure to so report or the failure to protect any person while that person was in the care, custody or control of the insured, its “employees”, agents, officers or directors;
The assault and battery exclusion in the liquor liability portion of the policy
was similarly comprehensive.
[¶4] After Barnie’s Bar requested that USLIC defend it in the Beaulieu
litigation, the insurer declined to defend the bar relying on the policy’s
exclusions for assault and battery. Barnie’s Bar then sued USLIC in Superior
Court, seeking a declaratory judgment that USLIC had a duty to defend it in the
Beaulieu litigation and seeking damages for a breach of contract. Barnie’s Bar
and USLIC filed cross-motions for summary judgment on a joint stipulated 4
record. See M.R. Civ. P. 56. Concluding that USLIC had no contractual duty to
defend Barnie’s Bar, the court granted USLIC’s motion and denied Barnie’s
Bar’s motion for summary judgment. Barnie’s Bar appealed.
II. DISCUSSION
[¶5] We review a ruling on a motion for summary judgment de novo
and analyze an insurer’s duty to defend as a question of law. Mitchell v.
Allstate Ins. Co., 2011 ME 133, ¶ 8, 36 A.3d 876. Because there is no dispute of
material fact in this case, we need address only whether USLIC had a duty to
defend Barnie’s Bar in the Beaulieu litigation as a matter of law.
A. The Duty to Defend
[¶6] To determine whether an insurer is contractually obligated to
defend an insured in an underlying lawsuit, we have long employed the aptly
named “comparison test,” in which we compare the allegations in the
underlying complaint with the terms of the applicable insurance policy to
determine whether the complaint falls within the policy’s coverage.
Id. ¶¶ 9-10. We have consistently applied a broad construction of the
underlying complaint in favor of the insured and a strict construction of policy
exclusions and ambiguities against the insurer. See id. ¶ 11; Elliott v.
Hanover Ins. Co., 1998 ME 138, ¶ 7, 711 A.2d 1310; Union Mut. Fire Ins. Co. v. 5
Commercial Union Ins. Co., 521 A.2d 308, 311 (Me. 1987). Our body of case
law should not, however, be misread as obliging courts to conjure the duty to
defend from speculation or supposition. See York Golf & Tennis Club v.
Tudor Ins. Co., 2004 ME 52, ¶ 8, 845 A.2d 1173 (“[In determining the duty to
defend,] we do not speculate about causes of action that were not stated.”);
see also 14 Lee R. Russ & Thomas F. Segalla, Couch on Insurance § 200:19 at
200-33 (3d ed. 2005) (stating that the duty to defend “cannot be triggered by
mere speculation that additional facts or causes of action will be developed at
a later time”). Although the duty to defend is broad, “[a]n insurer may
properly refuse to defend a policyholder if the allegations of the complaint fall
entirely within a policy exclusion.” Mitchell, 2011 ME 133, ¶ 13, 36 A.3d 876.
[¶7] In applying the comparison test, we examine the underlying
complaint for any potential factual or legal basis that may obligate the insurer
to defend the insured, id. ¶ 10, even the mere “intent to state a claim within
the insurance coverage,” Lavoie v. Dorchester Mut. Fire Ins. Co., 560 A.2d 570,
571 (Me. 1989). We confine this examination to the language of the
underlying complaint. Mitchell, 2011 ME 133, ¶ 9, 36 A.3d 876; Hardenbergh
v. Patrons Oxford Ins. Co., 2013 ME 68, ¶ 13, 70 A.3d 1237 (“[T]he duty to
defend arises exclusively from the allegations in the complaint and the 6
language of the policy.”). Except in rare circumstances, see State Mut. Ins. Co. v.
Bragg, 589 A.2d 35, 37 (Me. 1991), we will not consider facts extrinsic to the
underlying complaint nor will we read allegations into the complaint in
determining whether the insurer has a duty to defend, see York Ins. Grp. of Me.
Free access — add to your briefcase to read the full text and ask questions with AI
MAINE SUPREME JUDICIAL COURT Reporter of Decisions Decision: 2016 ME 181 Docket: And-16-76 Argued: November 9, 2016 Decided: December 20, 2016
Panel: SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, JABAR, HJELM, and HUMPHREY, JJ.
BARNIE’S BAR & GRILL, INC.
v.
UNITED STATES LIABILITY INSURANCE COMPANY
GORMAN, J.
[¶1] Barnie’s Bar & Grill, Inc., appeals from the entry of a summary
judgment in the Superior Court (Androscoggin County, MG Kennedy, J.) in
favor of United States Liability Insurance Company (“USLIC”) on a complaint
by Barnie’s Bar seeking declaratory relief and damages for a breach of
contract. The Superior Court concluded that USLIC had no duty to defend
Barnie’s Bar in an underlying negligence action because policy exclusions for
assault and battery applied. We affirm the judgment.
I. BACKGROUND
[¶2] The facts in this case are undisputed. On July 14, 2014, Maurice
Beaulieu filed a civil lawsuit in the Superior Court seeking compensatory
damages, interest, and costs from Barnie’s Bar in Lewiston for its alleged 2
negligence. In his complaint, Beaulieu alleged that he “was violently attacked
by a group of [other] patrons” while he “was a customer, licensee and invitee”
at the bar. He asserted that Barnie’s Bar was liable for the attack for two
reasons. First, Beaulieu contended that, although Barnie’s Bar “had general
and specific notice of the risk that an assault was imminent,” Barnie’s Bar
breached its duty of care to prevent or interfere with the assault by “failing to
summons law enforcement and otherwise failing to interfere with the assault
and battery.” Second, Beaulieu claimed that Barnie’s Bar breached its duty of
care “not to create a dangerous circumstance on its premises” by
“affirmatively ejecting” him and his assailants into the parking lot at the same
time.
[¶3] At all relevant times, Barnie’s Bar held an insurance policy from
USLIC that included both commercial general liability and liquor liability
coverage. Both coverage portions, however, contained comprehensive
exclusions for assault and battery. The commercial general liability coverage,
in relevant part, excluded
Any claim, demand or “suit” based upon any actual or alleged “assault” or “battery”, or out of any act or omission in connection with the prevention or suppression of any “assault” or “battery” . . . whether caused by or at the instigation or direction of an insured, its “employees”, agents, officers or directors, patrons or any other person. Further, no coverage is provided for any claim, 3
demand or “suit” in which the underlying operative facts constitute “assault” or “battery”.
This exclusion applies to all “bodily injury”, “property damage” or “personal and advertising injury” sustained by any person, including emotional distress and mental anguish, arising out of, directly or indirectly resulting from, in consequence of, or in any way involving “assault” or “battery” whether alleged, threatened or actual including but not limited to “assault” or “battery” arising out of or caused in whole or in part by negligence or other wrongdoing with respect to:
. . . .
b. investigation or reporting any “assault” or “battery” to the proper authorities; or
c. the failure to so report or the failure to protect any person while that person was in the care, custody or control of the insured, its “employees”, agents, officers or directors;
The assault and battery exclusion in the liquor liability portion of the policy
was similarly comprehensive.
[¶4] After Barnie’s Bar requested that USLIC defend it in the Beaulieu
litigation, the insurer declined to defend the bar relying on the policy’s
exclusions for assault and battery. Barnie’s Bar then sued USLIC in Superior
Court, seeking a declaratory judgment that USLIC had a duty to defend it in the
Beaulieu litigation and seeking damages for a breach of contract. Barnie’s Bar
and USLIC filed cross-motions for summary judgment on a joint stipulated 4
record. See M.R. Civ. P. 56. Concluding that USLIC had no contractual duty to
defend Barnie’s Bar, the court granted USLIC’s motion and denied Barnie’s
Bar’s motion for summary judgment. Barnie’s Bar appealed.
II. DISCUSSION
[¶5] We review a ruling on a motion for summary judgment de novo
and analyze an insurer’s duty to defend as a question of law. Mitchell v.
Allstate Ins. Co., 2011 ME 133, ¶ 8, 36 A.3d 876. Because there is no dispute of
material fact in this case, we need address only whether USLIC had a duty to
defend Barnie’s Bar in the Beaulieu litigation as a matter of law.
A. The Duty to Defend
[¶6] To determine whether an insurer is contractually obligated to
defend an insured in an underlying lawsuit, we have long employed the aptly
named “comparison test,” in which we compare the allegations in the
underlying complaint with the terms of the applicable insurance policy to
determine whether the complaint falls within the policy’s coverage.
Id. ¶¶ 9-10. We have consistently applied a broad construction of the
underlying complaint in favor of the insured and a strict construction of policy
exclusions and ambiguities against the insurer. See id. ¶ 11; Elliott v.
Hanover Ins. Co., 1998 ME 138, ¶ 7, 711 A.2d 1310; Union Mut. Fire Ins. Co. v. 5
Commercial Union Ins. Co., 521 A.2d 308, 311 (Me. 1987). Our body of case
law should not, however, be misread as obliging courts to conjure the duty to
defend from speculation or supposition. See York Golf & Tennis Club v.
Tudor Ins. Co., 2004 ME 52, ¶ 8, 845 A.2d 1173 (“[In determining the duty to
defend,] we do not speculate about causes of action that were not stated.”);
see also 14 Lee R. Russ & Thomas F. Segalla, Couch on Insurance § 200:19 at
200-33 (3d ed. 2005) (stating that the duty to defend “cannot be triggered by
mere speculation that additional facts or causes of action will be developed at
a later time”). Although the duty to defend is broad, “[a]n insurer may
properly refuse to defend a policyholder if the allegations of the complaint fall
entirely within a policy exclusion.” Mitchell, 2011 ME 133, ¶ 13, 36 A.3d 876.
[¶7] In applying the comparison test, we examine the underlying
complaint for any potential factual or legal basis that may obligate the insurer
to defend the insured, id. ¶ 10, even the mere “intent to state a claim within
the insurance coverage,” Lavoie v. Dorchester Mut. Fire Ins. Co., 560 A.2d 570,
571 (Me. 1989). We confine this examination to the language of the
underlying complaint. Mitchell, 2011 ME 133, ¶ 9, 36 A.3d 876; Hardenbergh
v. Patrons Oxford Ins. Co., 2013 ME 68, ¶ 13, 70 A.3d 1237 (“[T]he duty to
defend arises exclusively from the allegations in the complaint and the 6
language of the policy.”). Except in rare circumstances, see State Mut. Ins. Co. v.
Bragg, 589 A.2d 35, 37 (Me. 1991), we will not consider facts extrinsic to the
underlying complaint nor will we read allegations into the complaint in
determining whether the insurer has a duty to defend, see York Ins. Grp. of Me.
v. Lambert, 1999 ME 173, ¶¶ 4-5, 740 A.2d 984; Penney v. Capitol City Transfer,
1998 ME 44, ¶¶ 6-7, 707 A.2d 387; Horace Mann Ins. Co. v. Me. Teachers Ass’n,
449 A.2d 358, 360-61 (Me. 1982).
B. The USLIC Policy and the Beaulieu Complaint
[¶8] Applying the comparison test to the instant case, we are faced with
policy exclusions that are so broadly written and an underlying complaint that
is so narrowly drafted that there are simply no intersections between the
policy and the complaint in which to find coverage. Barnie’s Bar’s policy with
USLIC contained comprehensive exclusions for claims “based upon any actual
or alleged ‘assault’ or ‘battery’, or . . . any act or omission in connection with
the prevention or suppression of any ‘assault’ or ‘battery’ . . . whether caused
by . . . an insured, its ‘employees’, . . . patrons or any other person” and “any
‘suit’ in which the underlying operative facts constitute ‘assault’ or ‘battery.’”
The only allegations of fact and law found in the Beaulieu complaint relate to
the assault and battery on the bar’s premises. Even liberally construing the 7
Beaulieu complaint in favor of Barnie’s Bar, there is no allegation—or even the
hint of an intent to state an allegation—that escapes the USLIC policy’s
exclusions for assault and battery.
[¶9] Although Barnie’s Bar urges us to conclude that Beaulieu’s
allegation that the bar breached a duty of care “not to create a dangerous
circumstance on its premises” is an allegation of general negligence pursuant
to which Beaulieu might prove facts that fall within the policy’s coverage at
trial, we cannot do so. The very next paragraph of the Beaulieu complaint
alleges that “Barnie’s breached that duty of care” (emphasis added) by
simultaneously ejecting Beaulieu and his assailants into the parking lot,
leaving no doubt that the “dangerous circumstance” on the premises was the
attack rather than some action or hidden defect or condition unmentioned in
the complaint. As we have stated, the comparison test is limited to the
language of the underlying complaint and the insurance policy. See Elliott,
1998 ME 138, ¶¶ 6-7, 711 A.2d 1310. Just as we cannot read extrinsic facts or
allegations into an underlying complaint in the comparison test, we cannot
selectively read facts or allegations out of that complaint in order to conclude
that the insurer has a duty to defend, and we will not do so in this instance. 8
[¶10] Because the allegations of the Beaulieu complaint fall squarely
within the policy’s exclusions for assault and battery, we conclude that USLIC
was not obligated to defend Barnie’s Bar in that litigation.1
The entry is:
Judgment affirmed.
Marc N. Frenette, Esq. (orally), Trafton, Matzen, Belleau & Frenette, LLP, Auburn, for appellant Barnie’s Bar and Grill, Inc.
Robert C. Hatch, Esq., and Hillary J. Bouchard, Esq. (orally), Thompson, Bowie & Hatch, LLC, Portland, for appellee United States Liability Insurance Company
Androscoggin County Superior Court docket number CV-2015-36 FOR CLERK REFERENCE ONLY
1 On appeal, Barnie’s Bar also contends that a duty to defend arises from assault and battery
coverage that it acquired from USLIC after the events alleged in the Beaulieu complaint. We are not persuaded by this argument and do not discuss it further.