Faysal Hassan v. First Financial Insurance Company

• Court: Court of Appeals of Kentucky
• Decided: November 8, 2024
• Docket: 2024-CA-0163
• Status: Unpublished

Opinion

RENDERED: NOVEMBER 8, 2024; 10:00 A.M. NOT TO BE PUBLISHED

Commonwealth of Kentucky Court of Appeals NO. 2024-CA-0163-MR

FAYSAL HASSAN AND AAA MILLING CENTER, LLC D/B/A FUTURE MOTOR SALES, LLC APPELLANTS

APPEAL FROM JEFFERSON CIRCUIT COURT v. HONORABLE MITCHELL PERRY, JUDGE ACTION NO. 22-CI-004153

FIRST FINANCIAL INSURANCE COMPANY APPELLEE

OPINION AFFIRMING

** ** ** ** **

BEFORE: ACREE, CETRULO, AND A. JONES, JUDGES.

CETRULO, JUDGE: This is an appeal of a summary judgment in favor of First

Financial Insurance Company (“First Financial”). The Jefferson Circuit Court

found that a general liability policy issued to Appellants Faysal Hassan (“Hassan”)

and AAA Milling Center, LLC d/b/a Future Motor Sales, LLC (“Future Motor Sales”) did not afford coverage for the owner of the business who shot and killed

an intruder.

FACTUAL BACKGROUND

On August 12, 2021, James Ludwig and Bobby Thornton were

stealing catalytic converters from motor vehicles located on the property of Future

Motor Sales. Hassan was the owner of Future Motor Sales and had security

cameras on the lot which sent images to his cell phone. Seeing that an unknown

car had entered his lot, he called the police and then drove to a nearby property to

await their arrival. When two more phone calls did not result in a police response,

Hassan drove onto the lot in his vehicle to block the thieves’ car until the police

arrived. Hassan carried a weapon with him and saw Ludwick come out from under

a customer’s vehicle. Hassan instructed Ludwick to stop, but Ludwick hid behind

a dumpster and a stack of used tires. Thornton, who was holding a power saw used

to cut the catalytic converters, then approached Hassan. Hassan saw Thornton

approach and fired a shot toward the area of the used tires, killing Ludwick.

Thornton then physically attacked Hassan, wrestling with him and attempting to

enter his vehicle. At this point, the police arrived.

Hassan was interviewed and repeatedly told the police he only fired

the shot to warn Ludwick and Thornton, and he was merely protecting his

-2- property. He did not intend to hurt anyone, although he admitted he fired into the

direction of the stack of used tires.

Hassan was charged with second-degree manslaughter and second-

degree reckless homicide. On May 16, 2023, a jury found Hassan guilty of the

latter charge, finding he mistakenly believed that physical force was necessary, and

he failed to perceive a substantial risk that he was mistaken in that belief

“constituting a gross deviation from the standard of care that a reasonable person

would have observed in the same situation.” (Instruction No. 3, Reckless

Homicide in the Second Degree from criminal trial.)

Following the criminal proceedings, Ludwick’s wife sued Hassan and

his business for her husband’s wrongful death. Hassan and Future Motor Sales

then filed a third party action for declaratory judgment against First Financial.

First Financial provided a general liability policy to Hassan and the business that

was in effect at the time of these events. That policy did provide for a defense and

indemnity for claims arising from an accident. The declaratory judgment action

sought coverage under the policy and a ruling that Hassan and the business were

entitled to be provided a defense to the wrongful death action. First Financial

denied coverage existed as the shooting was not an accident. It further argued the

policy specifically excluded coverage for injuries and damages sustained as the

-3- result of an assault and battery or other physical altercations. Both parties moved

the circuit court for summary judgment.

On January 18, 2024, the Jefferson Circuit Court ruled in favor of

First Financial, finding the shot fired by Hassan was not an “accident” for

insurance purposes, and the policy expressly excluded Hassan’s actions from

coverage under the exclusions in an endorsement relating to assault and battery and

physical altercations. This appeal followed.

STANDARD OF REVIEW

On appeal, Hassan and Future Motor Sales argue that: 1) the shooting

of Ludwick was accidental because Hassan did not intend to shoot him; and 2) the

exclusion for assault and battery is ambiguous and therefore unenforceable. First

Financial argues the policy itself is not applicable because the underlying incident

does not qualify as an accident. Secondarily, the insurer claims the damages are

excluded by an endorsement and exclusion for assault, battery, or other physical

altercations.

The determination of whether the claims are covered involves

interpretation of the insurance contract, which is a matter of law we review de

novo. Cincinnati Ins. Co. v. Motorists Mut. Ins. Co., 306 S.W.3d 69, 73 (Ky.

2010). Also, “when we review a trial court’s decision to grant summary judgment,

as in this case, we must determine whether the trial court correctly found that there

-4- were no genuine issues of material fact[.]” Id. Since there do not appear to be any

genuine issues of material fact in this case, summary judgment was appropriate.

Despite Hassan’s attempt at distinguishing precedent, we have clear caselaw to

guide us.

ANALYSIS

In Kentucky Farm Bureau Mutual Insurance Company v. Coyle, we

addressed very similar facts. 285 S.W.3d 299 (Ky. App. 2008). In Coyle, the

defendant (“Coyle”) shot a man who was harassing and stalking his wife. Id. at

301. Coyle was an “insured” party under his wife’s homeowner’s policy, but that

policy excluded coverage for bodily injury “expected or intended” by an insured.

Id. at 302. Coyle argued the injuries were not intended, but accidental. Id. at 301.

Despite a summary judgment motion by the insurer, the trial court allowed the

matter to proceed to a jury. Id. at 302. The jury found the shooting was an

accident and only negligent, not intentional. Id. at 301.

On appeal, we reversed the trial court and held that as a matter of law,

summary judgment should have been granted in favor of the insurer. Id. at 303.

Our Court acknowledged the general rule that coverage can be provided if an

injury was not actually and subjectively intended or expected by an insured. Id. at

304. However, we found the doctrine of inferred intent was applicable and acted

as an exception to that rule. Id. In discussing the exception, we relied on

-5- precedent, Willis v. Hamilton Mutual Insurance Company, 614 S.W.2d 251 (Ky.

App. 1981).

In Willis, a jury found a defendant, “Smothers,” civilly liable for an

assault and battery. Id. at 252. Smothers’s insurer denied liability for his acts on

the basis that he expected or intended them. Id. On appeal, we adopted the

majority rule which allows for intent to be inferred by the nature of the act and the

accompanying reasonable foreseeability of harm. Id. We then upheld summary

judgment in favor of the insurer. Id.

Since that early case, our appellate courts have consistently upheld

summary judgments in wrongful death actions and assault actions such as this,

even where the insured denied any intent to cause injury or death. See Nationwide

Mut. Fire Ins. Co v. Pelgen, 241 S.W.3d 814 (Ky. App. 2007) (applying the

inferred intent doctrine to deny coverage to a mentally ill insured who shot his

wife); see also Stone v. Kentucky Farm Bureau Mut. Ins. Co., 34 S.W.3d 809 (Ky.

App. 2000) (finding that despite being medicated and depressed, it was reasonable

for the court to conclude that the insured knew the “nature and quality of his

actions” when he pointed a rifle at another and pulled the trigger); see also Walker

v. Econ. Preferred Ins. Co., 909 S.W.2d 343 (Ky. App. 1995) (applying the

principles of the inferred intent doctrine to a man who intended to hit someone, but

did not intend the severe damage that resulted); see also Sigler v. Ralph, 417

-6- S.W.2d 239 (Ky. 1967) (finding that even absent intent to harm, use of a firearm

was enough to justify inferring intent); see also Coyle, 285 S.W.3d at 306 (finding

inferred intent where the insured admitted he intentionally and deliberately

discharged a bullet at the victim).

As the trial court noted, our precedent requires that the court decide

whether the event or action giving rise to the alleged damages was intended and

not whether the resulting injury or damage was intended. Martin/Elias Props.,

LLC v. Acuity, 544 S.W.3d 639, 643-44 (Ky. 2018). Further, as we held in Pelgen,

supra, “[t]he inferred intent rule is supported by sound public policy principles, in

part because it removes from the trial court the burden of determining an actor’s

thought process[es].” 241 S.W.3d at 817.

Here, Hassan stated he did not intend to injure or kill the intruders, but

only intended to scare them away. However, he did not assert the gun discharged

accidentally or because of something outside of his control. He admits he

intentionally fired the weapon and, as such, his actions cannot be properly

described as an “accident.” Certain acts are so likely to result in some injury that

intent “can be inferred as a matter of law.” See Thompson v. West American Ins.

Co., 839 S.W.2d 579, 581 (Ky. App. 1992). We believe Hassan firing a gun is

such an act. This is a permissible inference because of the nature and

-7- circumstances of the particular situation.1 See James Graham Brown Found., Inc.

v. St. Paul Fire & Marine Ins. Co., 814 S.W.2d 273 (Ky. 1991).

Hassan primarily argues his express denial of any intent to harm

anyone should be sufficient to reverse the summary judgment herein. In support of

that position, he relies upon out-of-state cases where an insured was protecting

himself or property. However, we do not need to turn to other jurisdictions when

our precedent is clear. As the Supreme Court has held and the circuit court noted

in its opinion and order:

in determining whether an event constitutes an accident so as to afford the insured [commercial general liability] policy coverage, courts must analyze this issue according to the doctrine of fortuity: 1) whether the insured intended the event to occur; and 2) whether the event was a “‘chance event’ beyond the control of the insured.”

Martin/Elias, 544 S.W.3d at 643 (quoting Cincinnati, 306 S.W.3d at 76).

Further, the cases relied upon by Hassan dealt with accidental

discharge of a weapon, and there was no such contention here. The circuit court

did not err in finding Hassan intended to fire his weapon and the “event” was not

an accident covered under this policy.

1 Hassan also points out that no depositions had been taken of any witness at the time of the trial court’s summary judgment ruling. However, the case had been pending for well over a year before both parties moved for summary judgment. Moreover, the record did include the policy, written discovery, the video recording of the attempted theft and shooting, Hassan’s recorded statement to the police, as well as the entire record of the criminal case against Hassan. Although it is not specifically argued that summary judgment was premature, we also do not find it to have been prematurely granted.

-8- Hassan also argues, on appeal, that the instruction to the jury and the

conviction in his criminal case directly contradicts this trial court’s ruling. In the

criminal action, the jury found Hassan “failed to perceive the threat of injury to

others.” This, he argues, indicates that he had no intent, but was merely reckless in

failing to perceive the risks associated with firing his weapon. Hassan provides no

authority for this assertion, but this Court has held that a final “criminal conviction

can be used for purposes of collateral estoppel in a later civil action.” See Roberts

v. Wilcox, 805 S.W.2d 152, 153 (Ky. App. 1991) (citation omitted).

However, we disagree that his conviction for reckless behavior –

failure to perceive the substantial risk – indicates absence of intent so as to qualify

the event as an accident under the policy. For one, Hassan argues that his actions

cannot be characterized as an assault because he did not intend for the bullet to

strike Ludwick. However, Hassan admits that he intended the gunshot to serve as

warning of bodily harm, and that conduct satisfies the prima facia elements of the

intentional tort of assault. See Brewer v. Hillard, 15 S.W.3d 1, 8 (Ky. App. 1999)

(“Battery is a tort which requires an unwanted touching of the victim. Assault

requires the threat of touching.”). Ludwick’s death resulted from Hassan’s

intentional assault, and, therefore, Hassan’s actions fell within the purview of the

policy’s coverage exclusion.

-9- The contract in this case provided for coverage for bodily injury

caused by an accident. In determining whether an event constitutes an accident for

insurance purposes, our Courts have held this issue must be analyzed according to

the doctrine of fortuity. Cincinnati, 306 S.W.3d at 74. As explained, that doctrine

focuses on the event and not on the actor’s subjective intent.

Secondly, Hassan’s actions are excluded from coverage regardless by

language contained in the endorsement. The endorsement excluded any coverage

for injury or damage:

1. Expected or intended from the standpoint of any insured;

2. Arising in whole or in part out of any “assault” or “battery” committed or attempted by any person;

3. Arising in whole or in part out of any act or omission in connection with avoiding, preventing, suppressing or halting any actual or threatened “assault” or “battery”; or

4. Arising in whole or in part out of any actual or threatened verbal or physical confrontation or altercation committed or act or omission in connection with avoiding, preventing, suppressing or halting any actual or threatened verbal or physical confrontation or altercation.

Hassan argues the exclusion contained within this later issued

endorsement was ambiguous and should be disregarded. The endorsement

excludes coverage for bodily injuries, expected or intended, or arising from any

-10- assault, battery, or other physical altercation. We note that if the shooting does not

fall within the general liability coverage, we do not need to assess the applicability

of the exclusion. Jones v. Acuity, 658 S.W.3d 492, 497 (Ky. App. 2022).

However, since the circuit court also found Hassan’s actions fell within the

exclusion to coverage, we will address this claimed error. Assuming arguendo

there was coverage under the policy, which we did not find, the endorsement

would have also excluded any coverage.

Hassan argues the endorsement language is confusing and capable of

inconsistent interpretations since it replaced the prior policy language that

excluded coverage for any bodily injury expected or intended by the insured.

Here, he primarily relies on the doctrine of reasonable expectations and asks this

Court to interpret ambiguous terms in favor of coverage for the insured. See

generally True v. Raines, 99 S.W.3d 439 (Ky. 2003). However, Hassan offers

nothing other than his own interpretation that the endorsement is ambiguous. Only

actual ambiguities will trigger application of the doctrine of reasonable

expectations, and we discern no ambiguity in the endorsement herein. See id. at

443 (citing St. Paul Fire & Marine Ins. v. Powell-Walton-Milward, Inc., 870

S.W.2d 223, 226 (Ky. 1994)). Contracts must be “construed according to the

entirety of [their] terms and conditions” and as modified by any endorsements. Id.

at 443 n.10 (citation omitted). “Where the terms of an insurance policy are clear

-11- and unambiguous, the policy will be enforced as written.” Reynolds v. Travelers

Indem. Co. of Am., 233 S.W.3d 197, 201 (Ky. App. 2007) (citation omitted).

The plain language of the endorsement herein states it replaces

paragraph A.2, Section II of the policy. “An endorsement is later in time than the

original policy; and it should prevail over any conflicting provisions of the policy.”

Kemper Nat. Ins. Cos. v. Heaven Hill Distilleries, Inc., 82 S.W.3d 869, 875 (Ky

2002) (internal quotation marks and citation omitted). The endorsement clearly

says the assault and battery exclusion from coverage applies to all acts “expected

or intended” and all theories of liability asserted against any insured, including all

theories of negligence, recklessness, or intentional tort if the precipitating event

was an assault or battery or physical altercation. As the circuit court noted, “any

one of these would be sufficient grounds upon which to deny coverage. Taken

together, they remove all doubt.”

Based upon our own review, we agree with the circuit court that

summary judgment was proper in favor of First Financial. The judgment is

therefore AFFIRMED.

ALL CONCUR.

-12- BRIEFS FOR APPELLANTS: BRIEF FOR APPELLEE:

Grover S. Cox Katherine L. Kennedy Louisville, Kentucky Cincinnati, Ohio

-13-