Final Table, LLC v. Acceptance Casualty Ins. Co.

CourtCourt of Appeals of Oregon
DecidedOctober 11, 2023
DocketA176545
StatusPublished

This text of Final Table, LLC v. Acceptance Casualty Ins. Co. (Final Table, LLC v. Acceptance Casualty Ins. Co.) is published on Counsel Stack Legal Research, covering Court of Appeals of Oregon primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Final Table, LLC v. Acceptance Casualty Ins. Co., (Or. Ct. App. 2023).

Opinion

620 October 11, 2023 No. 538

IN THE COURT OF APPEALS OF THE STATE OF OREGON

THE FINAL TABLE, LLC and Jason Thompson, Plaintiffs-Appellants, v. ACCEPTANCE CASUALTY INSURANCE COMPANY, Defendant-Respondent, and David GARCIA; GDR, LLC, dba Creative Insurance Marketing Company; and EVERGREEN INSURANCE MANAGERS, INC., Defendants. Multnomah County Circuit Court 20CV06497; A176545

Bruce C. Hamlin, Judge pro tempore. (Limited judgment entered July 1, 2021) Katharine von Ter Stegge, Judge. (Limited judgment entered July 21, 2021) Argued and submitted September 13, 2023. Brandon B. Mayfield argued the cause for appellants. Also on the briefs were Kyle A. Sturm and Nicholas A. Thede. Jonathan Henderson argued the cause for respondent. Before Tookey, Presiding Judge, and Egan, Judge, and Kistler, Senior Judge. KISTLER, S. J. Affirmed. Cite as 328 Or App 620 (2023) 621 622 Final Table, LLC v. Acceptance Casualty Ins. Co.

KISTLER, S. J. This appeal arises out of plaintiffs’ action to recover on a liquor liability policy that defendant issued. The trial court ruled on summary judgment that defendant did not have a duty to defend its insured because the insured failed to provide defendant with timely notice of the complaint filed against it. The court also ruled that defendant did not have a duty to indemnify its insured because the complaint came within an exclusion from coverage. The court entered a limited judgment consistent with that ruling, which plain- tiffs have appealed. We affirm. We summarize the historical facts briefly before turning to the issues that plaintiffs raise on appeal. Because the trial court granted defendant’s summary judgment motion, we set out the facts in the light most favorable to plaintiffs. This case arises out of a shooting at Puff’s Pub in Gresham. One of Puff’s customers (Sheets) had been drink- ing heavily before he arrived at Puff’s around 10:00 p.m. While he was at Puff’s, Sheets experienced a bout of flat- ulence, which caused some of the people around him to make rude gestures and another person (Thompson) to make a crude comment. Approximately five minutes after Thompson made the comment, Sheets stepped outside of Puff’s briefly and came back into the pub with a gun. Sheets shot Thompson in the face. Thompson survived but experi- enced substantial injuries.1 Following the shooting, Sheets pled no contest to and was convicted of attempted murder and second-degree assault. Before arriving at Puff’s, Sheets had been drinking at another bar, The Final Table. Thompson served a statuto- rily required notice of a liquor liability claim on Final Table, asserting that Final Table had negligently overserved Sheets and that the shooting at Puff’s was a foreseeable con- sequence of Final Table’s negligence.

1 An officer viewing the surveillance video from Puff’s opined that the bullet that Sheets fired at Thompson went through Thompson’s cheek and ear and hit a bystander in the buttocks. Sheets fired at least one other shot, which did not hit Thompson but did hit another bystander also in the buttocks. Cite as 328 Or App 620 (2023) 623

Final Table forwarded a copy of Thompson’s claim to defendant. After reviewing that claim, defendant notified Final Table that Thompson’s claim came within an exclu- sion to the liquor liability policy for “[a]ny claims arising out of Assault and/or Battery.” As a result, defendant declined to defend or indemnify Final Table. Defendant, however, advised Final Table that it was basing its response on the information it knew at the time, and it asked Final Table to send it any new information that it received as well as any “[a]mended [c]omplaint.” Over a year later, Thompson filed and served his initial complaint on Final Table. The complaint added alle- gations that were not included in the statutorily required notice of claim, although it repeated the essence of that claim—that the shooting at Puff’s had been a foresee- able consequence of Final Table’s negligent overserving of Sheets.2 Having received Thompson’s complaint, Final Table did not notify defendant that Thompson had initiated an action against it, nor did it forward a copy of Thompson’s complaint to defendant. Final Table did not defend against Thompson’s action. Approximately 40 days after Thompson served its complaint on Final Table, the trial court issued an order of default against Final Table. Three months after the order of default, Thompson put on a prima facie case, and the trial court entered a limited judgment in favor of Thompson and against Final Table for approximately $419,000. Defendant did not learn that Thompson had filed a complaint against Final Table until approximately six months after the judg- ment against Final Table became final. Final Table and Thompson entered into a settlement agreement. As part of that agreement, Final Table assigned its claims against defendant to Thompson. Thompson and Final Table (plaintiffs) then brought this action, alleging that defendant had breached its duty to defend and indem- nify Final Table. The trial court ruled on summary judg- ment that defendant had no duty to defend Final Table. 2 As discussed below, Thompson’s complaint included allegations that strengthened the inference that Sheets intended to injure Thompson when he shot him. 624 Final Table, LLC v. Acceptance Casualty Ins. Co.

The court explained that the statutory claim that Final Table forwarded to defendant did not trigger the duty to defend. Only Thompson’s complaint could trigger that duty. However, Final Table did not provide defendant with timely notice that Thompson had filed a complaint against it. The court then turned to the duty to indemnify. It determined that the only reasonable conclusion that could be drawn from the evidence on summary judgment was that Sheets had acted intentionally when he shot Thompson. It followed that Thompson’s claim against Final Table came within the exclusion in the liquor liability policy for claims arising out of assault and battery and that defendant had no duty to indemnify Final Table.3 On appeal, plaintiffs argue that the trial court erred in ruling that defendant had no duty to defend or indemnify Final Table. The duty to defend is separate from the duty to indemnify, ZRZ Realty v. Beneficial Fire and Casualty Ins., 349 Or 117, 150, 241 P3d 710 (2010), and we begin with the duty to indemnify. In the liquor liability policy that defen- dant issued to Final Table, defendant agreed to pay Final Table “those sums that the insured becomes legally obligated to pay as damages because of [injuries for which the insured is liable] by reason of the selling, serving or furnishing of any alcoholic beverage.” The policy also contained an exclu- sion from coverage, which is at issue here. That exclusion provided that “[t]his insurance does not apply to * * * [a]ny claims arising out of Assault and/or Battery.” Additionally, the exclusion provided that the policy did not apply to any act or omission taken “in connection with such acts,” nor did it apply to claims of negligent hiring, training, and the like “arising from any of the foregoing.” On appeal, plaintiffs raise essentially three issues regarding the duty to indemnify. They argue that the terms “assault” and “battery” in the exclusion require proof of spe- cific intent, that a reasonable juror could find on this record

3 The trial court did not rule against plaintiffs because no reasonable juror could infer that Sheets’ actions at Puff’s were a foreseeable consequence of Final Table’s negligent overservice. Cf. Chapman v. Mayfield, 358 Or 196, 361 P3d 566 (2015) (discussing that issue). Similarly, we assume without deciding that Sheets’ actions at Puff’s were a reasonably foreseeable consequence of Final Table’s overservice. Cite as 328 Or App 620 (2023) 625

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Final Table, LLC v. Acceptance Casualty Ins. Co., Counsel Stack Legal Research, https://law.counselstack.com/opinion/final-table-llc-v-acceptance-casualty-ins-co-orctapp-2023.