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Westfield Insurance Group v. J.P.'S Wharf9/17/2004
Submitted: July 14, 2004
Upon appeal from the Superior Court. REVERSED.
In this appeal, we consider whether a commercial insurance policy covers amounts paid by a restaurant for racial discrimination. The policy defines "personal injury " to include "wrongful eviction," among other intentional torts, and the trial court held that the wrongful eviction clause clearly and unambiguously affords coverage for discriminatory acts. We agree with the conclusion that the policy language is clear and unambiguous. But we hold that the wrongful eviction clause only applies to the eviction of claimants having a possessory interest in the premises. Since the patrons who were refused service at the restaurant had no possessory interest in the premises, the restaurant's expenses in resolving the patrons' claims are not covered under the insurance policy.
Factual and Procedural Background
In 2001, the State Human Relations Commission found that J.P.'s Wharf Restaurant, and its owner, Peter Russo (collectively "Wharf"), engaged in racial discrimination when Wharf refused to serve certain patrons and ordered them to leave. The Commission ordered Wharf, among other things, to pay damages totaling $6,000 to the complaining patrons, and to pay a $5,000 civil penalty. At all relevant times Wharf was insured by Westfield Insurance Group, under a commercial policy that provides coverage for "personal injury ," defined as: injury, other than "bodily injury," arising out of one or more of the following offenses:
a. False arrest, detention or imprisonment;
b. Malicious prosecution;
c. The wrongful eviction from, wrongful entry into, or invasion of the right of private occupancy of a room, dwelling or premises that a person occupies by or on behalf of its owner, landlord or lessor;
d. Oral or written publication of material that slanders or libels a person...; or
e. Oral or written publication of material that violates a person's right of privacy.
After Wharf filed an insurance claim for expenses related to the discrimination complaint, Westfield sought a declaratory judgment that its policy does not cover those expenses. The Superior Court held that the "wrongful eviction" clause provides coverage for Wharf's discriminatory conduct. This appeal followed.
Discussion
The sole issue is the scope of the coverage provided under the Westfield insurance policy. We consider this question of law de novo. Under settled principles, "if the relevant contract language is clear and unambiguous, courts must give the language its plain meaning." If the provision is ambiguous, it will be "read in a way that satisfies the reasonable expectations of the average consumer." The language is deemed "ambiguous" if it is "reasonably... susceptible of different interpretations."
Several other jurisdictions have considered similar policy language, reaching different conclusions. In Insurance Company of North America v. Forrest City Country Club, for example, the policy language defined "personal injury" to include "wrongful entry into, or eviction of a person from a room, dwelling or premises that the person occupies...." The Arkansas appellate court found the language ambiguous, as "eviction" could mean interference with a possessory property interest or, if used in its popular sense, simply the process of being forcefully removed or ejected from a particular location. Giving the insured the benefit of a liberal construction, the Arkansas court held that the insurer had a duty to defend a claim of racial discrimination brought by a woman who was barred from playing tennis at the insured's c
Page 1 2 Delaware Personal Injury Attorneys
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