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Supreme Court5/25/2000
erence phenomenon" by engaging in a sexual relationship with Wade could bring his conduct within the general coverage of the policy issued by plaintiff (see, e.g., St. Paul Fire & Marine Ins. Co. v Love, 459 NW2d 698, 702 [Minn] ). We conclude, however, that because all of the causes of action pleaded in the underlying action arise out of Singh's sexual conduct with Wade, they fall within the policy's "undue familiarity" exclusion which therefore relieves plaintiff of the obligation to indemnify Singh. Supreme Court thus erred in failing to grant plaintiff's summary judgment motion and make a declaration to that effect. We shall modify its order in that regard.
In support of their position that the "undue familiarity" exclusion does not necessarily bar indemnification in the underlying action, the Wades rely exclusively upon an unreported decision of Federal District Court in Legion Ins. Co. v. Vemuri (US Dist Ct, ND Ill, Nov. 24, 1997, Ashman, J.). There, the court determined that the word "claim" as used in the subject exclusion is ambiguous because it could mean either the entire underlying action or merely a discrete cause of action therein (id.). Thus, adopting the construction that was more favorable to the insured, the court concluded that only those causes of action making actual reference to conduct which on its face would constitute "undue familiarity" are affected by the exclusion (id.). Although we have no argument with District Court's interpretation of the word "claim", we strongly question its implicit holding that a cause of action clearly founded upon sexual conduct can be made to fall outside the exclusion by merely avoiding reference to sex. In any event, unlike the claim at issue in Legion Ins. Co. v. Vemuri (supra ), the Wades' first cause of action against Singh, alleging malpractice based on his mishandling of the "transference phenomenon", makes numerous references to conduct which on its face would constitute "undue familiarity". Therefore, the sole legal authority offered for the claimed inapplicability of the "undue familiarity" exclusion is found to offer the Wades no real assistance.
In our view, the proper inquiry is whether, regardless of the actual words used by the drafter, the claim under consideration is so intertwined with the underlying sexual misconduct as to make the two inseparable (see, American Home Assur. Co. v Stone, 61 F3d 1321, 1329-1330; Govar v. Chicago Ins. Co., 879 F2d 1581, 1583; Franklin v Professional Risk Mgt. Servs., 987 F Supp 71, 76; Chicago Ins. Co. v. Griffin, 817 F Supp 861, 864-865; Cranford Ins. Co. v. Allwest Ins. Co., 645 F Supp 1440, 1444; Chicago Ins. Co. v. Manterola, 191 Ariz 344, 955 P2d 982, 984-985; see also, Annotation, Coverage of Professional Liability or Indemnity Policy for Sexual Contact with Patients by Physicians, Surgeons and Other Healers, 60 ALR5th 239, at 317- 326; 9 Russ and Segalla, Couch on Insurance 3d ยง 131:12). Applying that analysis leads to the inescapable conclusion that the Wades' first cause of action falls squarely within the "undue familiarity" exclusion.
Crew III, Peters, Spain and Mugglin, JJ., concur.
_ ORDERED that the order is modified, on the law, without costs, by reversing so much thereof as partially denied plaintiff's motion for summary judgment; motion granted and it is declared that the insurance contracts issued by plaintiff to defendant Lokendra K. Singh do not require plaintiff to indemnify Singh for any damages that may be awarded to defendants Eric Wade, as executor of the estate of Deborah Wade, and Bruce Wade by reason of the allegations contained in their complaint; and, as so modified, affirmed.
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