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San Joaquin County Medical Society v. Amco Insurance Co.12/30/2003
NOT TO BE PUBLISHED
California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.
The San Joaquin County Medical Society (Society) and its executive director, Ellen Badley (together "the insured") sued their insurer, AMCO Insurance Company, claiming breach of the duty to defend an underlying suit. The trial court granted summary judgment to the insurer, and the insured appeals from the ensuing judgment. We shall affirm.
STANDARD OF REVIEW
We review the order granting summary judgment de novo. The coverage question raises a purely legal question based on the undisputed facts. (See California State Automobile Assn. v. Foster (1993) 14 Cal.App.4th 147, 149.)
FACTUAL AND PROCEDURAL BACKGROUND
A. The Underlying Complaint and Extrinsic Facts
Ten women sued the Society, Badley, Badley's husband and the Bureau of Medical Economics, known as the Physician's Exchange (Exchange), claiming Badley's husband sexually harassed them in the workplace. They alleged Badley "knowingly allowed her husband . . . to continue with the conduct and subsequently participated in similar conduct. [ ] As a supervisor, did nothing to stop the incidents of harassment . . . after being told of the conduct"; instead, Badley retaliated against plaintiffs.
Two plaintiffs worked for the Society; the other eight worked for the Exchange, which leased space from the Society. According to the responses to the claimed undisputed facts, Badley had the authority to fire or discipline employees of either entity.
The complaint set forth four theories of liability based on the fair employment laws (Gov. Code, § 12940), as follows:
(1) Gender harassment and discrimination, by maintaining a hostile working environment, specifically, that the insured "failed to take all reasonable steps to prevent discrimination and harassment from occurring."
(2) Retaliation in employment conditions for complaining about the hostile environment.
(3) Supervisor liability, for Badley's conduct of abetting her husband's conduct.
(4) As to Badley and her husband, the complaint alleged the acts were done intentionally or with reckless disregard, causing emotional distress and meriting punitive damages. This was styled as "Intentional Infliction of Emotional Distress," but it added no new factual allegations.
The insurer had reason to know Badley's husband was not an employee, but "merely a guest on the business premises" and to know that the Society and the Exchange were separate corporations with separate employees.
B. Policy Provisions
The named insured is the Society; Badley is an additional insured, as the Society's executive director. "Bodily injury" meant in part "bodily injury" or "sickness". An "occurrence" was in part "an accident". The policy covered bodily injury due to an occurrence.
One exclusion is for injuries "expected or intended" by the insured. (See also Ins. Code, § 533.)
The Employer's Liability exclusion has two relevant subparts. The first excludes injury to employees of the insured which "aris out of" the employment; the second excludes injury to "Any person arising out of any . . . governmental civil rights violations or alleged violations."
The Employment Practices exclusion covers injuries "arising out of any [ ] . . . [ ] discipline . . . harassment, humiliation
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