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County of Kaua v. Scottsdale Insurance Co.5/27/1999
the respondents filed the complaint against Scottsdale that gave rise to the present appeal. The complaint alleged that Scottsdale owed the County "defense and coverage" with respect to the two Moniz lawsuits because " mong the factors alleged in the lawsuits to have contributed to the cause of the death of Mr. Moniz were allegations . . . that the police department wrongfully scheduled one of its officers for an excessive number of hours prior to the accident[,] causing the officer to be too fatigued to carefully carry out his duties as a patrol officer."
After filing an answer, Scottsdale moved for summary judgment on February 20, 1997. In its memorandum in support of the motion for summary judgment, Scottsdale argued that "there is no possibility that coverage exists and, consequently, the [respondents'] claims . . . must fail." On March 17, 1997, the respondents filed a memorandum in opposition to Scottsdale's motion and a cross-motion for summary judgment.
On July 31, 1997, the circuit court entered an order granting Scottsdale's motion for summary judgment. Final judgment was entered in favor of Scottsdale and against the respondents on December 9, 1997. The respondents filed a timely notice of appeal on January 7, 1998.
The ICA filed a memorandum opinion on January 27, 1999. The ICA's majority opinion vacated the circuit court's judgment, concluding that "Scottsdale had a duty to defend based on the `mere possibility' of coverage created by the allegations that the County overworked or failed to properly train and/or supervise Officer Abadilla." ICA's majority opinion at 16. The ICA's majority opinion grounded its holding in the proposition that
" he negligent supervision claim is a separately recognized cause of action, and it is non-auto related conduct which is outside the scope of the motor vehicle exclusion clause. Therefore, `the policy should be applicable regardless of the automobile exclusion or the fact that an automobile was involved in the occurrence.'" Id. (quoting United States Fidelity & Guar. Co. v. State Farm Mut. Ins. Co., 437 N.E.2d 663, 667 (Ill. Ct. App. 1982)).
In her Dissent (hereinafter, the "Dissent"), Judge Watanabe noted:
". . . The fact that Officer Abadilla may have been overworked, tired, and improperly trained or supervised as a result of the County's negligence [ ] is irrelevant unless Officer Abadilla drove a vehicle "in a negligent manner . . . and in fact inflicted injury as a result of such conduct." [Hawaiian Ins. & Guar. Co. v. Chief Clerk of the First Circuit], 68 Haw. [336,] 341, 713 P.2d [427,] 431 [(1986)]. Stated otherwise, any negligence on the part of the County in allowing Officer Abadilla to drive on the occasion in question was separate from Officer Abadilla's negligence "`only in the fact that [the County's negligence] preceded the collision.'" Id. at 340, 713 P.2d at 430. The County's alleged negligent conduct was "not exclusive of, but, rather, . . . derived from the more general concepts of ownership, operation, and use of a motor vehicle." Id. at 341, 713 P.2d at 431."
Dissent at 4 (ellipsis points in original). Judge Watanabe concluded that the automobile exclusion contained in the law enforcement policy was applicable to the facts of the case, and that Scottsdale therefore owed no duty to indemnify or defend the County. Dissent at 5.
The ICA filed an "order of amendment" on January 29, 1999. On February 9, Scottsdale filed a motion for reconsideration. The ICA denied Scottsdale's motion on February 16. Scottsdale's timely application for a writ of certiorari was filed on March 18, 1999.
II. STANDARD OF REVIEW
We
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