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Coulombe v. Salvation Army2/15/2002
Reporter of Decisions
Argued: September 11, 2001
Donald Coulombe appeals from a summary judgment entered in the Superior Court (Kennebec County, Studstrup, J.) in favor of The Salvation Army on its affirmative defense of charitable immunity. Coulombe contends that the court erred in concluding that The Salvation Army is an organization entitled to charitable immunity and did not waive its immunity by maintaining liability insurance. We disagree and affirm the summary judgment.
I. BACKGROUND
Michael Coulombe, a resident in a building owned by The Salvation Army, fell down an elevator shaft and suffered fatal injuries. Donald Coulombe, Michael's father and the personal representative of Michael's Estate, filed a complaint in the Superior Court alleging, inter alia, that The Salvation Army negligently caused Michael's death. The Salvation Army raised the affirmative defense of charitable immunity and moved for a summary judgment on that ground.
Although the parties emphasize different facts in their respective Rule 7(d) statements of material facts, the following facts are not in dispute. The Salvation Army is a non-profit organization funded mainly from public sources and private charity. It derives a substantial portion of its income from its investments. Coulombe conceded at oral argument that even without the inclusion of investment income, The Salvation Army derives over fifty percent of its income from charitable contributions.
Every Salvation Army branch contributes funds to the national office earmarked for The Salvation Army Trust. The funds of the "Salvation Army Trust" are funds of The Salvation Army. The Salvation Army uses these funds to purchase some insurance and pay for all aspects of risk management. A third-party administrator, Chesterfield Services, handles claims under $25,000 made against The Salvation Army. The Salvation Army's risk management officer has the authority to settle claims between $25,000 and $100,000. The Salvation Army and Chesterfield Services decide whether to pay a claim despite The Salvation Army's charitable immunity.
The Salvation Army also has an excess liability policy issued by the Zurich Insurance Company, which provides that Zurich shall only be liable for [sums which the Insured shall become legally obligated to pay as damages] in excess of either
a) the limits set forth in the attached Schedule of Underlying Insurance in respect of each Occurrence covered by said underlying insurance [i.e., for our purposes, the general liability coverage provided by The Salvation Army Trust up to a limit of $5,000,000 per occurrence]; or
b) the amount specified in Item 3(c) of the Declarations [i.e., $10,000] as the result of all Occurrences not covered by said underlying insurance . . . and then only up to a further sum as stated in Item 3 of the Declarations in respect of each Occurrence [i.e., $25,000,000] and subject to the limit as stated in Item 3 of the Declarations in the aggregate for Each Annual Period during the currency of this policy [i.e., $25,000,000]. . . .
For our purposes Zurich will, therefore, pay anything over $5,000,000 for general liability occurrences such as Coulombe's, and anything over $10,000 for occurrences other than the general, automobile or workers' compensation liability claims described in the Schedule of Underlying Insurance.
Unfortunately for Coulombe, Zurich's general liability coverage only exists for claims in excess of $5,000,000 and the estimate of Coulombe's potential recovery does not exceed $350,000.
The court granted The Salvation Army's motion for a summary ju
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