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    United States Court of Appeals, Eleventh Circuit

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    This document summarizes an appeal to the Eleventh Circuit Court of Appeals regarding an insurance company's obligation to provide liability coverage to an insured chemical plant. The plant experienced an explosion that killed one employee and injured another. The insurance company argued it did not have to provide coverage or a defense because the policy excluded injuries intentionally caused by the insured. The district court found the exclusion ambiguous and required coverage. The Eleventh Circuit notes that Florida law requires construing ambiguities in favor of coverage and exclusionary clauses even more strictly. It also discusses two prior Florida cases finding specific intent was required to invoke an intentional acts exclusion. However, a recent Florida Supreme Court case on the same facts found injuries could be intentional if substantially certain to occur

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    United States Court of Appeals, Eleventh Circuit

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    Scribd Government Docs
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    This document summarizes an appeal to the Eleventh Circuit Court of Appeals regarding an insurance company's obligation to provide liability coverage to an insured chemical plant. The plant experienced an explosion that killed one employee and injured another. The insurance company argued it did not have to provide coverage or a defense because the policy excluded injuries intentionally caused by the insured. The district court found the exclusion ambiguous and required coverage. The Eleventh Circuit notes that Florida law requires construing ambiguities in favor of coverage and exclusionary clauses even more strictly. It also discusses two prior Florida cases finding specific intent was required to invoke an intentional acts exclusion. However, a recent Florida Supreme Court case on the same facts found injuries could be intentional if substantially certain to occur

    Original Description:

    Filed: 2003-04-04 Precedential Status: Precedential Citations: 326 F.3d 1190 Docket: 02-12829

    Original Title

    Travelers Indemnity Company, Plaintiff-Counter-Defendant-Appellant v. Pcr Incorporated, Defendant-Counter-Claimant-Appellee, Debra Turner, as Personal Representative of the Estate of Thomas Paul Turner Iii, James Creighton, 326 F.3d 1190, 11th Cir. (2003)

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    This document summarizes an appeal to the Eleventh Circuit Court of Appeals regarding an insurance company's obligation to provide liability coverage to an insured chemical plant. The plant experienced an explosion that killed one employee and injured another. The insurance company argued it did not have to provide coverage or a defense because the policy excluded injuries intentionally caused by the insured. The district court found the exclusion ambiguous and required coverage. The Eleventh Circuit notes that Florida law requires construing ambiguities in favor of coverage and exclusionary clauses even more strictly. It also discusses two prior Florida cases finding specific intent was required to invoke an intentional acts exclusion. However, a recent Florida Supreme Court case on the same facts found injuries could be intentional if substantially certain to occur

    Copyright:

    Public Domain
    Download as PDF or read online from Scribd
    Download as pdf
    8 views6 pages

    United States Court of Appeals, Eleventh Circuit

    Uploaded by

    Scribd Government Docs
    This document summarizes an appeal to the Eleventh Circuit Court of Appeals regarding an insurance company's obligation to provide liability coverage to an insured chemical plant. The plant experienced an explosion that killed one employee and injured another. The insurance company argued it did not have to provide coverage or a defense because the policy excluded injuries intentionally caused by the insured. The district court found the exclusion ambiguous and required coverage. The Eleventh Circuit notes that Florida law requires construing ambiguities in favor of coverage and exclusionary clauses even more strictly. It also discusses two prior Florida cases finding specific intent was required to invoke an intentional acts exclusion. However, a recent Florida Supreme Court case on the same facts found injuries could be intentional if substantially certain to occur

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    of 6

    326 F.

    3d 1190

    TRAVELERS INDEMNITY COMPANY, Plaintiff-CounterDefendant-Appellant,


    v.
    PCR INCORPORATED, Defendant-Counter-ClaimantAppellee,
    Debra Turner, As Personal Representative of the Estate of
    Thomas Paul Turner III, James Creighton, et al., Defendants.
    No. 02-12829.

    United States Court of Appeals, Eleventh Circuit.


    April 4, 2003.

    Allan B. Taylor, Day, Berry & Howard, LLP, Hartford, CT, for Travelers
    Indem. Co.
    Michael D. Whalen, John A. DeVault, Bedell, Dittmar, DeVault &
    Pillans, P.A., Jacksonville, FL, for PCR Inc.
    Appeal from the United States District Court for the Northern District of
    Florida.
    Before EDMONDSON, Chief Judge, and KRAVITCH and GIBSON * ,
    Circuit Judges.
    PER CURIAM:

    This case involves a determination by the district court that an insurance


    company is obligated to provide coverage to an insured because an ambiguous
    exclusionary clause must be read to require specific intent by the insured to
    invoke the intentional-tort exclusion from liability coverage. The Florida
    Supreme Court, after considering these same facts in the context of the Florida
    workers' compensation statute, concluded that intentional torts included acts
    which involved substantial certainty that death or injury would befall an
    employee. Before we decide if Travelers Indemnity Company must provide
    liability coverage to PCR Incorporated, we need to ask the Florida Supreme

    Court for some advice about Florida law.


    BACKGROUND
    2

    In 1991, an explosion at the PCR chemical plant killed Paul Turner and
    seriously injured James Creighton, chemical technicians for PCR. Two experts
    opined that the chemicals used to develop a replacement coolant for freon were
    "highly reactive" and "prone to spontaneous and violent decomposition when
    heated or compressed." The explosion seemingly occurred when the chemicals
    were mixed in containers that were ill-suited for the chemical reaction. One
    expert stated that a "substantial certainty" existed that placing large quantities of
    these volatile substances in a rudimentary propane tank rather than in a suitably
    equipped reactor would result in an explosion. Turner v. PCR, Inc., 754 So.2d
    683, 685 (Fla.2000).

    Creighton and Turner's wife brought suit in a Florida court for the damages
    they suffered. PCR invoked immunity from suit on the grounds that the only
    recourse for damages available to Creighton and Turner was through workers'
    compensation. PCR claimed its behavior constituted no intentional tort that
    would permit Creighton and Turner to bring suit against it outside of workers'
    compensation.

    The Florida Supreme Court eventually determined that a subjective, specific


    intent was not required to overcome tort immunity under the workers'
    compensation statute. After considering the facts of this case, the Florida
    Supreme Court concluded that a substantial certainty of death or injury
    adequately supported an intentional tort to overcome employer immunity from
    suit.

    [The] intentional tort exception includes an objective standard to measure


    whether the employer engaged in conduct which was substantially certain to
    result in injury. This standard imputes intent upon employers in circumstances
    where injury or death is objectively "substantially certain" to occur. To hold
    otherwise would virtually encourage a practice of "willful blindness" on the
    part of employers who could ignore conditions that under an objective test
    would be found to be dangerous, and later claim lack of subjective knowledge
    or intent to harm an employee.

    Turner, 754 So.2d at 691. The Florida Supreme Court concluded that there
    were issues of fact about whether PCR engaged in conduct substantially certain
    to cause injury or death and remanded the case to the trial court.

    Before the explosion, Travelers had issued an insurance policy to PCR.


    Travelers brought an action for declaratory judgment in the district court to
    determine the coverage scope of the insurance policy. Travelers contended that
    it bore no responsibility in defending or indemnifying PCR against the suit
    brought by Creighton and Turner because the policy covered no intentional
    torts. Part One of the policy provides workers' compensation coverage. That
    coverage extends only to injuries to employees that result from accident or
    disease. Part Two of the policy provides employers' liability insurance. The
    terms of the policy require Travelers to pay all sums PCR "legally must pay as
    damages because of bodily injury to [PCR's] employees, provided the bodily
    injury is covered by this Employers Liability Insurance." But the liability
    coverage is limited to accidental injury: "This employers liability insurance
    applies to bodily injury by accident...." Coverage for accidental injury is subject
    to exclusions, including "bodily injury intentionally caused or aggravated by
    [PCR]." Travelers is required by the policy to defend against any suit brought
    for damages payable under the terms of the policy (such as damages for
    accidental, unintentional injuries).

    The district court determined that the insurance law of Florida required any
    ambiguity in an insurance contract to be resolved in favor of the insured.
    Because earlier Florida caselaw allowed an insurance carrier to avoid coverage
    only where an intentional tort was supported by a specific intent to cause harm,
    the district court concluded there existed, at least, some ambiguity in the clause
    "bodily injury intentionally caused or aggravated" by PCR. The district court
    granted the motion for judgment on the pleadings by PCR.

    DISCUSSION
    9

    In the earlier case before the Florida Supreme Court, PCR claimed it owed no
    liability to Turner and Creighton because "workers' compensation is the
    exclusive remedy for `accidental injury or death arising out of work performed
    in the course and scope of employment.'" Turner, 754 So.2d at 686 (quoting
    Fla. Stat. 440.09(1) (1997)). The Florida Supreme Court, however,
    "reaffirmed" in the Turner decision that "workers' compensation law does not
    protect an employer from liability for an intentional tort against an employee."
    Id. at 687. The high court also stressed that, in the workers' compensation
    context, two alternative bases exist for an employee to demonstrate an
    intentional tort sufficient to avoid tort immunity: the employer must have either
    "exhibit[ed] a deliberate intent to injure or engage[d] in conduct which is
    substantially certain to result in injury or death." Id. (internal quote marks and
    citation omitted)(emphasis in original). The second part of the disjunctive test is
    viewed objectively and "imputes intent upon employers in circumstances where

    injury or death is objectively `substantially certain' to occur." Id. at 691.


    10

    Travelers claims that the insurance policy with PCR specifically excluded
    "bodily injury intentionally caused or aggravated by you." Based on this
    exclusion, Travelers denies a duty on their part to defend or to indemnify PCR
    against the suits by Turner and Creighton. Travelers argues that injuries
    intentionally caused by PCR include those injuries (or death) that are
    substantially certain to occur, consistent with the conclusion of the Florida
    Supreme Court about workers' compensation. The Turner case, according to
    Travelers, should be extended to impute intent on PCR and to relieve Travelers
    from its obligations under the insurance contract.

    11

    We are required to apply state law when construing insurance policies. Hyman
    v. Nationwide Mut. Fire Ins. Co., 304 F.3d 1179, 1186 (11th Cir.2002). Florida
    law requires that insurance policies be read for their plain language and that
    every provision be given its full meaning and effect. Id. But if the "relevant
    policy language is susceptible to more than one reasonable interpretation, one
    providing coverage and the [] other limiting coverage, the insurance policy is
    considered ambiguous." Id. (quoting Auto-Owners Ins. Co. v. Anderson, 756
    So.2d 29, 34 (Fla. 2000)). An ambiguous policy must be "interpreted liberally
    in favor of the insured and strictly against the drafter who prepared the policy."
    Id. (internal quotes omitted). "In fact, exclusionary clauses are construed even
    more strictly against the insurer than coverage clauses." Id. at 1196 (internal
    quotes omitted)(emphasis added).

    12

    The insurance agreement between Travelers and PCR fails to address directly
    the intent requirement for "bodily injury intentionally caused or aggravated" by
    PCR. Two decisions of the Florida courts which predated the insurance
    policy here seemed to conclude that specific intent was required by the
    ambiguous exclusionary language of the insurance policies there under review.
    In Cloud v. Shelby Mut. Ins. Co., 248 So.2d 217 (Fla. 3d DCA 1971), an
    insured backed his vehicle into another occupied vehicle in a deliberate attempt
    to move the other vehicle, which was blocking the insured's vehicle in a
    driveway. When his vehicle overrode the bumper of the other vehicle, a
    passenger in the other vehicle was injured. The insurance company sought
    exclusion from coverage because the injury was caused "intentionally by or at
    the direction of the insured." Id. at 218. The state appellate court determined
    that the defendant intended to push the other car, but intended no harm to the
    passenger.

    13

    The courts have generally held that injury or damage is "caused intentionally"
    within the meaning of an "intentional injury exclusion clause" if the insured has

    acted with the specific intent to cause harm to a third party, with the result that
    the insurer will not be relieved of its obligations under a liability policy
    containing such an exclusion unless the insured has acted with such a specific
    intent.
    14

    Id. (quoting 44 Am.Jur.2d 1411, at 259, "Insurance")(emphasis added).

    15

    In Phoenix Ins. Co. v. Helton, 298 So.2d 177 (Fla. 1st DCA 1974), an insured
    defendant drove his car into a crowd of people to extricate his wife from a fight.
    While moving his vehicle in the crowd, a man was injured. The insurance
    company invoked an exclusionary clause, claiming the injuries were "caused
    intentionally by or at the direction of the insured." Id. at 178. Relying
    principally on the language in Cloud, the state appellate court concluded that
    the insured must have specifically intended to cause injury to the plaintiff
    before the insurer could invoke the intentional tort exclusion from liability
    coverage. Id. at 180-82.

    16

    The policy clause excluding from coverage "bodily injury intentionally caused
    or aggravated" by PCR may possibly be read in the light of Florida caselaw
    as requiring specific intent. Resolving all ambiguities of the exclusion clause
    in favor of the insured, it seems that Travelers could remain liable for what
    might be interpreted as PCR's "intentional" torts if the torts were committed
    without specific intent to cause injury to the employees.

    17

    The law of Florida on point seems debatable. As the circumstances of this


    liability-coverage case might lead us to a wrong conclusion about Florida law,
    we think we need some advice. We certify to the Florida Supreme Court the
    following dispositive questions:

    18

    1. Does Florida insurance law require a reading of specific intent into an


    insurance clause excepting from liability coverage "[b]odily injury intentionally
    caused or aggravated" by the insured?

    19

    2. Is PCR in this case entitled to liability coverage based on the language of this
    policy agreement, read in the light of Florida's law of interpreting insurance
    policies?

    20

    The certified questions we seek to pose to the Florida Supreme Court are
    intended by us in no way to limit the scope of that high court's review.** The
    outcome of this declaratory judgment action will be resolved by interpretations
    of Florida state law, and we invite a full discussion by the Florida Supreme

    Court. We welcome their guidance. The records and briefs will accompany this
    certification as a means of assistance should the Florida Supreme Court accept
    the certification.
    21

    CERTIFIED QUESTIONS.

    Notes:
    *

    Honorable John R. Gibson, United States Circuit Judge for the Eighth Circuit,
    sitting by designation

    **

    We have addressed none of Travelers' policy arguments about encouraging


    deliberate wrongdoing by shifting the liability burdens for wrongdoing onto the
    insurance industry. The Florida Supreme Court may wish to consider the policy
    arguments as it contemplates this issue of state law

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