Appeal from Superior Court, King County. 93-2-24800-8. Honorable Liem E. Tuai, Judge.
As Corrected March 21, 1997.
Authored by James M. Dolliver. Concurring: Barbara Durham, Charles Z. Smith, Philip A. Talmadge, Barbara A. Madsen, Richard P. Guy, Gerry L. Alexander. Dissenting: Charles W. Johnson, Richard B. Sanders.
The opinion of the court was delivered by: Dolliver
DOLLIVER, J.--An insurance company asks for a declaration that a criminal acts exclusion in its homeowner's insurance policy precludes insurance coverage to a guest who was shot by the homeowner, when the shooting constituted the crime of reckless endangerment. We find the criminal acts exclusion applies to the facts of this case.
While a guest in James Peasley's house, Ardis Parker was shot in the stomach by James Peasley. Parker sustained serious but nonfatal injuries. Both Peasley and Parker maintain the shooting was accidental.
After reviewing the facts surrounding the shooting and interviewing Peasley's neighbors who had heard a loud argument from Peasley's house at the time of the shooting, the local prosecutor charged Peasley with second degree assault. Peasley was tried and convicted, but the Court of Appeals reversed the conviction because of an erroneous jury instruction. State v. Peasley, No. 29919-1-I (Wash. Ct. App. Nov. 15, 1993). Peasley then bargained with the prosecutor and pleaded guilty to second degree reckless endangerment in exchange for the prosecutor's recommendation of a suspended sentence.
Ardis Parker sued Peasley for damages arising from her injuries. Peasley was insured by Allstate Insurance Company (Allstate). When Allstate learned of Parker's lawsuit, Allstate brought this summary judgment against both Peasley and Parker seeking a declaration that a criminal acts exclusion in the Peasley's homeowner's insurance policy (Policy) excluded coverage for Parker's injuries because they were the result of Peasley's criminal acts. The trial court granted summary judgment for Allstate, and the Court of Appeals affirmed. Allstate Ins. Co. v. Peasley, 80 Wash. App. 565, 910 P.2d 483, review granted, 129 Wash. 2d 1013 (1996). We also affirm.
Summary judgment in this case is appropriate because the interpretation of language in an insurance policy is a matter of law. Rones v. Safeco Ins. Co. of Am., 119 Wash. 2d 650, 654, 835 P.2d 1036 (1992). The insurance contract must be viewed in its entirety; a phrase cannot be interpreted in isolation. Hess v. North P. Ins. Co., 122 Wash. 2d 180, 186, 859 P.2d 586 (1993). When construing the policy, the court should attempt to give effect to each provision in the policy. Kish v. Insurance Co. of N. Am., 125 Wash. 2d 164, 170, 883 P.2d 308 (1994).
Peasley thinks the criminal acts exclusion clause is ambiguous. "An ambiguity exists only 'if the language on its face is fairly susceptible to two different but reasonable interpretations'." Kish, 125 Wash. 2d at 171 (quoting Washington Pub. Util. Dists.' Utils. Sys. v. PUD 1, 112 Wash. 2d 1, 11, 771 P.2d 701 (1989)). If an ambiguity is found in an exclusionary clause, the ambiguity is strictly construed against the insurer. Kish, 125 Wash. 2d at 170 (citing Rodriguez v. Williams, 107 Wash. 2d 381, 384, 729 P.2d 627 (1986)). If, however, the language in an insurance policy is clear and unambiguous, the court must enforce it as written and cannot modify the contract or create ambiguity where none exists. Transcontinental Ins. Co. v. Washington Pub. Utils. Dists.' Util. Sys., 111 Wash. 2d 452, 456, 760 P.2d 337 (1988).
When analyzing an insurance policy and questioning whether an ambiguity exists, we look at the language according to the way it would be read by the average insurance purchaser. State Farm Gen. Ins. Co. v. Emerson, 102 Wash. 2d 477, 480, 687 P.2d 1139 (1984). Terms undefined by the insurance contract should be given their ordinary and common meaning, not their technical, legal meaning. Kish, 125 Wash. 2d at 170.
With these rules in mind, we must look to the exclusion at issue in Peasley's Policy:
1. We do not cover any bodily injury which may reasonably be expected to result from the intentional or criminal acts of an insured person or which are in fact intended by an insured person. Clerk's Papers at 23. Peasley claims the phrase "criminal acts" is ambiguous. He acknowledges Allstate's reading of the phrase, but he argues a reasonable person could understand the phrase as denoting only intentional crimes. If the phrase is subject to more than one reasonable interpretation, the interpretation most favorable to the insured will be applied. If the phrase is unambiguous on its face, then it must be applied as written. The Court of Appeals held the phrase clearly and unambiguously includes both intentional and unintentional criminal acts. Allstate, 80 Wash. App. at 568.
Before addressing Peasley's claim of ambiguity, we must break down the exclusion clause. Because the disjunctive conjunction "or" separates "intentional" from "criminal," we can break the clause down into the following order:
Allstate does not cover A. any bodily injury which may reasonably be expected to result from the 1. intentional acts of an insured person, or 2. criminal acts of an insured person, or B. injuries which are in fact intended by an insured. See Hooper v. Allstate Ins. Co., 571 So. 2d 1001, 1002-03 (Ala. 1990) (outlining the same exclusion in a similar fashion). As used in the clause, the word "intentional" clearly denotes its own category of acts -- acts which are intentional, whether or not they are criminal. Likewise, the word "criminal" denotes its own category of acts -- acts which are criminal, presumably whether or not they are intentional. We say presumably because Peasley claims the phrase criminal acts can be read by the ordinary person as denoting only intentional criminal acts.
Since Peasley's Policy appears to leave the phrase "criminal acts" undefined, we turn to the dictionary to determine the common meaning of the words. Boeing Co. v. Aetna Casualty & Surety Co., 113 Wash. 2d 869, 877, 784 P.2d 507 (1990); see also Kish, 125 Wash. 2d at 171 (looking to the dictionary to define "flood" as used in an exclusionary clause). The definitions for the adjective "criminal" include the following:
1 : involving or being a crime 2 : relating to crime or its punishment -- distinguished from civil 3 : guilty of crime or serious offense 4a:REPREHENSIBLE, BLAMEWORTHY, DISGRACEFUL b : EXCESSIVE, EXTORTIONATE 5 : of or suitable to a criminal 6 : concerned with crime or criminal law[.]
Webster's Third New International Dictionary 536 (1986) (examples of usage omitted). Peasley's claimed ambiguity is not supported by the dictionary. None of the definitions of criminal include intent as part of the adjective's meaning. To the contrary, the dictionary gives the ...