In Northfield Insurance Company v. Yates, Wood & MacDonald, Inc., et al., Judge Tana Lin with the U.S. District Court for the Western District of Washington found the insurance company had no duty to defend its insured in a negligent security case due to the policy’s exclusion for “assault or battery” and in doing so, distinguished state cases on “pre-assault” and “post-assault” conduct.
In August 2020, a female tenant of an apartment complex managed by Yates, Wood & MacDonald, Inc. (“Yates”), was physically and sexually assaulted and battered by one of Yates’s employees after he lured her to his apartment within the complex. The tenant brought a civil suit against Yates and the owner of the complex for negligence, negligent training and supervision, negligent hiring and retention, vicarious liability and sex discrimination. Therein, she alleged that her attacker was hired by Yates “without adequate background check, training, or supervision of any type.”
Yates submitted the claim to its insurer, Northfield Insurance Company, pursuant to its policy with Northfield. The policy contained standard “Coverage A Bodily Injury and Property Damage” coverage but with an endorsement entitled “Exclusion – Assault or Battery”, which excluded from coverage “ ‘Bodily injury’ or ‘property damage’ arising out of any act of ‘assault’ or ‘battery’ committed by any person, including any act or omission in connection with the prevention or suppression of, or in response to, such ‘assault’ or ‘battery’.” The endorsement also defined “assault” as “any attempt or threat to inflict injury to another, including any conduct that would reasonably place another in apprehension of such injury” and “battery” as “any intentional, reckless or offensive physical contact with, or any use of force against, a person without his or her consent that inflicts some injury, regardless of whether the resulting injury inflicted is intended or expected.”
In April 2024, Northfield Insurance Company filed a declaratory judgment action against Yates, seeking a determination of coverage for the claims in the underlying litigation. Therein the Court found that the claims alleged in the underlying litigation’s complaint were not “even conceivably” covered by the policy given the claims fell under the assault and battery exclusion. The Court noted that all of the tenant’s claims against Yates concerned “act[s] or omission[s] in connection with the prevention or suppression of, or in response to,” the alleged assault and/or battery by Yates’s employee. Given these allegations constitute both acts (i.e., Yates hiring the employee) and omissions (i.e., Yates negligently hired the employee without performing background check; Yates provided no training or supervision of the employee and Yates provided no warnings to tenants and the public of the employee’s possible harm to others) “in connection with the prevention or suppression” of the employee’s alleged attack, the Court held that they are clearly excluded under the policy.
Yates’s argument that the underlying complaint made a distinction between “pre-assault” and “post-assault” conduct, and that Northfield had a duty to defend as to Yates’s post-assault conduct was unpersuasive. The Court held that although Washington courts do make “a preassault/postassault distinction” in analyzing “arising out of” assault and battery exclusions, the distinction was irrelevant here because of the policy’s additional language: coverage is excluded for injury from acts or omissions “in response to” an assault or battery, which unambiguously includes Yates’s alleged conduct after the assault (i.e., the employee’s termination and delay in his eviction). Moreover, the Court found that even when construing the complaint liberally, the complaint alleged claims regarding only the hiring, management, and retention of the employee, not any “post-assault” conduct.
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