Cincinnati Ins. Co. v. Oblates of St. Francis de Sales, Inc.
(Ohio Ct. App. Sept. 17, 2010)
An appellate court in Ohio recently held that an insurer was not obligated to indemnify the Archdiocese of Oklahoma City in an underlying action against a priest for sexual molestation. The court held that the Church’s assigning the priest to a parish without warning that resulted in the parish allowing the priese unsupervised access to minors was substantially certain to result in additional incidents of sexual molestation and, therefore, did not constitute an “occurrence” within the meaning of the policy.
The underlying lawsuit arose from the priest’s sexual abuse of a minor whose family belonged to the priest’s parish. Prior to his assignment to that parish, the priest had been accused of and admitted to several incidents of sexually abusing minor boys. The priest underwent psychiatric counseling, a result of which it was determined that his sexual disorder was manageable, but not curable, and that he should not be in the presence of youth without another responsible adult there. Four years after the report was issued, the priest was assigned to a new parish that was given no warning about his sexual propensities. As a result, the parish placed no restrictions on the priest with respect to his dealings with parish youth.
After the priest and his Order were sued by the claimant, the Order tendered its defense and indemnity to its primary and excess insurers. The excess insurer denied coverage based on lack of an “occurrence.” The Order ultimately assigned its claim against its excess insurer to the Archdiocese of Oklahoma City, which had funded the settlement in the underlying action.
In the ensuring declaratory judgment action, the trial court granted summary judgment to the excess insurer. The appellate court affirmed the ruling, finding that the Order’s knowledge of the priest’s history and his need for supervision and ongoing treatment without warning to the parish was substantially certain to result in additional incidents of sexual molestation of boys. The court held that injury to the priest’s victim was expected from the Order’s perspective and, therefore, did not constitute “occurrences” within the meaning of the policy. The court acknowledged the Ohio Supreme Court’s decision in Doe v. Shaffer, 738 N.E.2d 1243 (2000), which held that allegations of negligent hiring related to sexual molestation could constitute a policy “occurrence” and, therefore, afford coverage. The court distinguished its case on the ground that in Shaffer, there was no evidence that the molester had any history of sexual abuse or that the respective employers knew of the molesters’ potential propensities toward sexual abuse.
For a copy of the case, click here
Carrie Appler and Sharon Angelino