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Frat insurer must pay for fight injuries, Ala. SC rules

By Nathan Bass | Jan 16, 2013

MONTGOMERY, Ala. (Legal Newsline) - An insurance company for a University of South Alabama fraternity has to cover damages to the plaintiff who filed suit against the fraternity and two of its officers due to injuries he obtained in a fight at the fraternity house.

Justice Lyn Stuart wrote the opinion, handed down Jan. 11, for the unanimous five judge panel of the Court.

The case stems from an altercation at the Kappa Nu fraternity house in Mobile, Alabama. Kappa Nu is the name used for the local chapter of the national fraternity, Kappa Sigma.

Plaintiff Ryan Price-Williams was attacked and beaten at the fraternity house on the evening of Jan. 31, 2004. He "suffered significant, permanent injuries as a result of the assault and incurred medical expenses of approximately $27,145," the opinion states.

Price-Williams filed suit against Kappa Sigma, Kappa Nu, Gabriel Dean, Charles Baber and Michael Howard. The three men were alleged to have committed the assault.

Dean and Baber were, respectively, president and vice president of Kappa Nu at the time of the assault. Neither Price-Williams nor Howard were members of Kappa Nu.

A summary judgment was entered in favor of Kappa Sigma before trial and Kappa Nu reached a settlement with Price-Williams after closing arguments were made at the conclusion of the trial. Price-Williams then moved the trial court to withdraw his jury demand and enter a final judgment against Dean, Baber, and the other man based upon the evidence adduced at trial.

The trial court granted the motion.

A dispute then arose between Price-Williams and Kappa Nu as to whether as part of the settlement agreement reached with Kappa Nu, Price-Williams had agreed to release only Kappa Sigma and Kappa Nu, or whether the agreement included additionally releasing Dean and Baber, as agents of Kappa Nu.

Motions were filed and the trial court eventually ruled in favor of Price-Williams on this matter as well. During the litigation, Price-Williams had also filed an action alleging that Dean and Baber were additional insureds under the commercial general liability policy Kappa Sigma held with Admiral Insurance Company.

Admiral denied this but the trial court, after a May 3, 2011, bench trial, entered a judgment in favor of Price-Williams on this matter and Admiral filed its notice of appeal to the state Supreme Court.

"Admiral first argues that the trial court's judgment should be reversed because the gravamen of Price-Williams's claims is that he received bodily injury as a result of an illegal assault and battery, and Kappa Sigma's policy with Admiral contains the following exclusion: 'This insurance does not apply to 'bodily injury,' 'property damage,' 'personal injury,' or 'advertising injury' arising out of any act of assault and/or battery by any insured or additional insured.'

"Thus, Admiral argues, the trial court erred in finding that coverage existed because it is undisputed that Price-Williams's injuries arose out of an assault committed by Dean and Baber," Stuart wrote.

"However, in addition to his assault claim," Stuart continued, "Price-Williams alleged claims of negligence and/or wantonness based on Dean's and Baber's failure to implement the risk-management program required by Kappa Sigma rules."

"[T]he trial court correctly held that Dean and Baber were not acting within the scope of their duties with regard to one act - the assault of Price-Williams - but were acting within the scope of their duties with regard to another act - the failure to implement a risk-management program, as required by Kappa Sigma rules, at some point before the assault," Stuart wrote.

Admiral also argued that Dean's and Baber's failure to implement a risk-management program at the fraternity house was not an "occurrence" under the policy because an "occurrence is generally defined as "an accident" and Dean and Baber intentionally injured Price-Williams.

"Again, however," Stuart wrote, "this argument conflates two separate acts. It is undisputed that the assault was not a covered occurrence for various reasons, including the fact that it was not an accident, and the trial court did not rule otherwise. Rather, the trial court necessarily held that the "occurrence" was Dean's and Baber's failure to implement a risk-management program before the assault.

"Admiral's final argument is that the trial court's judgment should be reversed because, Admiral argues, there is no evidence indicating that Price-Williams's injuries were proximately caused by Dean's and Baber's negligence and/or wantonness in failing to implement a risk-management program.

"The trial court could have reasonably concluded that a proper risk-management program, including the designation of a responsible 'sober monitor' to 'generally maintain order'" which the Court pointed out the Kappa Sigma Risk Management Handbook set out to be followed with regards to parties at which alcohol is served, "would have, as the trial court stated, 'either prevented the assault from starting in the first instance or, at a minimum, stopped the assault within a few seconds after it started.'

"Because the evidence adduced at trial supports the trial court's conclusion that Admiral's policy with Kappa Sigma provided liability coverage to Dean and Baber with regard to the negligence and wantonness claims tried in the underlying action, we hereby affirm that judgment."

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