Two work crews building a new home are taking a break. One of the employees of the plumbing contractor and a carpenter get into a little verbal sparring. It starts out good-natured but turns heated, and the plumber picks up a metal nut and flips it in the other man’s direction. At that moment, the carpenter stands up directly in the nut’s path. It strikes him in the eye; the ensuing injury is so severe that he loses part of the sight in that eye. He sues the plumbing contractor and the employee who threw the object. Employer and employee both look for coverage and defense under the plumber’s Commercial General Liability (CGL) insurance policy. Although the policy will likely cover the employer, coverage for the employee is not certain.
A CGL policy normally does not cover a person (an “insured”) for liability for injuries or damages “expected or intended from the standpoint of the insured.” If the insurance company concludes that the plumber’s employee either expected or intended to injure the carpenter with the thrown nut, it will not cover either his liability or defense costs. As R. Steven Rawls and Rebecca C. Appelbaum explained in a recent article, when courts have interpreted this policy language, they tend to agree on the meaning of the word “intended” but differ on the meaning of “expected.” Courts in various states have approached the meaning of “expected” in different ways.
- Expected and intended mean the same thing. Some courts have ruled that the two words have the same meaning within the insurance policy’s context. If the plumber expected the carpenter to get hurt, he must have intended it, and vice versa.
- What did the insured think was more likely to occur? A Texas court ruled that a result, such as an injury, is expected if the insured considered its occurrence to be more likely to happen than not to happen. The same court said that a finding that the insured intended an injury requires more proof than does a finding that an injury was expected.
- If the insured committed a reckless act, does that automatically mean he expected an injury? Another Texas court did not believe so. It raised the possibility that someone, while aware of the risks of a particular action, might believe that the chances of something going wrong are low. An Indiana court also said that recklessness alone is not enough to prove that an insured expected an injury. However, an Illinois court said that some actions are so inherently dangerous (such as firing a gun) that the only possible conclusion is that the insured expected the injury.
- Two-part tests. Some courts have used a two-part test to determine expectation. A Michigan court used a test that asked, first, did the insured foresee the injury that occurred? If not, was the likelihood of the injury so overwhelming and obvious as to make unbelievable the insured’s claim that he didn’t foresee it? A Delaware court said that, where the insured clearly did not intend to injure the other person and where he should not necessarily have known that an injury would occur, the policy would cover him.
Construction sites are dangerous places; injuries can occur either through horseplay or in the normal course of work. Contractors cannot emphasize too strongly to their employees the necessity of common sense and care on the job site. If an employee injures someone else on the site, his financial well-being could depend on a court deciding whether he should have expected the injury. That’s a chance no one should want to take.