Posted by H. Lee Pruett
A recent Georgia case attests to the importance of looking to the allegations of the plaintiff’s complaint in determining potential coverage and the insurance company’s duty to defend a lawsuit. In Nationwide Mut. Fire Ins. Co. v. Kim, Case No. A08A1063 (Ga. Ct. App., Nov. 14, 2008), Chong Yang sued Yong Kim for hitting Yang in the face with an ice cream scoop in a DeKalb County karaoke bar. Yang’s initial complaint alleged an intentional assault and battery. Yang later amended the complaint to delete all factual allegations in the initial complaint and to allege that Kim negligently threw the ice cream scoop in Yang’s direction. Yang sought compensatory and punitive damages. Nationwide Insurance Company insured Kim under a homeowner’s policy. Nationwide entered into a defense of Kim under a reservation of rights and filed a declaratory judgment action seeking a judgment of non-coverage based on the intentional act exclusion in the policy.
The Georgia Court of Appeals affirmed the trial court’s ruling that the plaintiff’s claims of negligence and gross negligence were covered under the policy. The Court repeated the rule that an insurance company’s duty to defend is determined by the allegations of the complaint, even if groundless or false. Although in this case the plaintiff had originally alleged an intentional assault and battery, the Court emphasized that the amended complaint removed all of the original factual allegations of intent and alleged negligence instead. The Court acknowledged the liberality of Georgia’s rule allowing amendments to a complaint up to the entry of a pretrial order.
The Court also held that, although the policy specifically excluded coverage for bodily injury caused by intentional acts, the insurer would be liable for punitive damages because the policy did not contain an explicit punitive damages exclusion.