The opinion
STATE OF MAINE SUPERIOR COURT
CIVIL ACTION
YORK, ss. DOCKET NO. CV-01-291
PAF ~ Yor, ~ y [one | ol DOR,
YORK GOLF AND TENNIS CLUB,
et al.,
DONALD L. GARBRECHT
Paints LAW LESRARY
. DECISION
. AND ‘FER 13 2002
ORDER FEB 13
TUDOR INSURANCE COMPANY,
Defendant
In August of 2000 the York Golf and Tennis Club (York) held its annual
meeting to elect directors. A dispute arose concerning the conduct of the election
and whether defamatory statements were made. A complaint was brought by
Robert Reilly, an unsuccessful candidate for election as a director, and his supporters
against York and several individuals. The first amended complaint consisted of six
counts. The first four sought either preliminary or permanent injunctive relief
regarding the composition of the board of directors. Monetary damages were not
sought in Counts I-IV. Count V was a defamation count seeking a monetary
judgment while Count VI sought punitive damages. While that case is now
resolved, its outcome is immaterial to the present case.
York was insured by the current defendant Tudor Insurance Company which
declined to defend York. York and its directors have sued Tudor alleging a breach by
Tudor of its duty to defend York and its directors under the non-profit organization
liability insurance policy.
Tudor has filed a motion to dismiss while the plaintiffs have filed a motion
for partial summary judgment.
Tudor argues that it has no duty to defend because the policy defines “loss” to
exclude punitive damages and that defamation claims are not covered. York and its
officers concede these arguments. Therefore, no duty to defend, nor obviously to
indemnify, would exist on Counts V and VI of the amended complaint.
Counts I-IV sought injunctive relief and did not request monetary damages.
Among the exclusions in the policy is one for “. . . claims, demands or actions
‘seeking relief, or redress, in any form other than money damages.” The question
becomes whether, in light of the allegations in Counts ILIV of the amended
complaint, the policy exclusions and a series of Law Court opinions, a duty to defend
exists. The answer is yes under existing law.
Maine uses a well-established comparison test where the allegations in the
complaint are matched against the policy. Gibson v. Farm Family Mutual Insurance
Co., 673 A.2d 1350, 1352 (Me. 1996) and Foundation for Blood Research v. St. Paul
Marine and Fire Insurance Co., 1999 Me. 87 ¥4, 730 A.2d 175, 177.
The Law Court has stated in many opinions how the comparison test is to be
used. A central requirement is that there is a duty to defend if there is “.. . any legal
or factual basis for payment under a policy.” Gibson at 1352, AmericanPolicyholders
Insurance Co. v. Kyes, 483 A.2d 337, 339 (Me. 1984) and Horace Mann Insurance Co.
v. Maine Teachers Association, 449 A.2d 358, 360 (Me. 1982). Other cases indicate
that “any” means any. See Maine Bonding & Casualty Co. v. Douglas Dynamics,
Inc., 594 A.2d 1079, 1080-1 (Me. 1991) where even “albeit remotely” possibilities of
coverage were sufficient to require that the insurance company defend.
Since there is a possibility that in later considering the requests for injunctive
relief a court could, as part of its broad equitable powers, grant “such other relief” as
monetary damages, that remote possibility, regardless of whether it has any
grounding in the facts of the election results suit, if sufficient to create a duty to
defend. See York Insurance Group of Maine v. Lambert, 1999 Me. 73 77, 740 A.2d .
984, 6. Lastly, the caselaw cited by the plaintiffs supports its argument that it is no
consequence that any potential monetary damages would flow from a count in
equity.
The entry is:
Defendant’s motion to dismiss is denied. Plaintiffs’
motion for partial summary judgment is granted. The
defendant had a duty to defend in York County Superior
Court docket no. CV-00-289, Reilly v. York Golf and
Tennis Club. oO
Dated: January 28, 2002
Z
(Hel, bi Lortreby
Paul A. Fritzsche/
Justice, Superior Court
Stephen B. Wade, Esq. - PLS
Thomas V. Laprade, Esq. — DEF