The general liability insurance policy of the Northumberland Hunt Club in Virginia provides coverage not only for the Club itself, but also for any of its members “with respect to their liability for [the Club’s] activities or activities they perform on [the Club’s] behalf.”  But the Fourth Circuit Court of Appeals has affirmed a trial court decision holding that it doesn’t provide coverage for a club member who fired at a deer near a public highway and injured a passerby.  (Marks v. Scottsdale Insurance Company, 4^th Cir., No. 14-1823,6/29/15.)

The passerby first sued the member, alleging negligence and gross negligence because he knew or should have known that his shotgun would fire beyond the boundary of the Club property.  He also sued the Club for failing to promulgate rules to protect the public.  Before those cases were heard, he sued the Club’s insurer seeking a declaratory judgment that it had to defend and indemnify the member as an individual.  The passerby obviously wanted some assets to be available to pay for his damages when the shooter filed for bankruptcy.

The passerby agreed that the member did not get coverage under the second clause of the policy, performing activities on behalf of the Club.  But he argued that the member was covered because he was involved in an activity of the Club, hunting.

The Court of Appeals agreed with the Magistrate judge who had decided the case at the trial court level and “the other federal courts that have considered identical policy provisions.”  It said that the first clause “unambiguously restricts coverage to situations involving a member’s alleged vicarious liability for the activities of the Club as an entity.”

The passerby argued that there was coverage because the injury occurred “during” a Club activity or “arose from” a Club activity.  “But that is not what the Policy says,” the Court wrote, “and we cannot add words that are not there.  Members are covered with respect to their liability for the Club’s own corporate activities, not with respect to anything they may do during or in connection with Club activities.”

YOU NEED TO KNOW

The insurer did not contest its obligation to defend and indemnify the Club itself in connection with the shooting, but the claims against the shooter are obviously stronger than the claims against the Club itself.  And if the shooter is bankrupt, the claims against the individual may not be worth a whole lot of money.