R.S. and D.S. v. United Services Automobile Association

Summary

The Montana Supreme Court affirmed summary judgment for United Services Automobile Association, holding that a homeowners insurance policy's sexual misconduct exclusion unambiguously applied to claims arising from an insured's surreptitious recording of a minor showering. Because the claims fell outside the policy's coverage, USAA had no duty to defend the insured.

Holdings

1. The policy's exclusion for claims arising out of sexual misconduct was not ambiguous. Secretly recording a minor while she showered unambiguously constituted sexual misconduct under the ordinary meaning of those words.
2. The claims against Conrad arose out of his sexual misconduct because that misconduct was the only act alleged from which liability for D.S.'s emotional injury could arise.
3. USAA had no duty to defend Conrad because the allegations in the underlying complaint fell within the unambiguous sexual-misconduct exclusion and were therefore outside the policy's coverage.

Questions Presented

1. Whether the sexual-misconduct exclusion in Conrad's homeowners insurance policy unambiguously excluded the claims asserted by R.S. and D.S.
2. Whether USAA had a duty to defend Conrad against the underlying invasion-of-privacy and emotional-distress claims.
3. Whether summary judgment for USAA was proper.

Disposition

affirmed