Woo v. Fireman's Fund Insurance Co.

Summary

The Washington Supreme Court considered whether Fireman's Fund Insurance Company had a duty to defend an oral surgeon against claims arising from a practical joke played on an employee during a dental procedure. The court held that the insurer had a duty to defend under the professional liability and general liability provisions, but not under the employment practices liability provision. The court partially reversed the Court of Appeals, reinstated the trial court's judgment based on the jury's bad-faith and Consumer Protection Act verdict, and awarded attorney fees and costs on appeal.

Holdings

1. Fireman's Fund had a duty to defend because the complaint's allegations that Woo inserted the boar-tusk flippers during a dental procedure while operating a dental office could conceivably fall within the policy's broad definition of dental services and the practice of dentistry.
2. An insurer may not deny a defense by relying on an equivocal interpretation of case law when the complaint potentially alleges covered conduct; the insurer must give the insured the benefit of the doubt.
3. Fireman's Fund had no duty to defend under the employment practices liability provision because the complaint did not allege a wrongful discharge as defined by the policy.
4. Fireman's Fund had a duty to defend under the bodily-injury coverage because the complaint included negligent causes of action and did not clearly establish that Woo expected or intended the specific injuries Alberts alleged.
5. Fireman's Fund had a duty to defend under the personal-injury coverage because the complaint alleged injuries arising from conduct occurring during Woo's dental business and did not clearly allege that the injuries were expected or intended.
6. A new trial was not warranted because the reversal of the Court of Appeals restored coverage under the professional liability provision, which was the principal focus of the case and supported the jury's bad-faith verdict.
7. The trial court did not err by instructing the jury that Fireman's had breached its duty to defend while leaving the jury to decide whether Fireman's acted in bad faith or violated the Consumer Protection Act.
8. The trial court did not err in resolving Fireman's collusion challenge to the settlement or in denying relief from the jury's emotional-distress damages award.
9. Woo was entitled to attorney fees and costs on appeal because he prevailed in the duty-to-defend action and under the Washington Consumer Protection Act.

Questions Presented

1. Whether Fireman's Fund had a duty to defend under the professional liability provision.
2. Whether Fireman's Fund had a duty to defend under the employment practices liability provision.
3. Whether Fireman's Fund had a duty to defend under the general liability provision's bodily-injury coverage.
4. Whether Fireman's Fund had a duty to defend under the general liability provision's personal-injury coverage.
5. Whether the jury's bad-faith and Consumer Protection Act verdicts, the jury instructions, the settlement ruling, and the emotional-distress damages award could stand.
6. Whether Woo was entitled to attorney fees and costs on appeal.

Disposition

other