New York Law Review

Tag: Intentional Torts

  • RJC Realty Holding Corp. v. Republic Franklin Insurance Co., 4 N.Y.3d 158 (2005): Employer Liability for Employee’s Intentional Acts Under Insurance Policies

    RJC Realty Holding Corp. v. Republic Franklin Insurance Co., 4 N.Y.3d 158 (2005)

    An employee’s intentional tort, such as sexual assault, is not automatically attributed to the employer for insurance coverage purposes, and the incident may be considered an “accident” covered by the employer’s policy if the employer neither expected nor intended the act.

    Summary

    RJC Realty, operating a spa, sought insurance coverage from Republic Franklin for a lawsuit alleging sexual assault by RJC’s employee during a massage. Republic Franklin denied coverage, arguing the assault wasn’t an “accident” and was excluded due to being intentional and arising from body massage. The New York Court of Appeals held that the assault was an “accident” from RJC’s perspective because the employee’s intent isn’t automatically imputed to the employer. The court also found the “body massage” exclusion inapplicable, as it pertains to injuries from the massage itself, not from intentional torts committed during the massage, thus requiring Republic Franklin to defend and indemnify RJC.

    Facts

    RJC Realty operated a spa and held a business insurance policy with Republic Franklin, covering bodily injury caused by an “occurrence” (defined as an accident). Marie Harrison sued RJC and its masseur, alleging sexual assault during a massage. She claimed RJC was negligent in hiring and supervising the masseur. RJC sought coverage from Republic Franklin, who disclaimed it based on the “accident” definition and policy exclusions.

    Procedural History

    RJC sued Republic Franklin seeking a declaratory judgment for coverage. The Supreme Court ruled for RJC. The Appellate Division reversed, finding the “expected or intended” exclusion applicable because the employee committed an intentional act. The New York Court of Appeals reversed the Appellate Division, reinstating the Supreme Court’s judgment, thereby siding with RJC.

    Issue(s)

    1. Whether an employee’s intentional tort (sexual assault) is considered an “accident” from the employer’s perspective, thus triggering insurance coverage for the employer?

    2. Whether the insurance policy’s exclusion for bodily injury “arising out of body massage” applies to a sexual assault committed during a massage?

    Holding

    1. Yes, because, following Agoado and Judith M., the employee’s intentions are not automatically imputed to the employer, and thus from the employer’s viewpoint, the assault was unexpected and unforeseen.

    2. No, because the “body massage” exclusion is reasonably interpreted to apply to injuries inherent in the massage itself, not to intentional torts committed under the guise of a massage.

    Court’s Reasoning

    The Court of Appeals relied on Agoado Realty Corp. v United Intl. Ins. Co., stating, “in deciding whether a loss is the result of an accident, it must be determined, from the point of view of the insured, whether the loss was unexpected, unusual and unforeseen.” The court reasoned that, similar to Judith M. v Sisters of Charity Hosp., the employee’s actions were outside the scope of employment and for personal motives, and should not be attributed to RJC for determining insurance coverage. The court stated that, “Assuming plaintiff’s allegations of sexual abuse are true, it is clear that the employee here departed from his duties for solely personal motives unrelated to the furtherance of the Hospital’s business.” Regarding the “body massage” exclusion, the court found it ambiguous and narrowly construed it against the insurer, stating that “an exclusion in an insurance policy can negate coverage only where it is stated ‘in clear and unmistakable language [and] is subject to no other reasonable interpretation.’” The court interpreted the exclusion as pertaining to physical injuries from the massage itself, not from intentional torts. This case clarifies that an employer’s liability insurance can cover employee misconduct if the employer did not expect or intend the actions, emphasizing the importance of the insured’s perspective in determining what constitutes an “accident”.

  • Adams v. New York City Transit Authority, 88 N.Y.2d 116 (1996): Common Carrier Liability for Employee Assault

    Adams v. New York City Transit Authority, 88 N.Y.2d 116 (1996)

    A common carrier is not vicariously liable for the intentional torts of its employees when those actions are outside the scope of employment; the historical rule imposing such liability is no longer viable.

    Summary

    Margaret Adams sued the New York City Transit Authority (NYCTA) for injuries sustained when a token booth clerk assaulted her. The lower court granted summary judgment for Adams, relying on a long-standing rule that common carriers are liable for their employees’ torts, regardless of scope of employment. The Appellate Division reversed, finding the rule no longer viable. The New York Court of Appeals affirmed, holding that the NYCTA was not liable because the clerk’s assault was outside the scope of her employment. The court reasoned that the historical justifications for the special common carrier liability rule were outdated and inconsistent with modern tort principles. This case effectively eliminates the heightened vicarious liability previously imposed on common carriers in New York.

    Facts

    Margaret Adams was waiting in line to purchase a subway token. She observed the clerk yelling at another customer. After that customer left, Adams approached the booth, paid her fare, and asked for directions. The clerk responded with verbal abuse. As Adams walked away, the clerk assaulted her from behind, pushing her to the ground and choking her, causing physical and emotional injuries.

    Procedural History

    Adams sued the NYCTA, alleging various causes of action including negligent hiring and breach of the carrier’s duty. The Supreme Court dismissed the claims for negligent hiring, training, and supervision, but granted summary judgment to Adams on the claim based on the breach of the carrier’s duty to provide safe passage. The Appellate Division reversed the Supreme Court’s ruling and dismissed the remaining cause of action. The New York Court of Appeals granted leave to appeal and affirmed the Appellate Division’s decision.

    Issue(s)

    Whether the New York City Transit Authority is vicariously liable for the intentional tort of its employee, a token booth clerk, when the tortious act (assault) occurred outside the scope of the employee’s employment.

    Holding

    No, because the historical rule imposing heightened vicarious liability on common carriers for the torts of their employees is no longer viable as a matter of law or policy, and the general principles of vicarious liability do not support holding an employer liable for an employee’s intentional tort committed outside the scope of employment.

    Court’s Reasoning

    The Court of Appeals rejected the argument that common carriers are automatically liable for all torts of their employees. The Court recognized the general rule that employers are vicariously liable only for torts committed within the scope of employment. The Court then examined the historical exception to this rule for common carriers, as established in Stewart v. Brooklyn & Crosstown R. R. Co., 90 N.Y. 588 (1882), which held carriers liable for their employees’ torts regardless of whether those torts were committed within the scope of employment. The Court found that the justifications for this special rule were no longer valid.

    The court reasoned that the higher duty of care previously imposed on carriers has been criticized and is no longer widely applied. The court noted that the analogy between a carrier’s responsibility for goods and passengers was discredited, and the risks of travel by common carrier are no longer significantly greater than other activities. The Court stated, “[T]here is no real logical connection between a carrier’s higher duty of care and the imposition of ‘absolute’ liability for the unforeseeable acts of employees that are both beyond the employer’s control and outside the reasonable scope of the employer’s enterprise.”

    Furthermore, the court refuted the argument that passengers are “helpless prisoners” and highlighted that modern life includes many situations where individuals have curtailed movement. The court noted the flawed reasoning in Stewart, stating the court in Stewart concluded carriers should be liable for intentional misconduct, since it would be anomalous to deny liability, while imposing liability when an employee negligently permits a passenger to be attacked by a stranger. The Court stated, “[T]his syllogism is logically defective because it overlooks that liability in situations involving employee negligence requires the existence of an analytically critical fact not present in cases involving gratuitous intentional employee misdeeds, i.e., employee misconduct occurring within the scope of employment.”

  • Stein v. ECG Consulting Group, Inc., 92 N.Y.2d 864 (1998): Employer Liability for Employee Assault

    92 N.Y.2d 864 (1998)

    An employer is not vicariously liable for an employee’s assaultive acts unless the conduct was within the scope of employment, authorized by the employer, or the use of force was within the employee’s discretionary authority.

    Summary

    This case addresses the scope of an employer’s liability for the intentional torts of its employees, specifically an assault. The New York Court of Appeals held that the defendant company was not liable for the assault committed by a worker it hired to unload rice sacks, as the assault was outside the scope of employment and not authorized by the company. The court emphasized that an employer is not responsible for an employee’s malicious or wanton trespass if it is unrelated to the employer’s service.

    Facts

    The plaintiff was assaulted by one of three men hired by the defendant to unload sacks of rice from the plaintiff’s truck. The plaintiff alleged that the defendant was vicariously liable for the assault. The defendant’s owner-manager directed the workers where to place the sacks. Prior to the assault, the plaintiff complained about the worker’s verbal abuse. There was no evidence that the defendant authorized or condoned the assault.

    Procedural History

    The trial court granted the defendant’s motion for summary judgment, dismissing the complaint. The appellate division affirmed. The New York Court of Appeals affirmed the appellate division’s decision, holding that the defendant was not liable for the assault.

    Issue(s)

    Whether an employer can be held vicariously liable for an employee’s assault when the assault was not within the scope of employment, authorized by the employer, or related to the employer’s business interests.

    Holding

    No, because the assault was not undertaken within the scope of employment, the employer did not authorize the violence, and the use of force was not within the discretionary authority afforded to the employee.

    Court’s Reasoning

    The Court of Appeals relied on the principle that an employer is generally not liable for an employee’s tortious acts when the employee acts outside the scope of employment and with malicious intent or to achieve a personal purpose. The court cited Mott v. Consumers’ Ice Co., 73 NY 543, 547, stating, “if a servant goes outside of his employment, and without regard to his service, acting maliciously, or in order to effect some purpose of his own, wantonly commits a trespass, or causes damage to another, the master is not responsible.” The court distinguished the case from situations where the use of force is implicit in the employee’s duties or where the assault is in furtherance of the employer’s business. The court found no connection between the worker’s duties as a day laborer and the assault. The concurrence emphasized that whether the worker was an employee or independent contractor was irrelevant because the assault was clearly outside the scope of either relationship. The concurrence cited Oneta v. Toed Co., where an employer was not liable for an employee’s assault on a building porter during an argument about a hand truck. It was not enough that the dispute concerned a tool related to the employee’s job; the assault had to be in furtherance of the employer’s interests, which it was not. The concurrence stated that the Court should not focus on the employee’s status as that is a factual question, but rather the Court should focus on the lack of control over the entirely separate assaultive conduct of the worker.

  • Public Service Mutual Insurance Co. v. Goldfarb, 53 N.Y.2d 392 (1981): Intentional vs. Unintentional Acts and Insurance Coverage

    Public Service Mutual Insurance Co. v. Goldfarb, 53 N.Y.2d 392 (1981)

    An insured is not entitled to indemnification for civil liability arising from intentional acts that cause injury, but may be indemnified for liability arising from intentional acts that cause unintended injury; punitive damages are uninsurable as a matter of public policy.

    Summary

    A dentist, insured under a professional liability policy, was sued by a patient alleging sexual abuse during treatment. The insurer sought a declaratory judgment on whether the policy covered the claim. The court held that the insurer had a duty to defend, as the policy language covered assault and undue familiarity. However, indemnification depended on whether the abuse was intentional and caused injury, and occurred during professional services. The court also determined that punitive damages were uninsurable under public policy. A special verdict was required to determine the nature of the dentist’s conduct.

    Facts

    Dr. Goldfarb, a dentist, was insured under a “Dentist’s Professional Liability Policy” issued to the Dental Society of the State of New York by Public Service Mutual Insurance Company. Jacqueline Schwartz, a patient of Dr. Goldfarb, alleged that she was sexually abused by him during a dental treatment in May 1977. This allegation formed the basis of a civil suit, professional disciplinary proceedings, and a criminal conviction for sexual abuse in the third degree against Dr. Goldfarb.

    Procedural History

    The insurer, Public Service Mutual, initiated a declaratory judgment action seeking a determination that its policy did not cover the civil claim. Special Term held no coverage was provided. The Appellate Division reversed, finding coverage based on the policy’s broad language including “assault” and “undue familiarity.” Two justices dissented, arguing against coverage for punitive damages. The New York Court of Appeals granted review.

    Issue(s)

    1. Whether the insurance policy contractually obligated the insurer to defend and indemnify the dentist for the claim of sexual abuse.
    2. Whether public policy precludes insurance coverage for a claim of sexual abuse in the course of dental treatment.

    Holding

    1. Yes, because the policy language indicated an intent to cover both compensatory and punitive damages arising out of unlawful or inappropriate physical contact during dental treatment.
    2. No, unless the insured intentionally caused injury; punitive damages are uninsurable as a matter of public policy.

    Court’s Reasoning

    The court first addressed the contractual obligation, finding that the dentist provided timely notice. The policy required notice upon an unusual occurrence “or [upon] receiving notice of claim or suit”. The court found that the term “unusual occurrence” is ambiguous, and any ambiguity in the policy must be resolved against the insurer.

    The court then examined the policy language, which stated the insurer would pay all sums, including punitive damages, the insured was obligated to pay due to liability for damages because of injury from professional dental services, including claims based on malpractice, assault, or undue familiarity. This broad language suggested an intent to cover unlawful physical contact during treatment.

    Regarding public policy, the court stated that while an act may have penal consequences, insurance coverage for civil liability is not automatically precluded. The key is whether the insured intended to cause injury. One who intentionally injures another cannot be indemnified, but one whose intentional act causes an unintended injury may be.

    The court quoted Messersmith v American Fid. Co., 232 NY 161, 165: “fundamental principle that no one shall be permitted to take advantage of his own wrong”. Indemnity for punitive damages is barred because it would defeat their purpose. The court emphasized that the insurer must provide independent counsel for the dentist, given the conflict of interest, with the attorney’s fees to be paid by the insurer.

    Ultimately, the court determined that if the fact-finder determined that the dentist intended to injure the patient, he would be precluded from seeking indemnity from his insurer for either compensatory or punitive damages. However, if punitive damages are awarded on grounds other than intentional causation of injury (e.g., gross negligence), indemnity for compensatory damages would be allowable, though indemnity for punitive damages would still be barred.

  • Shapiro v. Glens Falls Ins. Co., 62 N.Y.2d 417 (1984): Insurance Coverage and Intentional Torts

    Shapiro v. Glens Falls Ins. Co., 62 N.Y.2d 417 (1984)

    An insurance policy that excludes coverage for personal injury caused intentionally by the insured does not require the insurer to defend or indemnify the insured in a slander action where the complaint alleges the insured spoke maliciously with intent to injure.

    Summary

    Alexander Shapiro, a limited partner in a real estate syndicate, was sued for slander by the general partners. His insurer, Glens Falls Insurance Company, refused to defend him, citing a “business pursuits” exclusion and an exclusion for intentionally caused personal injury. Shapiro then sued the insurer seeking a declaration of coverage. The court found that while the “business pursuits” exclusion did not apply, the policy’s exclusion for personal injury caused intentionally barred coverage because the slander complaint alleged Shapiro acted maliciously with intent to injure the plaintiffs. Therefore, the insurer had no duty to defend or indemnify.

    Facts

    Alexander Shapiro, president of a plumbing supply business, invested in a real estate syndicate as a limited partner.

    The general partners of the syndicate sued Shapiro for slander, alleging he falsely and maliciously told other limited partners that the plaintiffs were “phoneying and doctoring the books and records,” “flimflamming, cheating and stealing from the investors.”

    The complaint specifically stated that Shapiro’s statements were made “willfully and maliciously with intent to injure and damage the plaintiffs and their good name, reputation and credit.”

    Shapiro sought coverage from his insurer, Glens Falls Insurance Company, to defend against the slander action.

    Glens Falls denied coverage.

    Procedural History

    Shapiro commenced an action against Glens Falls Insurance Company, seeking a declaration that the insurer was obligated to defend and indemnify him in the slander action.

    The lower courts’ decisions are not specified in the Court of Appeals opinion, but the Court of Appeals affirmed the Appellate Division’s order.

    Issue(s)

    Whether Glens Falls Insurance Company was obligated to defend or indemnify Shapiro in the underlying slander action, given the policy’s exclusion for personal injury caused intentionally by the insured.

    Holding

    No, because the insurance policy specifically excluded coverage for personal injury caused intentionally by the insured, and the slander complaint alleged that Shapiro acted maliciously and with intent to injure the plaintiffs.

    Court’s Reasoning

    The court focused on the policy’s definition of “occurrence” and the endorsement excluding coverage for intentional personal injury. The policy defined “occurrence” as “an accident…neither expected nor intended from the standpoint of the Insured.” An endorsement to the policy further clarified that the policy “does not apply…to any personal injury…caused intentionally by or at the direction of the Insured.”

    The court reasoned that because the slander complaint alleged Shapiro spoke falsely, willfully, and maliciously with intent to injure, the exclusionary endorsement applied. This meant the alleged conduct fell squarely within the policy’s exclusion for intentional acts. The court distinguished this situation from cases involving negligence or unintentional torts, where coverage might be available.

    The court acknowledged that while the policy’s general summary of coverage indicated that perils like slander were included, this summary was explicitly stated not to be the contract itself and was subject to conditions and exclusions clearly stated in the contract. The exclusionary endorsement was deemed a valid and enforceable part of the insurance contract.

    The court emphasized that the nature of the claim, specifically the allegation of intentional and malicious conduct, triggered the policy exclusion, relieving Glens Falls Insurance Company of its duty to defend and indemnify Shapiro. In essence, the insurer only agreed to cover accidents, not intentional torts. The court effectively highlights the critical importance of aligning the allegations in the underlying complaint with the precise terms and exclusions of the insurance policy.

  • Jones v. State of New York, 33 N.Y.2d 275 (1973): State Liability for Intentional Torts of Employees

    33 N.Y.2d 275 (1973)

    The State can be held liable for the intentional torts, such as assault and battery, committed by its employees, like State troopers, under the doctrine of respondeat superior, even when those employees are engaged in “governmental” activities.

    Summary

    Lynda Jones, as administratrix, sued the State of New York for the wrongful death of her husband, a civilian employee at Attica Correctional Facility who was killed during the prison uprising and subsequent retaking by State troopers. The claim alleged negligence in failing to warn him of the riot and intentional tort (assault and battery) by a State trooper. The Court of Appeals held that while the negligence claim was barred by the exclusivity of workmen’s compensation, the claim for intentional tort could proceed. The court reasoned that the State’s waiver of immunity in the Court of Claims Act made it liable for the intentional torts of its employees under respondeat superior, even when those employees were performing “governmental” functions, and that the troopers may have used excessive force.

    Facts

    Herbert Jones, Jr., the claimant’s decedent, was employed by the Department of Correctional Services as an accounts clerk at Attica State Correctional Facility. His job was clerical and did not involve guarding or disciplining prisoners. During the Attica uprising on September 9, 1971, Jones was taken hostage. During the retaking of the prison on September 13, 1971, a State trooper allegedly shot Jones in the head, chest, and back, causing his death.

    Procedural History

    The claimant filed a claim in the Court of Claims alleging negligence and intentional tort. The State moved to dismiss, arguing that workmen’s compensation was the exclusive remedy and that sovereign immunity barred the claim. The Court of Claims denied the motion. The Appellate Division reversed, granting the State’s motion and dismissing the claim, holding that the State was immune because it acted in its sovereign capacity. The Court of Appeals modified the Appellate Division’s order, reinstating the intentional tort claim.

    Issue(s)

    1. Whether the claimant’s negligence claim is barred by the exclusivity provisions of workmen’s compensation.
    2. Whether the State can be held liable for the intentional tort of assault and battery committed by a State trooper during the retaking of Attica prison, resulting in the death of a civilian employee/hostage.

    Holding

    1. Yes, because the claim alleges negligence while the decedent was performing his clerical duties.
    2. Yes, because the State’s waiver of sovereign immunity in the Court of Claims Act makes it liable for the intentional torts of its employees under the doctrine of respondeat superior, even when the employees are engaged in “governmental” activities, and the claim alleges an unjustifiable assault.

    Court’s Reasoning

    The Court of Appeals reasoned that the negligence claim was properly dismissed because workmen’s compensation is the exclusive remedy for injuries sustained during the course of employment. However, the court found that the claim for intentional tort (assault and battery) stated a valid cause of action. The court relied on the Court of Claims Act, which waived the State’s immunity from liability and subjected it to the same rules of law as applied to individuals or corporations. The court cited a line of cases holding the State or municipalities liable for the actions of their police officers in the line of duty. Prior to the waiver of immunity, police officers were considered public officers whose actions in governmental activities could not create liability for the State. However, after the waiver of immunity, the State became liable for the torts of its agents on the basis of respondeat superior, even if the agent was engaged in “governmental” activity. The court distinguished Weiss v. Fote, which involved planning highway safety, as irrelevant to the instant case of alleged assault.

    The court rejected the argument that the Attica riot should bar recovery, stating that retaking the prison was no more “governmental” than making an arrest or investigating a traffic infraction. The court emphasized that excessive force used by troopers during these activities was sufficient to hold the State liable. The court noted that claimant faced a heavy burden of proof, given the chaotic conditions, but the McKay Commission’s report indicated that the State troopers’ assault was “marred by excesses” and that the type of ammunition used presented “a high risk of injury and death to unresisting inmates and hostages.”

    Judge Jasen dissented, arguing that the manner and means of coping with the Attica uprising was a basic discretionary policy decision made at the highest levels of the executive branch and should be immune from judicial review under the doctrine of sovereign immunity. He contended that this case differed from typical police tort cases because it involved a policy decision concerning how to handle a crisis situation, implicating separation of powers concerns. The majority rejected this argument by implication.