Neighbors’ Suit Alleging Insureds Had Committed Intentional Wrongs Was Not Covered by Homeowners’ Policy, District Court Rules

A federal district court in Massachusetts has ruled that an insurance company did not have a duty to defend its policyholders in a lawsuit against them alleging the commission of three intentional wrongs arising from a dispute among neighbors.

The Case

Kenneth and Donna Kaplan, residents of Hull, Massachusetts, were sued in a Massachusetts state court by their neighbors, William and Mary Costello.

The Costellos complained of an ongoing campaign of harassment by the Kaplans in an attempt to enlarge their own yard at the Costellos’ expense. As part of this campaign, according to the Costellos, the Kaplans had filed five lawsuits in state court that involved the Costellos, had initiated a number of complaints and appeals to town and state agencies, and had written many aggressive emails about the matter to public officials and the local media.

In their lawsuit, the Costellos asserted three causes of action against the Kaplans: abuse of process, intentional infliction of emotional distress, and violation of the Massachusetts Civil Rights Act.

Narragansett Bay Insurance Company, which had issued a homeowners’ insurance policy to the Kaplans, contended that it did not have to defend the Kaplans in the Costellos’ state court lawsuit because its policy covered only accidental harms, not intentional conduct, and the Costellos’ action alleged only intentional conduct by the Kaplans.

The Court’s Decision

The court ruled that Narragansett did not have a duty to defend the Kaplans in the Costellos’ suit.

The three causes of action asserted by the Costellos required intentional conduct for liability to exist, the court explained. Therefore, it ruled, they did not arise out of an “occurrence” because they did not stem from “accidental behavior” and they necessarily were excluded by the policies’ exclusion of “expected or intended injuries.”

The court also decided that the three causes of action in the Costellos’ complaint were not covered under the insurance policy for another reason as well. It found that none of the harms underlying the three causes of action – legal harassment, emotional distress, or civil rights violations – constituted bodily injury or damage to property.

The case is Narragansett Bay Ins. Co. v. Kaplan, No. 14-12466-DPW (D. Mass. Nov. 18, 2015).