New Jersey’s Appellate Division recently held that an insurance policy’s assault-or-battery exclusion precluded a bar’s claim for coverage for a lawsuit alleging that the bar negligently permitted a customer to enter and shoot another patron.
The claim at issue in Pickett v. Moore’s Lounge, A-2330-17T2 (App. Div. 2020) involved a fatal shooting at a tavern following an argument. The decedent’s estate sued the tavern owner for damages alleging that the tavern negligently permitted the shooter to enter the tavern armed, remain at the tavern, and then intentionally shoot the victim. The shooter was convicted of recklessly causing the death of the victim in an underlying criminal matter.
The estate alleged claims against the tavern owner, EMRO, that included negligent hiring, negligent training, supervision and oversight, and retention. The final negligence claim alleged that EMRO failed to ensure that the invitee was free from reasonable foreseeable criminal activity.
EMRO sought defense and indemnification from Northfield Insurance Company. Northfield invoked the policy’s assault-or-battery exclusion to deny the claim for defense and indemnification. The exclusion precluded coverage for “bodily injury” or “property damage” arising out of any act of “assault” or battery” committed by any person, including any act or omission in connection with the prevention or suppression of such “assault” or “battery.”
EMRO filed a third-party complaint against Northfield for coverage. The motion court granted summary judgment to Northfield, holding that the assault-or-battery exclusion barred EMRO’s claim because the estate sought damages for bodily injuries arising out of the shooter’s assault or battery of the victim.
The Appellate Division found that since the shooter was convicted in the criminal matter of recklessly causing the victim’s death, the shooter’s recklessness satisfied the language of the exclusion. Key to the decision was that the estate did not allege in the alternative that the shooter negligently shot the victim. The tavern’s alleged negligence was only connected with the intentional/reckless assault or battery, and thus the court found that the policy exclusion encompassed those claims.
The Court also found that the since the exclusion plainly included negligent acts or omissions that fail to prevent or suppress an assault or battery, the exclusion further encompassed the estate’s allegations that EMRO failed to exercise reasonable care in assuring the tavern was safe. Furthermore, the Court held that those same provisions excluded any claims with respect to negligence allegations related to EMRO’s personnel management (i.e. hiring, training, and retention as well as failure to prevent the shooter from shooting the victim.) Although the policy did not explicitly refer to negligent personnel management, the policy broadly excluded damage claims “arising out of . . . any act or omission in connection with the prevention or suppression of such ‘assault’ or battery.’” This provision clearly encompassed situations where an insured could have prevented a battery, had it not negligently managed its staff, or negligently failed to maintain a safe environment, according to the Appellate Division.