Wargo French partner Raymond J. Tittmann was sought for expert commentary by Law360 Monday on the new landmark insurance decision from the California Supreme Court on the meaning of “occurrence.” The California Supreme Court issued its long-awaited decision in Liberty Surplus Insur. Corp. v. Ledesma & Meyer Const. Co., finding that the relevant “occurrence,” in deciding whether an act is intentional, “refers to the conduct of the insured” that would yield liability, instead of the derivative acts of the ultimate wrongdoer who caused the injury. Law360 quoted Mr. Tittmann of Wargo French concerning the wide-ranging implications of this decision:
However, Wargo French LLP partner Raymond J. Tittmann, who counsels insurers, said the California Supreme Court’s analysis could have troubling implications.
Rather than adopting a blanket presumption that negligent hiring and supervision claims trigger coverage under liability policies, the court should have crafted a test basing the coverage analysis on whether an employer was aware of red flags in an employee’s history, Tittmann said. Here, court documents indicate that L&M learned that Hecht was a registered sex offender before hiring him, but still brought him onboard and allowed him to work on the middle school project.
“Under the court’s decision, it is difficult to imagine a wrongful hiring or supervision case that would not be an ‘accident,’ no matter how intentional and knowing the insured’s conduct,” Tittmann said.