A commercial general liability insurer had no duty to defend a massage company’s employee against a suit alleging that the employee sexually assaulted a client during a massage. ( Baek v. Continental Casualty Co. (2014) 2014 WL 4966020)
Facts
Jamie Weinberg filed a lawsuit against Luis Baek and Baek’s employer, Heaven Massage and Wellness Center (HMWC). In her complaint, Weinberg alleged that Baek was an HMWC massage therapist, and that during a massage Baek sexually assaulted Weinberg by touching, rubbing and fondling Weinberg’s breasts, buttocks and genitals. Weinberg asserted causes of action against Baek and HMWC for sexual harassment, sexual battery, assault, battery, false imprisonment, intentional infliction of emotional distress, and negligence.
Baek claimed that he was either an employee of or partner in HMWC, and that he therefore qualified as an insured under HMWC’s general liability policy issued by Continental Casualty Company. However, Continental declined to defend Baek, asserting that Baek’s alleged tortious conduct was not within the scope of Baek’s employment.
Baek subsequently filed an action for breach of contract and bad faith against Continental, alleging that Continental had wrongfully failed to defend Baek in the underlying tort action filed by Weinberg. The trial court ruled in favor of Continental. Baek appealed.
Holding
The California Court of Appeal affirmed, holding that Continental had no duty to defend Baek against Weinberg’s lawsuit.
The appellate court noted that the Continental policy covered HMWC’s employees “for acts within the scope of their employment ” and “while performing duties related to the conduct of [HMWC’s] business.” However, according to the appellate court, Baek’s alleged sexual assault of Weinberg could not have been an “act within the scope of [Baek’s] employment” and could not have occurred “while performing duties related to the conduct of [HMWC’s] business.” Although Baek’s alleged sexual assault occurred at the workplace and during the work day, it was unrelated to Baek’s duties for HMWC. Thus, even if Baek was an employee of HMWC, Baek could not qualify as an additional insured under these provisions of HMWC’s policy though Continental.
The appellate court also noted that the Continental policy covered HMWC’s partners “with respect to the conduct of [HMWC’s] business.” However, the appellate court concluded that Baek’s alleged sexual assault of Weinberg was not an act undertaken “with respect to the conduct of HMWC’s business.” Baek’s conduct was not done at HMWC’s request or for its benefit, but rather was simply the product of Baek’s lust. Thus, even assuming Baek was a partner in HMWC, Baek was not an insured in these circumstances.
In short, because Baek’s alleged acts of sexual battery could not properly be characterized as relating to the conduct of HMWC’s business or within the scope of Baek’s employment, Baek was not an additional insured under the Continental policy. Thus, Continental has no duty to defend Baek in the underlying action.
Comment
The appellate court found that while Baek’s employment with HMWC may have provided Baek with the opportunity to be alone with Weinberg, Baek’s alleged sexual assault on Weinberg was a purely personal act and was committed for reasons unrelated to work. Therefore, Baek was not an insured under HMWC’s policy through Continental.