No Insurance Coverage for Sexual Assault by Employee

Common Carrier Status Did Not Create Liability for Driver's Actions

R. A. Stuchbery & Others Syndicate 1096 v. Redland Insurance Company (Aug. 27, 2007, A114986, First District, Division Five)
12 p. opinion

This is an insurance coverage case in which the general liability insurer (Stuchbery) defended and indemnified its insured and then brought this action against the issuer of the insured's business automobile policy for reimbursement or equitable contribution for the costs of the defense and indemnification.

The insured was a shuttle service operator. The underlying action was brought by a 16 year-old girl who alleged that she had entered the shuttle because the driver, the insured's employee, had told her that he would take her to a youth center. As they were driving, the driver told the girl that because it was late at night, the youth centers were closed. He suggested she sleep at his apartment for a few hours until the centers opened. The girl accompanied the driver to his apartment where he sexually assaulted her.

Previous California cases have interpreted the portion of Redland's policy which provides coverage for a bodily injury resulting from the use of a covered auto as creating coverage only when the use of the insured vehicle was a predominating cause or a substantial factor in causing the injury.

Stuchbery argued that those previous cases concerned private vehicles while the shuttle involved in the underlying action was a common carrier. Stuchbery contended that the relationship between the driver of a common carrier and one of its passenger is defined by the common carrier vehicle. Without the vehicle, there would be no relationship between the driver and the passenger and thus no opportunity for the driver to assault the passenger.

The Court of Appeal held that the assault in this case was too attenuated from the vehicle to trigger potential coverage under the Redland policy. The passenger voluntarily left the vehicle and entered the driver's apartment. As a result the link between the use of the vehicle and the sexual assault was too weak to support Stuchbery's argument.
Acting Presiding Justice Simons wrote the opinion. Justices Gemello and Needham concurred.