The Archdiocese sought coverage under its CGL policy for allegations of sexual abuse committed by its former priests. Because the underlying complaints alleged volitional acts rather than accidental occurrences, the court determined there was no coverage. See Doe v. Archdiocese of Milwaukee, 2010 WISC. App. LEXIS 954 (Wis. Ct. App. Nov. 23, 2010).
Several complaints were consolidated for appeal involving allegations of sexual abuse by the priests. The complaints alleged causes of action for negligent misrepresentation stating that the Archdiocese represented that children were safe in the presence of the priests despite high-ranking personnel having the knowledge of the priests' histories of sexual abuse. Further, the Archdiocese allowed the priests to have continued access to children through parishes and schools, thereby subjecting the plaintiffs to abuse.
The Archdiocese tendered its defense to its carrier, OneBeacon Insurance Company. OneBeacon intervened in the cases and sought a declaration of no coverage. The trial court determined there was no coverage obligation because there was no occurrence.
On appeal, the Archdiocese argued that because it did not intend to harm the plaintiffs, the allegations in the underlying complaints were within coverage provided by OneBeacon's policy. OneBeacon argued there was no coverage for alleged negligent misrepresentation because there was nothing accidental about the misrepresentation. Rather, the Archdiocese engaged in volitional acts.
The Wisconsin appellate court agreed with OneBeacon. By placing the children in harms way, the Archidocese's acts were volitional. Where a volitional act was involved in a misrepresentation regarding a false statement, that act removed it from coverage as an "occurrence" under the policy. The proper focus was not the ultimate injury the plaintiffs suffered, but rather the underlying acts of the Archdioceses that led to the plaintiffs' injuries. The complaints alleged that agents of the Archdiocese were aware of the sexual abuse histories of some of its clergy but still kept the clergy in contact with the children. The children were allegedly victims of molestation. The underlying act that led to the plaintiff's injury, therefore, was the misrepresentation that the plaintiffs would be safe in the presence of the priests. The proper focus for determining coverage, then, was on the misrepresentations leading to the molestation.
