Opinion
No. C4-97-365.
Filed July 22, 1997.
Appeal from the District Court, Hennepin County, File No. 962856.
Kyle E. Hart, Holly A.R. Hart, Fabyanske, Svoboda, Westra Hart, P.A., (for appellants).
Thomas H. Crouch, Charles H. Becker, Meagher Geer, P.L.L.P., (for respondent).
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1996).
UNPUBLISHED OPINION
When Richard Johnson, a former director, CEO, and shareholder, sued Johnson Bros. Corporation (company) for wrongful termination and wrongful redemption of his stock, the company tendered its defense to Aetna Casualty and Surety Company (the insurer) under a fiduciary responsiblity insurance policy relating to the company's employee benefit plan. The insurer denied coverage, and the company sued for a declaration that Johnson's complaint asserted covered claims. The parties filed cross-motions for summary judgment. Finding there was no covered claim and the insurer had no duty to defend or indemnify the company, the trial court entered judgment in favor of the insurer. On appeal, the company argues the trial court erred as a matter of law. We affirm.
DECISION
On appeal from a grant of summary judgment, this court determines whether there are genuine issues of material fact and whether the trial court correctly applied the law. Offerdahl v. University of Minn. Hosps. Clinics , 426 N.W.2d 425, 427 (Minn. 1988); see Minn.R.Civ.P. 56.03 (setting forth trial court standard for summary judgment). The construction of an insurance policy presents a question of law, subject to de novo review. Iowa Kemper Ins. Co. v. Stone , 269 N.W.2d 885, 886-87 (Minn. 1978).
An insurer has a duty to defend any claim arguably within the scope of policy coverage. Prahm v. Rupp Constr. Co. , 277 N.W.2d 389, 390 (Minn. 1979). To determine whether an insurer has a duty to defend, courts compare the language of the complaint with the coverage provided by the policy. See Ross v. Briggs Morgan , 540 N.W.2d 843, 848 (Minn. 1995) (stating "a duty to defend may be established if there is a semantic connection between the policy's enumerated offenses and the claims made in the underlying case"). An insurer bears the burden of proving that a claim falls outside policy coverage, and any ambiguity or doubt is resolved in favor of the insured. Crum v. Anchor Cas. Co. , 264 Minn. 378, 390, 119 N.W.2d 703, 711 (1963); Farmers Union Oil Co. v. Mutual Serv. Ins. Co. , 422 N.W.2d 530, 532 (Minn.App. 1988).
The company argues the trial court erred in ruling the insurer owed no duty of defense. However, the record demonstrates the complaint: (1) sought damages and equitable relief for wrongful termination and wrongful redemption of stock; (2) did not mention any breach of fiduciary duty with respect to the trust or employee benefit plan; (3) sued the individual defendants in their capacities as corporate directors, officers, and shareholders, but not as fiduciaries of the employee benefit plan; (4) sought relief under Minn. Stat. § 302A.751 (1996) for illegal corporate acts; and (5) did not allege a claim under ERISA. After carefully examining the complaint and the policy's insuring clause, we conclude Johnson's claims against the company are not covered by the insurer's limited liability policy.
The company insists the complaint alleged, at least inferentially, that Johnson's fellow directors exercised self-interested control over the retirement plan's stock to ensure Johnson's separation from employment, thereby causing damage to the plan and his interest in the plan. While a complaint need not be pleaded in the language of the policy, the policy at issue does not provide general liability coverage. See Ross , 540 N.W.2d at 848 (recognizing it would require "far too generous reading" of complaint to conclude claims fell within policy coverage). A plain reading of the complaint does not support the company's construction. Johnson did not allege a violation of ERISA or any violation of a fiduciary duty owed to the beneficiaries of the company's retirement plan. Cf. CPT Corp. v. St. Paul Fire Marine Ins. Co. , 515 N.W.2d 747, 749 (Minn.App. 1994) (holding insurer had duty under fiduciary responsibility policy to defend insured against claim specifically alleging breach of fiduciary responsibilities under ERISA), review denied (Minn. July 27, 1994). Under these circumstances, the trial court properly granted judgment as a matter of law in favor of the insurer.