LIBERTY SURPLUS INSURANCE v. LEDESMA AND MEYER CONSTRUCTION

Respondents’ Answer Brief on the Merits

Cal.February 17, 2017

SUPREME COURT Case No. $236765 FILED THE SUPREME COURTOF THE STATE OF CA LIFORNIA FEB 17 2017 Jorge Navarrete Clerk LIBERTY SURPLUS INSURANCE CORPORATION,et ai. Deputy Plaintiffs and Respondents, V. CRC b LEDESMA AND MEYER CONSTRUCTION COMPANY,INC.,e¢al. 8.25( ) Defendants and Appellants. After Order Certifying Question by the U.S. Court of Appeals for the Ninth Circuit RESPONDENTS’ ANSWERING BRIEF ON THE MERITS McCormick, BARSTOW, SHEPPARD, WAYTE & CARRUTH LLP * Patrick Fredette, #207284 patrickfredette@mccormickbarstow.com Christopher Ryan, #294854 christopher.ryan@mccormickbarstow.com 7647 North FresnoStreet Fresno, California 93720 Telephone: (559) 433-1300 Facsimile: (559) 433-2300 Attorneys for Plaintiffs and Respondents Liberty Surplus Insurance Corporation and Liberty Insurance Underwriters Inc. Case No. 8236765 THE SUPREME COURT OF THE STATE OF CALIFORNIA LIBERTY SURPLUS INSURANCE CORPORATION,ef al. Plaintiffs and Respondents, V. LEDESMA AND MEYER CONSTRUCTION COMPANY,INC., e¢ ai. Defendants and Appellants. After Order Certifying Question by the U.S. Court of Appeals for the Ninth Circuit RESPONDENTS’ ANSWERING BRIEF ON THE MERITS McCormick, BARSTOW, SHEPPARD, WAYTE & CARRUTH LLP * Patrick Fredette, #207284 patrick.fredette@mccormickbarstow.com Christopher Ryan, #294854 christopher.ryan@mccormickbarstow.com 7647 North FresnoStreet Fresno, California 93720 Telephone: (559) 433-1300 Facsimile: (559) 433-2300 Attorneys for Plaintiffs and Respondents Liberty Surplus Insurance Corporation and Liberty Insurance Underwriters Inc. TABLE OF CONTENTS INTRODUCTION 00. ccccececseseeeeseeeseesecsecsessesscacssesseecssssstsevsstaserareseens 1 STATEMENT OF THE CASE.......ccccccccsessscsssecssceecsecsscessccsessesssaevenevueeauees 3 I. Factual Background Relating to the Doe Action.....0..00.....0 3 A. The Cesar Chavez Middle SchoolProject.......0.0.0.0.. 3 B. Hecht’s Background and Employment by L&M.......... 4 C, The Allegations of the Doe Action......0.c0ccccceeeeeeee 5 D. Hecht’s Criminal Conviction ..............cccccccccscesecseecececees 7 E. Rulings and Termination of the Doe Action ..........00.... 7 I. The Liberty Policies... ccccccecscescsscsscsscessecsesssesvceeecreeasens 9 A. The LSIC Policy .....cccceccccscscesscsscessesessccsessecseessecenresens 9 B. The LIUI Policy... iecccccccccseesessceseccsscseessssssceseeeaes 10 III. Liberty’s Reservation ofRights and Defense ofL&M in the Doe Action... .cceececesscesssssessescescssesecseccssecsssscssvsetsneveaseas 1] IV. Procedural History of This Coverage Action ........0000.c.ee 13 A. In the District Court... ccccesccceseesscesecsscscsscsssssseeaes 13 B. Before the Ninth Circuit .0..0..0.ccccccccccsesscssessceseeeeee 16 ARGUMENTooo. ecceeccteesceeeeseteseeseesseessesecsecsecsecsecsesssesssccaussvsstavsnseerenaes 16 L. L&M Cannot Meetits Burden to Establish Coverage........... 16 A. L&M Hasthe Burden to Establish Coverage in the First Instance, and L&M’s Characterization of the “Occurrence” Requirementas Exclusionary Is INCOPTOCEeee ceeeesseceeseeessecesecesseeeeeeessscnsevsserenteeesers 16 B. The Acts That Caused The “Bodily Injury” Are Inherently Non-Accidental .......00..ccccceccccsseeeeeeeeees 18 I. L&M’s Argumentthat an “Occurrence” Analysis Should be Independent of the Immediate Cause of Harm is Not Supported by California Law ........c ccc ecccssesesseeeeseeenseees 20 A. L&M’s Forced Interpretation of This Court’s Precedents Is Mistaken .........cccccccccccssscccesseesecerenseeeses 20 1. Geddes & Smith, Inc. v. St. Paul Mercury TNO, CO. ciecceccececccceccccceceescescescesecsenseseverenes 21 2. Hogan v. Midland Nat’ Ins. C0. .c.ccccccccceceee. 23 3. Delgado v. Interinsurance Exch. ofAuto. Club ofSo. Calif. c.ccccccccccccccccccccceeetseevtseseessees 27 4. Minkler v. Safeco Insurance Co. ......0cccccccccce- 30 B. The Liberty Policies Require that the Injury- Causing Act Itself Define if an “Occurrence”is PLOSCNE ooo. eeeeceseesceeensesecscesecssesscseccsscsccsctsseseearsarens 32 1. Insurance Coverage is Not Coextensive With an Insured’s Potential Tort Liability ......32 2. The “Occurrence” Language Imposes an Objective Standard ......ccccccccccccccccseeescesetseeseees 35 C. L&M Incorrectly Contends that “Trigger of Coverage” Cases Have Improperly Influenced Decisions as to What Constitutes an “OCCUITENCE”oo.ee eeeecceeseeeseessesecsscesccsecsessscsessceassaeeess 39 Tl]. L&M’s Argument in Relation to the “Unexpected Consequences” of Deliberate Acts is Misplaced...4] A. The Issue, As Framed by L&M, is Not Determinative for this Action.................ccccecececseseeeeeee 4] B. Merced Was Correctly Decided and Reasoned, and Did Not Particularly Rely on Unigard....0.0.00...49 C. The Merced Opinion is Not the Result of a “Scrivener’s Error? oo. cccccccsccecseseccssessesscssesesseesseaeeaee 52 CONCLUSION(000. cecccececssesseseessesecseesecsssscsesscsevsccescsevscesssesarsetsevevasvaceateas 55 ii TABLE OF AUTHORITIES Cases Aerojet-General Corp. v. Transport Indemnity Co. (1997) 17 Cal4th 38 ooo ccccsccccesscsssscescsssscscseseusaesaeversataneass 17, 18, 35 American Empire Surplus Lines Ins. Co. v. Bay Area Cab Lease, Inc. (N.D. Cal. 1991) 756 F.Supp. 1287wccceeeecesereesees 14, 42, 43, 44 Aspen Internat. Capital Corp. v. Marsch (1991) 235 Cal-App.3d 1199 ooocccccscescecsssscesssesesseessatetesessteassees 53 Aydin Corp. v. First State Ins. Co. (1998) 18 Cal.4th 1183 occcccccccccscsscscesssscsscsscsesseserereesssteasseeaesnees 17 _ Bank ofthe West v. Superior Court (1992) 2 Cal.4th 1254 cecccccccccccssessecssvscescssesvseeecsavseatesseseeseassaes 18 Century Transit Sys., Inc. v. Am. Empire Surplus Lines Ins. Co. (1996) 42 Cal.App.4th 121 occccesesceeseceeseeeetssesestsesavseseeees 37 Chatton v. National Union Fire Ins. Co. (1992) 10 Cal.App.4th 846 oo... ccccccccccescssvesssesseseetacestsceassarseseees 19 Chu v. Canadian Indem. Co. (1990) 224 CalApp.3d 86 oo. ccccccccccsssescscssssccescsessessvsevessesstseetstseseeaes 49 Collin v. American Empire Ins. Co. (1994) 21 Cal-App.4th 787 oo...cccccccscssseceseeecesssetseeesees 16, 17, 19, 30 Commercial Union Ins. Co. v. Superior Court (1987) 196 CalApp.3d 1205 oo... cccccccccscssssescsesecesseseresestseestsnseseeses 20 Delgado v. Interinsurance Exch. ofAuto. Club ofS. California (2007) 152 Cal.App.4th 671 ooo. cccccccccsccssescsssceevcescsecesestsssevacsesavscenees 27 Delgadov. Interinsurance Exch. ofAuto. Club ofS. California (2009) 47 Cal.4th 302we 15, 20, 22, 27, 28, 29, 31, 33, 40, 44 Do v. Superior Court (2003) 109 Cal.App.4th 1210 .o..cccccececsesscescescsseesesestsesecsessseeeses 54 Dyer v. Northbrook Prop. & Cas. Ins. Co. (1989) 210 Cal.App.3d 1540 oo...ccccececscescssseeseeverseeesseetsesseses 19, 20 Employers Ins. of Wausau v. Granite State Ins. Co. (9th Cir.2003) 330 F.3d 1214 ooo cccccccccssesesessscsscssceverseseetscseeecscseeeees 39 Farmerv. Allstate Ins. Co. (C.D. Cal. 2004) 311 F. Supp. 2d 884 occccceseeeseeeeeees 37, 38, 39 ill Farmers Ins. Exch. v. Superior Court (2013) 220 CalApp.4th 1199 ooccccccccssessecessssercstsseseeeeseees 34, 38 FMCCorp. vy. Plaisted & Companies (1998) 61 Cal. App. 4th 1132 occcscsccscsssssessesersseesteesssetecsesevees 32 Foremost Ins. Co. v. Eanes (1982) 134 CalApp.3d 566 .....ccccccccccccseccsevessesseceesseessereseeans 14, 41, 42 Geddes & Smith, Inc. v. St. Paul Mercury Indem. Co. (1959) 51 Cal. 2d 558 occ eccccccsseecsssecscsevsesreeeerees 20, 21, 22, 23, 54 Gill v. Epstein (1965) 62 Cal.2d O11 occeccccccscscescsssseessssececsessseveseesesstttssacsevacerees 53 Hauenstein v. Saint Paul-Mercury Indem. Co. (1954) 242 Minn. 354 oo. ccccccccccccscescssssescecsesecseveceutseeesetssesvseasssvanerees 22 Hogan v. Midland Nat. Ins. Co. (1969) 2 Cal.App.3d 761 oo. cccccccccsccscsessessscsscscssescscssaseesstsssesesecasseses 26 Hogan v. Midland National Ins. Co. (1970) 3 Cal. 3d.553 Licccccccccccsscsssessesscsscereeseseeeeres 20, 23, 24, 25, 26, 32 In re Candelario (1970) 3 Cal.3d 702 ooececccccccsesesesesssssseescscsccsvscsessesssssseessestsseecsesateacsees 55 J.C. Penney Casualty Ins. Co. v. M. K. (1991) 52 Cal. 3d 1009 oo. ccccescessescssecssescseceveusessssetstseeseaeeseeass 18, 48 L.A. Checker Cab Co-op., Inc. v. First Specialty Ins. Co. (2010) 186 CalApp.4th 767 oo... cccccccccccscssssesssssssssssssesestsesssessseeseaeees 39 Liberty Ins. Corp. v. Ledesma and Meyer Const. Co., Inc. (9th Cir. 2016) 834 F.3d 998 ooo ccccccscscssescsscsssecessesesereetssssssecassecsees 16 Maples v. Aetna Casualty & Surety Co. (1978) 83 Cal.App.3d 641 o.cccccceccccccsescsssscssssesssssssseesesteresseees 38, 39, 40 Marchel v. Bunger (1975) 13 Wash.App. 81 .....ccccccccccccsssescscsssssscessasesvscesevaeeetectecsetsseacsees 53 Merced Mut. Ins. Co. v. Mendez (1989) 213 Cal.App.3d 41 ween 3, 14, 29, 49, 50, 51, 52, 53 Meyer v. Pacific Employers Ins. Co. (1965) 233 CalApp.2d 321 oooccccccccsccsssssesssscscsesecseccetsetsessesscasessees 48 Minkler v. Safeco Insurance Co. ofAmerica (2010) 49 Cal. 4th 315 occcccccccscsssscssssevecenseseseerstreas 20, 30, 31, 32 Napa Cmty. Redevelopment Agency v. Cont’l Ins. Companies (9th Cir. 1998) 156 F.3d 1238 vocescecsssecesssessreseteetsstscsecattecsess 33 iv Northland Ins. Co. v. Briones (2000) 81 Cal.App.4th 796 ..ccccccccccccccccscessescssescsssssscnssnevervatteteesates 18 Quanv. Truck Ins. Exchange (1998) 67 Cal.App.4th 583 oo. ccccccccsscssccsecesvscessessssetereessereerees 18, 30 Richards v. Travelers Ins. Co. (1891) 89 Cal. 170 ee cccccccccscsccecsecsscsseescessesssesssssssssssesevuseateasenees 22, 54 Rock v. Travelers’ Ins. Co. (1916) 172 Cal. 462 ooo ccccccccsecsesecsecsecseccsescscssesssssarssaseavarereeaeaneaes 55 Royal Globe Ins. Co. v. Whitaker (1986) 181 Cal.App.3d 532 oiecccccscccsecesscsescsessscsscuscsssssseeseesesneaes 19 St. Paul Fire & Marine Ins. Co. v. Superior Court (1984) 161 Cal. App. 3d 1199 occccccccscescsscsssctscvssesereceesseesesaeens 20 State Farm Fire and Cas. Co. v. Superior Court (2008) 164 Cal.App.4th 317ccc cccccceccesscesserscsssssssseverseseeeeeaees 46, 47 State Farm General Ins. Co. v. Frake (2011) 197 Cal.App.4th 568 oo.cccccccccccescsscssscsecsessessesseeeessens 47, 48 State Farm Mut. Auto. Ins. Co. v. Partridge (1973) 10 Cal.3d 94 oecceccessescseesceecsecsecseeesesscsessesssecsevsevsusasersereateaes 34 State v. Allstate Ins. Co. (2009) 45 Cal.4th 1008 ooo.eccccccsccscescsscsscesecscsssscsssscsseseessrtateresaeaes 33 Tijsseling v. Gen. Acc. etc. Assur. Corp. (1976) 55 Cal.App.3d 623 ...ccccccccscccsssscsscesccsssessvevscesecsevaccetessseeseeaesas 40 Underwriters v. Purdie (1983) 145 Cal.App.3d 57 oo.cccccccccccssescsscsssescsscesssssssensereeeaceseacers 36, 37 Unigard Mut. Ins. Co. v. Argonaut Ins. Co. (1978) 20 Wash.App. 261... cccccccccccsccscescesccsecscestevscesesseseevacertsnees 51, 54 Waller v. Truck Ins. Exch., Inc. (1995) 11 Cal4th docceeccecsecsecsscsscssssssscescssvevsssasseevaeeereseaess 16, 17 Zuckerman v. Underwriters at Lloyd’s (1954) 42 Cal.2d 460 ooo ccccccccseeseesesesesesesseesvssessesensevenes 21, 54, 55 Other Authorities Black’s Law Dictionary (9th ed. 2009) oo... eecscsscecsseceseessetscsseseceeees 53 INTRODUCTION Whenthe policy languagerestricts coverage to “‘bodily injury’ caused by an ‘occurrence,’” does determination of whether there has been an “occurrence” required to trigger coverage focus on the molestation and rape that caused the alleged “bodily injury,” or remote, antecedenteventsofalleged negligenthiring, retention and supervision thatare purported to have madethe injury-causing eventpossible, but are not an independentcauseofthe “bodily injury”? Respondents Liberty Surplus Insurance Corporation (“LSIC”) and Liberty Insurance Underwriters Inc. (“LIUI”) (collectively, “Liberty”) issued certain liability policies to Appellants Ledesma & Meyer Construction Co., Inc., Joseph Ledesma and Kris Meyer(collectively, “L&M”). The Liberty policies apply to covered “‘bodily injury’ caused by an ‘occurrence.’” The Liberty policies define “occurrence”as an “accident, including continuous or repeated exposure to substantially the same general harmful conditions.” The plaintiff (“Doe”) in the underlying action, Jane JS Doe, et al. v. Ledesma & Meyer Constr. Co., Inc., et al., San Bernardino County Superior Court, Case No. CIVDS 1007001 (“Doe action’), alleged she was sexually abused and raped by Darold Hecht (“Hecht”) in October and November of 2006 as a student at Cesar Chavez Middle School (“School”). Hecht was an employee ofL&M andat the time worked on project for L&M at the School. Hecht was so employedsince approximately 2003. Amongotherclaims, Doe alleged Hecht wasa registered sex offender when hired by L&M,andthat L&M wasnegligent in hiring, retaining and supervising Hecht on the project at the School. In its Opening Brief on the Merits, L&M mistakenly argues that California law requires that insurers look to the alleged sourceofliability as to its insured, such as alleged negligent hiring or supervision, and not to the injury-causing act itself in order to determine whether there has been an “occurrence” triggering coverage. The argument ignores that California courts, including this Court, have consistently focused on the actual cause of the “bodily injury” and whether that cause is accidental. If the cause of the “bodily injury” is not accidental, the “insuring agreement”is notsatisfied and coverage is not implicated. This is true even if there are remote, antecedent events that are alleged to have invited the actual cause ofthe “bodily injury.” Applied here, Doe’s alleged “bodily injury” was caused by Hecht’s molestation and rape, not L&M’s alleged negligentretention or supervision of Hecht. Molestation and rape are inherently non-accidental, and thus Doe’s alleged “bodily injury” was not caused by an “occurrence.” L&M also arguesthat the district court in the coverage action erred because it (according to L&M)foundthat alleged negligenthiring, retention and supervision were deliberate acts themselves and thus not “accidents.” Respectfully, L&M doesnotportray the district court’s holding accurately. Examination ofthe reasoning and law cited by the district court confirms that the district court was not making the positive proclamation that L&M contends, but rather simply stating that the purportedly unintended consequences, from L&M’s point of view, did not render the alleged antecedent negligence an “accident.” Again, this is because thefocusis on the injury-causing act itself. In attempting to argue the issue, L&M leads the Court through a discussion of the history and reasoning of one particular appellate case, Merced Mut. Ins. Co. v. Mendez (1989) 213 Cal.App.3d 41. However, L&M not only misapprehends Mercea’s relevanceto this action, but its reasoning more generally. Finally, L&M urges the Court to rewrite California black-letter law that places on the insured the burdenofestablishing that the insuring agreementis implicated by aclaim. L&M contends, incorrectly, that California law would support interpreting the requirement that “bodily injury” be caused by an “occurrence” as an exclusion, thus shifting the burden onto the insurer. However, this Court has clearly rejected such an approach. STATEMENT OF THE CASE L Factual Background Relating to the Doe Action A. The Cesar Chavez Middle School Project In April 2002, L&M entered into a Construction Management Agreement with the San Bernardino County Unified School District (“SBCUSD”) for a construction project (“Project”) at the School. (Vol. 4, Appellants’ Excerpts ofRecord (“4AER”) 555.) L&M’s work onthe Project beganin early June of 2003, (4AER 556), and continued to the end of 2006. (4AER 557.) B. Hecht’s Background and Employment by L&M In 1998 Hecht was arrested in Santa Clara County, California and convicted of one count under Cal. Penal Code § 261.5(d), “unlawful sexual intercourse with a minor”by “a person 21 years of age or older with a minor whois under 16 years of age.” (2AER 194.) A newsreport ofthe arrest stated that Hecht was 26 yearsold at the time and the victim was 15 years old. (See 3AER 351.) L&M hired Hecht on May 29, 2003, (see 4AER 556), and assigned him to the Project as an Assistant Superintendent. (/d.) Hecht was at the time Joseph Ledesma’s brother-in-law. (See 2AER 181.) On June 27, 2003, Hecht was arrested a second time, but on this occasion in San Bernardino County, California, and charged with one count under Cal. Penal Code § 647.6, “Annoying or Molesting Children.” (2AER 196.) Hecht pled guilty to the charge and was sentenced to 36 months of probation and 45 daysin jail. (/d.) Thejail time was served on weekends. (Id.) Hecht’s sentencealso required himto attend counseling, register as a sex offender, and provide proofof registration. (/d.) In or about August 2003, Hecht wassentfor fingerprinting as part of a background check for purposes of his employment with L&M, (4AER 556), although Hecht had already been hired and working on the Project. (/d.) Priorto receipt ofthe background check, Hecht informed Joseph Ledesma and Kris Meyer(the principals of the closely-held L&M)that he wasa registered sex offender. (/d.) Hecht’s sex offender status was verified in a report received by L&M in early 2004 pursuant to Hecht’s criminal background check. (See 2AER 207- 08.) Further, a San Bernardino County Sheriff visited L&M on February 4, 2004, to confirm L&M received the report and was. aware Hecht was a registered sex offender. (/d.) Notwithstanding Hecht’s status and L&M’s knowledge of it, L&M employed Hechton the Project through June 6, 2007. (See 2AER 177-78.) Hecht’s employment with L&M ended whenheresignedafter Kris Meyer and Joseph Ledesma learned that Hecht had an extra-marital affair with an SBCUSD employee, anact entirely unrelated to his rape and molestation of Doe. (See 2AER 219.) C. The Allegations of the Doe Action Doe named L&M, SBCUSD,and others as defendants in the Doe action. (See 2AER 124.) The Doeaction alleges that L&M was engaged in the Project during 2006, including when the school wasin session. (2AER 130-31.) Doe further alleges that Hecht was an employee of L&M in 2006 and assignedto the Project prior to the beginning of the 2006-07 schoolyear. (2AER 125-26.) According to the Second Amended Complaint in the Doe action (“Doe SAC”), L&M either knew or had reason to know of Hecht’s previous offenses. (2AER 125, 130, 147, 150.) The Doe SACallegesthat Hechtfirst approached Jane Doe, a 13-year old student of Cesar Chavez Middle School, while she was on summerbreak from school in August 2006. (2AER 131.) After school resumed in August 2006, Hecht allegedly approached Doeat the school bus stop, provided his phone numberandaskedto drive her home from school, which Doedeclined. (/d.) Thereafter, the Doe SAC alleges that Hecht began to follow Doe around campus and that Doe spoke with Hecht on the phone. (2AER 131-32.) According to the Doe SAC, in September 2006, Hecht “became more aggressive in his pursuit of Jane Doe” and in October 2006, Doe began to accept rides to and from school from Hecht. (2AER 132-33.) Doe allegesthat beginning on or about October 12, 2006, Hecht began to use these rides as opportunities to isolate and sexually molest Doe. (2ZAER 133-34.) According to the Doe SAC, Hechtcontinued to sexually abuse Doe for “several weeks.” (2AER 134-35, 138.) The Doe SACstates multiple causes of action against L&M andother defendants. (See 2AER 127.) As to L&M and SBCUSD,Doestates causes of action for negligence, negligent hiring/retention and negligent supervision which allegedly allowed Doe to comeinto contact with Hecht, who in turn sexually abused Doe. (2AER 147, 149, 152.) However, Doe alleges her injuries werethedirect result of the sexual abuse by Hecht. (2AER 148, 151, 153.) The Doe SACalsoincludesthree causesofaction specific to SBCUSD in relation to statutory duties applicable to public entities: negligence per se based onthe failure to report sexual abuse pursuant to Government Code § 815.6 and Penal Code § 11164; negligent supervision based on Education Code §44807; and failure to fingerprint pursuant to Education Code §§ 45125.1 and 45125.2. (2AER 144, 154-56.)! D. Hecht’s Criminal Conviction In October 2008, Hecht wasarrested in relation to his abuse ofDoe. In 2009 he wastried and convicted by a jury offive counts under Penal Code § 288(a), lewd and lascivious acts with a child under the age of 14; and one count under Penal Code § 288(b)(1), lewd and lascivious acts with a child underthe age of14 by use of force. (2AER 227). Hecht was sentenced to 24 years in prison. (2AER 230.) E. Rulings and Termination of the Doe Action Thetrial court in the Doe action ruled, in response to L&M’s motion for summaryjudgment,that plaintiffs had produced evidence “that Hecht was convicted twice related to sexual misconduct with minors with onepriorto his ' The Doe SACalsostates intentionaltort causes ofaction as to Hecht and an officer with the SBCUSD,Ionne Barnes-Joshua. (2AER 158, 160-62, 164, 166.) employmentand one whilestill employed with L&M.” (2AER 45.) Further, according to the Doe court, evidence indicated that L&M “knew ofthe 1998 incident soon after they hired Hecht” and L&M “were further informed in February 2004 of the second conviction.” (2AER 45.) Thus, evidence indicated that “with this knowledge [of Hecht’s sex offender status] L&M allowed Hecht to work on the Cesar Chavez project while school children were present....” (ZAER 45-46.) Further, the trial court found that “L&M’s principals were aware... that [Hecht] was a registered sex offender,” and thus L&Mcould not establish that L&M “lacked knowledge ofHecht’s unfitness to work at a school.” (2AER 48.) Pursuant to a stipulation of the parties in the Doe action, the parties proceeded to arbitrate the claims under Cal. Civ. Pro. § 638 rather than continue throughthe trial court, and the arbitrator produced a decision that contained only a “single statement of total damages.” (2AER 53-54.) The February 10, 2014,arbitration decision found “defendants Ledesma & Meyer Construction Company,Inc., ... Joseph Ledesma and Kris Meyerindividually, lonne Barnes-Joshua individually and [SBCUSD]to beliable to the Plaintiff in the amount of three million, two hundred and fifty-thousand dollars ($3,250,000).” (2AER 54.) I. The Liberty Policies A. The LSIC Policy Liberty issued to Ledesma & Meyer Development, Inc. a Commercial General Liability policy under number DGL-SF-184779-016, effective June 1, 2006 to June 1, 2007 (“LSIC policy”), which included Ledesma & Meyer Construction Company,Inc. as anamed insured by endorsement. (See 3AER 262.) The LSIC policy states in relevantpart: SECTION I - COVERAGES COVERAGE A. BODILY INJURY... LIABILITY 1. Insuring Agreement a. Wewill pay those sumsthat the insured becomeslegally obligated to pay as damages becauseof“bodily injury” ... to which this insurance applies. We will have the right and duty to defend the insured against any “suit” seeking those damages. However, we will have no duty to defend the insured againstany “suit” seeking damages for “bodily injury” ... to which this insurance does not apply. ... This insurance applies to “bodily injury” ... only if: (1) The “bodily injury” ... is caused by an “occurrence” .... * * * SECTION V — DEFINITIONS 13. B. “Bodily injury” means bodily injury, sickness or disease sustained by a person, including death resulting from any of these at any time. “Occurrence” means an accident, including continuous or repeated exposure to substantially the same general harmful conditions. The LIUIPolicy LIUI issued to Ledesma & Meyer Construction Company, Inc. a Commercial Umbrella policy under number LQ1-B71-185256-016,effective June 1, 2006 to June 1, 2007 (“LIUIpolicy”). (See 3AER 415.) The LIUI policy states in relevantpart: INSURING AGREEMENTS COVERAGE Wewill pay on behalf of the “Insured” those sumsin excess of the “Retained Limit” that the “Insured” becomes legally obligated to pay by reason ofliability imposed by law or assumedby the “Insured” under an “Insured contract” because 10 of “bodily injury,” ... that takes place during the Policy Period and is caused by an “occurrence” happening anywhere.... * * * V. DEFINITIONS C. “Bodily injury” means physical injury, sickness, or disease, including death ofa person.“Bodily injury”also means mental injury, mental anguish, humiliation, or shockifdirectly resulting from physical injury, sickness, or disease to that person. J. “Occurrence” means: 1. as respects “bodily injury”or “property damage,” an accident, including continuous or repeated exposure to substantially the same general harmful conditions; * * * HI. —Liberty’s Reservation of Rights and Defense of L&M in the Doe Action L&Mtendered the Doe action to LSIC on June 11, 2010. LSIC agreed to defend L&M in the Doeaction undera reservation ofrights, througha letter dated July 2, 2010. (See 4AER 559.) ll The LIUIpolicy is an excess policythat is only potentially applicable once underlying insuranceis properly exhausted. LIUIissued a reservation of rights letter to L&M dated July 16, 2010, stating it had no indemnity obligation “to the extent that this matter did not arise from an ‘occurrence,’” and reserved LIUI’s “rights to disclaim coverage for this matter ...”. (See 3AER 396.) In further advising L&M ofLiberty’s position regardingits reservation of rights through correspondence dated August 22, 2011, Liberty noted that California law: support[s] the proposition that the “occurrence” determination focuses on the immediate injurious act, not any antecedentacts or omissions which purportedly allow thelater act to take place. In context, the proposition results in the conclusion thatthere is no coverage for the Doeaction, as while negligent supervision andretention are accidentalin nature,” L&M’s alleged negligent * L&Mselectively cites this portion ofLiberty’s letter out of context, to argue that “Liberty has directly admitted that L&M’s negligence in hiring and supervising Hecht was ‘accidental in nature’.” (See Appellant’s Opening Brief, (“Br.”), at pp. 2, 14, and 16.) L&M appearsto suggestthat Liberty has not maintained a consistent position; that Liberty has concludedthat, under the facts of the Doe action, L&M’sintentional acts of retention and supervision were somehow accidental; or that, under the facts of the Doe action, Hecht’s molestation and rape ofDoe were somehow unexpected from the perspective of L&M. (See id.) L&M is wrong on all accounts. Theletter, in context, reflects that Liberty has maintained a consistentposition, andin fact referred to L&M’s “alleged negligent acts and omissions.” Further, here, L&M’s 12 acts and omissions werenotthe actual and/or immediate cause of the claimed bodily injury. Rather the direct cause of the harm was Hecht’s molestation of Doe. (3AER 371.) Despite that the injury alleged in the Doe action did not appear to implicate covered exposure, Liberty defended L&M in the Doe action under a reservation of rights. (See 3AER 371-72, 471.) IV. Procedural History of This Coverage Action A. In the District Court While defending L&M undera reservation ofrights, (see 4AER 559), Liberty filed this declaratory judgment action seeking a declaration that Liberty had no duty to defend L&Min the Doe action becausethat action did not allege an “occurrence” that could trigger coverage under the Liberty policies. (See 4AER 573.) On December 3 & 4, 2012, L&M andLiberty filed cross-motions for summary judgment respectively. (See 2AER 115, 4AER 469.) Thecross- supposed “negligent management”wasto hire, retain and place Hecht, whom L&M knew at the time was a registered sex offender, on the grounds of a middle schoolin a supervisory role. L&M ignoresthis reality in its attempt to in turn force a construct of California law which would support the misplaced theory that the “occurrence” analysis should be driven by the sourceofits liability, not the actual cause ofDoe’s “bodily injury.” L&M also mistakenly characterizes the letter as “denying coverage,”(see id.), despite that Liberty defended L&M in the Doeaction pursuantto a reservation ofrights, as noted in theletter itself, (see 3AER 371-72), and by L&Minthedistrict court. (See 4AER471.) 13 motions were ruled upon bythe district court in its January 23, 2013, order which granted summary judgment to Liberty and denied L&M’s motion for summary judgment. (1AER 12-16.) The district court reasoned: Here, L&M’s alleged negligent hiring, retention and supervision were acts antecedent to the sexual molestation that caused injury to Doe. While they set in motion and created the potential for injury, they were too attenuated from the injury-causing conduct committed by Hecht. Moreover, even if one argued that L&M’s conduct of supervision and retention were not antecedent, but rather simultaneous, to the molestation, that argument is unavailing. First, the supervision and retentionarestill not the injury-causing acts. Second,courts have rejected the argument that the insured’s intentional acts of hiring, supervising, and retaining are accidents, simply because the insured did not intend for the injury to occur. See Foremost Ins. Co. v. Eanes (1982) 134 Cal.App.3d 566, 570-71; Merced Mut. Ins. Co. v. Bobby Mendez (1989) 213 Cal.App.3d 41, 50; American Empire Surplus Lines Ins. Co. v. Bay Area Cab Lease, Inc. (N.D. Cal. 1991) 756 F.Supp. 1287, 1290; see also Delgado v. 14 Interinsurance Exchange of the Automobile Club ofSouthern California (2009) 47 Cal.4th 302, 315-316.° (1AER 15, format of citations changed.) The Court concluded that “Doe’s injuries givingrise to the claims in the Underlying Action were not caused by an ‘occurrence,’ as defined under the General Policy. Consequently, thereis no possibility for coverage, and Liberty does not have a duty to defend and indemnify L&M.” (LAER 15.) Further, because there wasno injury caused by an “occurrence”and coveragedid not apply to any entity, the district court did not needto specifically address any claim ofcoverage for SBCUSD.(Seeid.) Thedistrict court granted Liberty’s motion to enter final judgment on June 13, 2014. (1AER 6.) On June 26, 2014, L&M filed a motion for reconsideration of the district court’s January 23, 2013, order based on a stipulated judgmententered into by the parties in the Doe action and related documents. (See 2AER 34, 53.) L&M alsofiled a notice of appeal ofthe June 13, 2014, judgment on July 10, 2014. (2ZAER 27.) Thedistrict court denied L&M’smotion for reconsideration on August 6, 2014, notingthat it had found that “L&M’s alleged conduct wasfar too attenuated from the injury-causing conduct, namely, the assault of Jane Doe, and thus did not constitute an ‘accident’ or an ‘occurrence’”that caused Doe’s injury. (1AER 3.) Thus, a * Contrary to L&M’s characterizationofthe district court’s opinion, (see Br.at p. 8), the district court did not single out Merced to support its reasoning but rather included Mercedin string cite with three other cases. 15 judgmentofliability on those negligence claims against L&M wasirrelevant to the district court’s analysis and conclusion. (See LAER 3.) L&M subsequently filed an amended notice of appeal on August 8, 2014. (See 2AER17.) B. Before the Ninth Circuit L&Mappealedthedistrict court’s decision to the U.S. Court ofAppeals for the Ninth Circuit. (See Liberty Ins. Corp. v. Ledesma and Meyer Const. Co., Inc. (9th Cir. 2016) 834 F.3d 998.) L&M and Liberty briefed the Ninth Circuit and appeared for oral argument. The Ninth Circuit subsequently requested that this Court determine the proper interpretation of the Liberty policies in this context. (See id. at 1001.) This Court granted review. (Order granting review, Oct. 21, 2016.) ARGUMENT I. L&M Cannot Meetits Burden to Establish Coverage A. L&M Has the Burden to Establish Coveragein the First Instance, and L&M’s Characterization ofthe “Occurrence” Requirement as Exclusionary Is Incorrect Asthis Court has noted, “the burdenis on the insured to bring the claim within the basic scope of coverage, and (unlike exclusions) courts will not indulge in a forced construction ofthe policy’s insuring clauseto bring a claim within the policy’s coverage.” (Waller v. Truck Ins. Exch., Inc. (1995) 11 Cal.4th 1, 16, citing Collin v. American Empire Ins. Co. (1994) 21 Cal.App.4th 787, 803 .) “Accordingly, the insured has the burden of showing 16 that there has been an ‘occurrence’ within the termsofthe policy.” (Waller, supra, 11 Cal.4th at p. 16, citing Collin, supra, 21 Cal_App.4th at pp. 802-03.) L&M attempts to move the goalposts by mistakenly characterizing the “occurrence” requirementas exclusionary in nature. (See Br. at p. 42.) L&M cites Aydin Corp. v. First State Ins. Co. (1998) 18 Cal.4th 1183 to argue that it is the function of the policy language, not its location in the policy that determines whether it should be construed an exclusion, thus shifting the burden of proof. (See Br. at p. 43.) However, Aydin expressly dealt with the “sudden and accidental” exception to the pollution exclusion and holds that when allocating the burden of proof an exception to an exClusion is properly construed as a coverageprovision. (See Aydin, supra, 18 Cal.4th at p. 1191.) In response to the insured’s concern that such a holding would permitinsurers to “manipulate the allocation ofthe burden ofproofby . Simple linguistic adjustments,” the Aydin court stated: “The fact that different policy language mightresult in a different allocation ofthe burden of proof should hardly come as a shock. Rather, it arises from the parties’ general freedom to contract as they deem fit. Simply put, ourobligation is to give effect to the languagetheparties chose,not the language they might have chosen.” (/d. at pp. 1192-93.) In Aerojet-General Corp. v. Transport Indemnity Co. (1997 )17 Cal.4th 38, this Court explained that the insurance policies “provide what they provide,” and in agreeing to the policies the parties “established what was 17 eee ‘fair’ and ‘just’ inter se. We may not rewrite what they themselves wrote.... We mustcertainly resist the temptation to do so..... As a general matter at least, we do not add to, take away from, or otherwise modify a contract for “public policy considerations.’”(/d. at 75.) Ofcourse, ifthe “occurrence” requirement were conceptually removed from the insuring agreement, the insuring agreement would becomea blanket provision of coverage for liability imposed under any circumstance. L&M may contemplate that such result would benefitit here, butit is fiction, as the termsofthe policies are applied as written, (see Bank ofthe West v. Superior Court (1992) 2 Cal.4th 1254, 1264), and the rule of law in California is that the insured has the burden to establish, in the first instance, that the “occurrence” requirementis satisfied. B. The Acts That Caused The “Bodily Injury” Are Inherently Non-Accidental L&Mdoesnot dispute that the improper sexual contact with Doe was the deliberate, intended result of Hecht’s conduct. Under California law, sexual abuseis by definition intentional and nonaccidental conduct. (See,e.g., J.C. Penney Casualty Ins. Co. v. M. K. (1991) 52 Cal. 3d 1009, 1025 [child molestation is a/ways intentional”], italics in original; Northland Ins. Co.v. Briones (2000) 81 Cal.App.4th 796, 811 [“rapeis intentional conduct,stalking is intentional conduct...”]; Quan v. Truck Ins. Exchange (1998) 67 Cal.App.4th 583, 596 [sexual assault “necessarily nonaccidental”].) Further, 18 under California law, intentional conduct does not constitute an “occurrence” defined as an “accident.” (See, e.g., Collin v. American Empire Ins. Co. (1994) 21 Cal.App.4th 787, 806 [‘It is fundamental that allegations of intentional wrongdoing donotallege an ‘accident’”]; Royal Globe Ins. Co. v. Whitaker (1986) 181 Cal.App.3d 532, 537 [An intentional act is not an ‘accident’ within the plain meaning ofthe word”; Chatton v. National Union Fire Ins. Co. (1992) 10 Cal.App.4th 846, 861 [“it is well settled that intentional or fraudulent acts are deemed purposeful rather than accidental and, therefore, are not covered under a CGL policy”].) Without making the argument explicit, L&M suggests that an employer’s vicarious liability for an employee’s intentional tort should be considered the accident for the purposesofliability coverage. (See Br.at pp. 21-22.) However, where an intentional act is the immediate cause of the injury, the mere fact that the insured’s liability is vicarious does not mean the injury is caused by an “occurrence.” (See Dyer v. Northbrook Prop. & Cas. Ins. Co. (1989) 210 Cal.-App.3d 1540, 1551-53.) In Dyer, an insured corporation sought coverage for a claim brought by a former employee for alleged wrongful termination. (See id. at 1543.) While the act of wrongful termination was not accidental, the insured argued that its agents “did the intentional acts, which made [the insured employer] liable vicariously, not because of its own intentional or willful conduct.” (/d. at 1551.) Thus, reasoned the insured, its own “potential vicarious liability was accidental, 19 unforeseen, and a nonintentional event.” (/d.) The Dyer court disagreed, noting “[i]n the caseat bench, ... the issue was not whothepolicy insured, but what harm it covered.” (Id. at 1552,italics added.) Because “the policy expressed the intent not to include a termination of employment as an 5995 ‘occurrence,’” there was no coverage for the insured employer’s potential vicarious liability. (/d. at 1552-53; see also Commercial Union Ins. Co.v. Superior Court (1987) 196 Cal.App.3d 1205, 1209 [wrongful termination not an “occurrence”]; St. Paul Fire & Marine Ins. Co. v. Superior Court (1984) 161 Cal. App. 3d 1199, 1202 [same].) II. L&M?’s Argument that an “Occurrence” Analysis Should be Independentofthe Immediate Cause ofHarm is Not Supported by California Law A. L&M’sForced Interpretation ofThis Court’s Precedents Is Mistaken L&M’s argumentturns on a forced and mistaken interpretationofthis Court’s precedents in Geddes & Smith, Inc. v. St. Paul Mercury Indem. Co. (1959) 51 Cal. 2d 558; Hogan v. Midland National Ins. Co. (1970) 3 Cal. 3d 553; and Delgado v. Interinsurance Exch. ofAuto. Club ofS. California, 47 Cal. 4th 302 (2009). L&Malso arguesthat this Court’s decision in Minklerv. Safeco Insurance Co. of America (2010) 49 Cal. 4th 315, supports its argumentandverifies its reading ofthis Court’s precedent. An examination of this Court’s decisions reveals otherwise. 20 1. Geddes & Smith, Inc. v. St. Paul Mercury Indem. Co. In Geddes, supra, 51 Cal.2d 558, an insured sought coverage under an insurancepolicy for breach ofwarranty and negligence allegationsarising out ofthe insured’s delivery ofpurportedly defective aluminum doors, which were subsequently installed. (See Geddes, supra, 51 Cal.2d at pp. 560-61.) The insured’s policy providedthat the insured could not “recover underthe policy unless the damages were damages ‘because of injury to or destruction of property, including loss of use thereof, caused by accident...” (/d. at p. 563.) In determining that there had been an “accident,” this Court did not focus on the point ofview ofthe insured, or even the “actor.” Rather, to the extent any point of view was considered, it was that of the injured party. This Court reasonedthat the term “accident”had: been defined “as ‘a casualty-something out of the usual course of events and which happens suddenly and unexpectedly and without design of the person injured.’ [citations omitted]” (Zuckerman v. Underwriters at Lloyd’s (1954) 42 Cal.2d 460, 473.) It “‘includes any event which takes place without the foresight or expectation ofthe person acted uponor affected by 21 the event.’” (Richards v. Travelers Ins. Co. (1891) 89 Cal. 170, 176 ....4 (Geddes, supra, at pp. 563-64, citations shortened.) This Court has subsequently rejected defining an accident from the point of view of the “person injured.” (See Delgado, supra, 47 Cal. 4th at p. 306.) In Geddes this Court also cited a Minnesota case in support of a more point-of-view neutral definition: “Accident, as a source and cause of damage to property, within the terms of an accident policy, is an unexpected, unforeseen, or undesigned happening or consequencefrom either a known or an unknown cause.” (Geddes at p. 564, quoting Hauenstein v. Saint Paul- Mercury Indem. Co. (1954) 242 Minn. 354.)° Apparently quoting the Hauenstein formulation but withoutdirect citation and withoutdistinguishing it from the earlier California cases (and thus implying the cited case law in * As discussed further below, both Richards and Zuckerman involvedfirst- party life insurance policies that either used “accidental means” language or relied on cases interpreting that language. > Hauenstein is a brief opinion in which the Supreme Court of Minnesota found that damageto a building caused by defective plaster was not excluded due to an exclusion for injury to “products manufactured, sold, handled or distributed by the Insured.” (Hauenstein, supra, 242 Minn.at pp. 355-56.) The bulk of the opinion addressed whether the product exclusion applied. (See id., passim.) The Hauenstein court only briefly noted that “[t]here is no doubtthat the property damageto the building caused by the application ofthe defective plaster was ‘caused by accident’ within the meaningofthe insurance contract, since the damage was a completely unexpected or unintendedresult.” (Ud. at p. 358.) Thus, to the extent the Hauenstein court considered the question, it focused on whether the damageitselfwas objectively “unexpected or unintended.” (See id.) 22 general supported the rule), this Court concluded that “[t]he door failures were unexpected, undesigned, and unforeseen. They werenotthe result ofnormal deterioration, but occurred long before any properly constructed door might be expected to wear outor collapse.” (Geddes at p. 564.) In the Geddes opinion, this Court further explained, “[m]Joreover[the doorfailures] occurred suddenly. /t bears emphasis that we are concerned, not with a series of imperceptible events that finally culminated in a single tangible harm, but with series of specific events ... each ofwhich caused identifiable harm atthe time it occurred.” (Geddes at p. 564,italics added.) Thus, the Court concluded, and chose to emphasize, that the damage was accidentalin natureat the time each eventoccurred,i.e., throughoutthe causal chain. (See Geddes at p. 564.) As a result, Geddes provided the groundwork for the rule that eventually developed: an “accident” or “occurrence” is determined objectively based on the injury-causing event, and not remote events in the causal chain. 2. Hogan v. Midland Nat’l Ins. Co. Hogan, supra, 3 Cal.3d 553, is particularly relevant and its close examination is helpful. In Hogan, this Court adopted the reasoning ofthe Geddes decision in determining whether two distinct injuries were covered undera policy that provided coverage for“injury to or destruction ofproperty .. caused by accident....” (Id. at p. 558, italics added by the Court.) In Hogan, the insured (Diehl) manufactured and sold wood processing 23 machinery, “insuring it against liability for property damage caused by accident.” (/d. at p. 557.) The underlying claimant, Kaufman, purchased a saw manufactured by Diehl and beganto useit in September 1961.° (/d.) The saw was allegedly defective causing lumberto be cut in widths that were too narrow. (/d. at p. 558.) After customers had rejected the lumber becauseit had been cut too narrow, “to avoid complaints in the future, Kaufman deliberately cut lumber wider than specified in orders,” beginning after April 24, 1962. Ud. at p. 559.) The insurer argued that damage to the boards resulting both from cutting the widths too narrow and too wide were not the result of “an accident.” (See Hogan at p. 559.) The Court determined that there was “no merit” to the insurer’s “assertion that damagesresulting from undercutting were foreseeable under [Geddes].” (/d. at p. 560.) However, the Court determined that “[t]he circumstances, and the legal consequences, differ[ed] as to the boards cut too wide.” Ud.) Even though,after April 24, 1962, Kaufman cut boards extra wide to compensate for the defective saw, the Court concluded that “[w]hatever the motivation, there is no question that these boards were deliberately cut wider than necessary; the conduct being ° Kaufman was the claimantin the liability action against Diehl in which Kaufman obtain a judgment. See id. at 557. Thereafter, Diehl assigned its cause of action against its insurer to Robert Hogan. See id. Neither the Supreme Court decision, nor the preceding Court ofAppeal decision, discuss the relationship (if any) between Hogan and Kaufman. 24 calculated and deliberate, no accident occurred within the [Geddes] definition.” (/d., italics in original.) It 1s important to note that the saw manufacturer, Diehl, and not Kaufman, was the insured. (See id. at p. 557.) The policy insured Diehl “againstliability for property damage caused by an accident.” Jd. In Hogan this Court did not discuss in any way whether the under- or overcutting were expectedor foreseeableby the insured, Diehl. (See id., passim.) It was simply not relevant to the analysis. The only question was whetherthe injury-causing act itself was deliberate. (See id. at pp. 560-61.) This Court reasoned: “The deliberate nature of Kaufman’s act (i.e., he contemplatedthe result of his act before he cut the boards) prevented the overcutting from constituting an accident....” (/d. at p. 560, italics added.) Hoganis importantin anotherrespect. In Hogan,the plaintiffargued— muchlike L&M here—that an insured’s precipitating negligence should be the focus ofthe analysis, rather than the actual cause ofthe harm. (Seeid. at 561.) In Hogan,theplaintiffargued that “Diehl’s reasonable expectations werethat the policy would cover claims for negligence, breach of warranty or strict liability in tort,” and thatthe insurer’s position would meanthat “Diehl would have obtained nothing ofvalue for its premium dollar.” (/d.) In Hogan,this Court conceded that “[i]t was established in the prior action that, due to 25 Diehl’s improper conduct’in delivering a defective saw, Kaufman deliberately cut boards too wide.” (/d. at 560, italics added.) But, the Court did not view the term “accident” as coextensive with the insured’s potential negligence (or strict) liability. Rather the Court found: There wasno evidencein the record as to the expectationsofthe parties and no indication that Diehl anticipated coverage for liability not attributable to accident. The basic coverage for property damageliability due to accident is commonin products liability policies.... One who purchases an insurance policy against liability for property damage due to accident cannot reasonably expect to obtain coverage for consequencesclearly outside the scopeofthe definition of accident. (Hoganat p. 561, citations omitted.) Thus Hogan, which has not been overruled and remains California law, makesclearthat the determination ofan “accident”rests on the injury-causing conduct(i.e., the deliberate overcutting ofthe lumber) and not any antecedent act that precipitated the injury. ” Subsequently, the Court identified Diehl’s “improper conduct” as “Diehl’s negligence.” (See Hogan, supra, 3 Cal.3d at p. 560.) Notwithstanding the Court’s identification, it appears that Kaufman had sued undera breach of warranty cause of action. (See Hogan v. Midland Nat. Ins. Co. (1969) 2 Cal.App.3d 761, vacated (1970) 3 Cal.3d 553.) 26 3. Delgado v. Interinsurance Exch. ofAuto. Club ofSo. Calif. In Delgado, the underlying complaint alleged two causes of action against the insured: “[t]he first alleged an intentionaltort in that [the insured] ... physically struck, battered and kicked [the claimant] Delgado. The second cause of action alleged that [the insured] negligently and unreasonably believed he was engaging in self-defense and unreasonably acted in self defense ....” (Delgado, supra, 47 Cal. 4th at p. 306.) Overruling the trial court, the Court of Appeal found that excessive force exercised in the course of self-defense was generally considered unintentional conduct under California law and thus “[t]he complaint showedpotentially covered conduct becauseit alleged plainly that[the insured] actedin self-defense.” (Delgadov. Interinsurance Exch. ofAuto. Club ofS. California (2007) 152 Cal.App.4th 671 [61 Cal.Rptr.3d 826, 837], revd. (2009) 47 Cal. 4th 302.) On appeal to this Court, the claimant argued that “because [the insured’s] assault and battery was motivated by an unreasonable belief in the need for self-defense, the act fell within the policy’s definition of ‘an accident,’ because from the perspective of the injured party the assault was ‘unexpected, unforeseen, and undesigned.’” (Delgado, supra, 47 Cal. 4th at pp. 308-09.) This Court disagreed, reasoning: Were weto accept Delgado’s argumentthat any interpretation ofthe policy term “accident” should be based solely on whether 27 the injury-causing event was expected, foreseen, or designed by the injured party, then intentional acts that by no stretch could be considered accidental nevertheless would fall within the policy’s coverage ofan “accident.” Under Delgado’s reasoning, even child molestation could be considered an “accident” within the policy’s coverage, because presumably the child neither expected nor intended the molestation to occur. (/d. at p. 310, citing .C. Penney Casualty Ins. Co., supra, 52 Cal. 3d at 1028, fn. 17, italics added.) Thus, in response to the claimant’s argument that an “accident” can be construed from the perspective of the injured party, the Court refocused the inquiry onto the actitself that immediately caused the injury. (See Delgado, 47 Cal. 4th at p. 304.) In Delgado, this Court continued to address an additional argument from the claimant: that the insured’s mistaken understanding asto the need for self defense was “unforeseen and unexpected from the perspective of the insured, making the insured’s responsive acts unplanned and therefore accidental.” (/d. at p. 314.) The Court rejected this argument as well, explaining that “the law looks for purposes of causation analysis to those causes whichare so closely connected with the result and ofsuch significance that the law is justified in imposingliability.” (/d. at p. 315.) “Ina case of assault and battery,it is the use of force on another that is closely connected to the resulting injury.” (/d. at p. 315-16.) To “look to acts within the causal 28 chain that are antecedent to and more remote from the assaultive conduct would renderlegal responsibilities too uncertain.” (/d.) To that end, the Court noted that “the term ‘accident’ unambiguously refers to the event causing damage, not the earlier event creating the potential for future injury.” (/d., quoting Maples v. Aetna Casualty & Surety Co. (1978) 83 Cal.App.3d 641, 647-48.) The Court provided anillustrative example ofits reasoning: Whena driverintentionally speeds and,asa result, negligently hits another car, the speeding would be an intentional act. However,the act directly responsible for the injury—hitting the other car—wasnot intended by the driver and was fortuitous. Accordingly, the occurrence resulting in injury would be deemed an accident. (Delgado, supra, 47 Cal. 4th at p. 316, quoting Merced, supra, 213 Cal.App.3d at p. 50.) The Merced court, from which Delgado drawsthe example, continued the illustration: “On the other hand, where the driver was speeding and deliberately hit the other car, the act directly responsible for the injury— hitting the other car—would be intentional and any resulting injury would be directly caused by the driver’s intentional act.” (Merced, supra, 213 Cal.App.3d at p. 50.) Thus confirming that under California law 29 determination of whetherthere has been an “occurrence” focuses on the “the act directly responsible for the injury” and not antecedentevents.® 4. Minkler v. Safeco Insurance Co. L&M’sbriefdiscussion ofMinkler v. Safeco Insurance Co. ofAmerica (2010) 49 Cal.4th 315, reflects just how wide-off-the-mark L&M’s reading of this Court’s precedents is. According to L&M, Minklerillustrates that the law requires examination of antecedentacts of the insured(i.e., negligent hiring, supervision, etc.) to determine an “occurrence,” defined as an accident, if those antecedent events providea basisofliability. (See Br. at p. 15.) Minkler does no such thing. While this Court examined the question ofcoverage for a ’ L&M contendsthat Delgado supports its position based on the Court’s statement that an “accident” referred “to the conduct of the insured for which liability is sought to be imposed on the insured.” (See Br. at p. 13, citing Delgado, supra, 47 Cal. 4th at p. 311.) However, L&M ignores context. In Delgado, the assailant and the insured were one and the same;the Court had no occasion to distinguish between the actor engaged in the assault and the insured. In support ofthe statement, the Court in De/gado cited Quan, supra, 67 Cal.App.4th at page 596, and Collin, supra., 21 Cal-App.4th 787 . Quan held that sexualassault is necessarily non-accidental, even if encompassed by a purported negligence cause of action and the insured argued he may have mistaken consent. (See Quan, supra, 67 Cal. App. 4th at p. 596.) In Collin, the court held that a conversion could not be considered “accidental,” even if there was nointent to permanently deprive the ownerofproperty. (See Collin, supra, 21 Cal.App.4th at p. 804.) Like in Quan, the court found that the term accident referred to the conduct, not the insured’s state of mind. (See id.) In both Quan and Collins, the court did not have occasionto distinguish between the insured and the actor performing the intentional act, as they were one in the same. However, the context of Delgado, Quan, and Collin, makes clear the focus is on the injury-causing act and not the subjective understanding of the insured. 30 claim of negligent supervision against one insured in relation to alleged child sexual abuse committed by another, the Minkler decision was based only on consideration of the policies’ intentional acts exclusion, and not the “occurrence” requirement. (See Minkler, supra, 49 Cal.4th at p. 322.) The policies at issue contained a grant of coverage for liability for “damages because ofbodily injury ... caused by an occurrence,” but the court noted that the insurer “[did] not contend that the ... claims against [the insured] fell outside the scope ofthis basic coverage provision.” (/d. at 322.) Pointing out the distinction, and suggesting the parties had focused on the wrongissue, the Court stated: Thepolicies defined an “occurrence”as “an accident, including exposure to conditions whichresults, during the policy period, in bodily injury or property damage.” (Italics added [by Court].) [The insurer] does not assert that [the claimant’s] claims related to his alleged molestations by [an insured] are beyond the scope of this basic coverage because the molestations were not “accident[s],” and we have not been asked to addressthat issue. We therefore do not do so. (But see Delgado v. Interinsurance Exchange of Automobile Club of Southern California (2009) 47 Cal. 4th 302, 308-17, 97 Cal.Rptr.3d 298, 211 P.3d 1083; Hogan v. Midland National 31 Ins. Co. (1970) 3 Cal. 3d 553, 560, 91 Cal.Rptr. 153, 476 P.2d 825 .) (Minkler, supra, 49 Cal.4th at p. 322,fn. 3.) Minkler explicitly did not address the issue of whether there had been an “occurrence,” as the Court was not asked to do so. However,in citing Delgado and Hogan onthe issue, and no other cases, the Court appeared to directly suggest that it would not have foundthe alleged injury to be caused by an “occurrence,” consistent with the cited cases, as the act that caused the bodily injury—the molestation—wasnotaccidental. B. The Liberty Policies Require that the Injury-Causing Act Itself Define if an “Occurrence”is Present 1. Insurance Coverage is Not Coextensive With an Insured’s Potential Tort Liability L&M mistakenly arguesthat a policyholder’s coveragefortort liability should extend liability that may be imposed undertort-causation principles. (See Br. at p. 19.) The proposition is plainly an incorrect interpretation of California law. A “general liability” policy does not connote “unlimited coverage. ... It is invariably necessary to consult the language of any particular general liability policy to determine what coveragesit affords.” (FMCCorp. v. Plaisted & Companies (1998) 61 Cal. App. 4th 1132, 1146-47, disapproved of on other grounds by State v. Cont’l Ins. Co. (2012) 55 Cal.4th 186.) Liability policies generally provide coverage for certain types ofrisk and do not provide coverage that extends to the boundaries of all of the 32 insured’s potential tort liability. (See, e.g, Napa Cmty. Redevelopment Agency v. Cont’l Ins. Companies (9th Cir. 1998) 156 F.3d 1238 [“‘Accident’ or ‘occurrence’-based liability policies ... do not cover intentional or fraudulent behavior, only accidental or negligent [acts]”].) The contention wasalso plainly rejected by this Court in De/gado, which found no coverage even though the insured was subject to potential negligence-basedliability. (See Delgado, supra, 47 Cal. 4th at pp. 306, 314-16.) Utilizing an out-of-context quote, L&M mistakenly contendsthatthis Court has ruled in State v. Allstate Ins. Co. (2009) 45 Cal.4th 1008, that coverage under a liability policy necessarily extends to the extent of an insured’s potential liability. (See Br. at p. 19.) In State, this Court examined whetherliability policies provided coverageto certain pollution events caused by the flooding of a waste containmentfacility. (See State, supra, 45 Cal.4th at p. 1014.) The passage quoted by L&Mis in the context of whether the “concurrent cause” approach indicated there should be coverage. (Seeid. at pp. 1034-37.) The Court explained the rationale in employing the “concurrent cause” approachin the third-party liability context. (See id.) Applying the “concurrent cause” approach,the Court found that there wasa triable issue of fact in relation to whether damage had been causedby an ostensibly covered “sudden accidental release” in addition to uncovered “subsurface leakage.” (See id. at p. 1032.) 33 The Court did not decide or even opine on what might constitute an “occurrence” or “accident” under a third party liability policy. (See id, passim.) Rather, State—andin particular the section quoted by L&M—stands for the principle that a covered, independent “concurrent cause” can implicate coverage undera third-party liability policy even when an excludedcauseis also present. Unsurprisingly, L&M doesnotraise the argumentthat alleged negligent acts and/or omissions by L&M canconstitute a covered independent “concurrent cause” of Doe’s injury. (See Br., passim.) The California “concurrent cause” doctrine also does not present an avenue for coverage here, and thus State has no substantive application. A concurrent cause exists when an indivisible harm occurs because of two distinct causes, each of which could independently cause injury, (see State Farm Mut. Auto. Ins. Co. v. Partridge (1973) 10 Cal.3d 94, 102), whichis not present here. (See also Farmers Ins. Exch. v. Superior Court (2013) 220 Cal.App.4th 1199, 1204-14 [discussing the concurrent cause doctrine].) Without the alleged intentional sexual assaults by Hecht, there is no injury, and thus no independent liability for L&M’s alleged negligence. The “concurrent cause” analysis thus simply confirms that the “occurrence” inquiry does not focus on antecedentacts. 34 2. The “Occurrence” Language Imposes an Objective Standard The language of the Liberty policies themselves indicate an objective focus on the injury-causing act to determine an “occurrence,” with a focus on the act, not the actor. A brief discussion of the ISO CGL policy form is instructive. The 1966 ISO CGL policy form introduced the “occurrence” coverage trigger, which required that damage or injury be caused by an “occurrence.” (See Aerojet-Gen. Corp. v. Transp. Indem. Co., supra, 17 Cal.4th at p. 49.) In the 1966 form,“occurrence” was defined as an “accident, including injurious exposure to conditions, which results during the policy period in [bodily injury or property damage] neither expected nor intended from the standpointofthe insured.” (See id.) In 1973, the form wasrevised to eedefine “occurrence” as an accident, including continuous or repeated exposure to conditions, which results in in bodily injury or property damage neither expected nor intended from the standpoint ofthe insured.” (See id. at p. 49.) The form subsequently again changed the definition of “occurrence,” but this time removedthe clause relating to the point of the view of the insured, leaving an objective definition: “an accident, including continuous or repeated exposure to substantially the same general harmful conditions,”as reflected in the Liberty policies. (See 3AER 289, 4AER 431.) This background is helpful in consideration of another “concurrent cause” doctrine case on which L&M mistakenly relies, Underwriters v. Purdie 35 (1983) 145 Cal.App.3d 57, in support of its contention that liability coverage should alwaysapply if liability is related to an employer’s alleged negligent conduct. In Purdie, the policy at issue provided “occurrence” coverage, and occurrence was defined to mean “an accident ... which results in bodily injury or property damage neither expected nor intended from the standpoint of the insured,” mirroring the earlier, 1973 ISO form. (See Purdie, supra, 145 Cal.App.3d at p. 61.) In Purdie, a deliveryman wasshotby a liquor store clerk with a gun kept on the premises with the permission of the insured store owner. (See id. at p. 62.) The deliveryman sued the insured, inter alia, for negligently hiring and supervising the clerk in addition to other claims. (See id.) While the Purdie case turned on application of the firearm exclusion,in discussing whether the shooting triggered coveragein the first instance, the Purdie court stated: Regardless ofwhether this shooting by Antoine wasintentional or negligent, it mustfirst come within the policy’s definition of an accident for liability to arise. There could be noliability underthe policy unless the occurrenceis “neither expected nor intended from the standpoint of the insured.” (Id. at p. 67.) Thus,in relation to the “occurrence”determination, the Purdie court focused on whether the shooting came within the policy’s definition of an accident. (See id.) Although it was not the focus of the Purdie court’s analysis and not madeexplicit, it appears clear in context that because the 36 policy defined “accident” subjectively, from the standpoint of the insured,it could be considered accidental underthe policy.’ The Purdie court ultimately foundthat the policy provided coverage based onits reasoning that negligent hiring presented an independent, concurrent cause of injury and thus under Partridge, supra, 10 Cal.3d 94, coverage should apply.’ In contrast, in Farmerv. Allstate Ins. Co. (C.D. Cal. 2004) 311 F. Supp. 2d 884 , affd. (9th Cir. 2006) 171 Fed. App’x 111, the policy at issue provided ” The above quoted reasoning comesat the end ofsection discussing that the firearm exclusion is not ambiguous, and therefore applicable. (See Purdie, 145 Cal.App.3d at pp. 66-67.) The insureds arguedthatthe firearm exclusion was ambiguous becauseit could be construed as applying onlyto the negligent use of a firearm, and not its intentional use. (See id. at p. 66.) The Purdie court examined the exclusion and found that it did not contain such a limitation, and noted that the policy already contained a similar limitation in the “occurrence”definition, which waslimited to the subjective standpoint of the insured. (See id. at pp. 66-67.) '° The concurrent cause analysis by the Purdie court is mistaken. As L&M note, Purdie wascriticized in Century Transit Sys., Inc. v. Am. Empire Surplus Lines Ins. Co. (1996) 42 Cal.App.4th 121, 128, fn. 6. In fact, the Purdie court’s mistaken “concurrent cause”analysis was thoroughly addressed by the Century Transit court: As we read Purdie, the negligent hiring or retention theory asserted against the employer wasnot an independent cause of the injury but rather a theory for imposing liability on a third party for an excluded injury. Unless the employeefired the gun, the injury would not have occurred. Therefore, liability for negligent hiring was wholly dependent upon an injury caused by excluded event and wasnota true “independent” cause of the plaintiffs injury. We agree with those cases which have criticized the concurrent cause analysis endorsed and applied by Purdie. (Century Transit, 42 Cal.App.4th at p. 128, fn. 6, citations omitted.) 37 coverageto the insured forliability arising out of an “occurrence,” which was defined objectively as “an accident ... resulting in bodily injury or property damage,” reflecting the 1986 ISO form, and mirroring the language in the Liberty policies. (/d. at p. 887.) The district court examined coverage for an in-homeday care operator (Mrs. Varela) in relation to an alleged molestation by her husband (Mr. Varela). Ud. at p. 886.) The district court first noted that the alleged molestation “was not an ‘occurrence’ because child molestation 999cannotbe an ‘accident.’” (/d. at p. 891.) Basing its reasoning on Maples v. Aetna Casualty & Surety Co. (1978) 83 Cal.App.3d 641, and its progeny (discussed infra), the court stated: The Court is inclined to find that Mrs. Varela’s negligent supervision does not qualify as an “occurrence.” ... In Maples, the court was faced with determining whether the negligent conduct that created the potential for the injury causing event should be deemed an “accident.” The Maples court presumably could have found that both the negligent heater installation and the fire itself were “accidents” (and thus “occurrences’’), but instead it found that only the event causing the injury was the “accident.” In the instant case, the injury causing events were clearly Mr. Varela’s molestations of Plaintiff—without such behavior, Plaintiffwould not have brought the underlying action against the Varelas. In that Mrs. Varela’s negligence enabled 38 Mr. Varela to molest Plaintiff[ Mrs. Varela’s conduct only created the potential for Plaintiff's injuries. Ud. at 893.) While the Farmer court correctly applied an objective standard under California law in its discussion indicating that the alleged “bodily injury” was not caused by an “occurrence,” the court ultimately based its finding of no coverage onotherprovisions in the policy. (/d.)!" C. L&M Incorrectly Contends that “Trigger of Coverage” Cases Have Improperly Influenced Decisions as to What Constitutes an “Occurrence” L&M mistakenly contends that this Court should discount California law dictating that the “occurrence”analysisis driven by the injury-causingact, becauseit is rooted in part in cases that have dealt with “trigger of coverage” issues. (See Br. at p. 17.) L&Malso ignoresthat a “seemingly unbrokenline of authority” in California explains that “the term ‘accident’ unambiguously refers to the event causing damage,notthe earlier event creating the potential for future injury.” (Maples, 83 Cal. App. 3d at pp. 647-648 [examining case '' As L&M notes, Liberty also cited in its Ninth Circuit brief an unpublished case from the Court of Appeals, L.A. Checker Cab Co-op., Inc. v. First Specialty Ins. Co. (2010) 186 Cal.App.4th 767 . (See Br. 16.) Liberty did not rely “heavily” on the decision, as L&M mistakenly claims, nor was it improperfor Liberty to discuss the case “openly” before the Ninth Circuit. In particular, a federal circuit court may look for guidance in depublished or unpublished opinions from intermediate state courts. (See Employers Ins. of Wausau v. Granite State Ins. Co. (9th Cir. 2003) 330 F.3d 1214, 1220, fn. 8 [noting that a depublished California case lent support to appellant’s reading of California law].) Consistent with the California Rules of Court, Liberty does not rely upon unpublished California case law in this Answering Brief. 39 law in relation to limitation of coverage to “injury to or destruction ofproperty ... caused by accident”’], citations omitted.) Cases in the line of authority referenced in Maples deal with timing, 1.€., a precipitating event that fell within a policy period, but a proximate, injury-causing event that occurred after the policy period. (See, e.g., Maples, supra, 83 Cal.App.3d 641; Tijsseling v. Gen. Acc. etc. Assur. Corp. (1976) 55 Cal.App.3d 623.) L&M mistakenly contends that such cases are inapposite and of no use in resolving the instant dispute. (See Br. at p. 17.) L&M is mistaken, and ignoresthe reality that this line of authority has been applied by this Court outside of the policy-period context, to confirm that remote events do not constitute an “occurrence” causing injury. (See Delgado, supra, 47 Cal.4th at p. 316.) Indeed, this Court’s citation of Maples in Delgado expresses its relevance to the determination ofwhether an “occurrence”has causedinjury in the context of this action. (See Delgado, supra, 47 Cal.4th at p. 316.) L&M relies heavily on Delgado, but L&M cannot embrace De/gadoas controlling andat the same timereject the authorities on which the Delgadoopinionrests as “inapposite” because they purportedly arise in a different context.'” In Delgado, this Court itself did not discount the authority of Maples as ’? In doing so, L&M selectively picks and chooses “snippets” fromDelgado— exactly what L&M incorrectly suggests Liberty has done. (See Br. at p. 18.) 40 inapposite, but rather embracedit to reflect the direct focus under California law onthe injury-causing event, not earlier, antecedent events. Ill. L&M’s Argumentin Relation to the “Unexpected Consequences” of Deliberate Acts is Misplaced A. The Issue, As Framed by L&M,is Not Determinative for this Action L&M takespainsto argue that there should always be coverage for the “unintended result” of “deliberate acts,” (see Br. at p. 25), but even if that were true, it does not follow that coverage is otherwise afforded under the Liberty policies. The argument appears to be in response to L&M’s incomplete characterization of the district court’s opinion in finding (according to L&M)that L&M’s purported negligence “did not qualify as an ‘accident’ under Merced becauseit was deliberate conduct.” (Br. at 8.) While L&M points to Merced as the source ofthe district court’s reasoning, in fact the district court did not single out Merced, but includedit in a string cite with three other cases—Foremost Ins., Bay Area Cab Lease, and Delgado—to support its conclusion that the alleged negligent hiring, retention and supervision was not an “accident.” (See LAER 15.) Thus,it is instructive to discuss the cases the district court cited’? in addition to Delgado, already '3 One of those cases, Foremost Ins., predated Merced, and wasthusplainly not guided by Merced. (See Foremost Ins., supra, 134 Cal. App. 3d 566.) Another, BayArea Cab Lease, did not rely on Mercedto reachits conclusion, though it cited Merced exactly once in support of the statement: “The coverage under a written insurance policy is solely a matter for judicial 4] discussed above,as it provides context for the district court’s reasoning, and in doing so explains that L&M’s forced arguments are entirely mistaken." In Foremost Jns., the owners of a motor home loanedit to others for a trip to Mexico. (See ForemostIns., supra, 134 Cal.App.3d at p. 569.) While in Mexico, the motor home was involved in an accident in which two occupants ofthe motor home were killed. (See id.) The owners were sued on a negligent entrustment theory, as well as under vehicle statutes. (See id.) The owners had an insurance policy with respect to the motor home that providedthat “[t]his policy applies only to accidents ... while the automobile is within the United States of America.” (/d.) Thus, the argument turned on defining the “accident.” Ifthe “accident” wastheinitial loaning ofthe motor hometo others,i.e. the negligent entrustment, it would fall within the coverage territory of the United States. (See id. at 571.) In responseto that argument, the Foremost Ins. court stated “[t]o argue that the loan of the vehicle constituted the ‘accident’ in this case strains credulity. ‘Accident’ suggests a negative unexpected occurrence. While a manufacturing defect or a negligent repair may conceivably fit within this rubric, the intentional loaning of a vehicle to friends does not.” (See id.) Thus, the Foremost Ins. court clearly interpretation.” (See Bay Area Cab Lease, supra, 756 F. Supp. at p. 1289, citing Merced, supra, 213 Cal.App.3d at p. 45.) '’ Because L&M focusparticularly on Merced,it is discussedat greater length in the following sections. 42 delineated between the initial, allegedly negligent antecedent act of entrustment and the injury-causing event (the vehicle accident in Mexico). The court clearly understood that there had been an “accident,” albeit one that occurred in Mexico andthus subject to theterritorial limitation. As negligent entrustment can neatly be analogized to negligent hiring, it appears that the district court in this action cited ForemostIns. in supportofits conclusionthat negligent hiring would not be considered an “accident” under California law. Othercasescited by the district court in turn support the same conclusion with respect to negligent retention and supervision. Of the cases cited by the district court, only Bay Area Cab Lease involved an underlying claim of negligent supervision. (See Bay Area Cab Lease, supra, 756 F. Supp. at p. 1289.) In Bay Area Cab Lease, the district court examinedliability coverage for a cab company whereit wasalleged that an employee had molested a child and foundthat“negligent hiring/supervision is not an ‘accident.’” (Ud) The Bay Area Cab Lease court reasonedthat, “even if it [were] accepted that the act of ‘negligent hiring’ is the occurrence whichgaverise”to the claimant’s injuries,“this is not a risk that is covered by the policy since it is not an ‘accident.’” (Ud. at p. 1290.) The hiring and supervision of the employee “merely created the potential for injury to [the claimant] but wasnotitself the cause of the injury.” Ud.) The Bay Area Cab Lease court did not focus on the “deliberate” nature ofthe purported negligent supervision in reasoning that there had been no “accident.” Rather, there had 43 been no “accident” because the hiring and supervision were not the injury- causing events themselves. (See id. at p. 1290.) While the Bay Area Cab Lease court’s finding of no coverage wasalso based on a limitation that the policy extended coverage only to injury arising from certain premises,(see id. at pp. 1290-91), the court’s reasoning that no “accident” was alleged accurately reflects California law. Thus, it appears that the district court collapsed into one sentence its reasoning as to why negligent hiring, retention and supervision do not constitute an “accident” under the facts of the Doe action. In some circumstances,like in ForemostIns., acts like alleged negligent entrustment or alleged negligent hiring are distinct because they represent discrete intentional acts. In others, as in Bay Area Cab Lease, there was no accident because the allegedly negligent acts were not themselvesthe direct cause ofthe injury, but rather merely created the opportunity for another actor to behaveintentionally. The commonthreadis that the antecedentacts are distinct and separable from the events that actually caused the injury—whether temporally/geographically as in Foremost, Ins., or because an inherently intentional act was the direct cause of injury, as in Bay Area Cab Lease. This Court, in De/gado(also cited by the district court here), confirmed the reasoning. (See De/gado, supra, 47 Cal. 4th at p. 310 [proper focus is on the injury-causing event].) Examination of L&M’s proffered hypothetical makes it clear that L&M’s argumentis unnatural and not responsiveto this case. L&M present a 44 hypothetical wherein “Smith” attempts to throw a baseball to a child, but inadvertently “throwsthe ball over the child’s head, and the ball breaks his neighbor’s window.” (Br. at p. 41.) According to L&M,acceptance of Liberty’s argumentand the judgmentofthe district court, particularly insofar as it reflects the reasoning ofMerced, supra, 23 Cal.App.3d 41, would indicate there would be no coverage for Smith because he intended to throw the ball, just not through the window. (See Br. at p. 41.) One could hardly think of a scenario more disparate from the facts of this case and less enlightening. Adopting L&M’s hypothetical to the actual issue in controversy in this action wouldresult in a scenario like this: Smith intentionally threw a baseball through his neighbor’s window. Despite knowing that Smith was prone to throwing baseballs through his neighbor’s window, Jones gave Smith a baseball as they stood outside the neighbor’s house. It becomesclearthat the broken windowis notthe result ofan “accident,” and certainly is not an “unintended consequence”of intentional conduct. Rather, the result was a direct, intended result of the voluntary act. Further, Jones’s antecedent act of entrusting the baseball to Smith does not changetheresult, independent from the fact that Jones can properly be viewed as expecting Smith to throw the ball through the window based on his knowledge of Smith’s proclivity. The entrustment did not cause the broken window,butit 45 was rather Smith’s act of throwing the baseball through the window that causedit to break. L&Mstate that the majority of California appellate courts have not found than an “accident ... includes the unexpected consequences flowing from the insured’s deliberate acts,” (Br. at p. 25), but note that a handful of courts have followed what L&M contends is the correct rule. However, examination of those cases in context, makesit clear that they do not support the forced journey L&M invites the Court to undertake. In State Farm Fire and Cas. Co. v. Superior Court (2008) 164 Cal.App.4th 317 (“Wright”), the court examined an instance where an insured attempted to throw a boy into a pool simply to get him wet, but instead the boy landed on a cement step and was injured. The Wright court concluded that, because the injury itself was not intended, it could be deemedtheresult of an “accident.” (See id. at p. 329.) The Wright court rejected the insurer’s argument that the court “should apply ‘fortuity’ solely to the act causing the injury without referenceto the injury....” Ud. at p. 330.) In concludingthat a fortuitous injury resulting from an intentional act could implicate an “occurrence,” the Wright court distinguished cases involving “sexual harassmentor sexualassault,” noting that “with respect to sexual molestation, 'S Other courts, as well as L&M in its Opening Appellate Brief, refer to this case by the name of the claimant, Wright. We follow the convention. 46 no aspect in the causal series of events can be unintended.” (/d., citing Merced, supra, 213 Cal.App.3d at p. 50.) Thus, the Wright decision clearly does not embrace a circumstance where the harm itself is a necessary consequenceofthe injury-producingact, as in the case of sexual molestation. Further, Wright predates Delgado; compare Wright with State Farm General Ins. Co. v. Frake (2011) 197 Cal.App.4th 568, which followsthis Court’s decision in Delgado. In Frake, the court determinedthat an insured’s intentional act of striking the claimant did not qualify as an “‘accident” simply because the insured did not intend to cause the resulting injury. (See Frake, supra, 197 Cal.App.4th at p. 584.) Although L&M mistakenly contendsthat Frake, among other cases, adopted Merced’s reasoning,(see Br. at p. 27), the Frake court relied most heavily on this Court’s holding in De/gado,discussing it at length. (See Frake, supra, 197 Cal.App.4th at pp. 581-83, 584-85.) In following Delgado, the Frake court criticized Wright, stating: [T]o the extent Wright ruled that the term “accident” applies to deliberate acts that directly cause unintended harm, such a holding is contradictory to well-established California law. We are not aware of any California decision that has cited Wright approvingly or adoptedits analysis. (Id. at p. 585.) The Frake court reasoned that Delgado “reaffirm[ed] prior case law holding that the nature of the ‘injury-causing event’ determines whetheran accident has occurred, not the nature of the resulting injury.” (/d. 47 at p. 582.) As aresult, the intentional act of striking the claimant, despite the purportedly unexpected consequences, could not be considered an “occurrence.” L&M also cites Meyer v. Pacific Employers Ins. Co. (1965) 233 Cal.App.2d 321, in which the court found that an intentional trespass could still result in an “accident” because while intent is an elementofthe tort of trespass, “[i]ntent to cause damage wasnot ... an elementofthe tort and,... the trespasser was liable for such damage as he caused even though that damage was not intended or foreseen by him.” (/d. at p. 326.) The Meyer court distinguished, at some length, circumstances where an injury was intended and whereanintentional act inadvertently resulted in injury. (See id. at pp. 326-27.) In doing so, the Meyer court focused on whether the injury itselfwas “accidental in character.” (See id. at p. 327.)'° As with State Farm, the court’s reasoning in Meyer does not indicate a finding of coverage for '© As this Court noted in J.C. Penney Cas. Ins. Co., supra, 52 Cal. 3d 1009, ‘Meyer does not support [the] view that coverage applies unless the insured acted with a subjective intent to injure. To the contrary, Meyer makesclear that coverage is excluded in this case [where the claimant was sexually molested]. ... Meyer does not support the argument ... that one can sexually abuse a young child but intend no harm.” (J.C. Penney Cas. Ins. Co., supra, 52 Cal. 3d at pp. 1024-25, citing Meyer, supra, 233 Cal. App. 2d at p. 325.) 48 L&M in relation to Doe’s sexual molestation—where the act and intent to injure are indivisible.'’ B. Merced WasCorrectly Decided and Reasoned, and Did Not Particularly Rely on Unigard L&M’s unusual focus on Merced cannot be a result simply of the district court’s citation ofthe case. As discussed above, Merced1s simply one of a numberofcasescited by the district court. The focus appears to be based on a mistaken preconception that the particular reasoning of Merced contradicts California law, and thus improperly influencedthe district court’s determination. However, this is not the case, as a closer look at Merced reveals. In Merced, supra, 213 Cal.App.3d 41, the insured, Mendez, was sued for liability due to alleged repeated instances of sexual assault. (See Merced, supra, 213 Cal.App.3d at 44.) The complaint alleged causes ofaction for both intentional and negligent assault and battery. (See id.) Mendez had a homeowner’s policy that provided coverage for bodily injury “caused by an occurrence,” a term defined to mean an “accident.” (See id. at p. 46.) In seeking liability insurance coverage from his insurer, Mendez arguedthat he believed the sexual acts were consensual, and thus could be construed an "The other case cited by L&M for the proposition, Chu v. Canadian Indem. Co. (1990) 224 Cal.App.3d 86, modified (Oct. 5, 1990), does not support L&M’s contention for coverage here, and otherwise lacks instructional value in this context. Chu turned on whether there was knownloss precluding coverage. See Chu at 97. 49 “accident” because, “even if the acts causing the alleged damage were intentional,” “the resulting damage wasnot intended.” (/d. at p. 48.) In determining that Mendez’s sexual assault was not covered as an “occurrence,” the Merced court examinedseveral California cases at length, including cases decided by this Court. (See Merced, supra, 213 Cal.App.3dat pp. 48-50.) Specifically, the Merced court closely examined this Court’s decision in Hogan, characterizing the holding thusly: Focusing on the foreseeability of the damages, the insurance company argued damageto the boardsresulting from cutting the widths too narrow wasnotthe result of an accident becauseall ofthe damages“were not only foreseeable and expectable but in fact foreseen since Kaufman knew from the outset that the saw was defective...” (id. at p. 49, quoting Hogan, supra, 3 Cal.3d at p. 559.) The Merced court then examined why the Hogan court rejected that assertion. (See Merced, supra, 213 Cal.App.3d at p. 49.) Transitioning directly from its discussion of Hogan, the Merced court concluded “[w]e reject appellants’ argumentthat in construing the term ‘accident,’ chance or foreseeability should be applied to the resulting injury rather than to the acts causing the injury.” (/d. at p. 50.) This conclusion is clearly a correct application of this Court’s precedent in Hogan, and presented as such. The intentional sexual acts were deliberate and thus not an “accident.” (See id. at p. 50.) 50 After announcing the above-quoted conclusion, the Merced court offered three paragraphs of further explanation. In the first paragraph, the Merced court briefly quoted Unigard Mut. Ins. Co. v. Argonaut Ins. Co. (1978) 20 Wash.App. 261, to note that “[i]n terms of fortuity and/or foreseeability, both “the means as well as the result must be unforeseen, involuntary, unexpected and unusual.” (Merced, supra, 213 Cal.App.3d atp. 50, citing Unigard, supra, 20 Wash.App.at p. 264.) The Merced court then cited Unigard for the propositionthat “[a]n accident, howeveris never present when the insured performs a deliberate act unless some additional, unexpected, independent, and unforeseen happening occursthat producesthe damage.” (Merced, supra, 213 Cal.App.3d at p. 50, citing Unigard, supra, 20 Wash.App. 261.) The Merced court did not discuss the facts or reasoning of Unigard, as it did with Hogan, as well as other California cases. In fact, the Merced court did not otherwise discuss or cite Unigard in any way. While L&M,in its brief, quotes the Merced court at length, including a theoretical presented by the Merced court that L&Magreesis correctly reasoned, (see Br. at p. 36), L&M omits the final explanatory paragraph of the Merced court’s ruling on the issue, which applies the law to the facts and concludesin part: All of the acts, the manner in which they were done, and the objective accomplished occurred exactly as appellant intended. No additional, unexpected, independent or unforeseen act occurred. ‘Whatever the motivation,” because Mendez’s 51 conduct was “calculated and deliberate” (Hogan, supra, 3 Cal.3d at p. 560), it was not an “accident” and thus not an “occurrence” within the meaning ofthe policy provision. (Merced, supra, 213 Cal.App.3d at p. 50.) In concludingits discussion ofthe issue, the Merced court again rooted its decision in this Court’s decision in Hogan. Despite that the Merced court correctly applied California law and this Court’s precedent, L&M claims, without any justification, that “the comerstone ofMercea’s distinction between what qualifies as an ‘accident,’” wasthe twobriefcitations to Unigard. However, neither the reasoning nor the context of the Merced opinion supports L&M’s forced contention. C. The Merced Opinion is Not the Result of a “Scrivener’s Error” L&M exaggerates the role of the Unigard citations in the Merced opinion in order to create the illusion of flawed reasoning by the Court of Appeals. By arguing (incorrectly) that the “cornerstone” of the Merced court’s reasoning was a couple of brief cites to Unigard, L&M creates the false impression that the Unigardcase is the source of a supposed “error” in California law. It must do so because it cannot directly dispute that Merced wascorrectly reasoned and decided underCalifornia law,or indeed that any of the subsequent cases citing Merced (including this Court’s decision in Delgado) were correctly reasoned and decided under California law. 52 L&M incorrectly contends that the opinion of the appellate court in Merced, supra, 233 Cal.App.3d 41, is the product of a “scrivener’s error.” (See Br. at p. 32.) A “scrivener’s error,” or “clerical error,” 1s defined as “[a]n _ error resulting from a minor mistake or inadvertence, esp. in writing or copying something on the record, and not from judicial reasoning or determination.” (Black’s Law Dict. (9th ed. 2009) p. 622, col. 1, italics added.)'* Under California law,a clericalerror is distinguished from judicial discretion (or error) and is dependent on “whetherit was the deliberate result ofjudicial reasoning and determination.” (Gill v. Epstein (1965) 62 Cal.2d 611, 615, citing Estate ofDoane (1964) 62 Cal.2d 68, 71; see also Aspen Internat. Capital Corp. v. Marsch (1991) 235 Cal.App.3d 1199, 1204 [“A correctable clerical error includes one made by the court which cannot reasonably be attributed to the exercise of judicial consideration or discretion’”].) Washington, where L&M supposes the “scrivener’s error” originated, is in accord. (See, e.g., Marchel v. Bunger (1975) 13 Wash.App. 81, 84 [A judicial error involves an issue of substance; whereas, a clerical error involves a mere mechanical mistake. Thetest for distinguishing between '8 Tn the Ninth Edition of Black’s Law Dictionary, the entry for “scrivener’s error”refers one to the entry for “clerical error.” (See Black’s Law Dict. (9th ed. 2009) p. 1466, col. 1.) The above definition is found under the entry for “clerical error,” whichstates that it is “[a]lso termed scrivener’s error.” (Id. at p. 622, col. 1, italics in original.) 53 ‘judicial’ and ‘clerical’ error is whether, based on the record, the judgment embodiesthetrial court’s intention’’].) - There is no indication that the court in Unigard made any sucherror. In orderto resolve the issue, the Unigard court examined analogouslaw from other cases. (See Unigard, supra, 20 Wash. App.at p. 264, fn. 2.) Courts do so routinely. (See, e.g., Do v. Superior Court (2003) 109 Cal.App.4th 1210, 1214.) L&M contendsthat the Unigard court’s use ofcase law relating to first- person “accidental means” policies somehow invalidates or poisons that court’s reasoning, and in turn the Merced court’s brief citation of Unigard as persuasive authority. But this Court did exactly the same thing in Geddes, supra, 51 Cal.2d 558, whenit turned to Richards v. Travelers’ Ins. Co. (1891) 89 Cal. 170, and Zuckerman v. Underwriters at Lloyd’s (1954) 42 Cal.2d 460, in order to define “accident” in a third-person liability policy. (See Geddes, supra, 51 Cal.2d at p. 563.) In Richards, the Court examineda life insurance policy wherein “the death must have been caused by accidental means.... The insurance is not against accidental injuries, but against injuries occurring through accidental means.” (Richards, supra, 89 Cal. at p. 171.) In Zuckerman, the Court had examineda first-person life insurance policy that provided coverage for “accidental bodily injury ... caused by ... Accident.” (Zuckerman, supra, 42 Cal.2d at p. 466.) While thefirst-personlife insurance policy before the Court in Zuckerman did not use the term “accidental means,” 54 the Court noted that the provision was “substantially similar” to a provision insuring injury “caused directly and independently of all other causes by violent and accidental means.” (/d., quoting Brooks v. Metropolitan Life Ins. Co. (1945) 27 Cal.2d 305, 306.) The Court in Zuckerman court also looked at “accidental means”policies in Richards, supra, and Rock v. Travelers’ Ins. Co. (1916) 172 Cal. 462 , in discussing the term “accident.” Further, L&M’s characterization (incorrect, as it is) has no legal significance here. Under California law,a “clerical error” can be corrected by the trial court through a simple amendment. (See, e.g., Jn re Candelario (1970) 3 Cal. 3d 702, 705 .) However, “[a]ny attempt by a court, underthe guise ofcorrecting clerical error, to ‘revise its deliberately exercised judicial discretion’ is not permitted.” (/d., quoting In re Wimbs (1966) 65 Cal.2d 490, 498.) Noissue relating to any attempt to “correct” or alter any lower court record has everbeenraisedin this action by either party. Rather, L&M usethe term loosely to incorrectly impugn the reasoning of the Merced court. However, as discussed above, the Merced court’s reasoning is sound and accurately reflects California law as established by this Court. CONCLUSION For the foregoing reasons, Liberty respectfully submits that the Court should answer the certified question in the negative in the context of the undisputedfacts ofthis action, and find that the Doe action doesnot allege an “occurrence” within the meaning of the Liberty policies. 55 Dated: February 16, 2017 McCORMICK, BARSTOW, SHEPPARD, Chris Attorneys for Plaintiffs and Respondents Liberty Surplus Insurance Corporation and Liberty Insurance Underwriters Inc. 56 CERTIFICATE OF WORD COUNT Thetext ofthis Answering Brief contains 13,295 words, according to the word count generated by the word-processing program used to prepare the brief. Dated: February 16, 2017 Liberty Surplus Insu and Liberty Insurance UnderwritersInc. 4294621.1 57 PROOF OF SERVICE STATE OF OHIO, COUNTY OF HAMILTON At the time of service, I was over 18 years of age and not a party to this action. I am employed in the County of Hamilton, State of Ohio. My business address is 312 Walnut Street, Suite 1050, Cincinnati, Ohio, 45202. On February 16, 2017, I served true copies of the following document(s) described as RESPONDENTS’ ANSWERING BRIEF ON THE MERITSontheinterested parties in this action as follows: Ricardo Echeverria Jeffrey I. Ehrlich SHERNOFF BIDART THE EHRLICH LAW FIRM ECHEVERRIALIP 16130 Venture Boulevard, 600 South Indian Hill Boulevard Suite 610 Claremont, California 91711 Encino, CA 91436 Attorney for Appellants: Ledesma & Meyer Construction Company,Inc.; Joseph Ledesma; and Kris Meyer Attorney for Appellants: Ledesma & Meyer Construction Company,Inc.; Joseph Ledesma; and Kris Meyer BY MAIL:I am readily familiar with the firm’s practice of collection and processing correspondence for mailing. Underthat practice it would be deposited with the U.S. Postal Service on that same day with postage thereon fully prepaid in the ordinary course o{ business. [amaware thal on motion of the party served, service is presumed invalid if postal cancellation date or postage meter date is more than one day after date of deposit for mailing in affidavit I declare under penalty of perjury under the lawsofthe State of Ohio that the foregoing is true and correct. Executed on February 16, 2017, at Cincinnati, Ohio. feeBPO Christopher Ryan 4246928.1