Professional Documents
Culture Documents
No. 11-2057
Appeal from the United States District Court for the Middle
District of North Carolina, at Greensboro.
L. Patrick Auld,
Magistrate Judge. (1:09-cv-00480-LPA-LPA)
Argued:
Decided:
2004,
Appellant
Duke
University
Health
System,
Inc.,
who may have come into contact with the tainted instruments sued
Duke, who settled the claims for over $6 million.
sued Automatic Elevator.
Insurance
Company
of
Duke then
Elevators
insurer
that
occurrence,
the
hydraulic
obligating
it
fluid
to
mistake
pay
$1
Mitsui Sumitomo
constituted
million
under
one
the
The
I.
A.
We draw the following facts from Duke and Mitsui Sumitomos
stipulations of fact, dated June 15, 2010.
Automatic
projects.
Automatic
Raleigh
Elevator
In
worked
keeping
Elevator
Hospitals
to
with
with
this
renovate
(DHRH)
Duke
on
various
arrangement,
two
parking
elevators
deck.
elevator
Duke
in
engaged
Duke
Automatic
Health
Elevator
the
North
Carolina
Department
of
commenced
(Elevator 2).
its
renovation
Labor
inspected
and
the
second
elevator
previously
contained
surgical
detergents
called
These
Mon
During the
same
plastic
barrels
to
store
hydraulic
fluid
from
that
elevator.
When
Automatic
Elevator
completed
its
renovation
of
saw
contained
the
surgical
barrels
and
detergents
mistakenly
and
thought
lubricants.
A DHRH
that
The
they
employee
and
DRH
mistakenly
surgical instruments.
used
the
hydraulic
fluid
to
clean
came into contact with the hydraulic fluid when employees used
hydraulic fluid in three different washing machines in December
2004.
who may have come into contact with the affected instruments.
Approximately
Duke,
150
Cardinal,
negligent
of
and
these
Automatic
infliction
consortium.
patients
of
asserted
Elevator,
emotional
claims
alleging
distress,
negligence,
and
loss
of
against
settlement
agreements
with
approximately
Duke entered
127
claimants,
B.
Mitsui Sumitomo issued two insurance policies to Automatic
Elevator
that
coincide
Elevator
worked
on
with
the
the
two
time
DHRH
periods
elevators:
when
Automatic
the
2003-2004
for
any
one
occurrence.
The
policies
define
to
substantially
the
same
aggregate
limit,
and
both
harmful
condition,
but
contain
per
settling
Elevator
negligence
in
the
the
for
tort
claims
breach
of
General
Court
against
contract,
of
Justice,
it,
Duke
sued
indemnity,
Superior
and
Court
because
the
insurance
policy
set
$1
million
per
Sumitomo
also
contended
that
the
per
elevator
The
district
Sumitomo,
court
finding
entered
that
judgment
Automatic
in
favor
of
Elevators
Mitsui
negligence
Co.,
1:09-CV-00480,
2011
WL
4103752,
at
*14
Id.
been
administratively
dissolved
by
and we have
Automatic Elevator
the
North
Carolina
II.
Pursuant
to
Rule
56(a)
of
the
Federal
Rules
of
Civil
dispute
as
to
any
material
fact
and
the
movant
is
A district court
United States v.
Because
Shaw v.
Automatic
in
this
case
in
North
Carolina.
Consequently,
North
v. Stanley, 669 F.3d 184, 188 (4th Cir. 2012) (quoting Horace
Mann Ins. Co. v. Gen. Star Natl Ins. Co., 514 F.3d 327, 329
(4th Cir. 2008)) (internal quotation marks omitted).
III.
Duke
alleges
that
the
hydraulic
fluid
mistake
involved
million
argues
that
under
(1)
the
2004-2005
Automatic
policy.
Elevators
Specifically,
decision
to
leave
Duke
the
occurrence
in
and
of
itself
because
that
choice
was
surgical
occurrences.
court
instrumentsto
determine
the
number
of
correctly
determined
that
the
hydraulic
fluid
incident
A.
Automatic
Elevators
insurance
occurrence as an accident.
policy
defines
an
argument
that
this
case
involves
multiple
To support
accidents
and
accident.
accident
as
First,
[a]n
Blacks
unintended
Law
and
Dictionary
unforeseen
defines
injurious
Machine
Co.
v.
Northfield
Blacks
Co.,
the
Supreme
happening
consequences.
juxtaposes
these
or
event,
usually
with
with
10
Blacks
Law
unfortunate
Duke then
Dictionarys
definition
of
volition[t]he
determine
something; . . . the
ability
act
of
to
make
making
a
a
choice
or
choice
or
to
Dukes
assertions,
North
Carolina
precedent
that
the
definition
accident
is
relevant
when
See
fluid
mistake
constituted
an
occurrence,
Dukes
B.
North
Carolina
courts
have
adopted
cause
test
to
See Gaston
occurrence.
Michael
Murray,
Note,
The
Law
of
In
Id. at 1497.
For example,
separate
occurrence,
single event:
Cir.
1984).
even
though
the
implies
that
North
problem
arose
from
courts
have
part
of
the
insured
gave
rise
to
liability.
Mitsui
Court
of
North
Carolina
determines
the
number
of
the harm.
considered
whether
the
rupture
of
pressure
vessel
and
the
as
single
occurrence
or
multiple
occurrences.
whether
the
incident
had
triggered
one
insurance
Duke contends
that Gaston County supports its position that the Supreme Court
of
North
Carolina
looks
to
the
most
immediate
cause
of
the
the
court
never
analyzed
this
issue,
instead
and,
if
so,
when
it
happened.
524
S.E.2d
at
564-65.
Id. at 565.
14
trigger
of
coverage
issueit
does
not
support
Dukes
argument.
Both
the
district
court
and
Mitsui
Sumitomo
relied
on
that
North
Carolinas
courts
have
adopted
the
multiple
occurrence.
acts
of
Id. at 126.
embezzlement
constituted
single
at
issue
in
this
case
contains
no
Id.
The insurance
similar
grouping
Lutherans
precedent
Sumitomo.
does
holdings
not
However,
strongly
we
and
this
favor
believe
the
case,
either
Supreme
North
Duke
Court
Carolina
or
of
Mitsui
North
Carolina would find that this case involves one occurrence for
15
three reasons.
Supreme Court of North Carolina would not apply the test that it
enunciated
in
occurrences
Gaston
in
County
contexts
to
other
determine
than
the
trigger
number
of
of
coverage.
number
including
of
the
occurrences
United
in
States
cases
District
analogous
Court
to
for
this
the
one,
Eastern
3256947,
at
*4-5
(E.D.N.C.
Nov.
2,
2007);
see
also,
e.g.,
448
(E.D.
Ark.
1997)
(concluding
that
preparation
of
Insurance Co., 849 So.2d 263 (Fla. 2003)the primary case that
Duke relies on to support its contention than an occurrence is
the most immediate cause of the injuryhas been discredited by
other courts.
North Carolina would adopt the rule that the Florida Supreme
Court developed in Koikos rather than turning to the standard it
enunciated in Gaston County.
Third, looking to the number of surgeries or instances of
using hydraulic fluid to wash surgical instruments to determine
the number of occurrences would turn the focus in this case from
Automatic
Elevators
alleged
negligence
to
Dukes
actions.
Ct.
App.
Div.
2005)
(holding
that
the
insureds
calculating
number
intervening acts).
of
occurrences,
not
the
gunmans
storage
that
area
these
at
DHRH.
out-of-state
Consequently,
holdings
are
although
not
we
binding
C.
Duke
correctly
points
out
that
we
should
resolve
any
and
that
we
should
interpret
the
policy
in
favor
of
Wachovia
Bank & Trust Co. v. Westchester Fire Ins. Co., 172 S.E.2d 518,
522-23 (N.C. 1970).
argument
occurrence
because
that
an
this
case
accident
involved
cannot
be
more
than
one
volitional
act.
finally,
Carolina
is
Duke
suggests
likely
to
adopt
that
a
the
Supreme
controversial
Court
of
standard
North
from
Florida Supreme Court case rather than extending its own holding
in
Gaston
County.
Because
Dukes
interpretation
is
IV.
Finally,
endorsement
Duke
applies
contends
in
that
this
case
the
policys
because
per
Automatic
elevator
Elevator
occurrence
and
not
trigger
the
policys
aggregate
V.
For the foregoing reasons, we affirm.
AFFIRMED
19
respectfully
dissent
from
the
opinion
of
the
panel
North Carolina
Mitsui
Giving effect to
524
S.E.2d
at
564.
North
Carolina
precedent
Gaston
also
an
occurrence
depends
upon
whether
they
were
expected
or
Waste Mgmt. of
Carolinas, Inc. v. Peerless Ins. Co., 340 S.E.2d 374, 380 (N.C.
1986).
as
leaving
barrels
occurrence,
or
in
the
accident,
Duke
must
Health
instead
parking
be
an
lot.
An
unplanned
or
in
the
parking
lot
gave
rise
to
Automatic
Elevators
liability.
In
addition
unplanned
to
happening
the
or
requirement
event,
the
that
presence
inasmuch
as
there
is
an
nothing
accident
of
be
an
injuries
or
the
insurer
to
For example,
the
falling
obstructed
over
the
walkway,
tools,
an
however,
accident
and
has
injures
occurred
If a person
himself
and
the
an
act
unintended
of
by
accidental.
scenario.
volition,
the
but
repairman
the
and
resulting
his
injuries
employer
and,
were
thus,
Insurance
Owens,
under
injuries.
which
Owens
sought
indemnification
for
Stoxs
Id. at 321.
The state
Id. at 322.
the
occurrence
was
not
subject
to
the
policy
Owens
act
was
Id.
Stox
court
also
assessed
whether
Id. at 324.
Since an accident
was not defined in the policy, the court gave the term the
dictionary definition similarly applicable here an event
that takes place without ones foresight or expectation; [an]
undesigned, sudden, and unexpected event; chance; contingency.
Id. at 325 (quoting Iowa Mut. Ins. Co. v. Fred M. Simmons, Inc.,
128 S.E.2d 19, 22 (N.C. 1962)).
insurance
policy
provisions
which
extend
coverage
must
be
unintended
injury
to
Stox,
rather
than
the
intentional
conduct of Owen.
Pursuant
to
the
foregoing,
am
convinced
that
North
or
event
that
carries
unfortunate
consequences.
As a result, an intentional or
however,
may
be
unexpected
harmful
events
(i.e.,
alone
an
accident
covered
by
the
policy,
in
that
the
The
accidents
damages
arose
(i.e.,
the
when,
occurrences)
unintended
by
took
place
Automatic
when
the
Elevator,
Such occurrences
25