NATIONWIDE MUTUAL INSURANCE COMPANY ET AL.
JEFFREY S. PASIAK ET AL.
December 5, 2016
J. Robertson, with whom were Christopher H. Blau, and, on the
brief, Madonna A. Sacco, for the appellants (named defendant
D. Laurie, with whom, on the brief, were Heather L. McCoy and
Elizabeth F. Ahlstrand, for the appellees (plaintiffs).
Rogers, C. J., and Palmer, Eveleigh, McDonald, Espinosa,
Robinson and D'Auria, Js. [*]
declaratory judgment action concerns whether an insurer is
obligated to indemnify a business owner under a personal
insurance policy for liability arising from his false
imprisonment of his company's employee at her workplace
and the evidentiary basis on which such a determination is to
be made. In this certified appeal, the defendant Jeffrey S.
Pasiakchallenges the Appellate Court's
determination that such liability fell under the business
pursuits exclusion to coverage under his personal umbrella
policy. The plaintiffs, Nationwide Mutual Insurance Company
and Nationwide Mutual Fire Insurance Company, contend that
coverage not only is barred under the business pursuits
exclusion, but also that (1) coverage is barred under policy
exclusions for workers' compensation obligations and for
mental abuse, (2) construing the policy to provide
indemnification for common-law punitive damages arising from
intentional wrongdoing violates public policy, and (3) the
trial court improperly limited the scope of discovery and the
declaratory judgment trial, depriving the plaintiffs of a
trial de novo on coverage issues that they could not litigate
in the underlying tort action.
that the case must be remanded to the trial court for further
proceedings, limited to the issue of whether the business
pursuits exclusion applies. We conclude that neither the
Appellate Court nor the trial court employed the correct
standard for determining whether the defendant's tortious
conduct was an occurrence ‘‘arising out
of'' the business pursuits of the insured and that
further factual findings would be necessary to determine
whether this exception applies under the correct standard. We
further conclude that the plaintiffs cannot prevail on their
alternative grounds regarding the other exclusions and public
policy as a matter of law. Finally, we conclude that the
plaintiffs are not limited to the evidentiary record in the
underlying tort action to establish that the business
pursuits exclusion barred coverage. Accordingly, we reverse
the judgment of the Appellate Court with direction to remand
the case to the trial court for a trial de novo on that
Appellate Court's opinion summarized the facts that the
jury reasonably could have found in the underlying tort
action; see Nationwide Mutual Ins. Co. v.
Pasiak, 161 Conn.App. 86, 90-91, 127 A.3d 346
(2015); which we have supplemented with the limited
additional facts found by the trial court in the declaratory
judgment action, also gleaned from the evidence in the
underlying action. At the time of the incident in
question, the defendant operated a construction company,
Pasiak Construction Services, LLC. The sole office for the
company was a room located on the second floor of the
defendant's home in Stamford; the company's
construction equipment was stored at another site. Sara Socci
was hired by the defendant to perform duties as an office
worker for the construction company and worked at that office
in the defendant's home. Her work hours were from 9:30
a.m. to 2:30 p.m., four days a week.
Socci's second week of employment, while she was alone at
the office performing her duties, a masked intruder carrying
a gun entered the office and demanded that she open the safe.
Unaware that a safe existed in the home, Socci could not
provide the intruder with the safe's combination. The
intruder led Socci into a bedroom, where he tied her hands,
gagged her, and blindfolded her. At one point, he pointed a
gun at her head and threatened to kill her family if she did
not give him the combination.
defendant returned home during the incident and was attacked
by the intruder. During an ensuing struggle, the defendant
pulled off the intruder's mask, revealing him to be
Richard Kotulsky, a lifelong friend of the defendant. The
defendant began talking to Kotulsky and inquired about Socci.
Kotulsky led the defendant to Socci, who was crying and
hysterical. After the defendant made Kotulsky untie Socci,
the three of them returned to the office, where a discussion
continued between the defendant and Kotulsky about a
woman.Socci asked to leave, but the defendant
told her to stay and sit down. After further discussions with
Kotulsky, the defendant allowed him to leave the house. Socci
then told the defendant about the threats that Kotulsky had
made to her and her family, but the defendant would not call
the police. He told Socci to stay with him and refused to let
her call the police or to discuss the incident further. She
remained with the defendant for several hours, in fear that,
if she left, she or her family might be harmed by Kotulsky.
Only after he drove Socci to Greenwich to discuss the
incident with a mutual friend, Denise Taranto, who advised
them to call the police, did he allow Socci to leave.
police were not contacted until later that day, after Socci
and her husband, Kraig Socci, went to the defendant's
home and learned that he had not yet contacted them. In the
presence of the Soccis and the police, the defendant
telephoned Kotulsky and told him that ‘‘the
girl'' had identified him to the police. Some days
later, Kotulsky was arrested and eventually convicted of
various criminal offenses in connection with this
incident. The safe was never opened, and its
contents were never divulged.
result of the incident, Socci developed post-traumatic stress
disorder, requiring extensive therapy, and was unable to
return to work.
record reveals the following additional undisputed facts and
procedural history. Socci and Kraig Socci commenced a tort
action against the defendant (Socci action), alleging (1)
false imprisonment, (2) negligence, (3) negligent infliction
of emotional distress, (4) intentional infliction of
emotional distress, and (5) loss of consortium as to Kraig
Socci. The first two claims related to the
defendant's conduct in preventing Socci from leaving
until she and the defendant returned from their meeting with
Taranto. The third and fourth claims related to the entirety
of the defendant's conduct leading up to his comments on
the telephone to Kotulsky implicating Socci as the police
informant. The complaint alleged that Socci had sustained
permanent physical and emotional injuries and requested
compensatory and punitive damages.
time of the relevant events, the defendant was covered by
insurance policies issued by the plaintiffs, including a
homeowners policy covering bodily injury and a personal
umbrella policy covering bodily injury and personal injury.
He did not have a separate commercial liability policy. The
plaintiffs provided the defendant with an attorney to defend
him in the Socci action, but notified him by letter that they
were reserving their right to contest coverage.
accordance with that reservation, the plaintiffs commenced
the present action seeking a declaration that they had no
duty to defend or indemnify the defendant in the Socci
action. The plaintiffs then filed a motion for summary
judgment, and the defendant filed a motion for summary
judgment solely as to the duty to defend. The court concluded
that the allegations of the complaint were sufficiently broad
to obligate the plaintiffs to provide the defendant with a
defense under both his homeowners policy and his personal
umbrella policy. The court deemed it improper at that
juncture to determine the plaintiffs' duty to indemnify
the defendant. Accordingly, it granted the defendant's
motion for summary judgment as to the duty to defend and
denied the plaintiffs' motion seeking a declaratory
judgment in their favor.
Socci action proceeded to trial with the plaintiffs providing
defense counsel to the defendant. At the conclusion of
evidence, the parties agreed not to submit special
interrogatories to the jury. The jury returned a general
verdict in favor of the Soccis. It awarded Socci $628, 200 in
compensatory damages and $175, 000 in punitive damages, and
awarded Kraig Socci $32, 500 in compensatory damages.
judgment in the Socci action, the plaintiffs filed a second
motion for summary judgment in the declaratory judgment
action regarding their duty to indemnify the
defendant. In support of their motion, the
plaintiffs argued that the defendant's policies did not
provide coverage for his liability in the Socci action
because those policies cover accidents, not intentional acts,
and do not cover claims for emotional distress. The
plaintiffs further contended that any coverage would be
barred under policy exclusions for intentional acts, wilful
violations of law, business pursuits, workers'
compensation, and mental abuse. Finally, they contended that
indemnification for the punitive damages would contravene
trial court framed its decision on the motion in three parts:
(1) the effect of the general verdict; (2) the duty to
indemnify under the homeowners policy; and (3) the duty to
indemnify under the umbrella policy. The court concluded that
the general verdict rule precluded the plaintiffs'
arguments premised on characterizing the defendant's
conduct as exclusively intentional and, therefore, not a
covered accidental occurrence. The court reasoned that the
absence of jury interrogatories created an ambiguity as to
the counts on which the verdict rested, and that because the
plaintiffs had failed to afford themselves of the
opportunity to seek such interrogatories, the verdict must be
construed to rest on both intentional and negligent conduct
as alleged in the complaint. The court did not, at this
stage, explain how the plaintiffs could have availed
themselves of this opportunity.
regard to the duty to indemnify, the court concluded that the
plaintiffs were entitled to summary judgment under the
homeowners policy, but were not entitled to judgment under
the broader umbrella policy. Specifically, the court pointed
to the homeowners policy coverage limited to
‘‘bodily injury, '' which was defined to
exclude emotional distress unless caused by a physical
injury, and the lack of evidence in the Socci action
establishing such physical injury. Although the umbrella
policy contained a similar definition for bodily injury, that
policy also covered ‘‘personal injury, ''
a term defined by reference to specified injuries/acts,
including ‘‘false imprisonment.'' In
light of that express coverage, the trial court concluded
that many of the policy exclusions on which the plaintiffs
relied were inapplicable. The court also concluded that the
requisite facts to support other exclusions on which the
plaintiffs relied were not supported by evidence or jury
interrogatories in the Socci action. The court rejected the
plaintiffs' public policy argument regarding the punitive
damages. Accordingly, it granted in part and denied in part
the plaintiffs' motion for summary judgment.
the trial court clarified that its decision on the motion for
summary judgment was not a final judgment for purposes of
appeal, a dispute arose over the scope of evidence, and,
hence, discovery, that would be permitted in the declaratory
judgment trial. In a written decision addressing that
dispute, the trial court cast the parties' positions as
polar opposites, with the plaintiffs contending that they
were entitled to a trial de novo regarding the issue of
indemnification, unfettered as to what evidence may be
proffered on that issue, and the defendant contending that
the trial must be limited to the evidence presented in the
Socci action. Ultimately the court concluded that
‘‘[i]t was [the plaintiffs'] choice in the
[Socci] action to not actively pursue in greater detail the
issues affecting the exclusions in the policy, ''
that the plaintiffs could have submitted interrogatories to
the jury to determine the basis of its decision, and that
they should not be permitted to have a second bite at the
apple. The court suggested that the plaintiffs could have
requested interrogatories through defense counsel, with whom
they were in close contact, or through their intervention as
a party. Accordingly, it denied the plaintiffs' request
to permit unrestricted evidence. However, a week before the
trial commenced, the court permitted the plaintiffs to obtain
certain limited discovery related to the workers'
compensation exclusion, and they were able to depose the
defendant on that matter. At the conclusion of that
deposition, the plaintiffs stated for the record that the
trial court had precluded discovery on matters other than
those on which they questioned the defendant that the
plaintiffs believed were relevant.
the declaratory judgment trial proceeded with only
documentary evidence submitted to the court, largely
originating from the Socci action, except as to certain
matters related to workers' compensation. Following
argument, the court issued a decision declaring that the
plaintiffs were obligated to indemnify the defendant for his
liability in the Socci action. In setting forth the
procedural history of the case, the court cast its earlier
ruling on the scope of discovery as precluding new evidence
relating to the basis of liability in the Socci action, and
not that relating to the issue of coverage under the policy.
In analyzing the substantive issue, the court largely
followed its prior reasoning when denying the plaintiffs'
motion for summary judgment. Accordingly, it rendered
judgment for the defendant.
plaintiffs appealed from the judgment to the Appellate Court.
They challenged the trial court's limitations on
discovery, the scope of the declaratory judgment trial, the
court's determinations regarding the policy exclusions,
except the intentional acts and wilful violation of law
exclusions, and its rejection of the public policy argument.
The Appellate Court determined that the trial court
improperly had concluded that the business pursuits exclusion
of the policy did not apply. Therefore, it reversed the trial
court's judgment on that basis without reaching the other
issues raised by the plaintiffs. Nationwide Mutual Ins.
Co. v. Pasiak, supra, 161 Conn.App.
89. The defendant's certified appeal to this court
followed. See Nationwide Mutual Ins. Co. v.
Pasiak, 320 Conn. 913, 130 A.3d 266 (2016).
POLICY AND ITS CONSTRUCTION
begin with the relevant policy provisions and the principles
of construction that guide our review of those provisions.
defendant's personal umbrella policy obligated the
plaintiffs to pay for damages an insured is legally obligated
to pay due to an ‘‘occurrence'' in excess
of certain sums. This term and others of significance are
defined in the policy as follows:
‘‘Occurrence(s) means an accident including
continuous or repeated exposure to the same general
conditions. It must result in bodily injury, property damage,
or personal injury caused by an insured. . . .
‘‘Bodily injury means bodily harm, including
resulting sickness, disease, or death. Bodily injury does
not include emotional distress, mental anguish, humiliation,
mental distress or injury, or any other similar injury unless
the direct result of bodily harm. . . .
‘‘Personal injury means:
‘‘[a] false arrest, false imprisonment,
wrongful conviction, wrongful entry . . . .''
The policy provides exclusions to this coverage. Those
‘‘An occurrence arising out of the business
pursuits . . . of an insured'';
‘‘Any insured's obligation, including
benefits required to be paid, under any of the following laws
. . . workers' compensation''; and
‘‘Bodily injury or personal injury resulting from
acts or omissions relating directly or indirectly to sexual
molestation, physical or mental abuse, harassment, including
sexual harassment, whether actual, alleged or threatened. . .
considering the meaning of these exclusions and their
application to the facts, we are guided by settled
principles. ‘‘[C]onstruction of a contract of
insurance presents a question of law for the [trial] court
which this court reviews de novo. . . . The determinative
question is the intent of the parties, that is, what coverage
the [insured] expected to receive and what the [insurer] was
to provide, as disclosed by the provisions of the policy. . .
. In evaluating the expectations of the parties, we are
mindful of the principle that provisions in insurance
contracts must be construed as laymen would understand [them]
and not according to the interpretation of sophisticated
underwriters and that the policyholder's expectations
should be protected as long as they are objectively
reasonable from the layman's point of view. . . . [W]hen
the words of an insurance contract are, without violence,
susceptible of two [equally responsible] interpretations,
that which will sustain the claim and cover the loss must, in
preference, be adopted. . . . [T]his rule of construction
favorable to the insured extends to exclusion
clauses.'' (Citations omitted; internal quotation
marks omitted.) Vermont Mutual Ins. Co. v.
Walukiewicz, 290 Conn. 582, 591-92, 966 A.2d 672
(2009). When construing exclusion clauses, ‘‘the
language should be construed in favor of the insured unless
it has a high degree of certainty that the policy language
clearly and unambiguously excludes the claim.''
(Internal quotation marks omitted.) Connecticut Ins.
Guaranty Assn. v. Drown, 314 Conn. 161, 188,
101 A.3d 200 (2014). While the insured bears the burden of
proving coverage, the insurer bears the burden of proving
that an exclusion to coverage applies. See Capstone
Building Corp. v. American Motorists Ins. Co.,
308 Conn. 760, 788 n.24, 67 A.3d 961 (2013).
court previously has applied these rules of construction to
policy definitions similar to those in the present case. In
Imperial Casualty & Indemnity Co. v.
State, 246 Conn. 313, 327-29, 714 A.2d 1230 (1998),
this court confronted the internal inconsistency between a
policy limiting coverage to accidents (i.e., unintentional
conduct) while also providing coverage for certain injuries
that could result only from intentional conduct, such as
false imprisonment. Consistent with our rules of
construction, we construed this ambiguity in favor of the
insured to provide coverage for the intentional acts
specified. See id., 330-31.
prior construction of those provisions has particular
significance to the present case. As the trial court
emphasized in its decision on the second motion for summary
judgment regarding indemnification, ‘‘the
provision within the umbrella policy that includes coverage
for false imprisonment is crucial in the determination of
whether the policy provides coverage for the plaintiffs'
verdict entered in the underlying Socci [action].''
The trial court identified the injury of false imprisonment,
and no other, as covered under the policy at
issue.With that focus in mind, we turn to the
defendant contends that the Appellate Court improperly
concluded that the false imprisonment of Socci was
‘‘[a]n occurrence arising out of the business
pursuits . . . of an insured.'' As we explain
subsequently in this opinion, although we agree with the
defendant that the Appellate Court's analysis was flawed,
we conclude that the trial court's analysis also was
trial court made no separate factual findings with regard to
this exclusion. However, its analysis referred to critical
testimony in the Socci action regarding certain statements
the defendant purportedly made to Socci after Kotulsky left
as to reasons why they should not call the police. The
defendant purportedly cited his long, close friendship with
Kotulsky and the ruinous effect on his business.
trial court framed its analysis in terms of two related
issues. First, it noted that ‘‘the real issue is
whether the actions of [the defendant] in response to the
robbery arose out of the business pursuits for the Pasiak
Construction business or [arose] as the defendant
contends because he was trying to protect a lifelong
friend.'' (Emphasis added.) Second, it considered
whether the defendant's actions evidenced the continuity
and profit motive necessary under the business pursuits test.
The court rejected the plaintiffs' reliance on
Socci's testimony indicating that the defendant had
claimed (at the time of the incident) that the incident would
ruin his business, reasoning that this argument ignored the
testimony reflecting Kotulsky's friendship with the
defendant, and the lack of proof of any impact on the
defendant's business had the robbery succeeded.
Appellate Court determined that the trial court's
analysis reflected a misapplication of the business pursuits
exclusion. Nationwide Mutual Ins. Co. v.
Pasiak, supra, 161 Conn.App. 89, 100-101.
The Appellate Court concluded that the defendant's
operation of his construction company, and his employment of
Socci in support thereof, constituted the requisite
‘‘business pursuits, '' and that
Socci's injuries arose out of that business pursuit.
Id., 99. As to the latter conclusion, the court
reasoned that ‘‘the sine qua non of the
defendant's tortious conduct was . . . Socci's
presence at his business office fulfilling her
responsibilities as his employee. . . . Stated alternatively,
had . . . Socci not been at the office performing her duties
as an employee of the defendant's business, there is no
reason to believe that she would have been assaulted by
Kotulsky and, consequently, detained by the defendant.
Indeed, there was no other reason for . . . Socci's
presence on the premises, and her acquiescence in obeying the
defendant's commands to wait and not leave were, in part,
a function of their employer-employee relationship.''
Id., 99-100. The Appellate Court deemed the
defendant's subjective motivations for his actions
irrelevant. Id., 101.
appeal to this court, the defendant contends that the
Appellate Court's analysis improperly focused on the
sequence of events rather than the mechanism of the injury.
He also contends that the Appellate Court improperly found
facts insofar as it concluded that Socci's acquiescence
in obeying the defendant's commands was a function of
their employer-employee relationship. He claims that the
trial court properly focused on whether his actions met the
continuity and profit motive test for a business pursuit
articulated by this court. We conclude that the analysis in
both of the lower courts' decisions was a misapplication
of the business pursuits exclusion, and that the case should
be remanded to the trial court to allow it to reconsider the
evidence, adduced after further proceedings, under the proper
the policy defines the term ‘‘business''
as ‘‘a trade, profession, occupation, or
employment including self-employment, '' it does not
define ‘‘business pursuits'' or
‘‘arising out of.'' The meaning of both
terms, however, has been articulated by this court as well as
other jurisdictions considering this exclusion.
court adopted a definition of ‘‘business
pursuits'' in Pacific Indemnity Insurance Co.
v. Aetna Casualty & Surety Co., 240 Conn.
26, 30, 688 A.2d 319 (1997), that conformed to the meaning
ascribed in most other jurisdictions: ‘‘[T]he
term business pursuits encompasse[s] two elements, continuity
and profit motive. As to the first, there must be a customary
engagement or a stated occupation; as to the latter, there
must be shown to be such activity as a means of livelihood;
gainful employment; means of earning a living; procuring
subsistence or profit; commercial transactions or
engagements.'' (Internal quotation marks omitted.)
This test casts a broader net to include activities other
than those that bear the formal or legal hallmarks of an
established business or a full-time occupation. See, e.g.,
id., 27-28 (boarding horses by persons otherwise
employed full-time was business pursuit). ‘‘The
determination of whether a particular activity constitutes a
business pursuit is to be made by a flexible fact-specific
inquiry.'' Id., 33.
present case, no one questions that the activities of the
defendant's construction company meet the two elements of
a business pursuit. Nor does anyone contend that false
imprisonment constitutes a business pursuit. Therefore, the
question is not whether the false imprisonment itself
satisfied the continuity/profit elements of a business
pursuit, as the trial court's rationale suggested, but
rather whether the defendant's false imprisonment of
Socci ‘‘arose out of'' his business
pursuits in operating the construction company. See Neal
v. Celina Mutual Ins. Co., 522 S.W.2d 179,
180-81 (Ky. 1975) (‘‘[o]f course accidents of any
kind are not business pursuits in themselves; the exclusion
clause plainly has reference to accidents that occur in the
carrying on of a business pursuit''); Greenman
v. Michigan Mutual Ins. Co., 173 Mich.App. 88,
94, 433 N.W.2d 346 (1988) (‘‘[t]he complained of
acts themselves need not be performed for profit; the acts
need only be performed during the business pursuit of the
insured''); 46 C.J.S. 226, Insurance § 1353
(2007) (‘‘[w]hen the questioned conduct is
incidental to the insured's regular employment, profit
motive is irrelevant to a business pursuits
determination''); see also Cambridge Mutual Fire
Ins. Co. v. Sakon, 132 Conn.App. 370, 378, 31
A.3d 849 (2011) (conducting separate inquiries as to whether
actions alleged in counterclaim for which indemnification was
sought were business pursuits and whether actions arose from
insured's business pursuit of commercial development
plan), cert. denied, 304 Conn. 904, 38 A.3d 1202 (2012).
Therefore, the present case turns on the meaning of
‘‘arising out of'' the defendant's
meaning of ‘‘arising out of'' in the
context of insurance policies was already well established
when this court first defined business pursuits. In Hogle
v. Hogle, 167 Conn. 572, 577, 356 A.2d 172
(1975), this court explained that ‘‘it is
sufficient to show only that the accident or injury
‘was connected with, ' ‘had its origins in,
' ‘grew out of, ' ‘flowed from, ' or
‘was incident to' the [specified subject] in order
to meet the requirement that there be a causal relationship
between the accident or injury and the [subject].''
See also Misiti, LLC v. Travelers Property
Casualty Co. of America, 308 Conn. 146, 158, 61 A.3d 485
(2013) (recognizing that definition in Hogle applies
outside of motor vehicle context). This court has described
the definition in Hogle as ‘‘expansive,
'' underscoring that it is less demanding than the
standard for proximate cause. New London County Mutual
Ins. Co. v. Nantes, 303 Conn. 737, 759, 36 A.3d
224 (2012); accord Board of Education v. St.
Paul Fire & Marine Ins. Co., 261 Conn. 37, 48, 801
A.2d 752 (2002); see also Fibreboard Corp. v.
Hartford Accident & Indemnity Co., 16
Cal.App.4th 492, 504, 20 Cal.Rptr.2d 376 (1993) (citing same
definition and noting that‘‘ ‘[a]rising out
of' are words of much broader significance than
‘caused by' ''); Metropolitan Property
& Casualty Ins. Co. v. Fitchburg Mutual
Ins. Co., 58 Mass.App. 818, 820-21, 793 N.E.2d 1252
(2003) (‘‘[t]he terms ‘arising out of'
and ‘in connection with' are not be to be construed
narrowly but are read expansively in insurance
contracts''); United States Fire Ins. Co. v.
New York Marine & General Ins. Co., 268 A.D.2d
19, 21-22, 706 N.Y.S.2d 377 (2000) (‘‘when used
in automobile exclusion clauses, the words arising out of the
. . . use are deemed to be broad, general, comprehensive
terms, ordinarily understood to mean originating from,
incident to, or having connection with the use of the
vehicle'' [internal quotation marks omitted]).
Hogle involved a provision affording coverage, its
expansive definition also has been applied when the phrase
was used in coverage exclusions; see, e.g., New London
County Mutual Ins. Co. v. Nantes,
supra, 303 Conn. 753-54; including the business
pursuits exclusion. See Cambridge Mutual Fire Ins. Co.
v. Sakon, supra, 132 Conn.App. 380.
Numerous other jurisdictions apply the same definition to the
business pursuits exclusion. See, e.g., Metropolitan
Property & Casualty Ins. Co. v. Fitchburg Mutual
Ins. Co., supra, 58 Mass.App. 821; Blomdahl
v. Peters, Docket No. 2014AP2696, 2016 WL
413174, *2 (Wis. App. February 4, 2016). But see Farm
Bureau Life Ins. Co. v. Holmes Murphy &
Associates, Inc., 831 N.W.2d 129, 134 n.7 (Iowa 2013)
(‘‘a phrase like ‘arising out of' may
be given a narrower scope in an exclusion when a court finds
the exclusion ambiguous and therefore determines the phrase
means ‘proximately caused by' '');
South Carolina Farm Bureau Mutual Ins. Co. v.
S.E.C.U.R.E. Underwriters Risk Retention Group, 347
S.C. 333, 339-40, 554 S.E.2d 870 (App. 2001) (concluding that
narrower construction of arising out of applied to business
pursuits exclusion under rule of construction specific to
exclusions), rev'd on other grounds, 353 S.C. 249, 578
S.E.2d 8 (2003).
case law indicates that the question of whether the
defendant's false imprisonment of Socci was connected
with, had its origins in, grew out of, flowed from, or was
incident to his business pursuits would also be a factual
matter. See Kolomiets v. Syncor International
Corp., 252 Conn. 261, 265, 746 A.2d 743 (2000)
(considering whether injury arose out of employment in
workers' compensation claim as matter of fact);
Whitney Frocks, Inc. v. Jobrack, 135 Conn.
529, 534, 66 A.2d 607 (1949) (‘‘the question
whether or not the transaction arose out of the business for
which the corporation was organized was a question of fact
for the jury to decide''). But see Northern
Security Ins. Co. v. Rosenthal, 186 Vt. 578,
579, 980 A.2d 805 (2009) (‘‘[t]he court's
determination that there was no coverage presents a mixed
question of fact and law:  a factual determination
concerning the nature of the conduct giving rise to the
liability; and  a legal conclusion as to whether the
conduct falls within the business-pursuits
case law construing the phrase ‘‘arising out
of'' offers useful, but limited, guidance. Although
broadly construed, this court's application of this
phrase indicates that the requisite causal nexus would not be
met merely by a sequential relationship between the injury
and the business pursuit. Compare Misiti, LLC v.
Travelers Property Casualty Co. of America,
supra, 308 Conn. 162-63 n.11 (causal nexus to
establish liability arising out of use of part of premises
leased to tavern not established simply because use of tavern
and injury occurred in sequence; injury occurred after patron
left tavern, took detour from walkway to parking lot to
scenic area, and was injured on part of premises not leased
to tavern), with Board of Education v. St. Paul
Fire & Marine Ins. Co., supra, 261 Conn.
45, 47-48 (causal nexus to establish liability resulting from
use of covered vehicle established when bus driver
negligently allowed special education student to depart from
bus unsupervised and student thereafter was sexually
assaulted in school bathroom when driver's negligence was
direct factor in causing injury). Accordingly, this case law
makes clear that the mere fact that the false imprisonment
occurred after Socci arrived at her workplace would not, in
and of itself, establish the requisite nexus.
the paucity of Connecticut case law applying this exclusion,
it is useful to consider other courts' applications of
this common exclusion, albeit with a critical eye in light of
other textual differences. See an not., 35
A.L.R.5th 375 (1996) (noting that business pursuits
exclusions may be found in ‘‘practically all
homeowners' policies, '' ‘‘nearly all
of the provisions employ virtually the same language,
'' ‘‘provisions . . . include broad
exclusionary language for liabilities ‘arising out of
business pursuits of an insured' '').
the workplace as the locus of the injury is always a
significant factor, as one early commentator noted:
‘‘There seems almost unanimous accord in the
decisions that the location at which an act is performed is
not decisive on the question of whether the act constitutes
part of an excluded business pursuit. Rather, it is the
nature of the particular act involved and its relationship,
or lack of relationship, to the business that
controls.'' L. Frazier, ‘‘The
‘Business Pursuits' Exclusion in Personal Liability
Insurance Policies: What the Courts Have Done with It,
'' 1970 Ins. L.J. 519, 533-34 (1970). The requisite
connection is obvious in cases in which the act giving rise
to liability occurred in the usual course of employment or
the acts were incidental to those occurring in the usual
course of employment. See, e.g., Metropolitan Property
& Casualty Ins. Co. v. Fitchburg Mutual
Ins. Co., supra, 58 Mass.App. 821 (focusing on
fact that act injuring coworker at workplace, although not
itself related to employment, occurred while coworker was
working, and injury would not have occurred but for fact that
insured tortfeasor had been performing task for her employer
just before injury occurred); Berkshire Mutual Ins. Co.
v. LaChance, 115 N.H. 487, 489, 343 A.2d 642
(1975) (accident injuring coworker at workplace arose out of
business pursuit when it occurred while insured was engaged
in his regular occupation).
‘‘arising out of'' is an expansive
phrase, however, the causal connection to the business
pursuit extends beyond such obvious examples. For example,
the purpose of the activity or action giving rise to the
liability, in connection with other employment related facts,
may support the requisite causal nexus. Altercations causing
bodily injury and even death have been deemed to arise from a
business pursuit when the dispute giving rise to the action
was business related. Liberty Mutual Ins. Co. v.
Miller, 549 So.2d 1200, 1200-1201 (Fla. App. 1989)
(exclusion applied to confrontation between physicians at
hospital, regarding care and treatment of mutual patient,
that resulted in personal injury); Otero v.
United States Fire Ins. Co., 314 So.2d 208, 209
(Fla. App. 1975) (exclusion applied to assault of tenant by
insured landlord's son-in-law when assault arose in
course of dispute regarding insured's return of security
deposit and tenant's return of key), cert. denied, 328
So.2d 843, 844 (Fla. 1976); Reliance Ins. Co. v.
Fisher, 164 Mont. 278, 280, 284-85, 521 P.2d 193
(1974) (exclusion applied when teacher struck another teacher
over disciplining of student during school hours);
U.S. F. & G. Ins. Co. v. Brannan, 22
Wn.App. 341, 342, 350, 589 P.2d 817 (1979) (killing of one
business associate and wounding of another fell within
exclusion when altercation arose over business matter and
took place on business site during business hours); see also
Kermans v. Pendleton, 62 Mich.App. 576,
579, 233 N.W.2d 658 (1975) (exclusion applied when insured
owner of bar shot patron because owner ‘‘was
engaged in his business pursuit at the time of the shooting
and . . . but for this business pursuit, the shooting would
not have occurred''; shooting incident was related to
physical safety of bar and its patrons); Luneau v.
Peerless Ins. Co., 170 Vt. 442, 443, 446, 750 A.2d
1031 (2000) (exclusion applied when insured, engaged as disc
jockey at wedding, knocked over negligently stacked speakers
when he got into fight with one wedding guest about song
insured had forgotten to play, injuring another wedding
guest). Although courts often have placed emphasis on the
fact that the incident occurred at a work site during normal
business hours; see 9A S. Plitt et al., Couch on Insurance
(3d Ed. Rev. 2015) § 128.19, p. 128-58
(‘‘liabilities in connection with workplace
altercations have been held to necessarily involve the
insured's business pursuits and therefore fall within the
business pursuits exclusion''); the absence of such
facts has not precluded application of the exclusion as a
matter of law when an employment relationship existed and
related to the basis of the dispute. See, e.g., Smith
v. Sears, Roebuck & Co., 191 W.Va. 563,
566, 447 S.E.2d 255 (1994) (material question of fact as to
whether business pursuits exclusion applied because, although
initial disagreement between coworkers was related to
business, conflict occurred after they left workplace).
other circumstances in which the business nexus of the
activity itself is not clear, the purpose of the activity may
be a decisive factor. Compare South Carolina Farm Bureau
Mutual Ins. Co. v. S.E.C.U.R.E. Underwriters Risk
Retention Group, supra, 347 S.C. 339-40
(exclusion did not apply to dog owner's liability for dog
bite sustained by minor at office because dog was family pet;
it was not kept for security purposes, as mascot or any
function associated with business), with Safeco Ins. Co.
v. Leslie, 276 Or. 221, 224, 554 P.2d 469
(1976) (exclusion applied to injury from accidental discharge
of gun kept by service station employee when he brought gun
to work to protect large amounts of cash that accumulated at
station on Friday nights). In addition, injuries sustained in
social gatherings initiated by the employer may be deemed to
arise out of a business pursuit if the purpose of the
gathering related to the business, i.e., improving employee
relationships or workplace morale. See West American Ins.
Co. v. California Mutual Ins. Co., 195
Cal.App.3d 314, 323-24, 240 Cal.Rptr. 540 (1987). The mere
fact that a dual social and business purpose exists will not,
in and of itself, take the activity outside the scope of the
exclusion. See id., 324; see also
New London County Mutual Ins. Co. v.
Nantes, supra, 303 Conn. 756-58.
addition, even when no business purpose reasonably could
motivate or be furthered by the action, use of the employment
relationship or status to effectuate the harmful act may
provide the requisite causal connection. Thus, sexual
assaults have been deemed to arise out of a business pursuit
when the employer or employee used his or her position of
authority or trust attendant to that position to perpetrate
the acts. See, e.g., Armed Forces Ins. Exchange v.Transamerica Ins. Co., 88 Haw. 373, 381, 386, 966
P.2d 1099 (App. 1998) (sexual assaults by public housing
inspector against residents arose from business pursuit
because inspector gained entry to residents' homes
purportedly to conduct inspections, which was function
performed as part of employment), cert. denied sub nom.
Armed Forces Ins. Exchange v.Sagawa,
Hawaii Supreme Court, Docket No. 21183 (October 26, 1998);
Rubin v.United Services Automobile Assn.,
Docket No. 04-P-1629, 2006 WL 1543972, *1-2 (Mass. App. June
6, 2006) (dentist's sexual harassment of employee at
office and at YMCA arose out of business pursuit; latter
‘‘was related to, linked to, or associated with
her employment'' because dentist paid employee for
her time during both periods [internal quotation marks
omitted]); Greenman v.Michigan Mutual Ins.
Co., supra, 173 Mich.App. 90, 94
(employer's sexual harassment of employee occurred at law
firm where both worked; additional support for finding that
act arose from business pursuit is that claim could not
legally exist but for employer-employee relationship);
Frankenmuth Mutual Ins. Co. v.Kompus, 135
Mich.App. 667, 677, 354 N.W.2d 303 (1984) (insured therapist
‘‘was able to commit the complained-of acts
[against patients] apparently only because of the trust
imposed in him as doctor by his patients''), appeal
denied, Supreme Court of Michigan, Docket Nos. 74742, 74743
(February 28, 1985); Zimmerman v.Safeco Ins.
Co. of America, 605 N.W.2d 727, 731 (Minn. 2000)
(‘‘[B]ecause the sexual harassment for which [the
insured] was found liable can only happen in the
workplace-for example, the creation of a hostile work
environment-by definition it falls within the ‘business
pursuits' exclusion. . . . [T]he liability-creating
conduct is based upon the employment relationship in the
business setting.''). But see Scheer v.State Farm Fire & Casualty Co., 708 So.2d 312,
313 (Fla. App.) (where court did not distinguish between two
policies at issue, respectively including
‘‘caused by'' and ‘‘arising
out of'' business pursuits, exclusions did not bar
duty to defend physician alleged to have touched
employees' breasts and buttocks because acts did not
arise out of his profession and conduct was not primarily
undertaken in furtherance of business interest), review
denied, 719 So.2d 893 (Fla. 1998); Miller v.McClure, 326 N.J.Super. 558, 570, 742 A.2d 564 (App.