## Facts

- Oxnard Hospitality Enterprise, Inc. operated a nightclub insured under a commercial general liability policy issued by Mount Vernon Fire Insurance Corporation.
- Roberta Busby, a dancer at the nightclub, was attacked on the premises when a patron threw flammable liquid on her and ignited it, causing severe injuries.
- Busby sued Oxnard alleging negligence, including failure to provide adequate security and protective measures.
- The policy contained an “Assault or Battery” exclusion applying to all bodily injury “arising out of” assault or battery, including assault or battery “caused in whole or in part by negligence.”
- The endorsement defined “battery” as “negligent or intentional wrongful physical contact with another without consent that results in physical or emotional injury.”
- While the tort case was pending, Mount Vernon filed an action for declaratory relief seeking a determination that it owed no coverage based on the exclusion.
- The tort case concluded with a $10 million stipulated judgment for Busby and an assignment to Busby of Oxnard’s rights against Mount Vernon.
- The trial court granted Mount Vernon summary judgment in the coverage action; Busby appealed as Oxnard’s assignee.

## Issues

1. Whether the policy’s definition of “battery” as “wrongful physical contact” required direct body-to-body contact, or included contact through a thrown substance that struck the victim.
2. Whether the assault-and-battery exclusion applied when the insured was sued only for negligence (such as negligent security), rather than for committing an intentional tort.
3. Whether the exclusion’s language was ambiguous and therefore construed in favor of coverage.

## Decision

- The Court of Appeal affirmed summary judgment for Mount Vernon.
- The court held the assault-and-battery exclusion was unambiguous.
- The attacker’s act of throwing flammable liquid on Busby (and igniting it) constituted “wrongful physical contact” and therefore a “battery” under the endorsement.
- Because Busby’s injuries “arose out of” that battery, the exclusion barred coverage for the incident, including claims framed as negligence against Oxnard.
- Mount Vernon owed no duty to indemnify for the stipulated judgment.

## Legal Principles

- Insurance policies are interpreted as contracts under ordinary contract-interpretation rules, giving effect to the parties’ intent as reflected in clear policy language.
- Courts apply the plain meaning a reasonable layperson would give the terms and do not create ambiguity through strained or absurd readings.
- An assault-and-battery exclusion using broad “arising out of” language can bar coverage when the injury has a causal connection to an assault or battery, even if the insured’s alleged wrongdoing is negligent security or other negligence.
- “Physical contact” in a battery definition may include contact accomplished by objects or substances applied to the victim, not only direct body-to-body touching.

## Conclusion

The court enforced a broadly worded assault-and-battery exclusion, holding that injuries from an attack involving thrown flammable liquid “arose out of” a battery as defined by “wrongful physical contact,” thereby eliminating coverage for related negligence-based claims against the insured nightclub.


Mount Vernon Fire Ins. Corp. v. Oxnard Hospitality Enter., Inc., 219 Cal. App. 4th 876 (Ct. App. 2d Dist. 2013)