Allstate Insurance v. Freeman

Cavanagh, J.

(concurring in part and dissenting in part). In Metropolitan, I accept the conclusion "that Metropolitan Property and Liability Insurance Company has a duty to defend on these facts, although it may yet emerge that Metropolitan is not liable to indemnify DiCicco,” for the reasons stated by my sister, Justice Boyle.1

In Freeman, I accept the analyses and conclusions of the majority in affirming the holding of the Court of Appeals with respect to Alonda Freeman, namely, that the exclusion precludes coverage for her intentional acts.2 Yet, I do not agree with the majority that Allstate has no duty to defend Marshall Freeman. I write separately because I am convinced that the term "an insured” in the Allstate policy exclusion does not mean that Marshall Freeman’s negligence liability is not covered simply because Alonda’s liability for the same injury is excluded. Simple principles of insurance clause construction, which the majority accepts, naturally lead to this obvious conclusion.

Moreover, under the Allstate exclusion, the mere fact that the injury to Mary Kelly was caused by an excluded act (i.e., Alonda’s act of intentionally shooting her) is not dispositive of the question of Allstate’s duty to defend Marshall Freeman against allegations that he negligently entrusted a dangerous instrumentality to his wife, Alonda. The majority has found no authority that is clearly controlling, or persuasive, in reaching *738the conclusion that Allstate has drafted an unambiguous exclusion.

i

THE PACTS

I accept the statement of facts set forth in the lead opinion in Allstate v Freeman.3 There are additional facts relating to Marshall’s claim for coverage, however, that deserve mention. After the defendant, Mary Kelly, filed the original amended complaint for damages arising from Marshall’s negligence on September 26, 1984, a second amended complaint was filed on March 15, 1985, which alleged in pertinent part:

That the defendant Marshall Freeman carelessly and negligently placed, allowed and/or permitted an illegal and unregistered pistol, fully loaded with bullets, to be assessable [sic] to his wife and defendant Alonda Freeman in their household, knowing said weapon was illegally purchased and possessed, unlawfully non-registered, fully loaded and that his wife and defendant Alonda Freeman had no training or skills in how to use said firearm; all harm caused plaintiff having been reasonably foreseeable by defendant Marshall Freeman having carelessly exercised unreasonable care in placing said illegal weapon in his household.

These pleadings adequately allege that Marshall Freeman violated a separate duty of care in allowing his wife to have access to a loaded firearm despite her lack of training or skills in how to use that dangerous instrumentality.

ii

THE ISSUE

The issue is whether Allstate has a duty to *739defend Marshall against the allegations that he negligently entrusted the firearm to Alonda, or otherwise was negligent in supervising the firearm, which she intentionally used to injure Mary Kelly.

The question presented requires this Court to determine the proper interpretation of an insurance contract which provides, in relevant part:

Losses we cover:
We will pay all sums arising from the same loss which an insured person becomes legally obligated to pay as damages because of bodily injury or property damage covered by this part of the policy.
We may investigate or settle any claim or suit for covered damages against an insured person. If an insured person is sued for these damages, we will provide a defense with counsel of our choice, even if the allegations are not true. We are not obligated to pay any claim or judgment or defend any suit if we have already exhausted the limit of liability by paying judgments or settlements. Exclusions—Losses we do not cover
1. We do not cover any bodily injury or property damage which may reasonably be expected to result from the intentional or criminal acts of an insured person or which is in fact intended by an insured person.

The lead opinion correctly states the two issues raised by Marshall Freeman under this policy language. Marshall has claimed:

First, that Allstate has a separate and distinct duty to cover each insured under the policy, and, therefore, its duty to defend depends solely upon his conduct.
[S]econd, that the policy language, "an insured,” *740is ambiguous and, therefore, must be construed in favor of the insured.[4]

ill

PROCEDURAL HISTORY AND ANALYSES OF COURTS BELOW

The trial court analyzed the defendants’ negligence claim against Marshall as derivative of the claim against Alonda. In granting the plaintiffs motion for summary disposition, the trial court found no duty to defend for the following reason:

[T]he claim itself, damages for Kelly’s injury, was what triggered the exclusionary clause. Because the injury could reasonably be expected to result from Alonda Freeman’s intentional act, regardless of intent to injure . . . the injury was not covered even if Marshall Freeman was negligent in leaving the weapon in the Freeman home. [160 Mich App 349, 352; 408 NW2d 153 (1987), summarizing the trial court’s reasoning.]

The Court of Appeals affirmed, in a two to one decision. Judge Hood, writing for the majority, found that the plain language of the exclusionary clause makes Allstate’s duty to defend Marshall on the claim of negligent entrustment solely derivative of the duty to defend Alonda. Id. at 357. The majority relied upon a rule for interpreting "intentional acts” exclusionary clauses that was stated in general terms, rather than being rooted in the language of the exclusionary clause of the Allstate policy:

[W]here an insurance policy exclusion precludes *741coverage for the particular injury, then it also excludes coverage for negligent entrustment of the instrumentality that caused the injury. In other words, we look to the underlying cause of the injury to determine coverage and not to the specific theory of liability alleged in the complaint. Illinois Employers Ins of Wausau v Dragovich, 139 Mich App 502, 507; 362 NW2d 767 (1984); Shepard Marine Construction Co v Maryland Casualty Co, 73 Mich App 62, 65; 250 NW2d 541 (1976) . . . Michigan Mutual Ins Co v Sunstrum, 111 Mich App 98; 315 NW2d 154 (1981), lv den 414 Mich 890 (1982). [Id. at 357-358.]

Judge Theiler, in his dissenting opinion, found the term "an insured” to be ambiguous.5 We granted leave to decide, inter alia, the validity of Marshall’s claim that he is entitled to be defended against the claim of negligent entrustment. 430 Mich 857 (1988).

IV

METHOD OF CONTRACT INTERPRETATION

The lead opinion has stated a method of interpreting the insurance contract clause at issue that is the prevailing law, but yet does not apply those very same principles. Thus, it is useful to state those established rules of insurance contract interpretation at the outset because they ought to be adhered to in deciding this case.

First, the lead opinion concludes that the exclusion focuses on "bodily injury,” yet it accepts that this is rendered ambiguous if "an insured” can be read to mean both the named insured and any insureds.6 Second, we agree in the abstract on the rules of construction that must guide our interpre*742tation of the policy exclusion at issue here.7 Third, the. lead opinion accepts that the principles of insurance contract construction applied by this Court in the context of an automobile accident policy, see Powers v DAIIE, 427 Mich 602, 623-631; 398 NW2d 411 (1986), also apply in the present case. See also Raska v Farm Bureau Mutual Ins Co, 412 Mich 355, 363; 314 NW2d 440 (1982).8 Finally, we are in agreement on the following specific rules of construction under which we must interpret the Allstate "intentional acts” exclusion. These principles are that (1) exclusions are strictly construed against the insurer, because (2) the policy must "make clear” the exclusion, and, as a consequence, (3) the insurer must accept a liberal interpretation that favors the insured where it could have employed a plainer and more generous use of words that would have removed the ambiguity.9

v

analysis: does the Allstate policy clearly EXCLUDE COVERAGE FOR NEGLIGENT ENTRUSTMENT BY AN INNOCENT COINSURED SPOUSE?

A. INTRODUCTION

I now reach the central issue, whether Allstate has unambiguously excluded Marshall’s negligent entrustment liability under the above definition. *743The majority has found no ambiguity in the Allstate "intentional acts” exclusion and has put forth, as an incontrovertible fact of English grammar and usage, the argument that the term "an insured” necessarily refers to all insureds. I disagree with this conclusion. The plain meaning of the term "an insured” unambiguously means both "any insured” and "the named insured.” Indeed, the indefinite articles "a, an,” and "the” all may be used before "insured” to mean either all the insureds or the one insured. Therefore, the Court must construe the ambiguity—that arises from the two plausible meanings that these indefinite articles create when they modify the term "insured”— liberally in favor of the insured.

B. THE TERM "AN” INSURED IS AMBIGUOUS

The meaning of the indefinite article "an” is ambiguous under accepted rules of English grammar and usage. "An” is the indefinite article sometimes used in the place of "a.”10 The term "an insured” is ambiguous according to a technical, as well as a common-sense, meaning of the term read in the context of the Allstate policy exclusion. This ambiguity is inherent in the use of the indefinite article "an” before a noun which creates a problem of interpretation since it gives the noun potentially two different meanings.

The definition of the word "an” in Black’s Law Dictionary (5th ed) demonstrates why this indefinite article (which is in the family of adjectives) has this effect:

The word "a” has varying meanings and uses. "A” means "one” or "any,” but less emphatically *744than either. It may mean one where only one is intended, or it may mean any one of a great number. It is placed before nouns of the singular number, denoting an individual object or quality individualized, [yet] [t]he article "a” is not necessarily a singular term; it is often used in the sense of "any” and is then applied to more than one individual object . . . [b]ut the meaning depends on context. [Citations omitted.]

Given the above definition of the word "an,” it is clear that the Allstate "intentional acts” exclusionary clause is reasonably susceptible of two different meanings.11

The term "an insured” is ambiguous in the context of the Allstate exclusion because it can be taken to mean either the named insured or all insureds. Thus, an ordinary layman of average intelligence could easily read the Allstate exclusion as follows:

Losses we cover:
We will pay sums arising from the same loss, which a named insured person becomes legally obligated to pay as damages because of bodily injury or property damage covered by this part of the policy.
Exclusions:
We do not cover bodily injury or property damage which may reasonably be expected to result from the intentional or criminal acts of a named insured person (who commits those acts) or which is in fact intended by that named insured._

*745In light of this ambiguity, I must dissent.12

I have chosen not to follow the analyses of the cases cited in the lead opinion which contain language similar to the Allstate policy. See ante, pp 693-699, citing and discussing two cases, Allstate Ins Co v Condon, 198 Cal App 3d 148, 152; 243 Cal Rptr 623 (1988), and Allstate Ins Co v Gilbert, 852 F2d 449 (CA 9, 1988). These cases hold that the term "an insured” is unambiguous. The analysis in these two cases is simply not persuasive, and this Court is not required to follow it.13 These courts simply have not adhered to the concept that an ambiguity must be found where a phrase has more than one plausible meaning when read according to accepted rules of English usage.

C. THE AMBIGUITY IN THE TERM "AN INSURED” CAN BE SEEN BY READING THE CONTRACT AS A WHOLE

I disagree with the majority for the additional reason that it fails to look at the insurance policy *746as a whole.14 Allstate, as drafter of this policy, chose to clarify that the meaning of the term "insured” in its third exclusion should be understood in the plural sense.15 The "intentional acts” exclusion that we must interpret, however, is not similarly clear in its meaning.16

The insurer’s failure to insert "any” before "insured” in the "intentional acts” exclusion indicates that the insurer intended "any insured person” and "an insured” to have different meanings. We must read the policy as a whole to determine the intent of the parties—at least insofar as it can be ascertained from the language of the contract.17

*747D. THE INSURER COULD USE PLAIN LANGUAGE TO CLEARLY EXCLUDE FROM COVERAGE MARSHALL’S NEGLIGENT ENTRUSTMENT LIABILITY

The term "an insured” could have been made unambiguous if Allstate had included a separate definition of that term, making it clear that the noun it modifies (insured) refers to any named insured.18 Conversely, if Allstate had used the term "the insured” to achieve the necessary clarity, then Marshall’s negligent entrustment liability would clearly be covered under the policy and not within the scope of the exclusion. In Unigard Mutual Ins Co v Spokane School Dist, 20 Wash App 261; 579 P2d 1015 (1978), the Court stated the accepted view, namely,

[W]here coverage and exclusion is defined in terms of "the insured,” courts have uniformly considered the contract between the insurer and several insureds, to be separable, rather than joint, i.e., there are separate contracts with each of the insureds.[19]

If the Allstate exclusion used the term "the insured,” the insurer could argue that this term refers to all insureds. This grammatical argument is supported by the theory that "a, an, and the” are all articles which render the noun they modify subject to two potential meanings. At least one learned jurist has relied upon this argument, lending support to the common-sense notion that even the term "the” can create ambiguity in the noun it *748modifies.20 If this argument were made by the insurer, however, it would fail because the insurer must clearly and unmistakably exclude negligent entrustment claims from its broad liability insurance contract.21

Thus, the insured will not always win in claiming coverage under the intentional acts exclusion. If Allstate had merely added "y” to the word "an,” to give us "any insured,” then Marshall’s negligence liability would clearly be excluded.22 In sum, Allstate has failed to unambiguously exclude negligent entrustment liability of an innocent co-insured spouse, such as Marshall Freeman, either in its broad coverage provision or in the "intentional acts” exclusion.

VI

THERE IS NO CONTROLLING PRECEDENT THAT REQUIRES THE TERM "AN INSURED” TO BE READ ONLY TO MEAN ALL INSUREDS

The majority relies primarily upon cases that have interpreted the meaning of motor vehicle exclusions in general liability insurance con*749tracts.23 These cases do not stand for any general principle applicable to the construction of the Allstate "intentional acts” exclusion for the obvious reason that they construe the meaning of different contractual language.24

To decide this case, the majority has extracted a principle from these cases that is totally inapposite to the particular language of the Allstate "intentional acts” exclusion:

[W]here an insurance policy exclusion precludes coverage for the particular injury, then it also excludes coverage for negligent entrustment of the instrumentality that caused the injury.[25]

Any such abstract rule, which runs contrary to our established rules of contract interpretation, must be rejected for the reasons stated by Justice Boyle:

[Since] the duty to defend, like the duty to indemnify, is contractual, any delineation of the scope of the duty to defend without reference to *750the policy itself must be viewed as a mere generality.[26]

But, assuming the validity of the abstraction arguendo, the analysis the majority relies upon is flawed on its own terms. The language of the Allstate policy differs dramatically from the provisions of the homeowner’s liability policies from which the majority gleans the above abstract rule of insurance contract exclusion clause interpretation. Given the plain and obvious differences of language between the Allstate "intentional acts” exclusion and the exclusions construed by the cases on which the majority relies, it is apparent that these precedents are inapplicable. The coverage dispute involved here is conceptually and linguistically distinct from the issue courts have faced in construing the motor vehicle exclusionary clauses. The Allstate policy excludes bodily injury related to acts of an insured on the basis of the state of mind of a person committing those acts. Yet, the language of the exclusion leaves it unclear whether the negligence of a coinsured is covered when that negligent act is a cause of injury, but there is a concurrent cause of the same injury traceable to the intentional act of another insured (whose acts are clearly excluded).

Those cases involve claims by insureds who seek coverage for negligent entrustment of an automobile, despite the existence of a motor vehicle exclusion in the general liability policy. They present an issue of contract interpretation that is conceptually distinct from the issue in this case. The issue there is whether the motor vehicle exclusion can be interpreted as unambiguously excluding all injury that is in any way causally related to the use of an inanimate object (i.e., a motor vehicle), *751or whether it also can be viewed as not excluding injuries caused by the loaning or negligent entrustment of the vehicle. See West American Ins Co v Hinze, 843 F2d 263, 267-268 (CA 7, 1988) (holding that the negligent supervision of a child is not within the scope of the motor vehicle exclusion clause because no negligent acts were committed in the handling of, or with respect to, the excluded instrumentality).

By contrast, the "intentional acts” exclusion relates to injury that is the product of the acts of one particular insured whose behavior is of a certain type (i.e., is intentional). Thus, we must interpret an exclusion that does not clearly spell out whether all injury is excluded from coverage when the injury is caused both by the intentional acts of one insured and by the merely negligent acts of another.

The key difference between the two exclusions is that the motor vehicle exclusions clearly exclude all negligence liability related to the use of the motor vehicle.27 The "intentional acts” exclusion, by contrast, does not plainly exclude any negligence liability.

Only by a strained construction of the exclusion that gives priority to one of two possible interpretations of the term "an insured,” can one arrive at the conclusion that negligent entrustment liability is excluded from coverage. Thus, I am unper*752suaded by the majority’s reliance upon the motor vehicle exclusion cases to support the conclusion that Allstate has no duty to defend Marshall against the claim of negligent entrustment.28

Thus, derivative liability theory upon which the majority relies,29 namely, that Allstate’s duty to defend Marshall is derivative of its duty to defend Alonda, is plainly inapplicable here. Therefore, the cases cited in support of that theory would not control, even if they could be applied to decide this case under the derivative theory.30

We must also keep in mind that the first issue is whether Allstate has a duty to defend Marshall Freeman. When interpreting the Allstate policy, we must attempt to discern what meaning would serve the broader purposes of the policy.31 Judge Wahls, in his dissent in Dragovich,32 indicates why the language of insurance liability policies, such as the Allstate homeowner’s policy here, often create a duty to defend that is broader than the duty to *753indemnify. Allstate, as drafter of the policy, has clearly intended to create a broad duty to defend.33

Under this broad duty, Allstate has a clear obligation to defend Marshall Freeman against the allegations by Mary Kelly that he negligently entrusted his wife with a dangerous instrumentality. The pleadings clearly imply facts that would make Allstate liable under its duty to indemnify. Thus, the duty to defend in this case extends at least up to the point of summary judgment, since facts might be available that would establish coverage during the process of discovery. Dragovich, supra at 508 (Wahls, J., dissenting).34 I would apply the approach that Judge Wahls followed to the case at bar.35

Allstate has provided contractually a broad “all *754risk” form of coverage for a homeowner’s liability, and cannot now attempt to exclude coverage for precisely the kind of negligent claims that it is designed to cover. The exclusionary clause language not only is ambiguous, but it conflicts with a broad coverage provision. This is an easy case since ambiguities in a policy exclusion are to be construed in favor of the insured—especially where there is a broad duty to defend provision in the policy.

VII

conclusion

The issue in this case must be decided in reliance on principles of contract interpretation alone. By following established principles of insurance contract interpretation this Court should reach the conclusion that the Allstate policy covers Marshall’s negligent acts.

The alternate rationale upon which the majority relies, namely, that Allstate’s duty to defend Marshall is derivative of its duty to defend Alonda, is unpersuasive on its merits. To accept Allstate’s view, that Marshall’s coverage is purely derivative of Alonda’s intentional or other tort liability, would be incorrect as a matter of tort law (as well as under rules of contract interpretation).36

*755The tort of negligent entrustment focuses on a different type of conduct than Allstate sought to exclude by the language of its exclusionary policy.37 Thus, I must conclude that Marshall’s negligent entrustment liability is a separate and independent source of tort liability not clearly excluded by the Allstate policy. At least under this policy, "Allstate has a separate and distinct duty to cover each of the insureds . . . .”38 Since I conclude that Allstate has a duty to defend Marshall Freeman against Mary Kelly’s second amended complaint, I too "would reverse the deci*756sion of the Court of Appeals with regard to Marshall Freeman, and remand [Allstate Ins Co v Freeman] to the trial court” to consider the issue of Allstate’s duty to defend Marshall Freeman against the allegations of negligence.39

Ante, p 701.

Ante, p 660.

See ante, pp 682-685.

Ante, p 690.

See Freeman, supra at 359.

Ante, p 692.

See ante, p 692 which states that "[a]ny ambiguity must be construed in favor of the insured.”

Raska is cited by the lead opinion (ante, p 666) and by Justice Boyle (ante, pp 707-708).

These principles are taken directly from Powers, supra at 623-631, and Raska, supra at 361-363.

See also ante, pp 665-666, citing Raska and Powers. I infer from the citation of Raska in the lead opinion that it accepts the other principles of insurance contract interpretation stated by the Raska majority.

See Freeman, supra at 363. Judge Theiler concluded that "an,” read in the context of the Allstate policy, is ambiguous.

See Huggins v Tri-County Bonding Co, 337 SE2d 12, 17-18 (W Va, 1985). (Language in an insurance exclusion is ambiguous when it is "reasonably susceptible of two different meanings or is of such doubtful meaning that reasonable minds might be uncertain or disagree as to its meaning.” Citations omitted.) The term "an insured” is also ambiguous under a common sense meaning of "ambiguity.” For example, the Webster’s New Collegiate Dictionary (1974), defines "ambiguous” as meaning both "doubtful or uncertain” and "capable of being understood in two or more possible senses.”

See also, ante, p 736.

For example, the court in Condon, supra at 153, relies upon strained reasoning when it concludes that "proper grammar necessitated” the use of the term "an insured,” as opposed to the statutorily mandated term "a.”

Such reasoning ignores the fact that the policy exclusion at issue could have been drafted in at least two ways that would have indicated the plural connotation of "any insured.” To see how Allstate could have drafted the policy at issue in Condon to be both plural in its reference and grammatically correct, read the disputed coverage provision in that case and insert either the term "any insured person” or "any person insured” for the disputed word "a person insured.” Id. at 151.

Thus, as a matter of accepted English usage, the Condon court’s reasoning is flawed. Id. at 153. I also reject that court’s conclusion that "[t]here is no logical method to construe the phrase ["an insured”] as singling out any particular insured person within the coverage of the policy. Indeed, my reasoning with respect to the meaning of the indefinite article "an” shows otherwise.

Similarly, the decision in Gilbert, supra at 454, is unpersuasive in concluding, "We agree with Condon that 'an insured’ refers to all insureds under the policy.”

The lead opinion concludes that “the omission of a definition from an insurance policy does not render that term ambiguous.” (Ante, p 698.) Yet, it nowhere discusses Allstate’s use of the term "any insured person” in the third exclusion in the policy. See discussion below.

The third exclusion in the Allstate policy uses the word "any insured person,” instead of the ambiguous term "an insured.” The exclusion states:

Exclusions—Losses we do not cover
3. We do not cover bodily injury to any person eligible to receive benefits required to be provided or voluntarily provided by any insured person under any workers’ compensation, nonoccupational disability or occupational disease law.

The exclusion we are interpreting employs the term "an insured” to describe whose coverage is limited when one of the class of insured persons commits an "intentional or criminal act[ ].”

See, generally, 2 Couch, Insurance, 2d (rev ed), § 15:29, pp 216-227. The Couch treatise explains:

The intent of the parties is to be ascertained from the language of the entire policy considered as a whole in connection with the risk or subject matter . . . [a]ll its words, parts, and provisions must be construed together as one entire contract. All of the terms and conditions of each part should be read and interpreted together in light of all the other parts. The intent of the contracting parties is to be ascertained, not by a process of dissection in which words or phrases are isolated from their context, but rather from a process of synthesis in which the words and phrases are given a meaning in accordance with the obvious purpose of the insurance contract as a whole. [Id. at 216-226. Citations omitted.]

See, e.g., Safeco Ins Co of America, Inc v McKenna, 90 NM 516; 565 P2d 1033 (1977); Pawtucket Mutual Ins Co v Lebrecht, 104 NH 465; 190 A2d 420 (Í963); Western Casualty & Surety Co v Aponaug Mfg Co, 197 F2d 673, 674 (CA 5,1952).

See also id. at 266, and cases cited therein.

See People v Enlow, 135 Colo 249; 310 P2d 539 (1957) (Day, J., dissenting).

See State Farm Fire & Casualty Co v Teresa Lather, unpublished opinion of the United States District Court for the Southern District of Indiana (Docket No. IP 83-561C). In the context of construing a motor vehicle exclusion in a homeowner’s liability policy, Judge Barker relied on the principle that insurers must clearly exclude negligent entrustment claims from broad liability policies:

If [the insurance company] intended to exclude negligent entrustment and negligent supervision from its coverage, it must state that exclusion "clearly and unmistakenly.” [Id. at 14.]

See Freeman, supra at 364.

See, e.g., Michigan Mutual Ins Co v Sunstrum, 111 Mich App 98; 315 NW2d 154 (1981); Shelby Mutual Ins Co v United States Fire Ins Co, 12 Mich App 145; 162 NW2d 676 (1968); State Farm Fire & Casualty v Huyghe, 144 Mich App 341; 375 NW2d 442 (1985); Allstate Ins Co v Goldwater, 163 Mich App 646, 649; 415 NW2d 2 (1987). These cases hold, with the exception of Shelby, that automobile-related negligent entrustment liability of any insured is excluded from the coverage of homeowner’s liability policies when one insured commits tortious acts related to the use of the excluded instrumentality.

In all these cases, the exclusion relates to bodily injury arising out of the ownership, maintenance, use, or operation of a motor vehicle. The policy language differs slightly in each case. But, the general issue that the courts have faced in the motor vehicle exclusion cases is whether the policy exclusion clearly excludes negligent acts that relate only indirectly to the use of the vehicle but are nevertheless causally related to some foreseeable harm related to that use.

Freeman, supra at 357. Ante, p 690.

Ante, pp 701-702.

In Hinze, supra at 267, the Seventh Circuit pointed out the obvious fact that the motor vehicle exclusions in homeowner’s liability policies are intended to exclude a whole range of negligent acts:

The "instrumentality” theory, to the extent it is recognized [in the context of construing the scope of motor vehicle exclusions in liability insurance contracts], is clearly limited to a negligent entrustment action for the explicit reason that negligent entrustment includes by definition a finding of negligence with the entrusted instrument.

See ante, pp 690-691. But, I do note that courts in at least five other states have found language similar to the motor vehicle exclusion clause interpreted by the Sunstrum Court to be ambiguous. On the basis of the finding of ambiguity in the language of the exclusion, these courts have concluded that the insurer owed the insured a duty to defend against negligent entrustment actions arising from the use and operation of a motor vehicle. See Douglass v Hartford Ins Co, 602 F2d 934 (CA 10, 1979); United Fire & Casualty Co v Day, 657 P2d 981 (Colo App, 1982); U S Fidelity & Guaranty Co v State Farm Mutual Automobile Ins Co, 107 Ill App 3d 190; 437 NE2d 663 (1982); Upland Mutual Ins, Inc v Noel, 214 Kan 145; 519 P2d 737 (1974); Republic Vanguard Ins Co v Buehl, 295 Minn 327; 204 NW2d 426 (1973); McDonald v Home Ins Co, 97 NJ Super 501; 235 A2d 480 (1967); Lalomia v Bankers & Shippers Ins Co, 35 AD2d 114; 312 NYS2d 1018 (1970).

Ante, p 690.

See Dragovich, supra, Sunstrum, supra, and Shepard Marine Construction Co, supra.

As the Couch treatise explains, “An ambiguity for which the insurer is responsible is not to be resolved so as to defeat the purpose of the policy, where a reasonable construction which will uphold the policy is permissible.” Couch, n 17 supra at § 15:14, p 158. (Citations omitted.)

Dragovich, supra at 508-510.

Allstate has said that it will defend against the negligent personal acts of an insured on the premises of the household " 'even if the allegations are not true.’ ” See ante, p 739.

Judge Wahls’ approach, which I would apply to the duty to defend issue at bar, was explained further as follows:

The majority analysis would be more convincing if the issue were policy coverage rather than duty to defend the claim. Where the ability of a party to prove negligence necessarily turns on facts in the control of an adversary, considerations of fairness require that an insurer with potential liability defend the claim through the discovery process. Summary judgment is inappropriate where an insufficient factual basis exists to decide whether claims are in fact covered by the policy in question. Reurink Bros Star Silo, Inc v Maryland Casualty Co, 131 Mich App 139, 147; 345 NW2d 659 (1983). [Id. at 509-510.]

Judge Wahls’ reasoning should be applied here, even if the insured has "simply labeled [her] claim as a negligence count to avoid the [intentional-acts] exclusions of the insurance contract.” Dragovich, supra at 508.

This approach is a fair one given the unambiguously broad contractual duty to defend that Allstate has voluntarily assumed by contract and its ambiguous policy exclusion. To find otherwise would be inconsistent with the policy language, as other courts have found construing similar exclusions in homeowner’s liability policies. See, generally, Milliken, Coverage under a homeowner’s policy for third-party claims arising out of an automobile accident, 53 Ins Couns J 146, 150 (1986).

Allstate contends that Marshall’s tort liability under a theory of negligent entrustment is "triggered” only by the intentional acts of Alonda (which are excluded from coverage).

The basic elements of the tort of negligent entrustment were explained in a recent law review article:

Negligent entrustment has three elements: (1) a person relinquishes control of a dangerous instrumentality to another; (2) the first person knows or should have known that the entrustee is likely to use the instrumentality involving an unreasonable risk of harm to others; and (3) the injury must be caused by the entrustor and entrustee. [Note, Exclusion of automobile related *755liability under a homeowner’s insurance policy, 9 U of Hawaii L R 345, 353, n 53 (1987), citing Prosser & Keeton, Torts (5th ed), § 33, pp Í97-203; Leitner, Negligent entrustment of a motor vehicle and the homeowner’s policy, 35 Fed’n of Ins Couns Q 335, 336 (1985). See also ante, pp 732-733 (opinion of Archkr, J.). The elements of this tort were explained in Perin v Peuler (On Rehearing), 373 Mich 531, 539-540; 130 NW2d 4 (1964).]

A claim of negligent entrustment depends upon a finding that the tortious acts of Alonda were the proximate cause of the damages alleged. See Perin, supra at 538-540. ("In all cases [of negligent entrustment] . . . the cause of the plaintiffs injury must be proximately connected to some negligent act or omission for which either the entrustor or the entrustee is legally responsible.”)

Yet, Marshall’s legal liability is only "triggered” when he acts negligently. His failure to prevent the foreseeable misuse of a dangerous instrumentality necessarily precedes the actual misuse of the firearm by Alonda.

Moreover, his negligent entrustment liability exists irrespective of whether the dangerous instrumentality (in this case, a firearm) is used in an intentionally tortious, or a merely negligent, manner.

I find it significant that Marshall Freeman can be held liable in negligence whether or not Alonda acts intentionally. Under a different policy exclusion, but in a very similar factual context, the West Virginia Supreme Court pointed out:

[T]he critical element of a negligent entrustment cause of action is the initial improper loaning of the vehicle—improper in the sense that it is given to a person who is known to be likely to cause an unreasonable risk of harm to others. [Huggins v Tri-County Bonding Co, 337 SE2d 12, 17 (W Va, 1985), citing, inter alia, Restatement Torts, 2d, § 308; Prosser & Keeton, Torts (5th ed), § 73.]

Freeman, supra at 357.

Ante, p 722.