Insurer has no Duty to Defend or Indemnify Bar Owners in Complaint Seeking to Impose Liability for Failure to Provide Adequate Security not Related to Selling, Serving or Furnishing of Alcohol
In Capitol Specialty Ins. v. Whitaker, Capitol Specialty Insurance (“Capitol”), the insurer, issued a policy to the owners of Club Elite, Whitaker and Moore, that contained two parts: a commercial general liability (“CGL”) part and a commercial liquor liability (“CLL”) part. The CLL part provided insurance coverage where liability was imposed on the insured by reason of the selling, serving, or furnishing of any alcoholic beverage.
Michael Taylor and his son were assaulted by two assailants in a bar fight at Club Elite. Taylor sued Whitaker and Moore, the owners of Club Elite, under a premises liability negligence theory for failure to provide adequate security. The underlying complaint did not mention whether any of the parties had consumed alcohol sold, served or furnished by Club Elite.
The insurer, Capitol, sought a declaration that the CLL part did not cover liability for the assault and that it was not obligated to defend or indemnify them. Capitol argued that the bare allegations of the underlying complaint did not allege the selling, serving, or furnishing of any alcoholic beverage.
The court held that the underlying complaint sought to impose liability for failure to provide adequate security, which was not related to the selling, serving or furnishing of alcohol. Thus, the insurer, Capitol, had no duty to defend or indemnify the bar owners.
Capitol Specialty Ins. Corp. v. Whitaker, 2009 WL 2925440 (S.D. Ill. 2009).
