Insurance Law

Carrier Held to Have No Duty to Defend or Indemnify Insured Massage Therapist Against Claim of Sexual Assault Because the Assault Was Not Allegedly Performed Within the Therapist’s Scope of Employment

Baek v. Continental Cas. Co., 230 Cal. App. 4th 356 (2014), [enhanced version available to subscribers].

In Baek, the general liability carrier for a massage business was held to have no duty to defend or indemnify a massage therapist alleged to have sexually assaulted a client during a massage because the alleged assault was not committed within the scope of the therapist’s employment.

In reaching this determination, the insurer explained that the therapist was only entitled to coverage under the massage business’s general liability policy for acts undertaken within the scope of his employment. After receiving notice of the matter, the massage business’s general liability carrier denied coverage based on the position that the alleged sexual assault was not committed within the therapist’s scope of employment, but instead was an independent act of exploitation. Following the declination of coverage, the therapist filed suit. The insurer responded with a demurrer that was sustained by the trial court.

In reaching its ruling, the Baek court held that although the assault would not have allegedly occurred “but for” the therapist’s employment, such an act cannot be deemed to have been committed within the scope of employment unless its “motivating emotions were fairly attributable to work-related events or conditions.” 230 Cal. App. 4th at 367 (citing Lisa M. v. Henry Mayo Newhall Memorial Hospital, 12 Cal. 4th 291, 301 (1995)), [enhanced version available to subscribers]. According to the Baek court, the alleged assault was not motivated by “work-related emotions” but instead was based on the therapist’s intent to take advantage of an isolated and naïve client. Based on this finding, the Baek court affirmed the trial court’s ruling.

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