LC and plaintiff Cosmin Marculetiu were ballet dancers at markedly different points in their respective careers. Marculetiu, then forty-four, had become a dance instructor of international renown. L.C., then twenty-three, had just finished college and was hoping to make a career out of being a professional dancer. L.C. took some lessons in a dance studio in Burlington run by Marculetius' company, International Ballet Academy of Norwell, Inc. (IBAN), and she participated in performances of a ballet produced by IBAN. Any professional relationship between L.C. and Marculetiu quit in 2014 after she accused him of raping her during a trip to Romania for an international ballet competition. The following year, L.C. appealed against the civil action in the Superior Court against Marculetiu and IBAN. Marculetiu denied L.C.'s accusations and sued for libel, intentional interference in beneficial relationships and abuse of process. Both LC's action for damages (underlying case) and Marculetius' counterclaim remain pending.
In Cosmin Marculetiu v Safety Insurance Company & others, No. 19-P-1407, Appeals Court of Massachusetts (October 2, 2020) insurance for defense and compensation was presented to the Board of Appeal. The appeal before us includes insurance coverage related to the underlying case. Based mainly on the fact that the underlying measure involved allegations of rape and other intentional sexual abuse, each insurer filed a request for dismissal, claiming that it had no legal obligation to defend or compensate Marculetiu. The proposals were allowed by separate judges, and the defendants were indicted.
The allegations in the underlying measure
According to the complaint, Marculetiu L.C. to compete in the “World Ballet Competition” which will be held in Romania in March 2014. L.C. claims that she woke up on the plane over to the dance competition and discovered that Marculetiu was groping her with her hands under her shirt and down her pants. According to her, Marculetiu, once in Romania, entered her hotel room (to which he had his own key), confessed his love for her, "then forcibly removed her clothes and pushed her into bed, where he sexually attacked her. Over the next few days, she claims that he "raped her and sexually assaulted her" in her room. The complaint alleges that she was in a particularly vulnerable position given that she went alone in a foreign country where she did not speak her mother tongue.
L.C .:'s complaint included ten lawsuits against Marculetiu. Five of the bills allege various forms of sexual assault: rape, assault and battery, decent assault and battery, assault with intent to rape and drug for sexual intercourse.
The transcripts of LC's deposits and one of her therapists, provide enlightening details of what she specifically claimed occurred during the trip to Romania. The deposit statements also suggest that if L.C. Convinced of all the sexual advances that Marculetiu would have made, she did so in the context of a mentor-mentee relationship where there was a significant imbalance in power. The "coverage area" according to the policy is defined so that it includes not only the United States but also [[a] other parts of the world if the injury or damage arises from. . . activities for a person whose home is [the United States] but is away for a short time on [the insured’s] business. . . .
IBAN itself is the main insured under the CGL policy. However, IBAN employees are also insured, but only for documents within the framework of their employment with IBAN or during the performance of tasks related to IBAN's operations. In the same way, IBAN's senior executives and board members are insured, but only with respect to their duties as IBAN's executives or board members.
In addition to the individual exceptions that apply to each type of coverage, the CGL policy included a separate endorsement entitled “SEXUAL ABUSE EXCLUSION – ILLINOIS. "The exclusion body states that coverage" does not apply to any claim, "lawsuit" or cause of action, including defense of the same, for any person who actively participates in sexual offenses, sexual abuse or physical or mental abuse of anyone. " It is further stated that "
Marculetiu and his wife purchased a Safety Policy from Safety in connection with their home in Quincy. Various exceptions generally apply to coverage E. One is for bodily injury that is expected or intended by the insured. Another – commonly known as "business exclusion" – is for damage "[a] arising out of or in connection with a" business "conducted by an" insured "." A third is for harm ”[a] rises out of sexual abuse, corporal punishment or physical or mental abuse.
Marculetiu claims that each insurer owed him both an obligation to defend and an obligation to compensate him. The obligation to defend is determined on the basis of the facts alleged in the underlying complaint, and on facts that are known or easy to know by the insurer that can help with its interpretation of the allegations in the complaint. an obligation to defend or harm him regarding LC's core allegations that he raped her or otherwise committed intentional sexual abuse against her. Instead, he argues that insurers' obligations are triggered by three other claims that L.C. brought: breach of administrative duty, false imprisonment and negligence.
The exercise of intentional damages does not necessarily exclude that the damages that occur can be considered "unintentional" for the purpose of assessing the insurance cover. Marculetiu abused her position of power as her employer or teacher by making unwanted sexual advances against her. She does not have to prove that Marculetius' actions constituted rape or other forms of intentional sexual abuse. Although it may be the case that someone is considered responsible for sexual harassment that is specifically intended to harm the person being harassed, one must not expect a specific intention to harm according to law. As for the specific allegations made by L.C. has raised, it is possible to imagine a jury concluding that Marculetiu committed actable sexual harassment without having a specific intention to cause her harm.
In summary, the Court of Appeal was not appealed by National's argument that the nature of LC's breach of administrative duty precludes coverage under law. For the same reason, National cannot show that the damage from such a claim was necessarily excluded as "expected or intended" by Marculetiu. However, it was IBAN, not Marculetiu, who bought the CGL insurance, and according to the insurance terms, Marculetiu was entitled to coverage as insured only to a limited extent.
As an employee of IBAN, his coverage extends only to those measures that “fall within the scope of his employment with IBAN or are taken while performing tasks related to IBAN's activities. The question is whether his alleged behavior during the trip to Romania can be said to fall into that category.
L.C. argues that Marculetius' actions cannot justly be described as serving any of IBAN's interests. Rather, the alleged acts obviously only served Marculetius' interests. Consequently, those measures cannot reasonably be said to fall within Marculetius' field of employment, and he cannot therefore claim the status of insured party on that basis.
The coverage that Marculetiu seeks from the household policy is subject to a business exclusion according to which security bears no responsibility for "[i] kidney that arises as a result of or in connection with a" business "conducted by the insured." In addition, remember that the obvious design of homeowners' insurance is to protect homeowners from risks associated with the home and activities related to the home.
It is common ground that any damage suffered by LC from Marculetius' alleged acts occurred out of the country on a work-related trip. In these circumstances, Security is correct that, regardless of whether Marculetius 'alleged actions were motivated by personal or business reasons, any damages arising out of or in connection with Marculetius' business activities are thus excluded. With regard to claims of sexual harassment, the court concluded that all the liability that Marculetiu faces is due to the fact that he was LC's employer or teacher.
As no insurer had an obligation to defend Marculetiu with respect to the underlying measure and the judgment was upheld.
Allegations of sexual harassment, rape and abuse – all intentional damages – are difficult for a court to resolve issues of insurance coverage when certain intentional damages are covered by a personal injury contract. In this case, the court ruled, even though it was manifestly precluded by intentional act and undesirable sexual events, that because his conduct was not within the scope and scope of his employment, there was no coverage under the CGL and because his actions had taken place out of country and part of an excluded business trip and was excluded by the business purpose of household policy. Three judges who looked at the same facts achieved the same result for different reasons and each concluded that there was no obligation to defend or harm them.
© 2020 – Barry Zalma
Barry Zalma, Esq., CFE, now limits his practice to working as an insurance consultant specializing in insurance coverage, handling insurance claims, cheating and insurance fraud almost equally for insurance policyholders. . He also acts as an arbitrator or mediator for insurance-related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims lawyer and more than 52 years in the insurance business. He is available at http://www.zalma.com and firstname.lastname@example.org.
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