WI. App. (Dist. 1)

No Defense to “Big Brother” Volunteer for Allegations of Sexual Abuse

The Wisconsin Court of Appeals for District 1, applying Wisconsin law, affirmed the decision of the circuit court and found no duty to defend or indemnify claims of alleged sexual abuse against an insured’s volunteer because the volunteer was not an insured under the applicable policy because his alleged actions fell outside the scope of his duties. The appellate court also affirmed the circuit court’s dismissal of the respondent superior  and negligent hiring, training, and supervision claims due to the alleged actions being outside the scope of the volunteer’s duties and no nexus between the volunteer’s past criminal history and the allegations at hand.

The coverage case stems from allegations by a “little brother” of the program Big Brothers and Big Sisters of Metropolitan Milwaukee (“BBBS”) of sexual assault against his “big brother,” David Foley. Plaintiff filed suit against Foley and BBBS alleging that he was sexually assaulted while he was in the program.  The plaintiff brought claims against Foley for battery, intentional infliction of emotional distress, false imprisonment and negligent infliction of emotional distress, and he brought claims against BBBS for respondeat superior and negligent hiring, training, and supervision, and punitive damages. BBBS’s primary and umbrella insurance carrier, First Nonprofit Insurance Company (“First Nonprofit”), intervened in the action and asked the Court to grant summary judgment finding that it did not have a duty to defend or indemnify Foley because he was not acting within the scope of his duties as a volunteer when the alleged abuse occurred. The circuit court agreed and granted First Nonprofit’s motion for summary judgment.  According to the circuit court, Foley is not an insured under the policies because the allegations of abuse were not within the scope of his duties as a volunteer for BBBS.

BBBS then moved for summary judgment seeking dismissal of the Plaintiff’s claims against it because: (1) Foley’s alleged actions “were not within the scope of his agency and therefore do not allow for vicarious liability;” (2) “there is no nexus between Foley’s criminal history and his unforeseeable actions of assault;” and (3) any claim for punitive damages “must be stricken because [the Plaintiff] cannot make the requisite showing to support his claim for damages.” The circuit court agreed and granted BBBS’s motion.

The plaintiff appealed both rulings. The policies at issue define “insured” to include BBBS’s volunteers, but only while the volunteers were acting at BBBS’s direction and within the scope of their duties. The primary policy covered an insured’s damages that stemmed from sexual abuse occurrences if the insurance policy applied. The umbrella policy covered all sums in excess of the primary policy in situations where BBBS was required to pay damages that stemmed from an injury where the policy applied.

The primary issue on appeal was whether Foley acted within the scope of his duties as a volunteer and in turn whether he was an “insured” under the policy. The appellate court determined that Foley’s conduct did not fall within the activities that BBBS directed and the alleged conduct was outside the scope of a volunteer’s duties, and therefore, Foley. was not an “insured” under the policy. Sexual misconduct is expressly prohibited by BBBS. According to the appellate court, even though the alleged conduct happened while Foley conducted BBBS-directed one-on-one time with the plaintiff, the acts of sexual misconduct were “so extraordinary and too disconnected from the type of services ordinarily contemplated” that they could not be covered by the policies. Foley’s actions precluded him from being considered an “insured” for the purposes of the lawsuit, and therefore, First Nonprofit did not have a duty to defend or indemnify him.

As to the Plaintiff’s claims of negligent hiring, training, and supervision against BBBS, the appellate court determined that BBBS did not know nor should it have known that Foley posed a foreseeable risk of sexually harming the Plaintiff.  Thus, the appellate court agreed with the circuit court that there was no nexus as a matter of law between Foley’s criminal history and the alleged assaults.  Accordingly, the Appellate Court affirmed the dismissal of the claims against BBBS. Doe v. Foley, No. 2019AP667, 2020 Wisc. App. LEXIS 376 (CT. App. Aug. 18, 2020).