Catholic archdiocese vs. insurer in priest sex abuse cases

AP News
|
Posted: Apr 08, 2016 5:15 PM

HARTFORD, Conn. (AP) — The Roman Catholic Archdiocese of Hartford has taken its dispute with an insurance company to trial, seeking reimbursement of more than $1 million in payments made to settle sexual misconduct cases involving priests and minors.

Testimony began Friday in a bench trial before U.S. District Judge Janet Bond Arterton in New Haven.

The case is one of many around the country in which insurance companies have balked at paying claims related to lawsuits against church officials seeking to hold them responsible for sexual assaults of minors by clergy — accusations that in many instances date back decades and involve priests who have since died.

A key issue in the Connecticut case and others is whether insurance companies can deny claims under assault and battery exemptions in liability policies. Many policies don't cover intentional acts, but church officials have argued that they did not know about the alleged assaults.

The archdiocese sued Interstate Fire & Casualty Co. in 2012, claiming the Chicago-based insurer breached its policy by refusing to reimburse the archdiocese for payments made in four settlements from 2010 to 2012 after previously reimbursing payments made in other abuse settlements.

"The foregoing activities of Interstate constitute unfair trade practices, because they offend public policy and they are immoral, unscrupulous and unethical," the lawsuit states.

Lawyers for the insurer argue in court documents that the settlements weren't covered by the policies. A spokeswoman and a lawyer for Interstate Fire & Casualty declined to comment.

The company has faced lawsuits in other states after refusing to reimburse church officials for priest abuse settlements.

And In a 2014 ruling, the 9th U.S. Circuit Court of Appeals in San Francisco said in a 2014 ruling that Interstate Fire's liability policy for the Diocese of Phoenix did not cover settlements of priest sexual abuse cases because of the policy's assault and battery exception.

The four cases at the center of the Hartford archdiocese lawsuit involved claims of sexual misconduct against minors in the 1970s and 1980s. Two cases involved sexual abuse claims against the Rev. Ivan Ferguson, who died in 2002 after serving as a church grammar school principal in Derby and other positions with the archdiocese.

A spokeswoman and a lawyer for the archdiocese declined to comment.

The archdiocese has settled many claims of sexual abuse by priests. It agreed in 2005 to pay $22 million to 43 people who said they were sexually abused by priests, including Ferguson.

Elsewhere in the country, the Diocese of Honolulu sued First Insurance Co. of Hawaii in January for refusing to cover priest abuse settlements. And in 2014, the Archdiocese of St. Paul and Minneapolis sued some 20 insurance companies to try to force them to cover its liabilities for clergy sex abuse claims. The lawsuit was put on hold after the archdiocese filed for bankruptcy last year in the wake of priest abuse claims.

Interstate Fire & Casualty has since been acquired by Munich, Germany-based Allianz Group.