by Christopher J. Graham and Joseph P. Kelly

Patient sues her physician and alleged sexual assault. Patient allegedly arrived for an appointment and was assaulted by physician resulting in her loss of consciousness and then physician sexually assaulted her while she was unconscious. Physician’s practice tendered the defense of physician for patient’s suit to its professional liability insurer. Is MedPro obligated to defend physician? That was the question decided in Medical Protective Company v. David L. Turner, et al, Case No. 3:15-CV-0366-L (N.D. Tex. June 10, 2015).

MedPro agreed under its policy “to defend and pay damages” for “any claim first made, or potential claim first brought to the Insured’s attention, during the term of this policy based on professional services rendered, or which should have been rendered … in the practice of Insured’s profession as hereinafter limited and defined.”

“Professional services” was defined as “the rendering of medical, surgical, dental, or nursing services to a patient and the provision of medical examinations, opinions, or consultations regarding a person’s medical condition within the Insured’s practices as a licensed health care provider. This shall include first aid rendered at the scene of an accident without expectation of monetary compensation.”

MedPro’s policy excluded “Payment of damages (but will defend) in any claim for damages if said damages are in consequence of the performance of a criminal act or willful tort or sexual act.”

Physician’s argument for coverage was two-fold:

(1) Patient’s suit is a claim “based on professional services rendered, or which should have been rendered” because “[a]ccording to the petition, the alleged physical and sexual ‘assaults’ arose out of or occurred in connection with [physician’s] rendition or failure to render professional medical treatment that was being sought by [patient]–i.e., during an office visit and examination for the purpose of obtaining refills.”

(2) A duty to defend is expressly stated in the above sexual act exclusion.

MedPro countered that “it cannot be a ‘professional service’ for a doctor to have non-consensual sex with a patient” and physician’s attempt to to expand coverage via the exclusion “confus[es the basic structure of an insurance policy … [and physician] cannot ignore the scope of coverage set out in the insuring clause of his policy, and then argue that different, additional coverage is somehow created by a policy exclusion.”

The court sided with MedPro on physician’s first argument stating “there are no allegations in the Petition in the Underlying Lawsuit that could bring the allegations within the coverage of the Policy. Even construed liberally, and resolving all doubts in favor of the insured, the allegations of assault and non-consensual sex in the Petition do not relate to the rendering of professional services, as the alleged assault and nonconsensual sex bore no connection to ‘the rendering of medical, surgical, dental, or nursing services to a patient and the provision of medical examinations, opinions, or consultations regarding a person’s medical condition within the insured’s practice as a licensed health care provider.”

The court also rejected physician’s argument that the sexual act exclusion created a duty to defend stating that physician’s argument “misconstrues the function of exclusions in insurance policies.” According to the court:

Initially, the insured has the burden of establishing coverage under the terms of the policy. If the insured proves coverage, then to avoid liability the insurer must prove the loss is within an exclusion. If the insurer proves the exclusion applies, the burden shifts back to the insured to show that an exception to the exclusion brings the claim back within coverage.

The court’s decision leads to an interesting question–when, if ever, could a patient’s claim involving a physician’s alleged “sexual act” be “based on professional services rendered” and, thus, trigger a professional liability insurer’s duty to defend? Here, it wasn’t enough that the alleged sexual assault occurred during patient’s appointment at the physician’s office; the claim wasn’t “based on professional services rendered, or which should have been rendered…”; it was based on a sexual assault. The court’s decision appears to be consistent with how other court’s have handled the issue.

Tags: Texas, professional liability insurance, professional services, physician, sexual assualt, sexual act exclusion