8th Circuit: Insurance Company Need Not Pay Archdiocese's Settlement In Wrongful Death Suit

In Chicago Insurance Company v. Archdiocese of St. Louis, (8th Cir., Jan. 29, 2014), the U.S. 8th Circuit Court of Appeals held that Chicago Insurance Co. is not required to reimburse the Catholic Archdiocese of St. Louis for amounts the Archdiocese paid to settle a wrongful death claim by the parent of a clergy sex abuse victim who committed suicide. The court held that the Archdiocese failed to show that the settlement was in reasonable anticipation of liability for negligence because the Missouri Supreme Court has held that negligence-based actions against a religious organization that require the court to evaluate the reasonableness of religious doctrine, policy and administration are barred by the 1st Amendment. (And the insurance policy does not cover intentional conduct.) The 8th Circuit held:

we are aware of no authority, and the Archdiocese cites none, that allows a settling insured to recover under an indemnity policy where governing law does not permit the claimant's underlying cause of action against the insured.

Business Insurance reports on the decision.