South Carolina Court of Appeals Says Arcade Accident Was Covered Under Saloon’s Liability Insurance Policy, but Bad Faith Was Issue for Trier of Fact

Those who have been hurt by someone else’s negligent or reckless conduct should receive fair compensation for their medical expenses, lost wages, and pain and suffering. Unfortunately, not every South Carolina personal injury lawsuit arising from an act of negligence goes smoothly.

Not only is liability often denied (many defendants try to put the blame on the injured person or a third party), but insurance coverage issues can also crop up, making it harder to collect a settlement or judgment even when liability can be proven. In such situations, a bad faith claim against the insurance company is a possibility.

Facts of the Case

In a recent (unreported) appellate court case arising from the Circuit Court of Greenville County, South Carolina, the plaintiff was a limited liability company that operated a saloon. After one of its patrons filed suit against it claiming that she was injured by an unknown person playing a boxing arcade game inside the saloon, the plaintiff sought coverage from the defendant insurance company, from which the plaintiff had purchased a comprehensive general liability insurance policy. (According to the saloon patron, her injuries occurred when she was inadvertently struck and knocked unconscious by an unknown person playing the arcade came.)

The defendant denied coverage, and the plaintiff filed suit for breach of contract and bad faith denial of coverage. The trial court granted summary judgment to the plaintiff, and the defendant appealed.

Decision of the Court

The State of South Carolina Court of Appeals affirmed in part and reversed in part. According to the court, the insurance policy in question required the defendant to provide coverage for an “accident” unless it was excluded under the provision of the contract between the parties. Notably, the contract did not specifically define the term “accident.” Under previous South Carolina case law, the term has been defined as “an unexpected happening or event, which occurs by chance…”

The court went on to discuss the defendant’s reliance on an “assault and battery” exclusion contained within the policy. According to the court, this exclusion was ambiguous, and there was no error in the lower court’s decision that the exclusion only applied to intentional acts, not to the type of situation alleged by the woman who sued the plaintiff following the arcade game incident. The appellate court also found that the “athletic or sport participant” exclusion was inapplicable, holding that this term, too, was ambiguous and could not be relied upon to deny coverage for the accident at issue.

The court did rule in the defendant’s favor on the issue of bad faith, however, agreeing that summary judgment to the plaintiff on this issue was inappropriate under the circumstances. Rather, this issue should be considered by the trier of fact on remand.

Schedule a Free Consultation with a South Carolina Injury Attorney

At the Patrick E. Knie Law Offices in Spartanburg and Greenville, we represent a wide array of personal injury and wrongful death claimants. We are also experienced in handling bad faith claims against insurance companies, workers’ compensation and Social Security disability cases, and class action lawsuits. To schedule a free consultation to discuss your case, call us at 864-582-5118. Please remember that there are strict deadlines in these kinds of cases, and failure to act promptly may result in your case being dismissed.

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