American Family Mutual Insurance v. Westfield Insurance Company

(Court opinion corrected 12/14/11.) Minor, age 12 at time of incident, was convicted of criminal damage to property for recklessly setting fire to company. Minor was insured under her grandparents' farm-ranch policy. Company's insurer sued minor's father in subrogation, and trial court found minor negligent and awarded damages to insurer. Grandparents' insurer had sent reservation-of-rights letter to minor's father after learning that suit would be filed, stating that its intentional-act exclusion may limit or deny coverage. Collateral estoppel does not apply, as issue decided in prior adjudication is not identical with present suit. As insurer and insured would have profitted from a finding that insured was not negligent, and minor's conduct could not have been found intentional, insurer's reservation-of-rights letter was properly sent, and insurer was not obligated to settle. (TURNER and STEIGMANN, concurring.)