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Marquis v. State Farm Fire and Casualty Co.6/5/1998
The trial court concluded that the homeowner's policy excluded liability and entered summary judgment in favor of State Farm on that policy. The plaintiffs did not appeal from this determination. However, the trial court determined that the contractor's policy did provide coverage for negligent hiring, retention, or supervision and that there was a question of fact as to whether Sharon Auck was negligent in her hiring or supervision of Jerry Auck. The court, therefore, permitted additional discovery on this issue.
On November 21, 1996, State Farm moved for reconsideration and filed a supplemental motion for summary judgment. State Farm requested that the trial court reconsider its determination that the plaintiffs could raise claims of negligent hiring, retention, or supervision. State Farm also asked in the alternative that the court enter judgment on its behalf because there was no factual basis for the claims of negligent hiring, retention, or supervision. In support of this contention, State Farm included 153 additional statements of fact.
The plaintiffs responded and filed their own motion for reconsideration. They objected to State Farm's filing of a supplemental motion for summary judgment on the basis that the motion was out of time and not authorized by the court. The plaintiffs further asked the court to reconsider its determination that a factual question existed as to the claim of negligent hiring, retention, or supervision. They argued that once the court determined coverage was owed, State Farm was barred under the terms of the agreement from contesting whether such negligence had occurred.
Upon final consideration, the trial court changed its ruling on its earlier interpretation of the agreement. Leaving intact its ruling on the question of coverage, the court determined that the settlement agreement was unambiguous and provided that once a determination had been made that coverage was owed for claims of negligent hiring, retention, or supervision under the contractor's policy, State Farm was precluded from litigating the issue of fault. Accordingly, the court entered judgment for the plaintiffs in the amount of $1,000,000, with interest, against State Farm on its contractors policy.
State Farm contends on appeal that (1) the settlement agreement between the parties prohibits the plaintiffs from proceeding on the new theory of negligent hiring, retention, or supervision; (2) the contractor's policy excludes such claims because plaintiffs' injuries arise out of the use of a motor vehicle operated by an insured; (3) the plaintiffs' claims of negligent hiring, retention, or supervision are without factual basis; and (4) the tortfeasor was an employee acting within the scope of his employment, which precludes claims of negligent hiring, retention, or supervision.
(1) The Agreement
State Farm contends that contrary to the trial court's determination, the settlement agreement bars the plaintiffs from raising new claims of negligent hiring, retention, or supervision. According to State Farm's interpretation, the settlement agreement limits claims to those raised in the petition filed by the plaintiffs. Moreover, State Farm argues that the statute of limitations and equitable considerations preclude new, further, and additional claims such as negligent hiring, retention, or supervision.
The interpretation of a written instrument is a question of law, and regardless of the construction given to a written instrument by the trial court, we may construe the instrument and determine its effect. See Galindo v. City of Coffeyville, 256 Kan. 455, 467, 885 P.2d 1246 (1994). The primary rule when interpreting a written contract
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