While an insurer has a duty to defend an insured if it becomes aware of facts giving rise to potential coverage, it should come as no surprise that this duty does not extend to the lewd acts of professionals.

In Baek v. Continental Casualty Company, the California Court of Appeal, Second District, recently affirmed the trial Court’s granting of Continental’s demurrer on the grounds that Plaintiff, a massage therapist who purportedly sexually assaulted a client during the course of the massage, failed to sufficiently plead a cause of action for breach of contract against Continental by virtue of Continental’s denial of coverage to Plaintiff’s employer.

In affirming the trial Court’s decision, the California Court of Appeal found that while Plaintiff’s employment provided him with the opportunity to meet his client, the alleged sexual assault did not constitute an act “within the scope of Plaintiff’s employment,” within Continental’s policy, as Plaintiff took advantage of solitude with the client to commit an assault for reasons unrelated to his work.  As such, the California Court of Appeal found that Continental did not breach a contract in denying coverage to Plaintiff.

When analyzing the scope of professional liability coverage, a key issue is to determine whether the professional was acting within the scope of his employment, let alone acting professionally.

Thanks to Caroline Frelich for her contribution to this post.  For any questions contact ">.