Scott Minkler alleged that when he was a child, his Little League baseball coach, David Schwartz, had molested him. During the period when these terrible events occurred, David was living at the home of his mother, Betty Schwartz, and some of the episodes had taken place at her house. Scott sued Betty, alleging that she had been negligent in supervising events in her own home.

Betty had a homeowners’ policy with Safeco Insurance Company, which covered any harm caused by the unintentional acts of the home’s residents, including David. Since David’s acts were intentional, Safeco was not responsible for the claims against him. But Safeco also argued that it was not responsible for claims against Betty because the wrongdoing that had caused the harm (that is, David’s acts) had been intentional. Safeco’s interpretation of this provision was valid under California law. However, her policy had an additional provision that stated, “This insurance applies separately to each insured.” 

In short, Betty’s policy was ambiguous. Safeco said the policy did not provide coverage if any insured had engaged in intentional wrongdoing while Betty argued that it did cover her if her own actions had been merely negligent. 

Questions:

1. How should the court interpret ambiguous provisions in a contract?

2. Why is ambiguity interpreted against the drafter?

3. How does the court define “ambiguous?”

4. How must the ambiguity in the contract at issue be resolved?