Law360 (April 28, 2020, 4:39 PM EDT) -- A split Pennsylvania Supreme Court recently held that Erie Insurance Exchange must defend a personal injury case brought by a man who was shot after walking in on an Erie policyholder's murder-suicide, a ruling that may expand insurers' duty to defend in cases where policyholders' intentional acts cause unintended consequences.

In a 4-3 opinion issued April 22, the Pennsylvania high court affirmed an intermediate appeals court's ruling that Erie must defend the estate of policyholder Harold McCutcheon in a suit brought by Richard Carly, who was shot in the face when McCutcheon's gun went off during a struggle between the two men in September 2013. The incident took place after McCutcheon had fatally shot Terry McCutcheon, his ex-wife and Carly's girlfriend, and Harold McCutcheon killed himself after wounding Carly, according to court documents.

The majority concluded that, based on the way Carly characterized the struggle in his complaint, it is possible the gunfire that wounded Carly was an accidental occurrence for the purposes of coverage under McCutcheon's homeowner's and personal catastrophe policies with Erie, notwithstanding the preceding events. Notably, Carly alleged that McCutcheon "negligently, carelessly, and recklessly" discharged the gun.

"The allegations in the present complaint are not clear about McCutcheon's intentions with respect to Carly; taken as true, the allegations establish he intended to kill his ex-wife and himself, but not that he intended to shoot Carly," Justice Kevin M. Dougherty wrote for the majority. "More to the point, the complaint's allegations — when read in light of the guiding standards — establish at least a duty to defend the insured's estate, and that duty adheres until the claim is 'narrowed to one patently outside the policy coverage.'"