While a duty to defend claims of malicious prosecution may be subject to exclusion, special limits, or a combination of the two by virtue of the language of a particular insurance policy, it is often difficult to determine when the cause of action accrued for purposes of identifying the operative policy period to analyze any such duty and determine whether a particular policy might be in play. In Zook v. Arch Specialty Ins., 2016 WL 1164257, Ga. Ct. App. March 25, 2016, the Georgia Court of Appeals analyzed this issue and found that the operative timeframe for identifying when the cause of action accrues for purposes of both evaluating a statute of limitations defense and a defense that a particular policy is not in play due to misapplication of a policy period is the time “when the legal machinery of the prosecution is set in motion.”
So does this mean that we are to look to the time when suit is filed? Or is it when the underlying act upon which the prosecution is based the appropriate trigger for time-sensitive inquiries such as the statute of limitations or determining which policy period is in play is the correct analysis? What about when the charges are brought? With nothing more to guide our analysis, a case could be made for any of these triggers as being operative. However, the Court answered such questions in Zook. In this case, the Court of Appeals gives us a bright line approach to be applied when analyzing coverage for malicious prosecution claims against an insured. While some policies may specifically address the issue, and in that case the parties would be bound to the plain terms therein, others may not be so explicit, and in any case you must know what policy period you are dealing with to determine which policy’s language controls. In that event, the Zook case instructs that we must evaluate the facts and ascertain when the prosecution was first conceived against an insured as the pivotal time for determining the correct policy period (and presumably the statute of limitations).
In Zook, the underlying basis for the insured, Zook, to be prosecuted by the State was surrounding a physical altercation he was involved in one night. Zook was, on that evening, arrested for disorderly conduct. Later, a charge was added for battery. The Court found that the original prosecution – the date on which the charges for disorderly conduct were brought – was the operative date, even though the malicious prosecution action was based upon a theory that the later battery charge was maliciously prosecuted. Therefore, it seems that the Court of Appeals is telling litigants to look to the date when the first action was taken by the prosecuting entity who is alleged to be liable for malicious prosecution, regardless of whether that action was taken in furtherance of the prosecution that is being scrutinized by the accused’s civil complaint. Simply put, based upon the Zook case, in Georgia the operative time for purposes of establishing when the cause of action accrued is the date when a charge of any type is brought against an accused who is now asserting the claim of malicious prosecution against an insured litigant. Presumably, if the criminal conduct giving rise to the claim is central to the conduct giving rise to the alleged maliciously prosecuted action, the framing of the charges as one violation or another is of no consequence after Zook.
Douglas R. Kendrick