United States Fidelity & Guaranty Co. v. Rae Volunteer Fire Co.

United States Fidelity and Guaranty Company (USF&G) sought a declaratory judgment in the Gallatin County District Court as to its obligations under a liability insurance policy issued by USF&G to Rae Volunteer Fire Company (Rae), a nonprofit corporation. Rae halted firefighting efforts upon determining that Harry Petroff and Rosalie Petroff (Petroffs), residential dwelling owners, were not members of Rae, and the Petroff home burned to the ground. The District Court held that the decision to cease firefighting was not an occurrence or an accident within the meaning of the policy, because the…