Opinion
Civil Action CV-18-530
08-28-2020
CONTINENTAL WESTERN INSURANCE COMPANY, Plaintiff, v. GEORGE BEAM, FEDERAL INSURANCE COMPANY, and FRANKEMNUTH MUTUAL INSURANCE COMPANY, Defendants.
ORDER ON DEFENDANT FRANKENMUTH MUTUAL INSURANCE COMPANY'S MOTION FOR SUMMARY JUDGMENT
MarvGay Kennedy, Justice Maine Superior Court.
Before the Court is Defendant Frankenmuth Mutual Insurance Company ("Frankenmuth's") Motion for Summary Judgment against Plaintiff Continental Western Insurance Company ("Continental'''')- For the following reasons, Frankenmuth's Motion is denied.
I. Summary Judgment Factual Record
The subject of this declaratory judgment action arises out of a separate personal injury action brought by George Beam ("Mr. Beam") against Auburn Plaza, Inc. ("Auburn Plaza"), George Beam v. Auburn Plaza, Inc., Docket No. CV-18-67, pending in the Androscoggin Country Superior Court. Mr. Beam's lawsuit (the "Underlying Action") seeks to recover damages for injuries he sustained on February 18, 2015, after falling through a skylight on the roof of the Auburn Mall. (Supp.'g S.M.F. ¶ 3.) Mr. Beam alleges that his injuries were caused by Auburn Plaza's negligent failure to remove snow that was concealing the skylight, and its failure to warn of, or otherwise mark the location of the skylight. (Supp.'g S.M.F. ¶ 5.)
Frankenmuth failed to attach as an exhibit Mr. Beam's underlying complaint against Auburn Plaza. Because Continental attached a copy to its Opposition, the Court will consider Frankenmuth's statements that cite to Mr. Beam's complaint.
Continental, in its Response to Frankenmuth's Statement of Material Facts, attempts to partially admit Paragraph 5. The Maine Rules of Civil Procedure prohibit such parsing. An admission must begin with the designation "'[a]dmitted'.. . and shall end with such designation." M.R. Civ. P. 56(h)(2). If a party does not expressly admit a fact, then the party must controvert it through a denial or a qualification. Stanley v. Hancock Cty. Comm'rs, 2004 ME 157, ¶ 18, 864 A.2d 169.
The accident occurred while Mr. Beam was on the roof servicing an HVAC unit for General Nutrition Corporation ("GNC"), a tenant of the Auburn Mall. (Supp.'g S.M.F. ¶ 7.) Pursuant to GNCs commercial lease with Auburn Plaza, GNC was contractually obligated to maintain the rooftop HVAC system that services the leased premises. (Add. S.M.F. ¶ 5.) Mr. Beam was an employee of Atlantic Conform Systems ("Atlantic"). (Supp.'g S.M.F. ¶ 6.) Facility Source, a maintenance services broker and one of Atlantic's customers, hired Atlantic to service GNCs HVAC system. (Supp.'g S.M.F. ¶¶ 8-10.) On the day of the accident, Mr. Beam was dispatched by Atlantic, and Atlantic billed Facility for the services Mr. Beam provided. (Supp.'g S.M.F. ¶¶ 11-12; Add. S.M.F. ¶ 2.) Atlantic had been servicing the GNC HVAC system at the Auburn Mall for several years preceding Mr. Beam's accident and the system is typically serviced four to six times a year. (Add. S.M.F. ¶¶ 7, 10.)
At the time of the accident, Auburn Plaza was insured by Continental under both a commercial general liability policy and an excess liability policy. (Supp.'g S.M.F. ¶ 15.) Continental is currently defending Auburn Plaza in the Underlying Action pursuant to its obligation as Auburn Plaza's insurer. (Supp.'g S.M.F. ¶ 16.) According to the terms of GNC's commercial lease with Auburn Plaza, any contractor GNC brings onto the leased premises must carry commercial general liability coverage with limits of $ 3, 000, 000 and the contractor must designate Auburn as an additional insured. (Add. S.M.F. ¶ 4.) Atlantic was insured under a comprehensive general liability policy issued by Frankenmuth (the "Frankenmuth Policy"). (Supp/g S.M.F. ¶ 17.)
Paragraphs 2, 15, 16 and 21 of Frankenmuth's Statement of Material Facts are not properly supported by references to the record considering the Court is not in receipt of Defendant's Request for Admission - the record to which these statements refer. See M.R. Civ. P. 56(e). In the absence of specific record references, the proffered facts are not properly before the court. Levine v. R.B.K. Caly Corp., 2001 ME 77, ¶ 9, 770 A.2d 653. The court is neither required nor permitted to independently search a record to find support for facts offered by a party. Id.
Frankenmuth did not reply to Continental's Additional Statement of Material Facts. Consequently, those Additional Statement of Material Facts that are properly supported by record references have been admitted. See M.R. Civ. P. 56(h)(4) ("Facts contained in a supporting or opposing statement of material facts, if supported by record citations as required by this rule, shall be deemed admitted unless properly controverted.").
If Facility required Atlantic to name a third party as an additional insured on its policy, Facility would provide the proper verbiage, and Atlantic would then ask its insurance agent to issue a renewal of the certificate of insurance. (Add. S.M.F. ¶ 11.) It is Atlantic's standard practice to arrange for its insurance agent to send certificates of insurance to the owner of the premises serviced by its technicians, and it had previously issued certificates designating Auburn Plaza as an "additional insured." (Supp.'g S.M.F. ¶ 19; Add. S.M.F. ¶ 10.) Mr. Beam would not have been permitted to access the roof without a certificate of insurance confirming that Auburn Plaza was named as an additional insured on Atlantic's policy with Frankenmuth. (Add. S.M.F. ¶ 6.)
A copy of the Certificate of Insurance from Atlantic's insurance agent and issued to Auburn Plaza has been provided and attached as Defendant's Exhibit E. (Supp.'g S.M.F. ¶ 20.) The additional insured's language on the 2015 Certificate of Insurance issued to Auburn Plaza would have been dictated by an earlier agreement between Atlantic and Facility. (Add. S.M.F. ¶ 14.)
Mr. Beam has been receiving workers' compensation benefits from Atlantic as a result of his injuries; in turn, Atlantic's workers compensation insurance has increased by 240%. (Supp.'g S.M.R ¶¶ 21-22.) This modification to Atlantic's insurance has disqualified it from bidding on certain jobs. (Supp.'g S.M.F. ¶ 23.)
Continental brought this action against Frarikenmuth, among others, seeking a declaratory judgment that Auburn Plaza is an "additional insured" under the Frankenmuth Policy, and that Frankenmuth is obligated to defend and indemnify Auburn Plaza in the Underlying Action. (Def/s Mot. Summ. J. 3.)
II. Standard of Review
A party is entitled to summary judgment when a review of the parties' statements of material facts and the record to which the statements refer demonstrate that there is no genuine issue as to any material fact in dispute, and that the moving party is entitled to judgment as a matter of law. Dyer v. Dep't of Transp., 2008 ME 106, ¶ 14, 951 A.2d 821; M.R. Civ. P. 56(c). A contested fact is "material" if it could potentially affect the outcome of the case. Id. A "genuine issue" of material fact exists if the claimed fact would require a factfinder to "choose between competing versions of the truth." Id. (quoting Farrington's Owners' Ass'n v. Conway Lake Resorts, Inc., 2005 ME 93, ¶ 9, 878 A.2d 504).
When deciding a motion for summary judgment, the court reviews the evidence in the light most favorable to the non-moving party. Id. The evidence offered in support of a genuine issue of material fact ""need not be persuasive at that stage, but the evidence must be sufficient to allow a fact-finder to make a factual determination without speculating." Estate of Smith v. Cumberland Cty., 2013 ME 13, ¶ 19, 60 A.3d 759.
III. Discussion
Whether an insurer has a duty to defend is a question of law. Harlot v. Arnica Mut. Ins. Co., 2016 ME 161, ¶ 7, 150 A.3d 793. In a typical coverage dispute, the Court compares the allegations in the underlying complaint with the coverage provided in the insurance policy. Id. ¶ 8. "The facts alleged in the [underlying] complaint need not make out a claim that specifically and unequivocally falls within the coverage. Rather, where the events giving rise to the complaint may be shown at trial to fall within the policy's coverage, an insurer must provide the policyholder with a defense." Mitchell v. Allstate Ins. Co., 2011 ME 133, ¶ 10, 36 A.3d 876 (quotation marks omitted) (citations omitted). Here, however, the threshold issue before the Court is whether Auburn Plaza qualified as an "additional insured" under the Frankenmuth Policy.
"[A]n insurer's duty to defend should be decided summarily and in favor of the insured if there exists any legal or factual basis, which could be developed at trial, that would obligate the insurer to pay under the policy." Mullen v. Daniels, 598 A.2d 451, 453 (Me. 1991) (quotations omitted) (citation omitted).
The dispute centers around Section II, of the Frankenmuth Policy, entitled "Who Is An Insured," which provides:
Who is an insured is amended to include as an additional insured any person or organization for whom you are performing operations when you and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy. But:
1. Such person or organization is an additional insured only with respect to liability for "bodily injury," "property damage" or "personal and advertising injury" caused, in whole or in party, by:
a. Your acts or omissions; or
b. The acts or omissions of those acting on your behalf; in the performance of "your work" for the additional insured; and
2. Such written contract or agreement must be:
a. Currently in effect or becoming effective during the term of this policy; and
b. Executed prior to the "bodily injury", "property damage", or "personal and advertising injury."(Def.'s Ex. D.) In its Motion, Frankenrnuth asserts that Auburn Plaza does not qualify as an additional insured because (1) Auburn Plaza and Atlantic never entered into a written contract with Auburn Plaza whereby Atlantic agreed that Auburn Plaza would be added as an additional insured; and (2) coverage for an additional insured is limited to injuries that were caused in whole or in part by the acts or omissions of the insured (Atlantic), or . persons acting on its behalf (Mr. Beam). (Def.'s Mot. Summ. J. 5.)
A. Written Contract or Agreement Requirement
With regards to the written contract requirement, the record contains evidence of a Certificate of Insurance issued by Frankenmuth, at Atlantic's request, naming Auburn Plaza as an additional insured. (Supp.'g S.M.F ¶ 20; see Def.'s Ex. E.) The Certificate of Insurance appears to have been in effect at the time of Mr. Beam's accident. The record demonstrates that Atlantic provided these certificates in the past, consistently designating Auburn Plaza as an additional insured under its policy. (Add. S.M.F.' ¶ 10; Pl.'s Opp'n to Def.'s Mot. Summ. J. 6.)
Continental denies Paragraph 14 of Frankenmuth's Statement of Material Facts that "Atlantic Comfort Systems has not had a contractual relationship with Auburn Plaza, Inc." by referencing the Certificate of Insurance. (Supp.'g S.M.F. ¶ 14; Opp. S.M.F ¶ 14.) There is no other evidence of a written agreement between the parties. Nonetheless, even if the Certificate of Insurance is insufficient to satisfy the written contract requirement, as Frankenmuth suggests, an additional insured's endorsement does not necessarily require privity between the party seeking additional insured status and the named insured. See Pro Con, Inc. v. Interstate Fire & Casualty Co., 794 F.Supp.2d 242, 250-53 (D. Me. 2011). In Pro Con, Inc., the United States District Court for the District of Maine held that a written contact between the insured party and its subcontractor requiring that another party be named as an additional insured satisfies the written contract requirement. Id. Similarly, the facts presented here demonstrate that either a contract between Atlantic and Facility, or between Atlantic and GNC, existed requiring that Atlantic name Auburn Plaza as an additional insured. (Add. S.M.F. ¶¶ 4, 6, 8-11, 13.) The evidence suggests that GNC's was contractually obligated to name Auburn as an additional insured on any contractor policy; its lease provided that "[a]ll policies evidencing Tenant's Insurance shall specify Tenant, Landlord ... as additional insureds." (Pl.s Opp'n to Def.'s Mot. Summ. J. 5.) Furthermore, Atlantic's CEO, Mark Tuller, testified that Mr. Beam would not have been allowed to access the roof without a certificate of insurance confirming that Auburn Plaza was an additional insured under its policy. (Add. S.M.F. ¶ 6.)
The court emphasized that the policy did not say "under written contract with such additional insured" or "with you" or "with each other" Rather, as in this case, the policy stated "[a]ny person or organization for whom you are performing operations when you and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy." Pro Con Inc., 794 F.Supp.at25l.
Thus, viewing the evidence in the light most favorable to the nonmoving party, the Court concludes that that there exists a genuine dispute as to whether the written contract or agreement requirement is satisfied.
B. Scope of Coverage
Frankenmuth next argues that regardless of whether the written contract or agreement requirement is satisfied, coverage only extends to liability for bodily injuries "caused, in whole or in part" by Atlantic's or Mr. Beam's acts or omissions in the performance of its work for the additional insured. (Mot Summ. J. 7-8.) Frankenmuth references Mr. Beam's Complaint, which alleges that his injuries were caused solely by Auburn Plaza's negligence. (Supp.'g S.M.F. ¶ 5.) In Continental's reply, it asserts that, despite the allegations in the Underlying Action, it may be established at trial that Mr. Beam and/or Atlantic were comparatively at fault. (Pl.'s Opp'n to Def.'s Mot. Summ. J. 10.)
In interpreting similar "in whole or in part" policy language, the United States District Court for the District of Maine held that coverage for additional insureds can extend to injuries "attributable in part to acts or omissions by both the named insured and the additional insured." Pro Con, 794 F.Supp.2d at 256 (emphasis in original). In Pro Con, Inc., the policy language at issue involved an additional insured clause limiting liability to claims "caused, in whole or in part" by the insured's own acts or omissions. Id. at 254. In that case, an employee of the named insured was working at a jobsite when he slipped and fell. Id. at 257. In the underlying action, he alleged that Pro Con - the general contractor named as an additional insured - was negligent in maintaining the premises in a safe condition. Id. The court held, however, that "there also is certainly the potential that facts might be developed at trial that would result in the fact finder determining that [the plaintiffs] injuries were caused, at least in part by, the acts or omissions of [the named insured] (or its agents)...." Id. Likewise, Continental contends that it may be established at trial that the accident was at least in part attributable to Mr. Beam's or Atlantic's own negligence, for example, by failing to investigate the presence of skylights on a roof that Atlantic had serviced in the past. (Pl.'s Opp'n to Def.'s Mot. Summ. J. 10.) In light of the requirement that insurance policies be read against the insurer, and "[a]ny ambiguity must be resolved in favor of a duty to defend," Mass Bay Ins. Co. v. Ferraiolo Constr. Co., 584 A.2d 608, 609 (Me. 1990), the inference that Mr. Beam was at least in part at fault for causing his own. injuries is sufficient to raise a genuine issue of material fact as to whether Frankenmuth's policy extends to Auburn Plaza.
Viewing the evidence in the light most favorable to the nonmoving party, the Court concludes that there exists a genuine dispute as to whether Auburn Plaza falls within the scope of Frankenmuth's additional insured endorsement.
IV. Conclusion
For the foregoing reasons, Defendant Frankeninuth Mutual Insurance Company's motion for summary judgment is DENIED.
The Clerk is directed to incorporate this Order into the docket by reference pursuant to Maine Rule of Civil Procedure 79(a).