Opinion
FSTCV136017134S
12-29-2015
Ricardo Soria v. Marc Necatera
UNPUBLISHED OPINION
MEMORANDUM OF DECISION RE MOTION FOR SUMMARY JUDGMENT (#162.00)
Kenneth B. Povodator, J.
Nature of the Proceeding
This is a lawsuit arising from a denied insurance claim. The plaintiffs have sued two insurance companies and other individuals/agencies involved in the issuance of the subject insurance policy (policies) and the processing of the claim which forms the basis for this proceeding.
Currently before the court is a motion for summary judgment filed by the defendant Mount Vernon Insurance Company. This defendant is moving for summary judgment with respect to the breach of contract claim directed to it (seventh count), based on the premise that there is no real issue of fact but that the insurance claim submitted by the plaintiffs was not a covered claim, in turn based on a number of exclusions that are claimed to be applicable. The defendant also is moving for summary judgment with respect to the claim that the policy contained (or was?) a false representation (ninth count), to the extent that it purported to provide coverage for janitorial services but did not cover this claim, arguing that there was no false representation.
Both sides submitted memoranda and affidavits, and argument was heard by the court on September 21, 2015.
The defendant also filed a motion to strike the affidavit that had been submitted on behalf of the plaintiffs (#172.00), claiming that the affidavit contained materials that were not within the personal knowledge of the affiant. The court explained that it would review the affidavit as it does all affidavits submitted in support of, or in opposition to, summary judgment motions, identifying competent evidence and disregarding incompetent evidence.
Facts/Claims
The court does not believe it to be necessary to set forth the appropriate (well-established) standard for summary judgment in great detail. The burden is on the moving party to establish the absence of any material issue of fact and that based on the undisputed material facts, the moving party is entitled to judgment in its favor.
In particular, with respect to the breach of contract/policy claim asserted in the seventh count, the defendant claims that " coverage is barred by the Policy exclusion for property damage to personal property in the care, custody or control of the insured; coverage is barred by the Policy exclusion for property damage to that particular part of any property that must be restored, repaired or replaced because the insureds' work was incorrectly performed on it; coverage is barred by the contractual liability exclusion; coverage is barred by the 'Damage To Your Work' provisions of Policy Exclusion 2(l), and coverage is barred because the plaintiffs breached the voluntary payment provisions of the Policy."
With respect to the negligent misrepresentation claims in the ninth count, the defendant contends that it is fatal to the claim that the plaintiffs did not communicate with Mount Vernon prior to the date of the claimed loss and had never even heard of Mount Vernon until the underlying claim was denied. Further, the defendant argues that the acknowledgment that the plaintiffs had never even reviewed the policy until three years after the loss precludes any claim of reliance on representations made in the policy.
The plaintiffs have filed an objection to the motion (#169.00), arguing that " [t]his is a simple case of an insurance company denying a valid claim for a janitorial services accident" that was, or was supposed to be, covered by the policy issued to the plaintiffs.
The essential facts are not in substantial dispute (except as identified below). Plaintiff Ricardo Soria is the owner of plaintiff Ace Green, a janitorial/maintenance company. Plaintiffs claim that they paid $2, 479.36 for a general commercial liability insurance policy entitled " Janitorial Services" for the policy period February 1, 2011 through February 1, 2012, procured from Mount Vernon.
On February 18, 2011, Ace Green's employees cleaned commercial " wall-to-wall" carpets . . . at The Willett Companies' building in Greenwich, CT. The carpet ultimately shrank and the landlord demanded payment to replace the carpet . . .
Ricardo Soria was forced to pay for the cost to replace the carpet when the landlord threatened the withholding of payments on three other buildings if Plaintiff did not comply. Ricardo Soria paid the landlord's demand under [claimed] duress and made a claim to Mount Vernon for coverage. Mount Vernon . . . denied the claim citing several policy exclusions. As a result of the denial, Plaintiffs incurred . . . costs and damages including, but not limited to: the cost to replace the carpet, attorneys fees and costs, interest on the loan to pay for the carpet and so on. Ace Green [claims that it] was forced to [cease] operations as a result of the losses. This suit followed. (pp. 1-2 of #169.00.)
The plaintiffs claim that the payment was made under duress. For purposes of this motion, the court accepts that characterization, but see Noble v. White, 66 Conn.App. 54, 59, 783 A.2d 1145 (2001), holding that duress is not financial pressure if claim had been made in good faith, i.e., duress requires that claim had been made " without any reasonable basis."
There does not appear to be any dispute concerning the core facts underlying the claim that was rejected, i.e. Ace Green cleaned the carpets, the owner complained of damage caused by the cleaning, the plaintiffs submitted a claim to the defendant, the defendant denied the claim, and the plaintiffs paid to replace the carpets and are now seeking reimbursement and other damages. The characterization and significance of some of these acts and facts, however, are very much in dispute.
Discussion
The court will discuss the issues in the order presented in the defendant's motion. As a preliminary matter, the court notes that each claimed basis for summary judgment must be evaluated independently, since each provision of the policy is claimed to be an independent basis for the granting of summary judgment.
I. Personal Property Damage Exclusion
The policy issued by the defendant Mount Vernon contains an exclusion applicable to damage to personal property. The threshold for applicability of the personal property damage exclusion, as something of a tautology, is that the claim at issue must be for damage to personal property. The carpet in question was attached to the floor, but the defendant necessarily claims/assumes that the carpet was personal property rather than part of the realty (a fixture), in order to invoke the claimed exception.
Whether something is a fixture or personal property is generally a matter of intent on the part of the party who affixed the property to the realty, considered in the context of the surrounding circumstances (including the extent to which the property may be severed from the realty and the extent to which it can be adapted to other uses). Waterbury Petroleum Products, Inc. v. Canaan Oil & Fuel Co., Inc., 193 Conn. 208, 215-17, 477 A.2d 988 (1984) (20, 000-gallon tanks determined to be personalty under the circumstances). Here, there is no evidence as to anyone's intent relating to the carpet.
The defendant does not spend any time explaining why the court should treat the carpet, affixed to the floor, as personal property as a matter of law, rather than as involving a material factual issue; instead, it assumes it to be true. That is insufficient to establish applicability of the invoked exception, to the requisite standard of proof--to any standard of proof. Accordingly, the court need not quote or discuss the exception in detail; the failure to establish the prerequisite to application of a personal property exclusion (that the property was personal property) requires the court to deny the motion in this respect.
For example, in McCants v. State Farm Fire & Casualty Co., 157 Conn.App. 509, 513-14, 116 A.3d 844 (2015), wall-to-wall carpeting was identified as part of the realty in the policy itself .
II. Exclusion for Damage to that Particular Part of any Property that must be Restored, Repaired or Replaced Because the Insureds' Work was Incorrectly Performed
The policy contains the following exclusion:
This insurance does not apply to:
* * *
j. Damage to Property
* * *
(6) that particular part of any property that must be restored, repaired or replaced because " your work" was incorrectly performed on it.
" Your work" in turn is defined as including " work or operations performed by you or on your behalf."
The court believes that the counterstatement of the issue, as set forth in the plaintiffs' memorandum in opposition to the motion, demonstrates a fundamental and recurring problem with the position articulated by the plaintiffs in their claims directed to this defendant, and their opposition to this motion. The plaintiffs state: " There is a genuine issue of material fact where defendant has failed to provide any evidence whatsoever that plaintiffs' work was incorrectly performed on February 18, 2011 to support the insurance policy exclusion." The problem with that statement is that it misconstrues the nature of liability insurance, starting with the broad duty to defend. Coverage is not determined by a retroactive analysis of whether a claim/occurrence truly involved negligence or otherwise actually comes within the scope of financial protection afforded by the policy; it starts with a determination of whether the allegations of wrongdoing asserted against the insured come within the scope of coverage. Indeed, there is a body of law establishing that an insurer's duty to defend is triggered by the allegations of a complaint and whether those allegations come within the scope of coverage--whether or not the allegations are supported by the actual facts. See, Missionaries of the Co. of Mary, Inc. v. Aetna Casualty & Surety Co., 155 Conn. 104, 113, 230 A.2d 21 (1967), cited recently for this proposition in Travelers Casualty and Surety Co. of America v. The Netherlands Insurance Co., 312 Conn. 714, 740, 95 A.3d 1031 (2014).
To frame the issue in an inverse or obverse manner: are the plaintiffs contending that the insurance company is required to make payments to third-party claimants under a liability policy when the insured has done nothing wrong (as is claimed by plaintiffs to be the case here)? On what basis? Do the plaintiffs understand that that is the nature of their position--that the carrier is obligated to pay a claimant such as Willett for damages to the claimant's property specifically when the plaintiffs (the insureds) have done absolutely nothing wrong? Are the plaintiffs claiming that the coverage somehow is more expansive when there is no negligence than when there is negligence? Are the plaintiffs suggesting that they eventually paid a claim that did not, at least implicitly, assert that the plaintiffs had done something wrong in cleaning the carpet? Are they suggesting that the policy obtained from Mount Vernon was some variation on a " no-fault" policy where any and all claims were required to be paid, without regard to assertions of fault by the insured (and eventual ability to prove fault)? Putting aside, for the moment, the broader scope of a duty to defend, the plaintiffs seem to be implying that the policy-based exclusion doesn't apply because the incident does not satisfy a prerequisite for coverage in the first place.
It is well established that an insurer's duty, and liability resulting from a failure to honor that duty, are determined by the existence of a potential (asserted) liability, rather than proof of liability, Capstone Building Corp. v. American Motorists Ins. Co., 308 Conn. 760, 808, 67 A.3d 961 (2013). Conversely, absent a claim alleging a potential liability (as asserted by a claimant), there is nothing to defend or indemnify. Simplistically, one does not procure insurance to protect only against spurious claims but to protect against all claims of legal responsibility, those that are meritorious and those that are completely defensible (and everything in between).
Capstone is further instructive as the analysis in that case begins with the proposition that the insurer generally is not liable under a typical liability policy for the direct conduct of the insured with respect to causing damage by its work, with the relevant issue being whether consequential damage to other portions of the property, not part of the insured contractor's work, might be subject to coverage. Here, there is no dispute--the claim is that the plaintiffs' crew cleaned certain carpets, that the carpets subsequently were found to have shrunk, that the owner claimed it was the fault of the plaintiffs, and that the plaintiffs subsequently paid what the owner/landlord claimed was necessary to correct the (alleged) effects of plaintiffs' workers' claimed improper work on the carpet. Either the owner claimed that there was a legal liability of the plaintiffs based on the work that had been done by the plaintiffs' employees, in which case there was an occurrence which in turn was subject to the identified exclusion, or the owner was claiming that the plaintiffs should pay for repairs despite the absence of any legal liability or claimed improper work (that might lead to legal liability), in which case there was no occurrence that would invoke the policy at all.
As discussed below, Capstone is essentially controlling with respect to another, somewhat related, exclusion.
The opening language of the first section of the policy, stating the basic premise for coverage, starts with the following: " We will pay those sums that the insured becomes legally obligated to pay as damages because of . . .'property damage' to which this insurance applies."
Returning to the exclusion being invoked, the plaintiffs' proffered interpretation of the policy would result in an insurer being a guarantor of the plaintiffs' work--perhaps subject to characterization as strict liability since the plaintiffs' argument seems to attempt to remove any implicit or explicit requirement of fault. That is not the intent of the policy and not the proper scope of the exception cited by the defendant.
The defendant has established the applicability of this exclusion to this situation, and the motion is granted in this regard.
III. Contractual liability exclusion
The defendant also relies on an exclusion for contractually-assumed liability:
This insurance does not apply to:
* * *
b. Contractual Liability
" Bodily injury" or " property damage" for which the insured is obligated to pay damages by reason of the assumption of liability in a contract or agreement . . .
To the extent that the position taken by the defendant is based on, and largely tracks, the position articulated in the denial letter attached to the defendant's submission, the relevant portion of that denial letter is a useful starting point.
Contractual Insurance coverage under this policy is limited to the definition of an Insured Contract, referenced on page two (2) of this letter above (and contained in the policy). This policy does not provide insurance coverage for injury or damage you (Ace Green) are obligated to pay by reason of the assumption of liability in a contract, subcontract, or agreement, unless the contract, subcontract or agreement is an Insured Contract.
To the extent you (Ace Green) entered into a cleaning or janitorial services contract or subcontract with Will Green, Will Green, LLC, Willett Company, LLC, and/or any other person or company, be advised that at cleaning or janitorial services contract or subcontract is not an insured contract as defined by the policy.
Consequently, to the extent you (Ace Green) are required to pay for or replace the subject carpet pursuant to any indemnity or hold harmless language, contained within any cleaning or janitorial services contract or subcontract with or for Will Green, Will Green LLC, Willett Company, LLC, and/or any other person or company, be advised that Policy Exclusion B., The Contractual Liability Exclusion, referenced above, also applies to exclude insurance coverage for this claim, under this policy." (Attachment B to Exhibit 3 of #169.00 (affidavit of Richard Sutton); emphasis added.)
The position of the defendant may be correct, as a matter of contract law, " to the extent" that the plaintiffs are relying on contractual liability that has been assumed. The concern about assumed contractual liability, however, is primarily centered on " new" liabilities such as, if not especially, assuming a liability to indemnify a contractual partner with respect to third-party claims. (" The logic and rationale underlying our indemnity case law are based on the premise that an action for indemnification is one in which one party seeks reimbursement from another party for losses incurred in connection with the first party's liability to a third party." Amoco Oil Co. v. Liberty Auto and Elec. Co., 262 Conn. 142, 148, 810 A.2d 259 (2002).) Such a risk is not reasonably within the scope of a general liability policy, so it is hardly surprising that an effort be made to circumscribe such open-ended potential liability.
Although perhaps technically coming within the scope of that same provision, there is less, if no, need for concern with respect to potential liability arising from direct interactions with the contracting partner itself, and especially any harm/damages that might be inflicted upon the contracting party by the insured. That is because the liability of the insured to the contracting party likely would exist regardless of the existence of a contractual obligation to indemnify. That alternate basis for liability, however, would mean that the contractual liability exclusion does not necessarily apply (in the sense of entitling the defendant to judgment). The existence of two independent routes to liability means that negating one does not entitle the defendant, as moving party, to summary judgment. In a somewhat simplistic restatement: negation of coverage for a claim predicated on the plaintiffs' contractual liability to their customer cannot be dispositive when there may be tort-based liability of the plaintiffs to that same customer that is not so precluded.
In one of the cases relied upon by the defendant (Gilbert Texas Construction, L.P. v. Underwriters at Lloyd's London, 327 S.W.3d 118 (Tex. 2010)), the policy excerpt quoted explicitly (if perhaps redundantly) states that such an exclusion does not apply when there is also a non-contractual basis for liability. See discussion at pp. 21-23 of the defendant's brief.
This exclusion, then, would only be applicable if the claim being asserted against the plaintiffs by the landlord/owner (Willett) was solely based on the existence of a contractual right of indemnification (or hold harmless agreement or other analogous contract provision). Although the plaintiffs perhaps unintentionally have adopted a self-defeating posture by insisting that nothing wrong was done with respect to the cleaning of the carpets, the court is unaware of anything indicating, conclusively, that the claim made against the plaintiffs for repair/replacement was based solely on a contractual provision as opposed to involving some level of blame/fault (negligence). There is nothing in the complaint asserting claimed contractually-based liability of the plaintiffs for which the defendant has a responsibility to reimburse.
" To satisfy [its] burden the movant must make a showing that it is quite clear what the truth is . . ." Ferri v. Powell-Ferri, 317 Conn. 223, 228, 116 A.3d 297 (2015), and the defendant has not made such a clear showing that the claim is based only on assumed contractual obligations. The court cannot grant summary judgment " to the extent" that a single count is (or may be) based partly on contractually assumed obligations while leaving the " balance" of the count in place. The defendant has not negated the existence of a potential for liability independent of any contractually-assumed liability, i.e., tort liability.
The defendant has failed to establish that the cited exclusion has any applicability here, and that the plaintiffs are relying on contractual liability as opposed to tort liability arising from a contractual relationship, i.e. the prototypical and simple notion of negligent damage to the property of another.
The court notes the existence of an admitted oral agreement between the owner (Willett) and the plaintiffs, whereby the plaintiffs accepted/assumed liability. That appears to be an agreement reached after this incident and essentially is nothing but a reformulation of the plaintiffs' agreement to pay for this loss in order to attempt to keep the owner's business. As discussed elsewhere, that agreement does not appear to have been finalized until after the defendant denied this claim, and the consequences of the denial are also discussed elsewhere.
In terms of logical analysis, the contractual liability exclusion is not a sufficient condition to allow judgment to be entered, by itself--it also would be necessary to negate negligence-based coverage. Negating a provision that does not appear to be invoked, much less relied upon, does not entitle the defendant to judgment.
IV. The " Damage To Your Work" provisions of Policy Exclusion 2(1)
Citing Capstone, supra, the defendant also relies upon an exclusion for damage to " your work":
I. Damage To Your Work
" Property damage" to " your work" arising out of it or any part of it and included in the " products-completed operations hazard."
This exclusion does not apply if the damaged work or the work out of which the damage arises was performed on your behalf by a subcontractor.
In the context of this case, the exclusion substantially overlaps the exclusion for damage to that particular part of any property that must be restored, repaired or replaced because the insureds' work was incorrectly performed, already discussed. Both exclusions focus on preventing an insured from making a claim that is directly or indirectly based on the manner in which it performed services for a customer. From differing perspectives, they seek to avoid putting the insurer in the position of a quasi-guarantor of the work being done by the insured.
The final sentence of the discussion in Capstone, supra, addressing a virtually-identical provision, says it all: " Property damage resulting from the plaintiffs' own faulty work, however, is precluded from coverage by the 'your work' exclusion." 308 Conn. at 790. Again, the fact that the plaintiffs deny any wrongdoing misses the point; the issue is whether there is a claim that the plaintiffs did something wrong, for without a claim of negligence, there would be nothing that might even trigger an obligation for the carrier to respond. Again, the policy intends to prevent the insurer from being put in the position of being a guarantor of the work performed by the plaintiffs.
This aspect of the motion for summary judgment is granted.
V. Voluntary Payment Provision
The defendant next relies on a condition set forth in the insurance policy relating to voluntary payments:
SECTION IV--COMMERCIAL GENERAL LIABILITY CONDITIONS
2. Duties In The Event Of Occurrence, Offense
* * *
Claim Or Suit
* * *
d. No insured will, except at that insured's own cost, voluntarily make a payment, assume any obligation, or incur any expense, other than for the first aid, without our consent.
The defendant insurer contends that the violation of this provision, based on the assertion in the complaint and elsewhere on the record that the plaintiffs paid the owner of the carpet for the claimed damage, excuses any responsibility on the part of the carrier for any expenses incurred, or payments made, by plaintiffs.
The court must immediately note that there is no explicit provision cited from the policy, indicating that the " penalty" for a violation of this provision is a denial of coverage. Related, this issue differs from the previous claims of the defendant which pertained to the extent and limitations of coverage provided--this provision is directed to the conduct of the insured when there is an otherwise-covered claim, whereas the previously discussed provisions addressed the question of whether the claim was covered.
Although the defendant does refer to a number of cases seemingly indicating that a denial of responsibility to reimburse for payments made is an often-recognized consequence, citing Interface Flooring Systems, Inc. v. Aetna Casualty & Surety Co., 261 Conn. 601, 804 A.2d 201 (2002) (applying Georgia law and noting that the issue presented would be one of first impression in Connecticut (261 Conn. at 611)), the issue is somewhat more nuanced than is presented in the defendant's motion and supporting documentation. The issue in Interface and related cases is the liability of an insurer for pre-tender expenses incurred by the insured. Many of the cases explicitly link notice to the carrier and the payment (although the Connecticut Supreme Court took pains to note that the issue in Interface wasn't actually a notice-based issue (" The law of notice, however, is irrelevant to the substantive issue in this appeal, " 261 Conn. at 611)). Thus, the Supreme Court's discussion of other cases, including a discussion of Elan Pharmaceutical Research Corp. v. Employers Insurance of Wassau, 144 F.3d 1372 (11th Cir. 1998), recognized a distinction between expenses incurred prior to tender of the defense (notice of the claim) and expenses that were incurred after the tender.
Note that in general, and in the context of a situation such as the present one, any other analysis would be nonsensical. Is the defendant suggesting that the court should accept the circular or bootstrap argument that if an insured pays a claim after the carrier denies coverage for the claim, that that payment itself justifies the carrier's denial of the claim (or provides a new justification for denial)?
This is not a hypothetical exercise. The court notes that the emails attached to #163.00 indicate that the plaintiff already had been advised of a denial of the claim by March 11, 2011, but the payment for the replacement carpet was not made until after March 14, 2011 (an email of that date indicating that the bill would be paid after installation). See, also, page 34 of the plaintiffs' brief, referring to an attached denial letter dated March 3, 2011. The " voluntary" payment, then, was made after the carrier had denied the claim, and once a denial had been issued, the situation has changed materially. Although it is beyond the scope of this motion, there is a question as to whether the claimed provision can even possibly apply in a post-denial time frame.
In their opposition (#170.00 at page 33), the plaintiffs discuss evidence indicating that notice had been given to the insurer on or about February 23, 2011.
The pdf viewing function of the court's computer reports that #163.00 consists of 489 pages, and only the first 36 (the brief itself) are consecutively numbered. The computer indicates that the emails of March 11, 2011 and March 14, 2011 are at pages 396-97 of the overall document.
There may well be an issue as to whether a commitment to pay, prior to tender or denial, might be the equivalent of a payment--but there is no claim to that effect and no evidentiary record that would allow a summary judgment-level determination. There might be a claim that an internal " appeal" procedure, seeking a review by the carrier of its initial denial, might have a bearing, but again, there is no argument and no evidence.
Once there is a total denial of the claim (duty to defend and indemnify), and assuming that the denial were otherwise wrongful (as has been claimed by the plaintiffs), the plaintiffs would have a valid and viable claim against the carrier for the amount of any reasonable settlement, Missionaries of the Company of Mary, Inc. v. The Aetna Casualty and Surety Company . 155 Conn. 104, 230 A.2d 21 (1967). (There might well be an obligation to try to settle, in order to mitigate damages.) Again, the voluntary payment provision necessarily loses essentially all of its potential applicability, once the claim has been denied. The defendant has not addressed the timing-related issues and how they implicate the attempted invocation of this provision.
The court again notes that the plaintiffs' continued insistence that nothing negligent or otherwise blameworthy occurred is at odds with the claim for reimbursement of the money paid to the owner for the damage to the carpet (100% of the claim). If there was nothing wrong in the work performed, and the plaintiffs made the payment solely to keep the customer happy, the plaintiffs have negated the basis on which there might be a responsibility for the insurer to reimburse them. The policy provides for protection from fault-based claims, not for protection of customer relations and not as a form of no-fault coverage.
" To satisfy [its] burden the movant must make a showing that it is quite clear what the truth is . . ." Ferri, supra . Not only is it not clear " what the truth is" with respect to asserting the existence of a claimed voluntary payment within the meaning of the policy language, but there is every indication that the actual payment was made after the claim had been denied, suggesting that such an argument tends towards implausibility. Under these circumstances, this aspect of the motion is denied.
VI. Misrepresentation
Finally, the defendant insurer challenges the claim of misrepresentation, claiming that there had been no direct contact/communications between the plaintiffs and Mount Vernon prior to the issuance of the policy or at any time prior to this claimed loss, and that the plaintiffs had not even read the policy prior to the loss, such that there were neither misrepresentations nor any possible reliance. Plaintiffs' response is that it relied upon the policy as being one that covered " janitorial services" and correctly notes that misrepresentation does not require direct communication to be actionable.
There is much discussion by the plaintiffs ostensibly relating to the scope of misrepresentations made by the defendant, but the reality is that the plaintiffs rely effectively- solely on the characterization of the policy as one intended for a janitorial services business, without regard to the substance or actual contents of the policy. Although the plaintiffs state that " the misrepresentations are contained in the policy itself" (#170.00 at p.35), there is no indication or identification of any misrepresentations " in the policy itself." Rather, the focus is on the characterization of the policy as one covering janitorial services and other non-specific claimed flaws in representations.
" Since Plaintiffs relied on the statements made by Defendant in its policy, including the representation that the policy was for 'Janitorial Services, ' and have suffered damages as a result, Defendant Mount Vernon is liable for negligent misrepresentation."
Thus, after the above statement, there is a recitation of the process by which the coverage was obtained from the broker/agent (id. at p.37-39). After that narrative, the argument of the plaintiffs continues:
Having received the information provided by Plaintiffs including payment, Defendant Mount Vernon provided the policy at issue in this case. Mount Vernon misrepresented that the entire policy provided the necessary coverage for a " Janitorial Service" business like Ace Green. Specifically, on the 'POLICY DECLARATIONS' page, Mount Vernon states " BUSINESS DESCRIPTION: Janitorial Service." See Exhibit 3, Policy Excerpts. On the next page entitled " COMMERCIAL GENERAL LIABILITY COVERAGE PART DECLARATIONS" Defendant Mount Vernon represents, in the " PREMIUM COMPUTATION" section:
Janitorial Services-Commercial Cleaning;
Including Mercantile (full-time worker).
See Exhibit 3, Policy Excerpts.
These were clear misrepresentations as Defendant Mount Vernon has claimed Plaintiff's cleaning of carpets at Willett on February 18, 2011 are excluded from coverage. There is no dispute Plaintiffs were engaging in " Janitorial Services" on that date. Further, there is no dispute the claim at issue arose from Plaintiff's completion of " Janitorial Services."
* * *
Next, Plaintiffs reasonably relied on the representations contained in the policy. See, Exhibit 1 Affidavit of Ricardo Soria, ¶ 7 (September 1, 2015). Plaintiff Ricardo Soria relied on the representations of Mount Vernon that the policy covered the business acts of Ace Green. Id. Ace Green relied on the representations that the policy covered " Janitorial Services" including the cleaning of carpets. Id. Indeed, this information was specifically given to Mount Vernon by Plaintiff's insurance agent, Defendant Marc Necatera.
The court has quoted the arguments of the plaintiffs at great length, to demonstrate that there is no reference to any of the specific provisions of the policy itself and especially, no claim that anything in the contents of the policy constitutes a misrepresentation. Rather, it is the characterization of the policy itself, and more narrowly, the representation that the policy covered a business engaged in janitorial services. Distilling the plaintiffs' claims to their essence, the problem is that the plaintiffs may have had expectations--reasonable or otherwise--as to what would be contained in a policy for janitorial services, but to quote an overused tautology that usually is only a form of verbal resignation but aptly summarizes the situation here: " it is what it is." The policy contains language relating to coverage, conditions, exclusions, etc. and there is no identified provision that is " false" or makes some other statement (in the policy or otherwise) " false" or somehow puts the lie to the characterization of the policy as one for janitorial services.
It is at this point that the observations by the defendant that the plaintiffs never communicated with the carrier directly prior to issuance of the policy, and never read the policy prior to making their claim, take on some modest significance. More accurately, it is the counterpart to those " nevers" that is of some limited significance--the plaintiffs dealt through an insurance broker/agent and the applicable insurance agency, and any specific needs or expectations would have been communicated on that local level. Even so, there is no claim in response to this motion that the agent/agency had been made aware of any specific expectations or needs. Instead, there are claims that if the plaintiffs had known of the existence of some of these provisions, they would not have purchased the coverage.
The court notes the existence of a contractual obligation to have the property owner/landlord named as an additional insured. More generally, there was a requirement that liability insurance be procured. If the plaintiffs had not obtained this policy, then some other policy would have been required.
Quite simply, the court does not believe that a broad generalization about the nature of coverage provided by an insurance policy, based solely on its designation as one for janitorial services, can form the basis for a claim of misrepresentation (as long as there is at least some level of described coverage being provided). If there were evidence of a representation having been made that coverage existed for a situation that is actually excluded, that might well support a claim of misrepresentation, but the plaintiffs do not make any such claim.
Conversely, that the plaintiffs never read the policy and do not point to any specific provisions in the policy emphasize the appropriateness of this characterization and approach. The existence of overlapping provisions that negate coverage for this situation--without any identified misrepresentations as to details of coverage--seemingly precludes any claim that the actual contents of the policy are somehow misleading (and again, there is no claim of such a nature).
The court is compelled to reject the contention that a policy identified as one intended for janitorial services businesses, constitutes a false statement of facts (actionable misrepresentation) by virtue of the presence of recited limitations, exclusions and conditions. Every policy contains limitations, exclusions and conditions. A personal motor vehicle insurance policy contains numerous exclusions and limitations (and may omit optional coverages not requested or explicitly waived), but the applicability of an identified exclusion does not (would not) render the policy inherently deceptive or misleading (or constitute a misrepresentation).
That a policy does not satisfy expectations, even if reasonable, does not change the situation, and here that situation is accentuated by the corollary of the assertion of no contact between the carrier and the plaintiffs--the existence of the insurance broker as intermediary. As recited in the complaint, it was the broker who obtained the coverage for the plaintiffs from the defendant insurer. While it is at least possible that the broker may have known, or had a sense of, the plaintiffs' expectations for coverage, there is no evidence, or even claim, that the carrier was made aware of the expectations of the plaintiffs.
Returning to core principles, misrepresentation generally requires a misstatement of a present fact. A claim of misrepresentation can encompass a statement concerning conduct to be performed in the future, but only if the statement is false at the time it was made. Identifying the policy as one for a business providing janitorial services does not constitute a substantive-factual representation--express or implied--that coverage will be provided for alleged poor work done by the insured, particularly when the actual contents of the policy expressly say otherwise.
A policy is a contract, and contracts are to be read as a whole.
" A firm foundational rule in the construction of insurance contracts is that the expressed intent of the parties is to be ascertained by examining the contract or policy as a whole. The policy must be construed in its entirety, with each clause interpreted in relation to others contained therein. All its words, parts, and provisions must be construed together as one entire contract, each part interpreted in the light of all the other parts in connection with the risk or subject matter." Lexington Insurance Co. v. Lexington Healthcare Group, Inc., 311 Conn. 29, 58-59, 84 A.3d 1167 (2014) (internal quotation marks and citations, omitted).
Whatever inference(s) the plaintiffs may have drawn from the identification of the policy as relating to janitorial services cannot possibly supersede the express language of the policy itself on the various points identified by the defendant insurer as excluding coverage for this claim. At the risk of oversimplification, absent extreme circumstances not claimed to exist here, the title of a document is not a factual assertion and cannot create a factual conflict with the explicit contents of the document.
In theory, a policy intended for a business engaged in janitorial services, which explicitly excluded all coverage associated with the provision of janitorial services, might be deemed to constitute a misrepresentation.
The labeling of the policy as one for " janitorial services" is suggestive of (analogous to) the principle that the name or caption given to a statute, while possibly of some limited assistance in understanding the scope of the statute, is not truly determinative but rather only a guide, and certainly cannot override the express language of that which is purported to be described. Coyle v. Commissioner of Revenue Services, 142 Conn.App. 198, 203, 69 A.3d 310 (2013).
Accordingly, absent any misrepresentation upon which the plaintiffs might reasonably have relied (indeed, any misrepresentation), there can be no claim of actionable misrepresentation, and the motion for summary judgment is granted in this respect.
Conclusion
The court understands how small business service providers such as the individual plaintiff and his business might be naive about the scope of insurance obtained for the business, and might expect it to provide protection for any and all claims asserted against the insured(s). Insurance policies are contracts, and have conditions, limitations, exclusions, etc., with an overlay of riders that are intended to alter the provisions of the core policy, all of which can lead to confusion. The complexity of a policy and the existence of exclusions and conditions, however, do not and cannot, alone, justify a claim of actionable misrepresentation.
Although the defendant insurer appears to have been overzealous in identifying policy provisions that are claimed to preclude any claim by the plaintiffs in this matter, it has identified two policy coverage provisions that do in fact establish that the underlying claim is outside the scope of the coverage. Although there is some overlap between the exclusions, the focus of the applicable exclusions is on the work actually being performed by the insured(s) and the corresponding lack of coverage for claims that are dependent upon the quality of the work performed by the insured(s). Using perhaps oversimplified language, the provisions do not allow the carrier to be placed in the position of guaranteeing or somehow standing behind the quality of work performed by the insured, but at its heart, that is what the present claim is about--were the plaintiffs alleged to have been responsible for damaging carpeting in the course of attempting to clean that carpeting, and is the carrier obligated to defend and/or indemnify such a claim?
The defendant insurer has established applicability of the policy exclusion for " damage to that particular part of any property that must be restored, repaired or replaced because the insureds' work was [allegedly] incorrectly performed" and the exclusion for property damage to the work performed by the insured (the second and fourth arguments advanced). The defendant has failed to establish that the exclusion for contractually-assumed liability applies, and has failed to establish that the carpeting constituted personal property as a matter of law sufficient to invoke the applicable exclusion. Further, the defendant has failed to establish that there was a voluntary payment within the meaning of the prohibition against voluntary payments, and has failed to establish that even if there had been such a voluntary payment that it would be necessarily a facial and disqualifying act. Thus, the defendant Mount Vernon is entitled to judgment on the breach of contract claims directed to it (seventh count), for at least two reasons, as a matter of law. It also is entitled to judgment, as a matter of law, on the negligent misrepresentation claim (ninth count).
Accordingly, subject to the foregoing, the motion for summary judgment is granted.
Query whether striking an entire affidavit would be an appropriate remedy for inclusion of some percentage of incompetent or otherwise inadmissible assertions, or whether that would be deemed a disproportionate/draconian remedy--and what percentage of affidavits submitted in connection with summary judgment motions do not contain at least some conclusory or argumentative assertions?