Opinion
CIVIL ACTION Case No. 03-2426-KHV
March 5, 2004
MEMORANDUM AND ORDER
Plaintiffs are general contractors. Advantage Homebuilding, LLC and Timothy Scribner d/b/a Quantum Homes bring suit against Maryland Casualty Company and Assurance Company of America. In related litigation, various homeowners sued plaintiffs in the District Court of Johnson County, Kansas, asserting claims for damage to "windows that were scratched" and "other damages" to their residences on account of the negligence of plaintiffs' subcontractor. In this case, plaintiffs ask the Court to declare that their respective insurers are required to defend and indemnify them for such claims. This matter comes before the Court onDefendant Maryland Casualty Company's Motion To Dismiss Or. In The Alternative. Motion To Strike Or For More Definite Statement (Doc. #8) and Defendant Assurance Company Of America's Motion To Dismiss Or. In The Alternative. Motion To Strike Or For More Definite Statement (Doc. #10), both filed September 11, 2003. The parties have agreed that both motions should be treated as motions for summary judgment. At best, however, the factual record is scanty. The Court cannot properly resolve the summary judgment arguments in this context, and it cannot address defendants' arguments in the context of motions to dismiss because the motions depend on factual material which is beyond the allegations of the complaint. The Court finds that defendants are entitled to a more definite statement of the claims against them, however, and to that extent, their motions are sustained.
Legal Standard
A party may move for a more definite statement of any pleading that is "so vague or ambiguous that a party cannot reasonably be required to frame a responsive pleading." Fed.R.Civ.P. 12(e). Motions for a more definite statement are generally disfavored in light of liberal discovery available under the federal rules and are granted only when a party is unable to determine the issues requiring a response. Resolution Trust Corp. v. Thomas. 837 F. Supp. 354, 355 (D. Kan. 1993). A motion for more definite statement should not be granted merely because the pleading lacks detail; rather, the standard to be applied is whether the claims alleged are sufficiently specific to enable a responsive pleading in the form of a denial or admission. Defendants contend that plaintiffs' complaint is so vague and ambiguous that they cannot reasonably be required to frame a response.
When a complaint fails to plead all elements of the cause of action, fails to plead any facts supporting the elements of the cause of action, or states the claim in a vague or ambiguous manner, the Court may dismiss the complaint. Alternative to this harsh remedy, pursuant to Rule 12(e), the Court may order plaintiffs to file a more definite statement, re-pleading their claim in accordance with Rule 8 of the Federal Rules of Civil Procedure.
Analysis
For purposes of the pending motions the following facts are undisputed or, where disputed, construed in the light most favorable to plaintiffs: In Benjamin, et al. v. Advantage Homebuilding, L.L.C., et al., Case No. 02CV07728 in the District Court of Johnson County, Kansas (the "underlying lawsuit"), various homeowners sued plaintiffs for negligence, breach of contract/warranty and violations of the Kansas Consumer Protection Act. The homeowners complain that on account of negligence by defendants' subcontractor, they are entitled to damages for "windows that were scratched and other damages."
On August 7, 2003, plaintiffs filed a petition for declaratory judgment in the Johnson County District Court, seeking a declaration that Maryland Casualty Company ("Maryland Casualty") is liable to indemnify Advantage Homebuilding, and that Assurance Company of America ("Assurance") is liable to indemnify both Advantage Homebuilding and Timothy Scribner d/b/a Quantum Homes for claims against them in the underlying lawsuit. Advantage Homebuilding also seeks a declaration that Maryland Casualty is obliged to defend it in the underlying litigation. Defendants filed a notice of removal to this Court on August 27, 2003.
A. Builders' Risk Coverage
Advantage Homebuilding and Tim Scribner are insureds under builders' risk insurance policies issued by Assurance. See B.R. 54983565 effective January 8, 2001 and B.R. 50891754 effective June 25, 2001 as to Advantage Homebuilding; B.R. 50856922 effective June 8, 2001 as to Scribner. The policies provide co-insurance for "direct physical loss to Covered Property from any Covered Cause of Loss." "Covered Property" is defined as follows:
1. COVERED PROPERTY, as used in the Coverage form means:
a. Property which has been installed . . . in . . . any one (1) to twelve (12) family dwelling. . . . This includes:
(1) Your property;
(2) Property of others for which you are legally responsible . . .
(5) Completed dwelling(s) which is being used as a Model Home when reported to us as such on monthly reports with an amount shown. . . .
2. PROPERTY NOT COVERED Covered Property does not include:
a. Existing building or structure to which an addition, alteration, improvement, or repair is being made, unless specifically endorsed.
B.R. 50856922, Attachment 1 to Suggestions In Opposition To Defendant Assurance Company Of America's Motion To Dismiss Or. In The Alternative. Motion To Strike Or For More Definite Statement (Doc. #18) filed October 20, 2003. A "Covered Cause of Loss" means "risk of direct physical loss to Covered Property," except as elsewhere excluded. Id. Paragraph B.3(c) expressly excludes liability for a loss "caused by or resulting from"
c. Faulty, inadequate or defective: . . .
(2) Design, specifications, workmanship, repair, construction, renovation, remodeling, grading, compaction;
(3) Materials used in repair, construction, renovation or remodeling; or
(4) Maintenance; of all or part of any property wherever located.Id. Paragraph B.3(c) further provides, however, that notwithstanding this exclusion, "if loss by a Covered Cause of Loss results, we will pay for the resulting loss caused by that Covered Cause of Loss."
Assurance argues that it is entitled to summary judgment because (1) builders' risk insurance provides first party coverage to the insured, and does not obligate the insurer to indemnify its insured from any claims by third parties; and (2) the policy expressly excludes coverage for faulty workmanship — the very claim asserted against plaintiffs in the underlying litigation. Plaintiffs do not address the first point. As to the latter point, plaintiffs argue that the subcontractor's workmanship was not faulty and that the policy exclusion does not apply.
The details of the underlying claims are vaguely identified in the record. Defendants' motion for summary judgment refers to the insureds' petition for declaratory judgment, which characterizes theBenjamin claims as claims "for windows which were scratched and other damages caused by and through the negligence of a particular subcontractor working on the residences." The fact section of defendant's summary judgment brief does not otherwise address the Benjamin claims. The argument section of defendant's summary judgment brief purports to describe the claims but cites no record support for its statements. In opposing summary judgment, plaintiffs allude to a brick subcontractor who — "due to his inept handling of materials" ancillary to his work installing brick siding on various homes — negligently caused the damages for which coverage is sought. Plaintiffs cite no record support for this statement. At oral argument, counsel assumed that the claims in Benjamin resulted from improper handling of materials by the brick siding contractor. None of this information has been presented to the Court in compliance with D. Kan. Rule 56.1. Therefore the Court cannot properly resolve the summary judgment arguments in this context.
As noted above, Assurance alternatively argues that it is entitled to a more definite statement because the petition is vague and ambiguous and that it cannot reasonably be required to frame a responsive pleading. The Court agrees. Plaintiffs allege that they are insureds under various builder's risk policies, but they do not identify the policy or policies on which they sue, or cite the policy provisions on which they rely to establish coverage. Moreover, plaintiffs have yet to address defendant's argument that builders' risk insurance provides first party coverage and does not obligate the insurer to indemnify its insureds from any claims by third parties. At oral argument, plaintiffs' counsel sought leave to amend the complaint to address this issue. The Court expects that plaintiffs' more definite statement will do so.
The Court therefore finds that Assurance is entitled to a more definite statement which states an actionable claim under the builders' risk policies and to that extent, sustains its motion on this issue.
B. Comprehensive General Liability Coverage
Keith Worrel d/b/a Advantage Homes is insured under a comprehensive general liability policy issued by Zurich American Insurance Company, Policy Number SCP 31920037.
Nothing in the record explains any relationship between Advantage Homebuilding LLC, who is the plaintiff in this case, and Keith Worrel d/b/a Advantage Homes, who is the insured under this policy. Also, Zurich American is not a party in this case. While Maryland Casualty asserts that it is entitled to summary judgment on the policy issued to Keith Worrel d/b/a Advantage Homes, nothing in the record suggests that it is even a party to the policy in question.
Maryland Casualty is entitled to a more definite statement of the claim by Advantage Homebuilding LLC, i.e. what policy it is suing on and how it asserts a claim under a policy issued to Keith Worrel d/b/a Advantage Homes.
On or before March 18, 2004, plaintiffs shall file an amended complaint. At a minimum, the amended complaint shall (1) identify the policy on which each plaintiff sues; and (2) cite the policy provisions on which each plaintiff relies to establish coverage.
IT IS THEREFOR ORDERED that Defendant Maryland Casualty Company's Motion To Dismiss Or. In The Alternative. Motion To Strike Or For More Definite Statement (Doc. #8) filed September 11, 2003 be and hereby is SUSTAINED in part. Maryland Casualty is entitled to a more definite statement which states an actionable claim under a general liability policy by Advantage Homebuilding LLC. The Court otherwise OVERRULES defendant's motion.
IT IS FURTHER ORDERED that Defendant Assurance Company Of America's Motion To Dismiss Or. In The Alternative. Motion To Strike Or For More Definite Statement (Doc. #10), both filed September 11, 2003, be and hereby is SUSTAINED in part. Assurance Company of America is entitled to a more definite statement which states an actionable claim under the builders' risk policies by both plaintiffs. The Court otherwise OVERRULES defendant's motion.
IT IS FURTHER ORDERED that on or before March 18, 2004, plaintiffs shall file an amended complaint.