Opinion
Civil Action 18-00366-G
09-25-2018
Wenda AQUINO v. UNITED PROPERTY & CASUALTY INSURANCE COMPANY
MEMORANDUM OF DECISION AND ORDER ON PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT AND DEFENDANT’S CROSS-MOTION FOR SUMMARY JUDGMENT
Paul D. Wilson, Justice of the Superior Court
This suit arises out of a 2017 fire at the home of Plaintiff Wenda Aquino, for which Aquino sought payments under her homeowner’s insurance policy. That policy was issued to her by Defendant United Property & Casualty Insurance Company ("UPC"). UPC denied payment to Aquino on the ground that the damage was intentionally caused by Aquino’s fiancé, who was a named co-insured on the policy, and that the homeowner’s policy excludes recovery by any insured in such a circumstance.
Aquino filed this suit seeking declaratory and other relief to reform the homeowner’s policy to provide for coverage of her claimed damages, and she seeks damages for unfair and deceptive trade acts and practices by UPC under G. L. c. 93A and G. L. c. 176D. In the present motion, Aquino seeks summary judgment on Count I (declaratory judgment), Count II (breach of contract), and Count VII (reformation of the policy). UPC has cross-moved for summary judgment on all counts in the Plaintiff’s complaint. For the reasons stated below, the Plaintiff’s motion is ALLOWED IN PART and DENIED IN PART , and the Defendant’s motion is ALLOWED IN PART and DENIED IN PART .
BACKGROUND
The following facts, drawn from the summary judgment record, are uncontested. Some facts are reserved for discussion below.
In 2014, Aquino and her fiancé, Kelly Pastrana, purchased a two-family residential dwelling located at 80 Warren Avenue in Chelsea, Massachusetts (the "Property"). Both Aquino and Pastrana are listed on the deed and mortgage for the Property. UPC issued a homeowner’s insurance policy to Aquino and Pastrana covering the Property ("the Policy") that was effective at the time of the events at issue in this case.
On May 22, 2017, a fire caused extensive damage to the Property. For purposes of the present motions, the parties do not contest that the fire was caused by an intentional act of Pastrana, and that Aquino was innocent of any involvement. Pastrana died in the fire.
After the fire, Aquino asserted several claims under the Policy for the damages she sustained, including claims for (a) destruction of the building situated on the Property, (b) destruction of the driveway, walkway, patio, retaining wall and stairs/railings on the Property, (c) loss of personal property contained in the building situated on the Property, (d) loss of rental income and additional living expenses, (e) costs associated with enforcement of "ordinance or law" against Aquino as owner of a Property containing a fire-damaged and unsafe structure, (f) destruction to landscaping, trees and shrubs, and (g) debris removal.
The parties have submitted an itemized summary of Aquino’s damages, categorized by Policy coverage provision. The parties agree, subject to their respective coverage positions, that these are Aquino’s damages.
On August 18, 2017, UPC denied its liability for Aquino’s claims, citing the Intentional Loss Exclusion provision in the Policy. That provision states, in relevant part:
In the letter denying coverage, UPC also stated that the fire was not an "occurrence" under the terms of the Policy. UPC does not advance that position in its briefing on the present motions.
SECTION I - EXCLUSIONS
A. We do not insure for loss caused directly or indirectly by any of the following....
8. Intentional Loss
Intentional Loss means any loss arising out of any act an ‘insured’ commits or conspires to commit with the intent to cause a loss.
In the event of such loss, no ‘insured’ is entitled to coverage, even "insureds" who did not commit or conspire to commit the act causing the loss.
Aquino and Pastrana are both named insureds on the Policy.
Aquino brought the present suit against UPC to recover the damages she sustained in the fire. There are eight counts in the complaint: Count I is for declaratory judgment; Count II is for breach of contract; Count III is for breach of the implied covenant of good faith and fair dealing; Count IV is for promissory estoppel; Count V is for equitable estoppel; Count VI is for waiver; Count VII is for reformation of the policy; and Count VIII is for unfair and deceptive trade acts and practices. In the first seven counts, Aquino seeks payment of all of her claimed damages under the Policy, as well as attorney’s fees, costs, and interest. In Count VIII, Aquino seeks relief under G. L. c. 93A and G. L. c. 176D for alleged unfair and deceptive trade acts and practices by UPC, for which she seeks double or treble the amount of her actual damages, as well as attorneys’ fees, costs, and interest.
DISCUSSION
I. Legal Standard
Summary judgment is properly entered "if the pleadings, depositions, answers to interrogatories, and responses to requests for admission under Rule 36, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Mass. R. Civ. P. 56(c); see Miramar Park Ass’n, Inc. v. Dennis, 480 Mass. 366, 376 (2018). "The moving party bears the burden of affirmatively demonstrating that there is no triable issue of fact." Ng Bros. Constr. v. Cranney, 436 Mass. 638, 644 (2002). The interpretation of an insurance policy raises a question of law that is appropriately resolved on summary judgment. See Massachusetts Bay Transp. Auth. v. Allianz Ins. Co., 413 Mass. 473, 476 (1992).
II. Analysis
A. Whether Aquino can recover under the policy
Aquino moves for summary judgment on Count I (declaratory judgment), Count II (breach of contract), and Count VII (reformation), arguing that the Policy must be reformed to comport with certain statutory requirements, and that UPC is in breach of the Policy as reformed. UPC cross-moves for summary judgment on the same Counts.
The parties do not dispute that the provision of the Policy governing intentional loss is unambiguous. That provision, if enforced as written, would impose a joint obligation on insureds not to cause intentional loss, and would thus preclude any recovery by Aquino as a consequence of the intentional act of Pastrana.
Aquino’s argument is rather that the Policy is not enforceable as written and must be reformed pursuant to G. L. c. 175, § 99 to allow for payments to her as an innocent co-insured party. That statute, entitled "Standard Form of Fire Policy," mandates the form of fire insurance policies in Massachusetts. Ideal Fin. Servs., Inc. v. Zichelle, 52 Mass.App.Ct. 50, 66 (2001). The statute provides that "[n]o company shall issue policies or contracts which ... insure against loss or damage by fire ... to property or interests in the commonwealth, other than those of the standard forms herein set forth," subject to certain exceptions not raised here. G. L. c. 175, § 99. Aquino argues that the Intentional Loss provision provides for a broader exclusion of coverage of insureds than the provisions of the statutory standard policy, and must be reformed in conformity with the mandate of G. L. c. 175, § 99.
The statutory standard policy contains a provision stating that the insurer "shall not be liable for loss occurring ... while the hazard is increased by any means within the control or knowledge of the insured." G. L. c. 175, § 99. The standard policy also contains a provision stating that the insurer "shall not be liable for loss by fire ... caused ... by ... neglect of the insured to use all reasonable means to save and preserve the property at and after a loss ...." Id. I agree with Aquino that these provisions govern a scenario in which the insured intentionally causes a loss by burning the insured property. Such an act increases the hazard to the property and evidences neglect to "preserve the property at ... a loss." I also agree that, if the Intentional Loss provision in the Policy provides a broader exclusion of coverage than these provisions mandated by G. L. c. 175, § 99, the Policy provision cannot prevail.
Aquino argues that because these statutory provisions refer to acts by "the" insured that would absolve the insurer of liability, rather than referring to acts of "an" insured as the Policy does, the statute mandates a several obligation not to cause a loss, rather than a joint obligation among the insureds not to do so. She argues that UPC, in limiting its liability in the Policy by excluding coverage on the basis of intentional acts of "an" insured, and in making clear that an intentional loss caused by one insured will preclude coverage by any other insured, imposes a joint obligation that impermissibly conflicts with the prescribed statutory form. This is correct. UPC’s Policy substitutes the use of "an" in place of the consistent use of "the" in the statutory policy, and adds a sentence making clear that the language of the Policy means that "no ‘insured’ is entitled to coverage, even ‘insureds’ who did not commit or conspire to commit the act causing the loss." Such variance from the statutory language impermissibly narrows the statutorily-required coverage afforded to insureds.
The argument raised by Aquino with respect to G. L. c. 175, § 99, has now been addressed on three prior occasions by judges of the Superior Court of Massachusetts, and on one occasion by a judge of the United States District Court for the District of Massachusetts. The rulings have been consistently in favor of the innocent insured. In two of the prior Superior Court matters, and in the case before the federal court, the courts ruled that the intentional loss provision in the insurer’s policy referring to "an" or "any" insured -- or similar language denying coverage for all insureds for an intentional loss caused by any insured -- conflicted with the Legislature’s use of "the" insured in G. L. c. 175, § 99. Liberty Mut. Ins. Co. v. Gonzalez, No. ESCV20151794B, 2017 WL 3080565, at *6 (Mass. Super. Ct. June 12, 2017); Hall v. Preferred Mut. Ins. Co., No. HDCV201400781, 2015 WL 4511760, at *6-7 (Mass. Super. Ct. May 1, 2015); Shepperson v. Metropolitan Prop. & Cas. Ins. Co., 312 F.Supp.3d 183, 198 (D. Mass. 2018). A third Superior Court ruling on the issue strongly suggested the same result. Barnstable County Mut. Ins. Co. v. Dezotell, No. 200500361, 2006 WL 2423570, at *2, 5-6 (Mass. Super. Ct. July 20, 2006) (where there was evidence insured defendant’s husband conspired with third party to have home burned, plaintiff insurer nonetheless had no "reasonable likelihood of ... recovering judgment" against defendant where there was no evidence defendant intentionally caused loss, and where "[t]he Intentional Act exclusion in the policy issued by the plaintiff may very well be construed as diminishing or diluting the coverage required under [G. L. c. 175, ] § 99.").
Additionally, the Supreme Judicial Court has stated that one factor to consider in construing the statute is the interest in "giving [G. L. c. 175, ] § 99 the same treatment that is given to identical language policies issued in other States." Pappas Enters., Inc. v. Commerce & Indus. Ins. Co., 422 Mass. 80, 83 (1996). Accordingly, Massachusetts state and federal courts have commonly surveyed decisions of courts outside Massachusetts on the matter.
Here, too, the decisions strongly favor the innocent co-insured. See Gonzalez, 2017 WL 3080565, at *6, and cases cited (surveying cases and concluding that "the overwhelming weight of appellate authority in other states addressing the very issue presented herein supports [the innocent co-insured’s] position. This court adopts the reasoning of those other courts."); Shepperson, 312 F.Supp.3d at 196-197, and cases cited, quoting Pappas Enters., Inc., 422 Mass. at 83 (surveying cases analyzing the distinction between "a(ny) insured" and "the insured" as it regards the statutory standard policy and concluding, "I see no reason why the Supreme Judicial Court would not join in the reasoning of its sister jurisdictions, especially when it has expressed an interest ‘in giving § 99 the same treatment that is given to identical language policies issued in other States.’ ").
Like the Gonzalez and Shepperson courts, I find persuasive the rulings of those courts of other jurisdictions that allowed recovery to the innocent co-insured. See, e.g., Streit v. Metropolitan Cas. Ins. Co., 863 F.3d 770, 773-774 (7th Cir. 2017) ("The term ‘the insured’ is not defined in the Standard Fire Policy. But as noted by many states interpreting identical language, the inclusion of the word ‘the’ as opposed to ‘an’ serves as a limitation."); Watson v. United Servs. Auto. Ass’n, 566 N.W.2d 683, 691 (Minn. 1997) ("[W]e conclude that the legislature’s use of ‘the insured’ in the Minnesota standard fire insurance policy evinces a general intent to compensate an innocent co-insured spouse despite the intentional acts of the other insured spouse."). The Intentional Loss provision of the Policy must be reformed to provide a several obligation, such that Aquino may recover under the Policy as an innocent co-insured party.
UPC argues that "[t]o the extent this court relies on out-of-state case law, there are numerous jurisdictions which bar coverage for ‘innocent co-insureds’ under exclusions nearly identical to the one contained in the Policy." Several cases UPC cites in that regard are inapposite. See Postell v. American Family Mut. Ins. Co., 823 N.W.2d 35, 48-49 (Iowa 2012) (innocent co-insured could not recover based on intentional loss exclusion in issued policy because Iowa legislature had amended standard policy statute to change relevant language from "the insured" to "an insured"); Tuturea v. Tennessee Farmers Mut. Ins. Co., No. W2009-01866-COA-R3-CV, 2010 WL 2593627, at *19 (Tenn. Ct.App. June 29, 2010) ("While courts in other jurisdictions have reformed or held unenforceable policies excluding recovery by an innocent co-insured where the policies did not comply with legislative limitations on liability exclusions ... [the plaintiff] has not argued that similar limitations govern the enforcement of insurance agreements in Tennessee."); Noland v. Farmers Ins. Co., 319 Ark. 449, 453 (1995) (holding that insured could not recover, but not discussing any standard policy statute, and noting that insured had offer[ed] "no Arkansas law" in support of contention that policy exclusion was contrary to public policy). The weight of out-of-state authority favors Aquino.
UPC argues that the Policy is consistent with G. L. c. 175, § 99, citing the Supreme Judicial Court’s 1938 decision in Kosior v. Continental Ins. Co. in support of its position. 299 Mass. 601 (1938). In that case, a husband and wife were named insureds on a policy, and the husband intentionally set fire to the home in an attempt to defraud the insurance company. Id. at 602. The policy in question provided that "if the insured shall make any attempt to defraud the Company" the policy would be void. Id. The court ruled that the policy was joint and that the wife -- the plaintiff in that case -- could not recover as a consequence of her husband’s actions. Id. at 604. However, while the Court acknowledged the existence of the standard form insurance policy of G. L. c. 175, § 99, id. at 603, the Court did not review the statutory text or address whether the statute required broader coverage of an innocent co-insured. As a result, Kosior did not address the question at the heart of these motions, and does not require a ruling in UPC’s favor.
B. How much Aquino can recover under the Policy
Given that Aquino can recover for damages under the Policy, the next question presented is whether Aquino is entitled to full recovery on the Policy, or whether her recovery should be less than that amount in light of Pastrana’s intentional act of arson. UPC argues that if Aquino recovers under the Policy, she should only be entitled to recover half of the damages caused by the loss, within the limits of the policy. The argument raised by UPC in favor of a limited recovery was not addressed by the Massachusetts courts in the Hall, Gonzalez, Dezotell, or Shepperson cases discussed above.
I conclude that Aquino should recover for half of the losses caused by fire, up to half of the applicable coverage limits. Having determined that the intentional loss provision of the contract must be reformed to treat Aquino and Pastrana severally for purposes of assessing Aquino’s ability to recover, I will also treat them severally in assessing any forfeiture of coverage by arson under that provision. Here, Pastrana’s act of purposefully burning the property will forfeit his share of recovery under the Policy.
I look to the contract to determine the extent of Pastrana’s share. Courts construe the words of an insurance policy "in their usual and ordinary sense," absent any ambiguity. Citation Ins. Co. v. Gomez, 426 Mass. 379, 381 (1998) (internal quotation marks omitted), quoting Hakim v. Massachusetts Insurers’ Insolvency Fund, 424 Mass. 275, 280 (1997). Here, as Pastrana is listed as one of two named insureds on the Policy who had an interest in the contract, I construe his share in the Policy damages as one-half. Neither party points to any other language in the Policy, and I find none, that would suggest that Aquino and Pastrana’s respective interests in the Policy were anything other than equal. Limiting Aquino’s recovery to one-half of the losses is also in keeping with the provisions of G. L. c. 175, § 99, discussed above, which evidence an intent to prevent a person who intentionally causes a loss from recovering for that loss. Aquino’s recovery will be half of the damages sustained, up to half of the coverage limits provided in the Policy.
In support of its argument that Aquino is only due half of the damages, UPC cites the "Insurable Interest And Limit Of Liability" provision in the Policy. That provision states that UPC "will not be liable in any one loss ... [t]o an ‘insured’ for more than the amount of such ‘insured’s’ interest at the time of loss." UPC argues that Pastrana and Aquino owned the property as tenants in common, and as such, Aquino only had a one-half insurable interest in the Property. Aquino responds that the way in which the Property was owned should not determine recovery under the Policy. However, Aquino does not point to anything in the Policy suggesting that Pastrana and Aquino’s interests in recovery under the Policy were anything other than equal.
Aquino acknowledges "the law’s legitimate concern that a wrongdoer not reap any benefit from his malfeasance" as the "predominant public policy concern," but argues that because Pastrana perished in the fire, no such concern is present here, and she should be awarded full recovery. But a person who intentionally burns a property and dies in the fire may well have intended to deliver the insurance proceeds to his family; if so, then a full recovery would reward the arson, albeit posthumously. More fundamentally, I decline to impose a rule that, by conditioning insurance awards on the survival or non-survival of the arsonist, would have the effect of providing a larger payout in an arson scheme if the arsonist takes his own life in the process.
My ruling in this regard is in keeping with the decisions of courts in other jurisdictions. See, e.g., Brunk v. Amica Mut. Ins. Co., No. 06-15160, 2007 WL 3244874, *2 (E.D. Mich., Nov. 2, 2007) ("Michigan has followed the majority of jurisdictions in limiting an innocent coinsured’s recovery to one-half in most circumstances."); id. at *6 ("Michael Brunk forfeited his interest by igniting a fire within the home as prohibited by the insurance policy’s exclusion for intentional loss. This forfeited interest was not resurrected by virtue of his death."); Texas Farmers Ins. Co. v. Murphy, 996 S.W.2d 873, 881 (Tex. 1999) (concluding, as matter of public policy, that policy against allowing an arsonist to benefit from fraud "does not overcome an innocent spouse’s contractual right to recover her or his one-half interest in the policy benefits"); Maravich v. Aetna Life & Casualty Co., 504 A.2d 896, 907-908 (Pa. Super. Ct. Jan. 24, 1986) ("By allowing [the insurer] to retain one-half of the loss, we give effect to the common law principle that [the arsonist] should not be permitted to profit from his own wrong.").
In the cases cited by Aquino that involved arson by a spouse and in which the court granted full recovery, the court premised such recovery, at least in part, on the fact that the arsonist died in the fire -- a position I reject. See American Economy Ins. Co. v. Liggett, 426 N.E.2d 136, 142-145 (Ind. Ct.App. 1981) ("The law’s legitimate concern that a wrongdoer not profit by his wrong is not a factor in this case and there is no reason to deny the innocent plaintiff a full recovery, (a different rule may need to be fashioned where the guilty spouse survives)"); id. at 140 ("This public policy [of denying wrongdoer insurance recovery] is easily vindicated by denying any recovery to the living guilty spouse and permitting the innocent spouse recovery of one-half of the insured loss within policy limits."); Safeco Ins. Co. of America v. Kartsone, 510 F.Supp. 856, 859 (C.D. Cal. 1981) ("[A]ny effect of [a statute providing that an insurer is not liable for loss caused by willful act of the insured] upon [the innocent co-insured’s] right to recovery for the fire loss is negated by the fact that the wrongdoer in this case died before the claim was paid, and cannot, under any circumstances, stand to benefit from it."); Felder v. North River Ins. Co., 435 N.W.2d 263, 266 (Wis. Ct.App. 1988) ("The trial court should tailor the recovery given to the innocent insured to guard against the possibility that the arsonist will receive financial benefit. Unlike the wrongdoer in [a Wisconsin Supreme Court case], [the arsonist] did not survive the fire and there is no possibility that he will profit from his criminal act.") (citation omitted).
Aquino argues that even if her recovery is limited to one-half of the recovery of the value of the destroyed property, her recovery should not be so limited for her additional living expenses, costs she incurs in order to comply with applicable ordinances or laws, or costs she incurs to remove the fire-damaged debris. She argues that she is entitled to full coverage as to these items because "[t]he basic focus of additional living expense coverage is on the deprivation of Aquino’s use of her home as a dwelling by reason of fire." However, neither the Policy provisions that Aquino alludes to nor the standard policy of G. L. c. 175, § 99 provides for such a parsing of the coverages in the Policy, and I decline to fashion that relief without such a basis.
In sum, I allow Aquino’s motion for summary judgment as to Counts I, II, and VII to the extent provided above, concluding that the Intentional Loss provision of the policy is unenforceable as written, that the Policy must be reformed as described in this Order, and that UPC is in breach of the Policy as reformed. I deny UPC’s cross-motion for summary judgment as to Counts I and II to the extent described above.
C. Structures covered under Coverage B in the Policy
Aquino also moves for summary judgment in Counts I and II of the complaint on the ground that UPC failed to appropriately pay for damage to certain structures on the Property, and UPC cross-moves on the same issue as to Count I. Specifically, the parties dispute whether certain structures on the Property are covered under Coverage A of the policy ("Dwelling") or Coverage B ("Other Structures"). Resolving that issue requires me to construe the language of the Policy. As noted, where there is no ambiguity in an insurance contract, courts "construe the words of the policy in their usual and ordinary sense." Citation Ins. Co., 426 Mass. at 381 (internal quotation marks omitted), quoting Hakim, 424 Mass. at 280. "When the language of an insurance contract is ambiguous, we interpret it in the way most favorable to the insured." Id. "[A]n ambiguity is not created simply because a controversy exists between the parties, each favoring an interpretation contrary to the other." Id. (internal quotation marks omitted), quoting Lumbermens Mut. Cas. Co. v. Offices Unlimited, Inc., 419 Mass. 462, 466 (1995).
UPC’s cross-motion for summary judgment as to Count II is based on the Intentional Loss exclusion provision in the policy.
The Policy provides, in relevant part, as follows:
A. Coverage A - Dwelling
1. We cover:
a. The dwelling on the "residence premises" shown in the Declarations, including structures attached to the dwelling ...
B. Coverage B - Other Structures
1. We cover other structures on the "residence premises" set apart from the dwelling by clear space. This includes structures connected to the dwelling by only a fence, utility line, or similar connection.
Thus, to be included within Coverage A, a structure must be "attached" to the dwelling, a term that is not defined in the Policy. To be included within Coverage B, a structure must be "set apart from the dwelling by clear space," a phrase that also does not include any terms defined in the Policy. I apply the usual and ordinary meaning of those terms.
The structures in question are the "driveway, walkway, patio, retaining wall and stairs/railings." The damage to the house exceeded the Coverage A policy limit, so, by agreement of the parties, the limit of insurance under Coverage A has been applied toward those damages. Thus the critical question is whether these structures can be included within Coverage B, where the policy limit has not been exhausted.
As Aquino conceded in her briefing and at oral argument, the summary judgment record establishes that "the walkway, retaining wall, steps and platforms touch or abut the dwelling." I conclude that no reasonable construction of the Policy would allow structures that touch or abut the dwelling to be "set apart from the dwelling by clear space." As a result, the walkway, retaining wall, steps and platforms do not fall under Coverage B.
Aquino also argues that the "railings surrounding the driveway and steps" do not touch or abut the dwelling and are thus set apart by clear space. I disagree. The summary judgment record contains an affidavit from a public insurance adjuster, attaching photographs of the dwelling and structures in question. As the photos demonstrate, the railings running down the right-hand side of the stairway and walkway (when facing the front of the property) form an integral part of the stairway and walkway. I do not think it reasonable to parse the Policy language to treat one portion of a unitary set of railings in one fashion while treating another portion differently, for example by ruling that the left-hand railing (which is fastened to the home) would fall within Coverage A, but the right-hand railing (which is not) would fall under Coverage B. I conclude instead that the appropriate Policy construction is that the railing is a component of the stairway and walkway and therefore falls within Coverage A.
The same railing proceeds from the stairs along the exterior of the driveway. The entire railing is included within Coverage A.
With respect to the patio, a genuine issue of material fact remains about how the patio stands in relation to the dwelling. While a back portion of the home extends into the area of the patio, debris in the photos obscures the point at which a back portion of the home meets the patio. It is therefore unclear whether the patio is "attached" to the dwelling or "set apart from the dwelling by clear space." As a result, summary judgment as to the treatment of the patio is denied.
The driveway, however, is shown in the photos to be a structure set apart by clear space from the home. Indeed, counsel for UPC conceded at oral argument that the tenant’s driveway is separated from the dwelling. Accordingly, the driveway falls within Coverage B.
I thus allow Aquino’s motion for summary judgment as to Counts I and II to the extent that those counts seek a declaration of coverage for the driveway under Coverage B, and a determination of breach by UPC for failing to provide such coverage. I deny summary judgment to Aquino regarding the other structures to the extent discussed above. I deny summary judgment to UPC with regard to the driveway and patio as discussed above, but allow summary judgment as to the other structures, to the extent described above.
D. Unfair methods of competition and unfair or deceptive acts or practices
Aquino alleges in Count VIII of her complaint that UPC has violated G. L. c. 93A by denying her coverage under the Policy. That statute provides that "[u]nfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful." G. L. c. 93A § 2(a). The basis for this claim is that UPC engaged in various unfair claim settlement practices prohibited by G. L. c. 176D, § 3(9). An insurer who violates that insurance statute automatically violates Chapter 93A as well. Hopkins v. Liberty Mutual Ins. Co., 434 Mass. 556, 563-565 (2001).
UPC seeks entry of summary judgment dismissing all claims in Count VIII, arguing that UPC’s denial of Aquino’s claim was justified and proper. I now grant that relief.
As discussed above, in denying coverage, UPC was simply applying the Policy’s Intentional Loss provision as written; the Policy language precluded any recovery by Aquino as a consequence of the intentional act of Pastrana. In light of the absence of controlling precedent in Massachusetts on the issues raised by Aquino as to the failure of the Policy to conform to the mandates of G. L. c. 175, § 99, UPC had a good faith basis for its position that the Policy conformed with G. L. c. 175, § 99. As a result, UPC has not committed any unfair or deceptive act or practice, and is entitled to judgment as a matter of law. See Gulezian v. Lincoln Ins. Co., 399 Mass. 606, 613 (1987) ("An insurance company which in good faith denies a claim of coverage on the basis of a plausible interpretation of its insurance policy is unlikely to have committed a violation of G. L. c. 93A"); Guity v. Commerce Ins. Co., 36 Mass.App.Ct. 339, 344 (1994) ("A plausible, reasoned legal position that may ultimately turn out to be mistaken -- or simply, as here, unsuccessful -- is outside the scope of the punitive aspects of the combined application of c. 93A and c. 176D.").
E. Summary Judgment as to Counts III, IV, V, VI of the complaint
UPC seeks summary judgment dismissing Counts III, IV, V and VI of the complaint. The basis for UPC’s motion as to those counts is that "Plaintiff does not have a cause of action under any such counts once Counts I and II have been dismissed." Because this Order does not entirely dismiss Counts I and II, UPC’s motion for summary judgment is denied as to those counts.
CONCLUSION AND ORDER
For the reasons stated above, the Plaintiff’s Motion for Summary Judgment (Docket No. 6) is ALLOWED IN PART as follows:
1. Count I: The Plaintiff is granted declaratory judgment that the Intentional Loss provision of the Policy is unenforceable as written, and must be reformed in accordance with G. L. c. 175, § 99 to provide coverage to the Plaintiff as described above. The Plaintiff is granted declaratory judgment that the driveway constitutes an "Other Structure" covered under Coverage B of the Policy.
2. Count II: UPC has breached the terms of the Policy, as reformed, by failing to provide coverage to the Plaintiff as described above.
3. Count VII: the Policy must be reformed in accordance with G. L. c. 175, § 99 to provide coverage to the Plaintiff as described above.
The Plaintiff’s motion is denied in all other respects.
For the reasons stated herein, the Defendant’s Cross-Motion for Summary Judgment (Docket No. 7) is ALLOWED IN PART as follows:
1. Count I is allowed insofar as it seeks dismissal of Aquino’s claims to coverage under Coverage B of the Policy of the walkway, retaining wall and stairs/railings, as described above.
2. Count VIII is dismissed.
The Defendant’s motion is denied in all other respects.
A status conference will be held at 2:00 P.M. on October 16, 2018 in Courtroom 1008. The parties shall confer beforehand, and shall be prepared to make proposals -- ideally a joint proposal -- about the next steps in this case.