Clark v. Rockwell Insurance Company

Summary of Case by Oliver Bryce Clark, Associate Attorney

Upon Defendant’s removal, the Middle District of Florida, Orlando Division ruled on the merits of Defendant, Rockhill Insurance Company’s Motion for Summary Judgment, finding, for the below-stated reasons, that the same admitted of disputed issues of material fact which precluded judgment in favor of Defendant.

In Donald E. Clark; and Stacy L. Clark v Rockhill Insurance Company, Plaintiff was the operators of the Sandman Motel in Mims, Florida. Defendant insured said Motel from June 30, 2016 through June 30, 2017. The Plaintiffs brought a breach of contract claim concerning a June 29, 2017 water backup and overflow at the Motel which resulted in water damage to Plaintiffs’ personal bedroom and two guest rooms. Plaintiffs reported the above damage to Defendant and engaged an initial telephone conference with Defendant’s employee. The Parties disagreed as to the content of the call, with Defendant’s employee insisting that Plaintiffs characterized the water backup as one of many which had persisted over a period of approximately ten (10) months due to persistent plumbing issues and Plaintiffs conversely contending that the above-referenced plumbing problems were unrelated to the instant loss.

Defendant tasked an Independent Adjuster with investigating Plaintiffs’ loss. The IA was unable to determine the exact duration of Plaintiffs’ water backup issues but did opine that the same had to have persisted for longer than three weeks. Based on this assessment, Defendant denied Plaintiffs’ claim, citing in its denial letter the following provisions: Plaintiffs’ policy “covers damage due to direct, physical loss unless specifically excluded or limited” and Plaintiffs’ loss was “a combination of collapsed cast iron pipes, corroded pipes, and blocked pipes that caused water to back-up into the building over the course of numerous months.” Defendant stated this damage was “due to a combination of wear, tear, age, and deterioration and lack of proper maintenance,” which is not covered by the policy. The letter also included a portion of Plaintiffs’ insurance policy which requires that the insured give “prompt notice of the loss or damage.” The instant lawsuit, its subsequent removal, and Defendant’s Motion for Summary Judgment followed.

The Court’s legal analysis consisted in its outlining the standard for summary judgment. On this line, the court noted that: Summary judgment is appropriate only “if the movant shows that there is no genuine dispute as to any material fact and that [it] is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). As to issues for which the movant would bear the burden of proof at trial, it must affirmatively show the absence of a genuine issue of material fact and support its motion with credible evidence demonstrating that no reasonable jury could find for the nonmoving party on all of the essential elements of its case. Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115 (11th Cir. 1993) (citing United States v. Four Parcels of Real Prop. in Greene & Tuscaloosa Ctys. in State of Ala., 941 F.2d 1428, 1438 (11th Cir. 1991)).

Applying this standard to the current matter, the court dissected Defendant’s argument which ran as follows: Defendant insisted that it was entitled to summary judgment because: (1) Plaintiffs did not provide prompt notice of their claim as the policy requires; and (2) Plaintiffs cannot rebut the presumption of prejudice that arises from untimely notice.  Plaintiffs respond: (1) these are factual issues that preclude summary judgment; (2) they did provide prompt notice; and (3) even if they did not provide prompt notice, Defendant was not prejudiced. As to argument one (1), the court reasoned that the question of whether an Insured gave notice timely was generally a question of fact for a jury and that on the instant facts, Defendant’s reference to the above-mentioned telephone conversation was unrelated to and therefore of no consequence to the present litigation. The court also noted that any inability of the Parties to agree as to a date of loss merely highlighted disputed facts which cut against a grant of summary judgment in favor of Defendant. As to argument two (2), the court maintained that Defendant had failed to prove that the seven-to-ten-month reporting delay was unreasonable under the circumstances; citing cases where a court has deemed shorter periods of delay to violate an insurance policy’s “prompt notice” requirement, without more, was insufficient. Argument three (3), denoting prejudice to Defendant, was not broached, as doing so first required an affirmative determination that Plaintiff failed to give “prompt notice” as required under the subject insurance policy.

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