ORDER ON CROSS-MOTIONS FOR SUMMARY JUDGMENT
Lance E. Walker, Justice.
This matter is before the court on the parties' competing motions for summary judgment, which are limited as to whether Maine Municipal Association (herafter "MMA") is obligated to provide a defense to Plaintiffs in their capacity as defendants in an underlying complaint for declaratory and injunctive relief presently pending in the United States District Court for the District of Maine.
The parties' statements of material fact are happily short and concise in keeping with the rule, as they must by necessity be, given the narrow inquiry involved in resolving the duty to defend. The material facts are not in dispute.
South Portland City Council enacted Ordinance #1-14/15 (herafter "Ordinance"), which amended the City's Zoning Ordinance to prohibit the bulk loading of crude oil onto marine tank vessels. Patricia Doucette, the City's Code Enforcement Officer, is the municipal official charged with enforcing the City's Zoning Ordinance.
On February 6, 2015, Portland Pipeline Corporation and American Waterways Operators filed a lawsuit against the City of South Portland (hereafter the "City") and Ms. Doucette in the United States District Court for the District of Maine challenging the Ordinance. The Complaint is captioned as "Complaint for Declaratory and Injunctive Relief, " and specifically and repeatedly requests "declaratory and equitable relief (hereafter the "Underlying Complaint").
MMA is a public, self-funded pool established pursuant to 30-A M.R.S. § 2251, et seq. The City is a member of the MMA risk pool, and since July 1, 2014, MMA has provided liability coverage to the City pursuant to a Coverage Certificate, including a Public Officials Liability Endorsement (hereafter "Certificate").
The City tendered the defense of the Underlying Complaint to MMA on February 9, 2015. By letter dated February 25, 2015, and received by the City and Ms. Doucette on February 27, 2015, MMA denied coverage and indicated that it would neither provide a defense nor indemnify the City in connection with the Underlying Action. MMA denied a request made by the City and Ms. Doucette to reconsider its position by letter dated April 28, 2015.
II. STANDARD OF REVIEW
Summary judgment is appropriate if, based on the parties' statements of material fact and the cited record, there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. M.R. Civ. P. 56(c); Dyer v. Dep't of Tramp., 2008 ME 106, ¶ 14, 951 A.2d 821. "A material fact is one that can affect the outcome of the case. A genuine issue of material fact exists when the fact finder must choose between competing versions of the truth." Dyer, 2008 ME 106, \ 14, 951 A.2d 821 (internal citation and quotation marks omitted). When deciding a motion for summary judgment, the court reviews the evidence in the light most favorable to the non-moving party. Id.
Whether an insurer has an obligation to defend its insured against a complaint is a question of law. Elliot v. Hanover Ins. Co., 1998 ME 138, ¶ 6, 711 A.2d 1310. A determination whether there exists a duty to defend is resolved by comparing the complaint with the terms of the insurance contract. Id. If the complaint contains allegations that, if proved, could fall within coverage afforded by the policy, then the insurer must provide a defense. Hardenbergh v. Patrons Oxford Ins. Co., 2013 ME 68, If 13, 70 A.3d 1237. "An insurer's duty to defend arises exclusively from the allegations in the complaint and the language of the policy." Id. Therefore an insurer may appropriately refuse to defend an insured if the allegations of the complaint are not within the threshold grant of coverage or if they fall entirely within a policy exclusion. Mitchell v. Allstate Ins. Co., 2011 ME 133, ¶ 13, 36 A.3d 876.
Although the duty to defend is broad, it is not limitless. The duty to defend "does not encompass alleged hazards not within the scope of the policy." Prime Tanning Co. v. Liberty Mut. Ins. Co., 750 F.Supp.2d 198, 208 (D. Me. 2010); Baywood Corp. v. Me. Bonding & Cas. Co., 628 A.2d 1029, 1030-31 (Me. 1993) (finding no duty to defend when a complaint alleged "a business risk specifically excluded from the policy"). A duty to defend "cannot be triggered by pure speculation as to conduct or causes of action that are not either set forth in, or fairly suggested by, the allegations of the complaint." W. World Ins. Co. v. Am. & Foreign Ins. Co., 180 F.Supp.2d 224, 232 (D. Me. 2002) (applying Maine law); accord Reliance Ins. Co. v. Shenandoah S., Inc., 81 F.3d 789, 791 (8th ...