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Maine State Properties LLC v. Chubb Custom Insurance Co.

United States District Court, D. Maine

July 11, 2016

MAINE STATE PROPERTIES, LLC, Plaintiff
v.
CHUBB CUSTOM INSURANCE COMPANY, Defendant

          MEMORANDUM DECISION ON MOTION FOR SUMMARY JUDGMENT AND MOTION TO EXCLUDE EXPERT [1]

          JOHN H. RICH III UNITED STATES MAGISTRATE JUDGE.

         Defendant, Chubb Custom Insurance Company (“Chubb”), moves for summary judgment on all claims of the plaintiff, Maine State Properties, LLC (“Maine State”), arising from Chubb’s denial of coverage for a December 17, 2013, property loss suffered by Maine State when pipes froze in an insured commercial building in Biddeford, Maine. See Defendant’s Motion for Summary Judgment (“S/J Motion”) (ECF No. 25) at 1-2; Complaint (ECF No. 1-1), attached to Notice of Removal of Defendant (ECF No. 1), ¶¶ 5-21. In its three-count complaint, Maine State seeks (i) a declaratory judgment that Chubb is obligated to pay for Maine State’s provable damages as a result of the December 17, 2013, loss (Count I), (ii) damages for Chubb’s alleged breach of contract (Count II), and (iii) damages for Chubb’s alleged violation of the Maine Unfair Claims Settlement Practices Act (“UCSPA”), 24-A M.R.S.A. § 2436-A (Count III). See Complaint ¶¶ 13-21. Chubb also moves to exclude all expert testimony of insurance professional Michael L. Averill on the basis that it constitutes impermissible legal argument and is irrelevant. See Defendant Chubb Custom Insurance Company’s Motion To Exclude the Expert Testimony of Michael L. Averill (“Motion To Exclude”) (ECF No. 24) at 1-2. For the reasons that follow, I grant Chubb’s motion for summary judgment in part, as to Maine State’s USCPA claim (Count III), and otherwise deny it, and grant its motion to exclude Averill’s testimony.

         I. Motion for Summary Judgment

         A. Applicable Legal Standards

         1. Federal Rule of Civil Procedure 56

         Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a); Ahmed v. Johnson, 752 F.3d 490, 495 (1st Cir. 2014). “A dispute is genuine if ‘the evidence about the fact is such that a reasonable jury could resolve the point in favor of the non-moving party.” Johnson v. University of P.R., 714 F.3d 48, 52 (1st Cir. 2013) (quoting Thompson v. Coca-Cola Co., 522 F.3d 168, 175 (1st Cir. 2008)). “A fact is material if it has the potential of determining the outcome of the litigation.” Id. (quoting Maymi v. P.R. Ports Auth., 515 F.3d 20, 25 (1st Cir. 2008)).

         The party moving for summary judgment must demonstrate an absence of evidence to support the nonmoving party’s case. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). In determining whether this burden is met, the court must view the record in the light most favorable to the nonmoving party and give that party the benefit of all reasonable inferences in its favor. Johnson, 714 F.3d at 52. Once the moving party has made a preliminary showing that no genuine issue of material fact exists, the nonmovant must “produce specific facts, in suitable evidentiary form, to establish the presence of a trialworthy issue.” Brooks v. AIG SunAmerica Life Assur. Co., 480 F.3d 579, 586 (1st Cir. 2007) (quoting Clifford v. Barnhart, 449 F.3d 276, 280 (1st Cir. 2006) (emphasis omitted)); Fed.R.Civ.P. 56(c). “As to any essential factual element of its claim on which the nonmovant would bear the burden of proof at trial, its failure to come forward with sufficient evidence to generate a trialworthy issue warrants summary judgment to the moving party.” In re Spigel, 260 F.3d 27, 31 (1st Cir. 2001) (citation and internal punctuation omitted).

         2. Local Rule 56

         The evidence that the court may consider in deciding whether genuine issues of material fact exist for purposes of summary judgment is circumscribed by the local rules of this district. See Loc. R. 56. The moving party must first file a statement of material facts that it claims are not in dispute. See Loc. R. 56(b). Each fact must be set forth in a numbered paragraph and supported by a specific record citation. See id. The nonmoving party must then submit a responsive “separate, short, and concise” statement of material facts in which it must “admit, deny or qualify the facts by reference to each numbered paragraph of the moving party’s statement of material facts[.]” Loc. R. 56(c). The nonmovant likewise must support each denial or qualification with an appropriate record citation. See id. The nonmoving party may also submit its own additional statement of material facts that it contends are not in dispute, each supported by a specific record citation. See id. The movant then must respond to the nonmoving party’s statement of additional facts, if any, by way of a reply statement of material facts in which it must “admit, deny or qualify such additional facts by reference to the numbered paragraphs” of the nonmovant’s statement. See Loc. R. 56(d). Again, each denial or qualification must be supported by an appropriate record citation. See id.

         Local Rule 56 directs that “[f]acts contained in a supporting or opposing statement of material facts, if supported by record citations as required by this rule, shall be deemed admitted unless properly controverted.” Loc. R. 56(f). In addition, “[t]he court may disregard any statement of fact not supported by a specific citation to record material properly considered on summary judgment” and has “no independent duty to search or consider any part of the record not specifically referenced in the parties’ separate statement of fact.” Id.; see also, e.g., Borges ex rel. S.M.B.W. v. Serrano-Isern, 605 F.3d 1, 5 (1st Cir. 2010); Fed.R.Civ.P. 56(e)(2) (“If a party fails to properly support an assertion of fact or fails to properly address another party’s assertion of fact as required by Rule 56(c), the court may . . . consider the fact undisputed for purposes of the motion[.]”).

         B. Factual Background

         The parties have stipulated to a number of facts in addition to filing separate statements of material facts. I have set forth their stipulated facts, as well as their separate statements of material facts, crediting the latter to the extent either admitted or supported by record citations in accordance with Local Rule 56, with disputes resolved in favor of Maine State as the nonmovant.[2]

         Maine State was formed by Jeffrey Sneller of Bainbridge Island, Washington, James Swaka of Biddeford, Maine, and Mark Lisson of Bainbridge Island, Washington. Defendant’s Statement of Material Facts in Support of Motion for Summary Judgment (“Defendant’s SMF”) (ECF No. 26) ¶ 2; Plaintiff’s Opposing Statement of Material Facts (“Plaintiff’s Opposing SMF”) (ECF No. 28) ¶ 2. Sneller and Swaka are managers of Maine State, and Sneller, Swaka, and Lisson are affiliated with corporations that are members of Maine State. Id. ¶ 3.

         Chubb issued Maine State a commercial property policy of insurance, Policy Number 99782618-00 (the “Policy”), effective September 5, 2013, to September 5, 2014, covering property located at 145 Main Street in Biddeford, Maine (the “Property”). Stipulated Record for Defendant’s Motion for Summary Judgment (“Stipulations”) (ECF No. 21) ¶ 1 & Exh. A (ECF No. 21-1) thereto. The Policy was underwritten by WKFC Underwriting Managers. Defendant’s SMF ¶ 1; Plaintiff’s Opposing SMF ¶ 1.

         At the time the Policy was in effect, Maine State was the lessee of the Property pursuant to a November 12, 2012, lease with JED Properties, LLC (“JED”). Stipulations ¶ 2.[3] The parties agree that, at all relevant times, Maine State had an insurable interest in the Property. Id. ¶ 3. The Policy provided that Chubb would “pay for direct physical loss of or damage to Covered Property at the premises described in the Declarations caused by or resulting from any Covered Cause of Loss.” Policy at Page ID #91. “Covered Causes of Loss” is defined in the Policy to mean “Risks of Direct Physical Loss, unless the loss is . . . [e]xcluded in Section B., Exclusions; or . . . [l]imited in Section C., Limitations[.]” Id. at Page ID #115.

         As lessee of the Property, Maine State was responsible for maintaining heat in the insured premises. Stipulations ¶ 5. As lessee in possession, Maine State had complete access to and control over the insured premises at all relevant times. Id. ΒΆ 6. Swaka was the person from Maine State who was in charge of maintaining the Property, including maintaining the heat in ...


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