Mulvey Construction, Inc. v. Bituminous Casualty Corp.

Filing

UNPUBLISHED AUTHORED OPINION filed. Originating case number: 1:07-cv-00634 Copies to all parties and the district court/agency. [999351831].. [13-1571]

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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

No. 13-1571

MULVEY CONSTRUCTION,
COMPANY,

INCORPORATED;

ONE

BEACON

INSURANCE

Plaintiffs – Appellants,
and
DCI/SHIRES, INCORPORATED,
Intervenor/Plaintiff
v.
BITUMINOUS CASUALTY CORPORATION;
AGENCY OF VIRGINIA, INCORPORATED,

BROWN

&

BROWN

INSURANCE

Defendants – Appellees.

Appeal from the United States District Court for the Southern
District of West Virginia, at Bluefield. David A. Faber, Senior
District Judge. (1:07-cv-00634)

Argued:

January 29, 2014

Decided:

May 7, 2014

Before DUNCAN, KEENAN, and WYNN, Circuit Judges.

Affirmed in part and vacated in part and remanded by unpublished
opinion.
Judge Wynn wrote the opinion, in which Judge Duncan
and Judge Keenan joined.

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ARGUED: Stuart A. McMillan, BOWLES RICE LLP, Charleston, West
Virginia, for Appellants.
Avrum Levicoff, LEVICOFF, SILKO &
DEEMER, PC, Pittsburgh, Pennsylvania; Henry I. Willett, III,
CHRISTIAN & BARTON, LLP, Richmond, Virginia, for Appellees. ON
BRIEF: Thomas M. Hancock, BOWLES RICE LLP, Charleston, West
Virginia, for Appellants.
Pamela C. Deem, KAY CASTO & CHANEY,
PLLC, Charleston, West Virginia, for Appellee Brown & Brown
Insurance Agency of Virginia, Inc.

Unpublished opinions are not binding precedent in this circuit.

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WYNN, Circuit Judge:
A city utility worker was killed when the trench he was
working in collapsed while he was repairing a sewage line at a
construction site for a McDonald’s restaurant in Bluefield, West
Virginia.
the

His estate brought a wrongful death action against

general

restaurant,

contractor
Mulvey

responsible

Construction,

subcontractor, DCI/Shires (“DCI”).

for

Inc.

constructing

(“Mulvey”),

and

the
its

In response, DCI’s insurance

company, Bituminous Casualty Corporation (“Bituminous”), refused
to defend and indemnify Mulvey.

That refusal prompted Mulvey

and its insurer, One Beacon Insurance Company (“One Beacon”), to
bring this action, which requires us to determine the scope of
DCI’s insurance policy from Bituminous.
decide

which

dispute,

state’s

whether

law

Mulvey

applies
was

to

covered

In particular, we must
this

by

insurance

DCI’s

contract

insurance,

and

whether the applicable statute of limitations bars Mulvey’s and
its insurer’s third-party beneficiary claim.
For the reasons explained below, we affirm the district
court’s holding that Virginia law controls the contract issue,
that Virginia law does not allow estoppel to extend an insurance
policy’s coverage, and that Appellants’ third-party beneficiary
claim

is

However,

barred
we

Appellants’

by

the

reverse
insured

Virginia

the

contract

statutes

district
and
3

duty

court’s
to

of

limitations.
rejection

defend

claims

of
and

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remand

this

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matter

to

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the

district

court

for

further

consideration.

I.
In May 2002, DCI, a Virginia corporation, applied for a
renewal insurance policy with Bituminous through Brown & Brown
Insurance Agency (“Brown”), a Virginia insurance agency.

DCI

had a Virginia post office box as its mailing address, but DCI’s
physical office was in Bluefield, West Virginia.

Bituminous

issued DCI’s renewal policy, which was effective from May 20,
2002 to May 20, 2003.

Although Bituminous’s headquarters is in

Illinois, the policy identified its Richmond, Virginia branch
office as the location for “the insurance company issuing this
insurance”

and

referred

inquiries

to

the

Corporation Commission’s Bureau of Insurance.

Virginia

State

J.A. 50.

In July 2002, Mulvey entered into a subcontract agreement
with

DCI

for

a

portion

of

the

construction

restaurant in Bluefield, West Virginia.
agreement,
additional

DCI

agreed

insureds

on

to
its

list

a

McDonald’s

Under the subcontract

Mulvey

insurance

of

and

policy

McDonald’s
with

as

Bituminous.

To satisfy this requirement, DCI sent the subcontract agreement
to Brown.
insurance

In July and August 2002, Brown issued certificates of
stating

that

Mulvey

and
4

McDonald’s

were

additional

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insureds

on

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DCI’s

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insurance

policy

with

Bituminous.

The

certificates of insurance also stated that “THIS CERTIFICATE IS
ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS
UPON THE CERTIFICATE HOLDER.

THIS CERTIFICATE DOES NOT AMEND,

EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW.”
J.A. 44, 259-64.

DCI’s insurance policy was not amended to add

Mulvey and McDonald’s as additional insureds.

In October 2002,

Brown sent a copy of the insurance policy to DCI.
In January 2003, a city employee was attempting to repair a
pipe next to the McDonald’s restaurant when the trench he was in
collapsed and killed him.

His estate sued McDonald’s, Mulvey,

and DCI for wrongful death, alleging that the retaining wall at
the McDonald’s had been negligently constructed.

Mulvey and

McDonald’s requested that Bituminous defend them in the wrongful
death action.
nor

McDonald’s

Mulvey

and

Bituminous refused, stating that neither Mulvey
was

an

McDonald’s

additional
settled

the

insured
wrongful

on

DCI’s

death

policy.

suit,

and

Mulvey’s insurer, One Beacon, paid the settlement on behalf of
McDonald’s and Mulvey.
Appellants Mulvey and One Beacon initiated an arbitration
action against DCI in New York asserting indemnification and
breach of contract claims.
action

against

Bituminous

In 2007, Appellants brought this
and

Brown

seeking

a

declaratory

judgment that Mulvey was entitled to coverage from Bituminous
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for the underlying action and payment of settlements and legal
fees.

The complaint (and later the amended complaint) included

a breach of contract claim against Bituminous, an estoppel claim
against

Bituminous

and

claim against Brown.
these claims.
separate

The

summary

Brown,

and

a

third-party

beneficiary

Bituminous moved for summary judgment on
district

judgment

court

orders

addressed
during

these

the

claims

case

and

in
the

district court’s conclusion of each of these individual claims
did not resolve the other claims.
The

district

court

granted

Bituminous

contract

claim.

supplemental

ruled

summary

that

judgment

However,

briefing

on

claims under Virginia law.

the

the

Virginia
on

law

applied

Appellants’

district

estoppel

and

breach

and
of

court

allowed

insured

contract

Mulvey and One Beacon had originally

conceded that the insurance contract was formed in Virginia,
but,

after

the

district

court

granted

summary

judgment

to

Bituminous on the breach of contract claim, moved to amend the
judgment arguing that the policy was issued in West Virginia.
The district court ordered them to offer evidence supporting
their

change

of

view

on

the

location

of

contract

formation.

Appellants provided affidavits stating that a DCI employee was
assigned to gather mail from DCI’s Virginia post office box and
carry it to the offices in West Virginia.

6

The district court

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reaffirmed its earlier ruling that Virginia law governed the
case.
Brown also moved for summary judgment on Appellants’ thirdparty beneficiary claim, arguing that the claim was barred by
the

statute

of

limitations.

The

district

court

agreed

and

judgment

to

granted summary judgment to Brown.
The

district

court

also

granted

summary

Bituminous on Appellants’ estoppel claim and held that Virginia
law

does

not

allow

estoppel

to

extend

insurance

coverage,

especially where the disclaimer language in the certificates was
“clear and unambiguous[.]”

J.A. 625-28.

However, the district

court stayed the case pending completion of the ongoing New York
arbitration
After
renewed

before

Appellants
their

considering
dismissed

motion

contract theory.

for

the

the

insured

New

summary

York
judgment

contract

theory. 1

arbitration,
on

the

they

insured

The district court rejected the theory and

granted summary judgment to Bituminous.

Mulvey and One Beacon

timely appealed these rulings.

1

The amended complaint does not contain an insured contract
claim as one of the specified counts.
However, the amended
complaint sought a declaration that “Mulvey’s subcontract
agreement with [DCI] is an insured contract under DCI’s
Bituminous policy so that Mulvey stands in the shoes of DCI for
coverage purposes” and that “Bituminous owes Mulvey a duty to
indemnify and defend it as an additional insured with an insured
contract on its policy of insurance covering DCI . . . .” J.A.
197.
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II.
First, Appellants argue that the district court erred in
ruling that Virginia law, rather than West Virginia law, applied
in this case.

Second, Appellants argue that the district court

erred in holding that estoppel did not apply and that Mulvey
could not rely on the certificates of insurance to establish
coverage under DCI’s insurance policy.
that

the

district

court

erred

Third, Appellants argue

in

rejecting

their

insured

contract theory; namely, that the subcontract between Mulvey and
DCI did not trigger a duty to defend requiring Bituminous to
defend

Mulvey

Finally,

and

Appellants

McDonald’s
argue

in

that

the
the

wrongful
district

death
court

action.
erred

in

applying Virginia’s statute of limitations and granting summary
judgment on the third-party beneficiary claims to Bituminous.
We address each issue in turn.

III.
We

review

determination.
231–34 (1991).

de

novo

the

district

court’s

choice

of

law

See Salve Regina Coll. v. Russell, 499 U.S. 225,
When a district court is considering a case

based on diversity jurisdiction, the court must apply the forum
state’s conflict of laws rules.
8

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Mfg. Co., 313 U.S. 487, 496 (1941).

Here, the forum state is

West Virginia; thus, West Virginia’s choice of law principles
must be applied.
In West Virginia, generally, the law of the state where an
insurance contract was formed governs contract disputes:
“In a case involving the interpretation of an
insurance policy, made in one state to be performed in
another, the law of the state of the formation of the
contract shall govern, unless another state has a more
significant relationship to the transaction and the
parties, or the law of the other state is contrary to
the public policy of this state.”
Joy Tech., Inc. v. Liberty Mut. Ins. Co., 421 S.E.2d 493, 496
(W. Va. 1992) (quoting Liberty Mut. Ins. Co. v. Triangle Indus.,
Inc., 390 S.E.2d 562, 563 (W. Va. 1990)).

We thus begin our

inquiry with an examination of where the pertinent contract was
formed.
A.
Under West Virginia law, “[a] contract is made at the time
when the last act necessary for its formation is done, and at
the place where the final act is done.”
Banking

&

Trust

Co.,

207

S.E.2d

897,

Carper v. Kanawha
901

(W.

Va.

1974)

(syllabus, pt. 8) 2 (citing Restatement of Contracts § 74 (1932));

2

“Pursuant to West Virginia’s Constitution, the Supreme
Court of Appeals of West Virginia articulates new points of law
through its syllabus.”
Hoschar v. Appalachian Power Co., 739
F.3d 163, 174 n.5 (4th Cir. 2014) (citing Walker v. Doe, 558
S.E.2d 290, 296 (2001)).
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see also Tow v. Miners Mem’l Hosp. Ass’n, 305 F.2d 73, 75 (4th
Cir. 1962) (“Examining [West Virginia] law, we find that the
contract here in question was made in New York because there the
last event occurred necessary to make a binding agreement[.]”).
The West Virginia Supreme Court has observed that “[a]n
insurance contract, similar to other contracts, ‘is an offer and
acceptance supported by consideration.’

. . . The application

for insurance is the offer, which the insurer then decides to
accept, reject or modify.

The insurer then issues a policy or

certificate of insurance that evidences the insurance contract.”
Keller v. First Nat’l Bank, 403 S.E.2d 424, 427 n.5 (W. Va.
1991) (quoting Warden v. Bank of Mingo, 341 S.E.2d 679, 682
(1985)).

Therefore, where a party has made an offer to the

insurance

company

by

applying

for

insurance,

the

insurance

company’s issuance of the policy constitutes its acceptance.
Appellants

argue

that

the

district

court

concluding that Virginia law governs the case.
they

contend

that

the

insurance

contract

erred

in

Specifically,

between

DCI

and

Bituminous was formed in West Virginia because DCI’s principal
office is located there.
the

contract

in

West

Appellants contend that DCI accepted

Virginia

when

the

insurance

policy

was

opened in DCI’s West Virginia office or when the premium check
was signed in DCI’s West Virginia office.

10

We disagree.

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Under

West

constituted
response,

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the

Virginia
offer

Bituminous

accepting DCI’s offer.

to

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law,

DCI’s

create

issued

the

the

renewal

insurance
insurance

application

contract.
policy,

In
thus,

At that point, the contract was formed

according to West Virginia law.

Neither the opening of the copy

of the policy in DCI’s West Virginia’s office nor the first
premium payment constituted the final act of contract formation.
The issuance of the policy from Bituminous’s Virginia branch
office represented Bituminous’s acceptance of DCI’s offer, the
last

act

necessary

to

form

the

insurance

contract.

Thus,

Virginia law applies—unless another state has a more significant
relationship or Virginia’s law contravenes West Virginia public
policy.

B.
Regarding

whether

another

state

has

a

more

significant

relationship to the transaction and parties than Virginia, the
West

Virginia

(Second)

of

Supreme
Conflict

Court
of

has

Laws

looked

and

to

the

identified

Restatement

several

exclusive factors for courts to consider:
(a) the needs of the interstate and international
systems,
(b) the relevant policies of the forum,
(c) the relevant policies of other interested states
and the relative interests of those states in the
determination of the particular issue,
(d) the protection of justified expectations,
11

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(e) the basic policies underlying the particular field
of law,
(f)
certainty,
predictability
and
uniformity
of
result, and
(g) ease in the determination and application of the
law to be applied.
Triangle, 390 S.E.2d at 567.

The West Virginia Supreme Court

placed great emphasis on uniformity and predictability, holding
that
“certainty, predictability and uniformity of result,”
as well as “ease in the determination and application
of the law to be applied” is essential to the
interpretation of an insurance policy when the law is
not otherwise chosen by the parties. Given the
increasingly complex nature of the insurance industry,
we believe that the needs of the “interstate” system
of insurance require that law be applied in the most
uniform and predictable manner possible.
Id.

The

expectations,

Court

demonstrated

also

examining
any

looked

to

whether

reasonable

the
“the

expectation

parties’

reasonable

insurance
at

the

company
time

the

contracts were entered into that any litigation over the policy
would be based upon West Virginia law.”

Id.

The West Virginia Supreme Court discussed the significant
relationship prong in Joy Technologies, Inc. v. Liberty Mutual
Insurance Company, 421 S.E.2d 493 (W. Va. 1992).

In that case,

a company that cleaned and repaired mining machinery in West
Virginia polluted West Virginia property.
for

property

damage

and

personal

12

The company was sued

injuries,

and

the

insurer

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argued that an exclusion applied.

Joy, 421 S.E.2d at 493-96.

Crucial to the exclusion issue was what state’s law applied.
The

West

Virginia

Supreme

precedent

and

identified

applying

the

law

Pennsylvania.

of

Court

factors
the

Id. at 496.

recognized

that

state

of

weighed

the
in

contract

Triangle
favor

of

formation—

However, the Court ultimately was

persuaded to apply West Virginia law because of the nature of
the suit.

The West Virginia Supreme Court’s reasoning focused

on the nature of the suit—toxic pollution—and its close link to
location:
[t]he action in the present case arises out of the
expenditures of monies for remediating damage caused
by pollution to property in West Virginia, and it is
rather clear that the pollution arose from operations
which were conducted in West Virginia and involved a
facility located in West Virginia.
Thus, the injury
occurred in West Virginia, the instrumentality of
injury was located in West Virginia, and the forum
selected to try the issues was West Virginia.
These
factors suggest that West Virginia has had a very
significant relationship to the transaction and the
parties. In fact, the relationship would appear to be
more substantial than that of Pennsylvania, where the
contract was formed.
Id. at 496-97.

For its reasoning, the West Virginia Supreme

Court looked to a New Jersey pollution case, in which the New
Jersey Appellate Division held that New Jersey law controlled a
dispute

about

insurance

“purchased

to

cover

an

operation

or

activity, wherever its principal location, which generates toxic
wastes that predictably come to rest in New Jersey[.]”

13

Gilbert

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Spruance Co. v. Pa. Manufacturers’ Ass’n Ins. Co., 603 A.2d 61,
65 (N.J. App. Div. 1992).
against
position

applying

Similarly, the Joy court decided

Pennsylvania

regarding

the

law

exclusion

because
of

Liberty

coverage

Mutual’s
would

be

“inconsistent with, and contrary to, the public policy of [West
Virginia].”

Id. at 497.

Appellants argue that under Joy, West Virginia law must
apply.

Specifically,

Appellants

claim

that,

as

in

Joy,

the

location and instrumentality of the injury was in West Virginia
and the forum selected to try the issues was West Virginia.

Yet

we find Joy easily distinguishable.
It is hard to imagine cases with stronger local ties than
environmental cases in which toxic pollution has occurred and
local interests in remediation and compensation are paramount.
But environmental
Rather,

this

harm

case

and

pollution

involves

a

are

commercial

not

at

issue

liability

here.

insurance

contract that covers DCI’s construction work in multiple states.
Although

the

tragic

accident

in

this

case

occurred

in

West

Virginia and killed a citizen of that state, the West Virginia
Supreme Court has downplayed the importance of injury location
compared to the place of contract formation.

See Nadler v.

Liberty Mut. Fire Ins. Co., 424 S.E.2d 256, 262 (W. Va. 1992);
Lee v. Saliga, 373 S.E.2d 345, 352 (W. Va. 1988); see also Howe
v. Howe, 625 S.E.2d 716, 723 (W. Va. 2005) (affirming the lower
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court’s finding that Ohio had a more significant relationship to
the parties and transactions because the “only relationship West
Virginia [had] to the parties or transactions at issue [was] the
‘mere fortuity’ that the accident at issue occurred” there);
Johnson v. Neal, 418 S.E.2d 349, 351 (W. Va. 1992) (per curiam)
(“In

the

present

case,

the

insurance

policy

was

issued

Virginia by a Virginia company to a Virginia resident.

in

West

Virginia’s relationship to the transaction based on the situs of
the

accident

and

the

residence

of

the

uninsured

motorist

is

minor.”).
In addition, the reasonable expectation of the parties to
the contract must be considered.

The parties to the insurance

contract included Bituminous, an Illinois corporation operating
out of a Virginia branch office, DCI, a Virginia corporation
that

used

Brown,

a

Virginia

renewal insurance contract.
and

accident

litigation

is

were
the

in

West

insurance

agent,

to

secure

the

Although the construction project
Virginia,

interpretation

which was formed in Virginia.

of

the

centerpiece

the

insurance

of

this

contract,

Thus, the parties to the contract

reasonably should have expected that Virginia law would apply.
In sum, “certainty, predictability and uniformity of result” and
“ease in the determination and application of the law to be
applied”

strongly

support

the

Triangle, 390 S.E.2d at 567.

application

of

Virginia

law.

And we agree with the district
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that

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West

Virginia

did

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not

have

a

more

significant

relationship to the transaction or parties than Virginia.

C.
The third element of the conflict of law analysis requires
the court to determine whether Virginia law is contrary to West
Virginia’s public policy.

This Circuit has recognized that West

Virginia’s public policy exception “is necessarily a narrow one,
to be invoked only in extraordinary circumstances.”

Yost v.

Travelers Ins. Co., 181 F.3d 95, at *6 (4th Cir. June 21, 1999)
(unpublished

but

orally

argued).

The

West

Virginia

Supreme

Court has recognized that “[t]he mere fact that the substantive
law of another jurisdiction differs from or is less favorable
than the law of the forum state does not, by itself, demonstrate
that application of the foreign law under recognized conflict of
laws principles is contrary to the public policy of the forum
state.”

Nadler, 424 S.E.2d at 258 (syllabus pt. 3).

The West

Virginia Supreme Court instructed lower courts not to refuse to
apply foreign law “unless the foreign law is contrary to pure
morals or abstract justice, or unless enforcement would be of
evil example and harmful to [West Virginia’s] own people.”
at 265 (quotation marks omitted).

16

Id.

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Appellants

argue

that

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applying

Virginia

law

would

be

contrary to West Virginia’s public policy, and they assert a
variety

of

policy

considerations

including:

1)

“quickly

determining which insurance is primary,” 2) “encourag[ing] the
resolution

of

settlement,”

controversies

3)

“regulating

by

contracts

insurance

of

compromise

practices

in

and

regard

to

West Virginia residents, West Virginia accidents, and how people
in

West

Virginia

accountable

in

are

a

treated;”

court

of

law

and

4)

when

“hold[ing]

they

coverage” and enforcing indemnity agreements.

insurers

wrongfully

deny

Appellants’ Br.

at 22-24.
Appellants

made

district court.

no

public

policy

arguments

before

the

J.A. 392 (“[T]he court does not find (nor do

plaintiffs argue) that the law of Virginia is contrary to the
public

policy

arguments

are

of

West

Virginia.”).

unavailing.

In

Appellants

any

have

event,

not

their

shown

how

Virginia’s public policy differs on any of these grounds or how
Virginia’s law is “contrary to pure morals or abstract justice.”
Nadler, 424 S.E.2d at 265 (quotation marks omitted).
Consequently, Appellants have failed to show that we should
depart

from

the

default

rule

that

the

contract

should

governed by the laws of Virginia—the state of formation.

be
West

Virginia does not have a more significant relationship to the
transaction, and Virginia law is not contrary to West Virginia
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public policy.

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Therefore, we affirm the district court’s choice

of law determination.

IV.
With

their

next

argument,

Appellants

contend

that

Bituminous should be estopped from refusing to defend Mulvey and
McDonald’s

in

certificates

of

the

wrongful

suit

stating

insurance

death

that

because
Mulvey

Brown
and

issued

McDonald’s

were additional insureds on DCI’s policy with Bituminous.

We

review the district court’s grant of summary judgment de novo.
FDIC v. Cashion, 720 F.3d 169, 173 (4th Cir. 2013).
Under Virginia law, a party seeking to invoke the doctrine
of

estoppel

must

prove

by

“clear,

precise,

and

unequivocal

evidence” the following elements:
(1) A material fact was falsely represented or
concealed; (2) The representation or concealment was
made with knowledge of the fact; (3) The party to whom
the representation was made was ignorant of the truth
of the matter; (4) The representation was made with
the intention that the other party should act upon it;
(5) The other party was induced to act upon it; and
(6) The party claiming estoppel was misled to his
injury.
Boykins Narrow Fabrics Corp. v. Weldon Roofing and Sheet Metal,
Inc.,

266

S.E.2d

887,

890

(Va.

1980).

Crucially,

however,

Virginia precedent reflects that estoppel may not be used to
extend the coverage of an insurance contract.
18

Norman v. Ins.

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Co. of N. Am., 239 S.E.2d 902, 908 (Va. 1978) (“The general
rule, which we approve, is that the coverage of an insurance
contract may not be extended by estoppel or implied waiver to
include risks expressly excluded.”) (quoting Sharp v. Richmond
Life Ins. Co., 183 S.E.2d 132, 135 (Va. 1971)).
In

Norman,

the

Virginia

Supreme

Court

referred

to

two

automobile insurance cases where the insurance companies filed a
form

stating

that

“its

policy

was

in

force

and

effect

and

covered the driver[s],” but the Virginia Supreme Court found
that these statements “did not estop the company from denying
coverage when in fact there was no coverage.”

Id. (citing Va.

Farm Bureau Mut. Ins. Co. v. Saccio, 133 S.E.2d 268 (1963) and
Va. Mut. Ins. Co. v. State Farm Mut. Auto. Ins. Co., 133 S.E.2d
277

(1963)).

However,

the

Virginia

Supreme

Court

has

not

squarely addressed whether an insurance company is estopped from
denying

coverage

in

a

situation

such

as

this

case:

where

certificates of insurance have been issued stating that third
parties were added as additional insureds on the policy, but
where

the

third

parties

were

never

actually

added

to

the

underlying insurance policy.
Courts
insurers

around

can

be

the

country

estopped

are

from

split

denying

regarding
coverage

whether
when

a

certificate of insurance that identified a third party as an
additional insured has been issued.
19

Some courts have deemed the

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insurer estopped from denying coverage.

See, e.g., Sumitomo

Marine & Fire Ins. Co. of Am. v. S. Guar. Ins. Co. of Ga., 337
F. Supp. 2d 1339, 1355 (N.D. Ga. 2004); Blackburn, Nickels &
Smith v. Nat’l Farmers Union, 482 N.W.2d 600, 604 (N.D. 1992).
Significantly, West Virginia is one of the states that has held
that

“a

certificate

of

insurance

is

evidence

of

insurance

coverage” and that
because a certificate of insurance is an insurance
company’s written representation that a policyholder
has certain insurance coverage in effect at the time
the certificate is issued, the insurance company may
be estopped from later denying the existence of that
coverage when the policyholder or the recipient of a
certificate has reasonably relied to their detriment
upon a misrepresentation in the certificate.
Marlin v. Wetzel Cnty. Bd. of Educ., 569 S.E.2d 462, 472-73 (W.
Va. 2002).
Other
insurance

courts,
that

however,

expressly

have

states

held
that

that
it

a

does

certificate
not

alter

of
the

coverage of the underlying policy will not be deemed to change
the policy.

In such states, therefore, a party may not rely on

estoppel to assert that it is covered under the policy.

See

e.g., Mountain Fuel Supply v. Reliance Ins. Co., 933 F.2d 882,
889 (10th Cir. 1991); T.H.E. Ins. Co. v. City of Alton, 227 F.3d
802, 806 (7th Cir. 2000); TIG Ins. Co. v. Sedgwick James of
Washington, 184 F. Supp. 2d 591, 597-98 (S.D. Tex. 2001); G.E.

20

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Tignall & Co., Inc. v. Reliance Nat. Ins. Co., 102 F. Supp. 2d
300, 304 (D. Md. 2000).
Here,

the

district

court

cited

Norman

in

holding

that,

under Virginia law, the certificates of insurance could not be
relied upon to establish coverage, particularly given that the
certificates included such a “clear and unambiguous” disclaimer.
J.A.

628.

The

district

court,

therefore,

concluded

that

Bituminous was not estopped from denying coverage.
The

certificates

of

insurance

included

the

direct

and

specific disclaimer that the certificates are provided as “A
MATTER

OF

INFORMATION

CERTIFICATE HOLDER.

ONLY

AND

CONFERS

NO

RIGHTS

We,

THE

THIS CERTIFICATE DOES NOT AMEND, EXTEND OR

ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW.”
259-64.

UPON

like

the

district

court,

must

J.A. 44,

conclude

that

Virginia would not recognize the use of estoppel to change the
policy in the circumstances of this case.

We find instructive

not only Norman, but also Blue Cross and Blue Shield of Virginia
v. Wingfield, 391 S.E.2d 73 (Va. 1990).
Virginia

Supreme

Court

directly

In that case, the

rejected

the

plaintiff’s

estoppel claim, which was based on a brochure that the insurance
company

sent

to

him

outlining

the

policy’s

benefits.

The

brochure included a clear disclaimer that the brochure was not a
contract and that the provisions of the contract governed any
discrepancies.

Wingfield, 391 S.E.2d at 74.
21

The trial court

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Wingfield

damages

Pg: 22 of 30

“because

of

the

difference

in

the

language in the brochure furnished [Wingfield] and that in the
contracts.”
omitted).

Id.

(alteration

in

original)

(quotation

marks

The Virginia Supreme Court disagreed, holding that

the trial court’s application of the doctrine of
estoppel, requiring payment of benefits beyond the
limited contractual time, extended coverage to include
risks not covered by the policy. In doing so, the
court erroneously brought “into being a contract of
insurance where there was none.”
Id. at 75 (quoting Norman, 239 S.E.2d at 908).

Guided by the

Virginia Supreme Court’s rulings in Norman and Wingfield, we
hold that the district court did not err in refusing to apply
estoppel to extend this insurance policy’s coverage beyond its
terms.

V.
With

their

next

argument,

Appellants

claim

that

summary

judgment was inappropriate because, even if Mulvey was not an
additional
policy’s

insured,

insured

Bituminous

contract

still

provision,

had

a

duty,

under

the

to

defend

them

in

the

policy

states

that

damages

wrongful death litigation.
Specifically,
arising
excluded.

from

DCI’s

DCI’s

insurance

contractual

assumption

of

liability

are

But that exclusion does not apply to liability for

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damages

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“[a]ssumed

in

a

contract

‘insured contract’, . . . .”
insured

contract

as

Pg: 23 of 30

“[t]hat

or

agreement

J.A. 105.
part

of

any

that

is

an

The policy defines
other

contract

or

agreement pertaining to your business . . . under which [DCI]
assume[s] the tort liability of another party to pay for ‘bodily
injury’ or ‘property damage’ to a third person or organization.”
J.A. 115.

In the subcontract between DCI and Mulvey, DCI agreed

to
indemnify and hold harmless . . . [Mulvey] . . . from
and against all claims, damages, losses and expenses,
including but not limited to attorney’s fees, arising
out of or arising from performance of [DCI’s] Work
under this Agreement, provided such claim . . . is
attributable to bodily injury, sickness, disease or
death[,] or to injury to or destruction of tangible
property . . . including the loss of use resulting
therefrom, to the extent caused in whole or part by
any neglect act or omission of [DCI] . . . regardless
of whether it is caused in part by a party indemnified
hereunder.
J.A.

41.

Appellants

argue

that

this

provision

renders

the

subcontract an insured contract because DCI assumed the tort
liability of Mulvey.
Assuming for the sake of argument that the subcontract was
an insured contract, we nevertheless agree with the district
court that the indemnitee, Mulvey, was not entitled to coverage
under the insurance policy because no language added Mulvey as
an additional insured or as a third-party beneficiary.

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Appellants attempt to rely on Uniwest Construction, Inc. v.
Amtech

Elevator

Services,

Inc.,

699

S.E.2d

223

(Va.

withdrawn in part on reh’g, 714 S.E.2d 560 (Va. 2011).
case,

a

general

contractor,

Uniwest,

engaged

2010),
In that

subcontractors,

including Amtech, to assist in building renovation work.

The

subcontract required Amtech to name Uniwest as an additional
insured under its liability insurance policies.

Id. at 225-26.

The pertinent policy included as an insured “[a]ny person . . .
to

whom

you

are

obligated

by

a

written

Insured

Contract

to

provide insurance such as is afforded by this policy but only
with

respect

to

.

.

.

liability

arising

out

of

conducted by you or on your behalf . . . .”

operations

Id. at 226.

Amtech’s insurer refused to defend and indemnify Uniwest in a
suit

by

employee.

the

estate

of

a

deceased

employee

and

an

injured

The Virginia Supreme Court held that the insurer was

required to defend and indemnify Uniwest, not merely because the
subcontract between the parties required Amtech to defend and
indemnify Uniwest.

Importantly, the Court found that Amtech’s

policy contained language sufficient to make Uniwest (and any
similarly

situated

contracting

under the policy as well.

party)

an

additional

insured

Id. at 232.

Here, the district court reviewed Uniwest and acknowledged
that, as in Uniwest, the subcontract required DCI to indemnify
Mulvey.

However, the district court underscored “the critical
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difference between the two policies at issue: under [the Uniwest
policy] any person to whom the insured becomes obligated under
an Insured Contract becomes an additional insured . . . .
Bituminous

Policy

has

no

similar

provision.”

The

J.A.

713.

Although we must agree with this analysis, we conclude that it
is incomplete.
Notably, the district court did not address the insurance
policy’s Supplementary Payments section.
does

not

make

Mulvey

an

additional

Although that section

insured,

it

states

that:

“[i]f [Bituminous] defend[s] an insured against a ‘suit’ and an
indemnitee

of

the

insured

is

also

named

as

a

party

to

the

‘suit’, we will defend that indemnittee if all of the following
conditions

are

met[.]”

J.A.

110.

The

requisite

conditions

include, among others: “the insured has assumed the liability of
the

indemnitee

in

.

.

.

an

‘insured

contract’;”

“[t]his

insurance applies to such liability assumed by the insured;”
“the obligation to defend . . . that indemnitee[] has also been
assumed by the insured in the same ‘insured contract[.]’”
110-11.

If

these

conditions

have

been

met,

then

J.A.

Mulvey

is

entitled to Bituminous’s defense and the district court’s grant
of

summary

judgment

to

Bituminous

was

in

error

because

the

insurance company would not be entitled to judgment as a matter
of law.

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Based on the record before us, it appears that at least
some of these conditions may be met.

Under these circumstances,

we cannot affirm the district court’s grant of summary judgment
without

the

section

of

benefit
the

of

its

insurance

analysis

policy.

of
We

a

directly

therefore

relevant

vacate

the

district court’s summary judgment order on the insured contract
theory and remand with specific instructions to the district
court to address whether the requirements of this provision have
been met and whether, specifically taking the provision into
consideration, Bituminous had a duty to defend Mulvey in the
underlying lawsuit.

VI.
Finally, Appellants contend that West Virginia’s, and not
Virginia’s, statute of limitations applies and that the district
court erred by dismissing their third party beneficiary claim on
the basis of Virginia’s shorter statute of limitations period. 3
Appellants contend that the certificates of insurance that Brown
3

Appellants also contend that the district court abused its
discretion by allowing Brown to untimely amend its answer to
include a statute of limitations defense.
Appellants’ Br. at
51-52.
However, upon close review, we reject the appellants’
claim and find that the district court did not abuse its
discretion when it ruled that appellants had failed to show any
prejudice arising from the district court’s decision to grant
Brown leave to amend its answer. See J.A. 582-87.
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sent to DCI qualify as a written contract between Brown and DCI
to add Mulvey to the Bituminous policy.
West Virginia has a five-year statute of limitations for
oral contracts and a ten-year statute of limitations for written
contracts.

W. Va. Code § 55-2-6.

By contrast, Virginia has a

three-year statute of limitations for oral contracts and a fiveyear statute of limitations for written contracts.

Va. Code §

8.01-246(2), (4).
Notably,

however,

borrowing statute.

West

Virginia

has

what

is

known

as

a

It provides that “[t]he period of limitation

applicable to a claim accruing outside of this State shall be
either that prescribed by the law of the place where the claim
accrued or by the law of this State, whichever bars the claim.”
W.

Va.

Code

§

55-2A-2.

Appellants’

third-party

beneficiary

claim is premised on Brown’s alleged failure to add Mulvey as an
additional insured on DCI’s policy.

Appellants have not alleged

that Brown, a Virginia insurance agent, breached an agreement to
add Appellants to the insurance policy in a different state than
where Brown conducts its business, Virginia.
the

borrowing

statute,

then,

Virginia’s

By operation of

shorter

statute

of

limitations applies here.
The district court deemed any contract between Brown and
DCI to add Mulvey to the Bituminous policy oral and barred by
the

statute

of

limitations.

The
27

Virginia

Supreme

Court

has

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recognized that for a contract to qualify as a written contract
for statute of limitations purposes, the contract “must . . .
show on its face a complete and concluded agreement between the
parties.”

Newport News, H. & O. P. Dev. Co. v. Newport News St.

Ry. Co., 32 S.E. 789, 790 (Va. 1899).

Here, on their face, the

certificates of insurance do not represent a written contract.
Rather, they state that they were issued for “INFORMATION ONLY”
and

specifically

HOLDER.”
that

if

“CONFER[RED]

J.A. 44, 259-64.
there

was

any

NO

RIGHTS

UPON

THE

CERTIFICATE

We agree with the district court

contract

requiring

Brown

to

obtain

insurance, then it was an oral contract and thus, the three-year
statute of limitations under Virginia law applied.
Further, even assuming for the sake of argument that the
contract was written and that the longer statute of limitations
applied, this claim would still be barred under Virginia law.
Any breach of that contract occurred no later than August 2002
because

the

final

certificate

of

insurance—the

contract

Appellants assert required their being insured by Bituminous—was
issued on August 9, 2002, and yet Appellants were never added to
the insurance.

But Appellants did not bring the third-party

beneficiary claim until October 11, 2007—after more than five
years

had

passed.

Under

Virginia

law,

the

statute

of

limitations accrues on the date of breach, not the date of the
resulting

damage

is

discovered.
28

Va.

Code

Ann.

§

8.01-230

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(“[T]he

right

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of

action

Pg: 29 of 30

shall

be

deemed

to

accrue

and

the

prescribed limitation period shall begin to run from the date
the injury is sustained in the case of injury to the person or
damage

to

actions

property,

ex

when

the

breach

and

not

when

contractu

discovered[.]”).

of

the

contract

occurs

in

resulting

damage

is

Thus, the third party beneficiary claim would

be barred by the statute of limitations, even assuming that the
longer, written-contract statute applied.
In

response,

Appellants

argue

that

Virginia

law

allows

tolling of the statute of limitation when a defendant misleads a
plaintiff into delayed filing.
Court

has

recognized

And indeed, the Virginia Supreme

tolling

in

the

face

of

affirmative

misrepresentation:
“Mere silence by the person liable is not concealment,
but
there
must
be
some
affirmative
act
or
representation designed to prevent, and which does
prevent, the discovery of the cause of action.
Concealment of a cause of action preventing the
running of limitations must consist of some trick or
artifice preventing inquiry, or calculated to hinder a
discovery of the cause of action by the use of
ordinary diligence, and mere silence is insufficient.
There must be something actually said or done which is
directly intended to prevent discovery.”
Newman

v.

Walker,

618

S.E.

2d

336,

338

(Va.

2005)

(quoting

Culpeper Nat’l Bank v. Tidewater Improvement Co., 89 S.E. 118,
121

(Va.

1916)).

But

Appellants

have

failed

to

show

Appellees took any affirmative actions to meet this bar.

29

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Appellants also argue that Virginia law allows for tolling
“when the failure to procure insurance claim was submitted to
arbitration.”
arbitration

Appellants’

proceedings

Reply

began

in

at

2006,

27.

However,

after

the

the

applicable

three-year statute of limitations for oral contracts expired in
August 2005.
fail,

and

we

Thus, Appellants’ statute of limitations arguments
affirm

the

district

court’s

grant

of

summary

judgment to Brown on the third-party beneficiary claim.

VII.
For the foregoing reasons, we affirm in part and vacate in
part the judgment of the district court and remand for further
proceedings.

AFFIRMED IN PART
VACATED IN PART AND REMANDED

30