Rose Hill Cumberland Presbyterian Church v. Church Mutual Insurance Company SI
Filing
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ORDER granting in part and denying in part 29 Motion to Compel; granting 31 Motion to Amend Complaint; directing Defendant to comply no later than 7 days from the entry date of this Order, by 5:00 p.m., regarding the second motion to compel; directing Plaintiff to file its amended complaint no later than 7 days from entry date of this Order, by 5:00 p.m.; and permitting Defendant to file an amended response. Signed by Magistrate Judge Jerome T. Kearney on 2/6/2024. (ldb)
IN THE UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF ARKANSAS
CENTRAL DIVISION
ROSE HILL CUMBERLAND
PRESBYTERIAN CHURCH
V.
PLAINTIFF
Case No. 4:23-cv-00335-LPR-JTK
CHURCH MUTUAL INSURANCE
COMPANY, S.I.
DEFENDANT
ORDER
Pending before the Court are Rose Hill Cumberland Presbyterian Church’s (“Plaintiff”)
Second Motion to Compel Discovery (Doc. No. 29) and Motion to Amend Complaint (Doc.
No. 31). Church Mutual Insurance Company, S.I. (“Defendant”) filed an untimely response to the
second motion to compel and submitted a timely email response to the motion to amend.1 The
motions are ripe for consideration, and Judge Lee Rudofsky referred them to the undersigned for
resolution. (Doc. Nos. 25, 32)
BACKGROUND
Plaintiff filed suit against Defendant over an insurance coverage dispute. Specifically,
Plaintiff alleges that Defendant refused to pay the total cost of $267,953.08 for restoration repair
services after Plaintiff’s building sustained significant water damage. Plaintiff claims that
Defendant only paid $128,672.53 and currently owes $139,280.55. Plaintiff also asserts that
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In an email dated January 24, 2023, and a response filed the same day, Defendant
informed the Court that it believes it has fully complied with the Court’s order dated December
18, 2023, granting Plaintiff’s first motion to compel discovery. Defendant’s email and response to
the second motion to compel, however, are not timely. The Court received them almost two weeks
past the response period. Furthermore, Defendant did not seek leave to file a late response and did
not indicate if it sought consent from Plaintiff. See Loc. R. 6, 7.
In the same email, Defendant also stated that it does not object to the proposed amended
complaint. That email response is timely. Plaintiff replied to both the email and docketed response.
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Defendant failed to provide a defense to the lien filed against Plaintiff by Service Restoration Inc.,
the company that performed the repairs. Conversely, Defendant denies that it has only issued
payments totaling $128,672.53 and further denies any other wrongdoing pursuant to the terms,
provisions, conditions, and exclusions contained in the insurance policy.
After initiating this lawsuit, Plaintiff sent a revised copy of its First Set of Interrogatories
to Defendant on July 19, 2023. Thereafter, Plaintiff sent its First Set of Requests for Production of
Documents (RFP). The first discovery dispute involves Defendant’s initial responses to both the
interrogatories and RFP.
On December 18, 2023, the undersigned entered an order granting Plaintiff’s first motion
to compel discovery. Defendant was ordered either to: (1) respond to the discovery requests by
identifying generally responsive information withheld based on its objections and to produce a
privilege log listing any information or documents withheld based on the attorney-client privilege
or work-product doctrine so that Plaintiff can determine whether to contest the objections or (2)
withdraw the objections based on its answers. The order was specific to Interrogatory Nos. 1, 3, 5,
6, 10, 11, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, and 25, along with RFP Nos. 1, 2, and 3. On
December 21, 2023, Defendant filed its supplemental answers and objections to Plaintiff’s first set
of discovery requests.
A week later, Plaintiff filed its second motion to compel discovery. Plaintiff states that
Defendant’s answer to Interrogatory No. 6 is non-responsive; that Defendant failed to withdraw
its objection to Interrogatory No. 13(b); and that Defendant did not exhibit good faith in
supplementing its answers to Interrogatory Nos. 1, 2, 3, 11, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24,
and 25 because it withdrew its objections but maintained the same answers from the first set of
discovery requests. Plaintiff further contends that Defendant still objects to RFP No. 1 although
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this Court ordered Defendant to answer, that RFP No. 3 should also be answered without objection,
that the supplemental responses to all the RFP are the same as the initial responses except that
Defendant withdrew its objection to RFP No. 2, and that Defendant should be ordered to provide
the claims file without objection(s).
Plaintiff also requests in-camera review of internal email correspondence dated March 15,
2023, that Defendant is withholding based on the attorney-client privilege and work-product
doctrine. Pursuant to federal procedural law and this Court’s local rules, Plaintiff acknowledges
that it tried to resolve the dispute with Defendant but to no avail.
Additionally, Plaintiff seeks leave to file its first amended complaint. It wants to add a
request for declaratory judgment. More specifically, Plaintiff demands that Defendant protects and
defends Plaintiff against the lien and lawsuit filed by Service Restoration Inc.
DISCUSSION
I.
Second Motion to Compel Discovery
The Federal Rules of Civil Procedure permit litigants to “obtain discovery regarding any
nonprivileged matter that is relevant to any party’s claim or defense and proportional to the needs
of the case. . . . Information within this scope of discovery need not be admissible in evidence to
be discoverable.” Fed. R. Civ. P. 26(b)(1). With respect to interrogatories, “[e]ach interrogatory
must, to the extent it is not objected to, be answered separately and fully in writing under oath.”
Fed. R. Civ. P. 33(b)(3). Additionally, a party may request production of documents under Rule
34 of the Federal Rules of Civil Procedure.
If a dispute arises, “a party may move for an order compelling disclosure or discovery.”
Fed. R. Civ. P. 37(a)(1). The Court may then compel a response if “a party fails to answer an
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interrogatory submitted under Rule 33” or if “a party fails to produce documents . . . as requested
under Rule 34.” Fed. R. Civ. P. 37(a)(3)(B)(iii)–(iv).
Here, the Court turns to each of Plaintiff’s concerns regarding Defendant’s supplemental
responses to Plaintiff’s first set of discovery requests.
A. Interrogatories
1. Interrogatory No. 6
Plaintiff alleges that Defendant’s answer to Interrogatory No. 6 is non-responsive and that
Defendant should be ordered to provide the claims file without objections being preserved.
Interrogatory No. 6 states:
6.
As to each fact identified in your answer to the foregoing interrogatory,
please further set forth:
a. An identification of each person who possesses or claims to possess
knowledge of any such fact;
b. An identification, which such particularity as you would require in a
motion to produce, of any writing relating to each such fact;
c. The name, business and residence address, and telephone number of the
present custodian of any writing identified in your answer to the
foregoing subpart to this interrogatory;
d. The date upon which you became aware of such fact and the means by
which you became aware of each such fact.
ANSWER: Please see Defendant’s response to Interrogatory #5 above as well
as the non-privileged documents from Defendant’s claim file produced
contemporaneously in response to Plaintiff’s First Set of Requests for Production.
The answer to Interrogatory No. 5 provides:
The applicable policy of insurance required Defendant to pay for covered losses on
a replacement cost basis. Based upon these policy obligations, Defendant made
payments to Plaintiff and its various vendors/contractors totaling $230,713.41 for
the repair of identified covered losses. Defendant reached this total amount based
upon the investigation it completed into the claim over a period of nearly eight
months. This investigation included (1) retaining an independent adjuster to
investigate the church property and prepare a scope and estimate of necessary
repairs, (2) communicating directly with repair contractors to reach agreements on
the scope of necessary repairs and the price of those repairs, and (3) retaining
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Accuserve Code Blue to perform an independent technical review of invoices
submitted by Service Restoration when it was unable to reach an agreement directly
with that provider. Each of these investigatory methods, among others, supported
Defendant’s position for making payment in the amount identified above.
While Defendant did sufficiently answer Interrogatory No. 5, its answer to Interrogatory
No. 6 is non-responsive. The four subparts specifically request Defendant to provide additional
information: specifically, to identify persons; writings; name and contact information for the
custodians of any writings; and dates regarding the facts described and relied upon by Defendant
as answered in Interrogatory No. 5. The specifics requested in Interrogatory No. 6 are not answered
in the response to Interrogatory No. 5, and Defendant’s reference to that answer is insufficient.
Plaintiff also wants the entire claims file without objections. However, this Court said that
Defendant can produce a privilege log of documents that are withheld based on the attorney-client
privilege or work-product doctrine. Defendant did provide a privilege log with respect to the claims
file. But because the Court is not aware of the exact documents contained in the claims file and
whether they suffice in fully answering Interrogatory No. 6, the Court orders Defendant to fully
supplement its answer to each subpart of Interrogatory No. 6 or, if referencing any production of
documents, to “specif[y] the records that must be reviewed, in sufficient detail to enable [Plaintiff]
to locate and identify them as readily as [Defendant] could; and giv[e] [Plaintiff] a reasonable
opportunity to examine and audit the records and to make copies, compilations, abstracts, or
summaries.” Fed. R. Civ. P. 33(d)(1)–(2). Defendant must comply within seven days from the
entry date of this Order.
2. Interrogatory No. 13(b)
Plaintiff further alleges that Defendant still objects to Interrogatory No. 13(b) after being
ordered to withdraw its objection. Just to be clear, this Court previously ordered Defendant to
either respond to the discovery requests by identifying generally responsive information withheld
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based on its objections and to produce a privilege log if any information is withheld based on the
attorney-client privilege/work-product doctrine or to withdraw the objections based on its answers.
So, Plaintiff is only stating a portion of this Court’s previous order instead of referencing the order
in its entirety.
Proceeding with Interrogatory No. 13(b), it states:
13.
If your answer to the foregoing interrogatory was in the affirmative,
please further set forth:
b.
Each and every step taken by you to investigate the factual basis of
said claim[.]
ANSWER:
b.
Defendant objects to this subpart to the extent it seeks identification of
“each and every” facet of Defendant’s investigation into Plaintiff’s
insurance claim. The investigation took place over a period of
approximately eight months and involved multiple vendors and
contractors. There are less burdensome means of discovering this
information. These objections notwithstanding, Defendant conducted
a comprehensive investigation into the claim at issue over a period of
nearly eight months. The steps taken during the investigation included,
among other things, (1) speaking with representatives and members of
Plaintiff to investigate the circumstances of the loss; (2) reviewing
various photographs and other documents submitted by Plaintiff and
its third-party vendors/contractors to evaluate the scope and value of
the loss; (3) retaining Tim Toler with Allied Universal Compliance and
Investigations to provide independent adjusting services, including
inspecting the loss site, preparing a scope and estimate of repairs, and
overseeing repairs actually made; (4) coordinating the scope and value
of repairs directly with third-party contractors and vendors; (5)
retaining Accuserve Code Blue to provide technical review services in
order to further investigate the scope and value of invoices submitted
for payment by non-party Service Restoration for water mitigation,
restoration, and pack-out services. Defendant further directs Plaintiff
to the non-privileged claim file documents produced in response to
Plaintiff’s First Set of Requests for Production for additional insight
into the investigation completed by Defendant.
This supplemental response is the same as Defendant’s initial response, and the Court cannot tell
whether or not Defendant has fully answered this interrogatory because of (1) Defendant’s
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preliminary objection and (2) its statement that “[t]he steps taken during the investigation included,
among other things[.]”
First, this Court’s previous order explained that Defendant’s method of objecting and
answering is improper. Defendant cannot properly answer a discovery request while persisting in
its objections. See Jones v. Forrest City Grocery Inc., No. 4:06-CV-00944-WRW, 2007 WL
841676, at *1 (E.D. Ark. Mar. 16, 2007) (unpublished). Second, Defendant’s answer implies that
other steps were taken but that Defendant did not include those steps in its answer. The Court is
not ordering a detailed narrative as an answer, but to say that this request is unduly burdensome,
when providing some of the investigatory steps but not all, seems to be a bit of a stretch.
As to Interrogatory No. 13(b), Defendant is ordered either to respond by identifying
generally responsive information withheld based on any other objection if applicable and to
produce a privilege log of information withheld if necessary or to withdraw the objection based on
its answer that should be set out fully. If referencing any production of documents, Defendant
should “specif[y] the records that must be reviewed, in sufficient detail to enable [Plaintiff] to
locate and identify them as readily as [Defendant] could; and giv[e] [Plaintiff] a reasonable
opportunity to examine and audit the records and to make copies, compilations, abstracts, or
summaries.” Fed. R. Civ. P. 33(d)(1)–(2). Defendant must comply within seven days from the
entry date of this Order.
3. Interrogatory Nos. 1, 2, 3, 11, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25
Next, Plaintiff contends that Defendant did not exhibit good faith in supplementing its
responses to Interrogatory Nos. 1, 2, 3, 11, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, and 25 because it
withdrew its objections but maintained the same answers from the first set of discovery requests.
To reiterate, this Court previously ordered Defendant either to respond to the discovery requests
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by identifying generally responsive information withheld based on its objections and to produce a
privilege log of information withheld when necessary or to withdraw the objections based on its
answers.
To the extent that Defendant withdrew its objections, Defendant must answer each
interrogatory in accordance with Rule 33 of the Federal Rules of Civil Procedure. In other words,
Defendant’s answers should be unqualified and answered fully. See Fed. R. Civ. P. 33(b)(3). If
referencing any production of documents, the answer must “specif[y] the records that must be
reviewed, in sufficient detail to enable [Plaintiff] to locate and identify them as readily as
[Defendant] could; and giv[e] [Plaintiff] a reasonable opportunity to examine and audit the records
and to make copies, compilations, abstracts, or summaries.” Fed. R. Civ. P. 33(d)(1)–(2). To ensure
compliance with Rule 33(d) specifically, the Court orders Defendant to examine its answers to
Interrogatory Nos. 2, 3, 11(d), 15, 18, 19, 21, and 23, which direct Plaintiff to the claims file. The
answers to the remaining interrogatories appear to be responsive. Defendant must comply within
seven days from the entry date of this Order.
B. RFP
Additionally, Plaintiff finds fault with each of Defendant’s responses to the RFP, which
are governed by Rule 34 of the Federal Rules of Civil Procedure. Upon filing its supplemental
responses to the RFP, Defendant appears to continue its method of objecting to and answering
RFP Nos. 1 and 3, which the Court said Defendant cannot do. The objections, however, reference
privileged documents that are being withheld, and in its previous order, that is a response that the
Court permitted Defendant to provide. Defendant still asserted that the non-privileged documents
have been produced in response to RFP Nos. 1 and 3. Answers to RFP Nos. 2 and 4 also appear to
be responsive.
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At this point, both parties have indicated that Plaintiff has possession of the claims file.
The Court is satisfied with Defendant’s privilege log and has no reason to believe that Defendant
is being dishonest regarding the nature of its privileged documents. On that basis, the Court denies
Plaintiff’s request for in-camera review of Defendant’s email correspondence dated March 15,
2023.
II.
Motion to Amend Complaint
Furthermore, Plaintiff seeks to amend its complaint under Federal Rule of Civil Procedure
15, which governs amended and supplemental pleadings. It requests leave of court to add a
provision for declaratory relief. See Fed. R. Civ. P. 57.2
“The court should freely give leave when justice so requires.” Fed. R. Civ. P. 15(a)(2).
Although litigants do not have an absolute right to amend their pleadings, federal procedural law
favors amendment unless compelling reasons exist in support of denying the request. Those
reasons are “undue delay, bad faith on the part of the moving party, futility of the amendment, or
unfair prejudice to the non-moving party can be demonstrated.” Hillesheim v. Myron’s Cards &
Gifts, Inc., 897 F.3d 953, 955 (8th Cir. 2018) (internal quotation omitted).
Here, it does not appear that any of the compelling reasons for denying leave to amend are
present. Likewise, in its email to the Court, Defendant did not object to the proposed amended
complaint. Based on the current record and leniency toward amendment under federal procedural
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Plaintiff thinks that the Arkansas Rules of Civil Procedure govern its motion to amend
complaint. Its motion requesting to amend complaint, however, is governed by the Federal Rules
of Civil Procedure. “Under the doctrine of Erie R[ailroad] Co[mpany] v. Tompkins, federal courts
sitting in diversity apply state substantive law and federal procedural law.” Smith v. Northland
Cap. Fin. Servs., LLC, No. 4:20-CV-01115-KGB, 2022 WL 1459580, at *3 n.2 (E.D. Ark. May 9,
2022) (unpublished). Stated differently, federal procedural law applies “in all civil actions and
proceedings in the United States district courts, except as stated in Rule 81.” Fed. R. Civ. P. 1.
Therefore, Rules 15 and 57 of the Federal Rules of Civil Procedure control here.
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law, Plaintiff’s Motion to Amend Complaint is granted. Plaintiff must file its amended complaint
within seven days from the entry date of this Order. Defendant shall comply with the Federal Rules
of Civil Procedure and this District’s Local Rules in filing its amended answer or other response.
CONCLUSION
For the foregoing reasons, Plaintiff’s Second Motion to Compel (Doc. No. 29) is
GRANTED in part and DENIED in part, and its Motion to Amend Complaint (Doc. No. 31) is
GRANTED. Regarding the second motion to compel, Defendant shall comply no later than seven
days from the entry date of this Order, by 5:00 p.m. Additionally, Plaintiff shall file its amended
complaint no later than seven days from entry date of this Order, by 5:00 p.m. Defendant is also
permitted to file an amended response pursuant to the Federal Rules of Civil Procedure and this
District’s Local Rules.
IT IS SO ORDERED this 6th day of February, 2024.
____________________________________
JEROME T. KEARNEY
UNITED STATES MAGISTRATE JUDGE
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