Allstate Insurance Company v. Statlender

Filing 35

ORDER granting 22 Motion for Summary Judgment. The Court declares that the business activities exclusion in the policy applies to the claims in the underlying action. If the parties seek further assistance from the Court, they may file a request within 14 days. Unless such a request is received by October 11, 2017, the Clerk will enter judgment in accordance with this ruling and close the case. So ordered. Signed by Judge Robert N. Chatigny on 9/27/2017. (Rickevicius, L.)

UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT
ALLSTATE INSURANCE CO.,

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Plaintiff,
v.
MORRIS STATLENDER,
Defendants.

Case No. 3:16-cv-284 (RNC)

RULING AND ORDER
Plaintiff Allstate Insurance Company brings this action
seeking a declaration that it has no duty to defend or indemnify
Morris Statlender under Allstate Deluxe Homeowners Policy #0 84
823160 08/05 (“policy”) in connection with claims brought against
him by Samantha Schannon in Connecticut Superior Court (Case No.
NNH CV 16 6059514S)(“underlying action”).

In the underlying

action, Ms. Schannon seeks damages for injuries allegedly
resulting from her exposure to toxic mold in an apartment she
rented from Mr. Statlender.
summary judgment.

Pending is Allstate’s motion for

After considering the parties’ submissions,

the motion for summary judgment is granted based on the business
activities exclusion of the policy.
Allstate has demonstrated that Mr. Statlender’s activities
in connection with his rental of the apartment to Ms. Schannon
fall within the scope of the business activities exclusion as a
matter of law.

The policy defines business activities subject to

the exclusion as “any full or part-time activity of any kind
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engaged in for economic gain including the use of any part of the
premises for such purposes.”

The exclusion encompasses “any

property rented or held for rental by an insured person.”
Mr. Statlender argues that the business activities exclusion
might not apply to the claims in the underlying action because
Ms. Schannon’s complaint can be construed to allege that she was
injured by exposure to mold on her first visit to the apartment
before she became a tenant.

By its terms, however, the policy

exclusion for business activities applies to “any activity of any
kind engaged in for economic gain.”

Activities engaged in for

the purpose of renting the premises, such as inviting Ms.
Schannon to tour the premises as a prospective tenant, are
activities engaged in for economic gain within the scope of the
exclusion.
Mr. Statlender argues that his rental of the property to Ms.
Schannon could conceivably fall within an exception to the
business activities exclusion.

The exception he relies on

provides: “Rental of your residence premises is not considered a
business when: (1) it is rented occasionally for residential
purposes.”

Mr. Statlender contends that the word “occasionally”

is ambiguous and should be construed in his favor to require
Allstate to provide him with a defense in the underlying action.
But this exception does not apply, regardless of any arguable

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ambiguity regarding the term “occasionally,” because it is
undisputed that Mr. Statlender did not reside at the premises.
Mr. Statlender asserts that he had a reasonable expectation,
based on the history of his dealings with an Allstate agent, that
the policy would cover any losses.

In granting Allstate’s motion

for summary judgment based on the business activities exclusion
of the policy, the Court does not address the merits of Mr.
Statlender’s claim.

The complaint in this case, and Allstate’s

motion for summary judgment, call for a determination of the
rights and responsibilities of the parties under the language of
the policy without regard to the history of Mr. Statlender’s
dealings with the agent.

A declaratory judgment action such as

this asks for a ruling on the meaning of policy language as a
matter of law.

Whether Mr. Statlender had a reasonable

expectation of coverage, notwithstanding the business activities
exclusion and, if so, what his legal rights might be, are matters
outside the scope of the complaint and they are not addressed by
this ruling.
Accordingly, the motion for summary judgment is granted.
The Court declares that the business activities exclusion in the
policy applies to the claims in the underlying action.
If the parties seek further assistance from the Court, they
may file a request within 14 days.

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Unless such a request is

received, the Clerk will enter judgment in accordance with this
ruling and close the case.
So ordered this 27th day of September 2017.

/s/ RNC
Robert N. Chatigny
United States District Judge

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