Candlelight Mini Storage, Inc. v. Chubb Group Insurance Companies

Filing 20

ORDER: Defendant's Motion to Dismiss Count III of Second Amended Complaint 17 is DENIED. Defendant shall file an Answer to the Plaintiff's Second Amended Complaint 14 within 14 days. Signed by Judge James S. Moody, Jr on 10/24/2012. (LN)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION

CANDLELIGHT MINI STORAGE, INC.,
a Florida corporation,
Plaintiff,
v.

Case No: 8:12-cv-393-T-30MAP

CHUBB GROUP INSURANCE
COMPANIES (d/b/a FEDERAL
INSURANCE COMPANY),
an Indiana corporation,
Defendant.

ORDER ON MOTION TO DISMISS
THIS CAUSE comes before the Court upon Defendant’s Motion to Dismiss Count
III of Second Amended Complaint (Dkt. #17) and Plaintiff’s Response in Opposition
(Dkt. #18). The Court having considered the motion and memoranda of law submitted by
the parties, and being otherwise fully advised, concludes the Motion to Dismiss should be
denied.
BACKGROUND
The factual background is drawn from the allegations of the Second Amended
Complaint (Dkt. #14), which the Court accepts as true for the purpose of this motion
only.
Candlelight Mini Storage, Inc. filed its Complaint against Chubb Group Insurance
Companies, (d/b/a Federal Insurance Company), in state court in Hernando County,

Florida on November 4, 2011. Federal Insurance then filed its Notice of Removal to this
Court on February 23, 2012.
On March 6, 2012, Federal Insurance filed its Motion to Dismiss Counts II and III
of Candlelight’s Complaint or Motion for More Definite Statement. Candlelight filed its
Response to Federal Insurance’s Motion, as well as an Amended Complaint, on March
20, 2012. Federal Insurance moved to dismiss Count III of the amended complaint on
March 27, 2012, and the Court granted Federal Insurance’s motion on June 13, 2012.
On July 3, 2012, Candlelight filed its Second Amended Complaint, which raises
three claims. Count I seeks a declaratory judgment, Count II alleges a breach of contract
by Federal Insurance, and Count III is an action in equity to enforce the bond terms.
In 2006, Candlelight entered into a contract with Hampton Ridge Developers,
LLC for the purchase of property. The agreement required Hampton Ridge to construct
requisite offsite infrastructure improvements, and was secured by a bond issued by
Federal Insurance. Candlelight relied on the bond when purchasing the property.
Hampton Ridge breached the contract by failing to construct the offsite
improvements for which the bond was issued. Although Candlelight made a demand on
the bond, Federal Insurance has failed to make payment on the bond or otherwise remedy
Hampton Ridge’s default. Candlelight has suffered expenses and losses as a result of
Hampton Ridge’s default and Federal Insurance’s failure to perform according to the
terms of the bond.

Page 2 of 5

Federal Insurance’s present Motion to Dismiss argues that Count III should be
dismissed because Candlelight alleges an adequate remedy at law.
STANDARD OF REVIEW
Federal Rule of Civil Procedure 12(b)(6) allows a complaint to be dismissed for
failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12 (b)(6). When
reviewing a motion to dismiss, a court must accept all factual allegations contained in the
complaint as true, and view the facts in a light most favorable to the plaintiff. See
Erickson v. Pardus, 551 U.S. 89, 93-94 (2007). However, unlike factual allegations,
conclusions in a pleading “are not entitled to the assumption of truth.” Ashcroft v. Iqbal,
129 S.Ct. 1937, 1950 (2009). On the contrary, legal conclusions “must be supported by
factual allegations.” Id. Indeed, “conclusory allegations, unwarranted factual deductions
or legal conclusions masquerading as facts will not prevent dismissal.” Davila v. Delta
Air Lines, Inc., 326 F.3d 1183, 1185 (11th Cir. 2003). In order to survive a motion to
dismiss, the complaint must “contain sufficient factual matter, accepted as true, to ‘state a
claim to relief’ that is plausible on its face.” Bell Atlantic Corp. v. Twombly, 550 U.S.
544, 570 (2007).
DISCUSSION
Federal Insurance argues that Count III of the complaint should be dismissed
because Candlelight has an adequate remedy at law in the form of money damages.
Federal Insurance contends that Candlelight’s allegations in Count III can serve as a basis

Page 3 of 5

for a breach of contract claim, but cannot state a claim for an action in equity to enforce
bond terms because Candlelight has a remedy at law.
Candlelight’s Second Amended Complaint does allege a breach of contract by
Federal Insurance in Count II. Federal Rule of Civil Procedure 8(d)(2), however,
expressly permits a plaintiff to assert alternative claims either in a single count or in
multiple counts. Candlelight specifically labels Count III as an “Action in Equity to
Enforce Bond Terms, Alternatively to Counts I and II.” (Dkt. #14).
In Count III, Candlelight alleges that Federal Insurance received and retained the
benefit of a payment to issue the bond, which promised to indemnify Candlelight against
“all loss cost or expense” resulting from Hampton Ridge’s failure to construct the
improvements. Second Amended Complaint (Dkt. #14), ¶56. Candlelight relied on
Federal Insurance’s promise to its detriment when it purchased the property prior to
improvements being constructed. Candlelight further asserts that its reliance on Federal
Insurance’s promise was reasonable, and that Federal Insurance knew or should have
known that Candlelight would act to its detriment in reliance on Federal Insurance’s
promise. Candlelight also claims that it has incurred losses, expenses, and damages
caused by Federal Insurance’s failure to fulfill its promise. These damages allegedly
include the purchase price of the property, interest, reduction in the market value of the
property, lost profits, real estate taxes, attorney’s fees, and engineering fees.
Although Candlelight cannot recover on both counts, Candlelight is permitted to
plead an equitable count in the alternative. See, e.g, Shibata v. Lim, 133 F. Supp. 2d 1311,
Page 4 of 5

1320 (M.D. Fla. 2000) (stating that under federal and Florida Rules, a plaintiff is
permitted to assert alternative claims for breach of contract and unjust enrichment,
though plaintiff would not be able to recover on both counts).
Accordingly, Count III should not be dismissed.
CONCLUSION
It is therefore ORDERED AND ADJUDGED that:
1.

Defendant’s Motion to Dismiss Count III of Second Amended Complaint
(Dkt. #17) is DENIED.

2.

Defendant shall file an Answer to the Plaintiff’s Second Amended
Complaint (Dkt. #14), within 14 days.

Copies furnished to:
Counsel/Parties of Record
S:\Odd\2012\12-cv-393 mtd.doc

Page 5 of 5