Cameron et al v. Scottsdale Insurance Company
ORDER GRANTING SUMMARY JUDGMENTgranting 13 Motion for Summary Judgment. Closing Case. Motions Terminated: 13 Defendant's MOTION for Summary Judgment filed by Scottsdale Insurance Company. Signed by Judge Marcia G. Cooke on 3/28/2017. (tm) NOTICE: If there are sealed documents in this case, they may be unsealed after 1 year or as directed by Court Order, unless they have been designated to be permanently sealed. See Local Rule 5.4 and Administrative Order 2014-69.
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Case No. 16-21704-Civ-COOKE/TORRES
KEN CAMERON and MICHELLE
SCOTTSDALE INSURANCE COMPANY,
ORDER GRANTING SUMMARY JUDGMENT
The parties in this action dispute certain insurance policy language related to water
damage coverage. Petitioners Ken and Michelle Cameron (“Petitioners”) seek a judicial
declaration of their rights under an insurance policy issued by Respondent Scottsdale
Insurance Company (“Respondent”).
Before me is Respondent’s Motion for Summary Judgment (“Motion”) (ECF No. 13). I
have reviewed the parties’ filings, the record, and the relevant legal authorities. For the reasons
set out below, I grant Respondent’s Motion.
A pipe collapsed in the internal plumbing system of Petitioners’ apartment complex that
caused water and property damage to the premises. ECF No. 1-2 at 3. The pipe was identified
after a tenant reported an overflow of water from a drain in their kitchen sink. ECF No. 14-1 at
3. Petitioners’ plumber described the damage as an “acute pipe failure” arising from an
“abrupt cessation of normal operation” of the collapsed pipe. ECF No. 15-1 at 3. The plumber
ultimately had to break the concrete floor slab in an apartment unit to access and repair the
pipe. ECF Nos. 14-1 at 3, 15-1 at 3. Respondent and Petitioners’ Trust had previously entered
into a commercial property insurance contract (“Policy”) that was in effect at the time of the
incident. ECF No. 1-2 at 3. Respondent investigated the damaged property and refused to
cover the loss based on the Policy’s exclusions. Id. at 3 – 4. Petitioners believe the exclusions, if
applicable, do not apply to water overflows originating from the internal plumbing system.
Several Policy provisions are relevant here. For one, the Policy notes that certain
property is never covered, including “Underground pipes, flues or drains.” ECF No. 7-1 at 55.
Further, the Policy generally excludes coverage for damages arising from “Wear and tear . . .
[or] Rust or other corrosion, decay, deterioration, hidden or latent defect or any quality in
property that causes it to damage or destroy itself.” Id. at 91. But this exclusion excepts
damages resulting from a “specified cause of loss,” id., like “water damage.” Id. at 98. The
Policy defines “water damage” to include “[a]ccidental discharge or leakage of water or stream
as the direct result of the breaking apart or cracking of a plumbing . . . or other system . . . that
is located on the described premises and contains water or steam.” Id. At the same time, a
Water Exclusion Endorsement (“WEE”) prevents payment for water damage resulting from,
among other things, “Water that backs up or overflows or is otherwise discharged from a
sewer, drain, sump, sump pump, or related equipment.” Id. at 99.
II. LEGAL STANDARD
Summary judgment is appropriate when “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). The function of the trial court is not “to weigh the evidence and determine the
truth of the matter but to determine whether there is a genuine issue for trial.” Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 249 – 50 (1986). “The court need consider only the cited
materials, but it may consider other materials in the record.” Fed. R. Civ. P. 56(c)(3).
“The moving party bears the initial burden to show the district court . . . that there is no
genuine issue of material fact that should be decided at trial. Clark v. Coats & Clark, Inc., 929
F.2d 604, 608 (11th Cir. 1991). If the moving party meets this burden, then the non-moving
party must “demonstrate that there is indeed a material issue of fact that precludes summary
judgment.” Id. Any inferences drawn from the underlying facts must be viewed in the light
most favorable to the nonmoving party. Scott v. Harris, 550 U.S. 372, 378 (2007).
Florida law mandates that insurance contracts be construed under their plain meaning,
without need for extrinsic evidence. See Taurus Holdings, Inc. v. U.S. Fid. & Guar. Co., 913 So. 2d
528, 532 (Fla. 2005). “If the relevant policy language is susceptible to more than one reasonable
interpretation, one providing coverage and another limiting coverage, the insurance policy is
considered ambiguous,” and the ambiguity is “construed against the drafter and in favor of the
insured.” Auto–Owners Ins. Co. v. Anderson, 756 So.2d 29, 34 (Fla. 2000). But “[a] provision is
not ambiguous simply because it is complex or requires analysis.” Garcia v. Fed. Ins. Co., 969
So. 2d 288, 291 (Fla. 2007). In fact, “if a policy provision is clear and unambiguous, it should
be enforced according to its terms whether it is a basic policy provision or an exclusionary
provision.” Id. (internal quotation marks omitted).
Parties dispute the scope of the WEE, which excludes from coverage “Water that backs
up or overflows or is otherwise discharged from a sewer, drain, sump, sump pump, or related
equipment.” ECF No. 7-1 at 99. Respondent believes the backup of the Petitioner’s plumbing
line falls under the WEE’s clear and unambiguous terms. Petitioners retort the WEE, when
read in context of the full Policy, applies to water backups or overflows deriving outside their
Respondent has the better of the argument here. No definition of “drain” appears in the
Policy, but the term ordinarily refers to a “conduit for draining liquid, as a ditch or a pipe.”
Drain, BLACK'S LAW DICTIONARY (10th ed. 2014). Though the parties dispute whether the
collapsed pipe was a “sewer” and refer to the pipe by different names—a “sewer line” for
Respondent, a “sanitary line” for Petitioners—it was, at the very least, a “drain.” Parties do
not seriously dispute this point or that there was a back up and overflow from the pipe.1 More
importantly, the WEE does not differentiate between drains found inside or outside the
Petitioners’ property line or their plumbing system. By its very terms, then, the WEE bars
payment for the water damage and other repairs stemming from the Petitioners’ collapsed and
backed up pipe.
The result of this case may have differed had another policy provision specifically
covered the overflow of water from the property’s internal plumbing system. See, e.g., Cheetham
v. S. Oak Ins. Co., 114 So. 3d 257, 260, 263 (Fla. Dist. Ct. App. 2013) (concluding a policy
exclusion for water damage from sewers and drains did not effect internal plumbing system
leaks since policy specifically covered overflow of water “from within a plumbing [ ] system”);
see also Old Dominion Ins. Co. v. Elysee, Inc., 601 So. 2d 1243, 1245 (Fla. Dist. Ct. App. 1992)
(citing cases with similar provisions). But no other Policy provision here, including the water
damage exception, limits the sewer and drain language found in the WEE. See ECF No. 7-1 at
98 (stating that “water damage does not include loss or damage otherwise excluded under the
terms of the [WEE]”). To be sure, a state court in Old Dominion Insurance Company v. Elysee,
In their response filing, Petitioners briefly dispute whether the water in question came “from” a drain. See ECF
No. 15 at 14 – 15. But this argument is moot because I find the pipe in question was a “drain,” and that the WEE
encompasses back ups and overflows from Petitioners’ internal plumbing system.
Inc., 601 So. 2d 1243 (Fla. Dist. Ct. App. 1992), declared “a sewer or drain begins at [a party’s]
property line,” despite no policy provision in that case that explicitly covered overflows from
the property’s internal plumbing system. See Old Dominion, 601 So. 2d 1243, 1245 (Fla. Dist.
Ct. App. 1992). But I adopt the reasoning from the federal district court in Killian Palms
Country Club and Sports Complex, LLC v. Scottsdale Insurance Company, No. 11-CIV-21978-UU,
ECF No. 49 (S.D. Fla. Feb. 29, 2012), that scrutinized Old Dominion’s findings and involved a
nearly identical insurance policy from Respondent. See Killian Palms, No. 11-CIV-21978-UU,
ECF No. 49 at 9 – 11. As the district court underscored, “courts may not rewrite [insurance]
contracts, add meaning that is not present, or otherwise reach results contrary to the intentions
of the parties.” Id. at 11 (quoting Taurus Holdings, Inc. v. U.S. Fid. & Guar. Co., 913 So. 2d 528,
532 (Fla. 2005)) (alteration in original).
Because I find the WEE bars recovery for Petitioners in this case, it is unnecessary to
analyze the other Policy provisions parties raise. The lack of coverage for underground pipe
damage, see ECF No. 7-1 at 55, is inconsequential, since it does not cover any purported water
damage Petitioners allege. The water damage exception, id. at 98, does not impinge on the
WEE, as discussed above. And I need not analyze the deterioration exclusion, id. at 91, since
the WEE undergirds my decision.2
For the reasons above, Respondent’s Motion for Summary Judgment (ECF No. 13) is
GRANTED. The Clerk shall CLOSE this case. I will issue a separate judgment pursuant to
Federal Rule of Civil Procedure 58.
DONE and ORDERED in chambers at Miami, Florida, this 28th day of March 2017.
Copies furnished to:
Edwin G. Torres, U.S. Magistrate Judge
Counsel of record
A discussion of standing is superfluous here. Any procedural defects with the Petitioners as the named parties, as
opposed to the Petitioners in their roles as trustees of the trust named in the insurance policy, are curable through
interlineation. But because I have found in favor of Respondent on its Motion, this potential corrective measure is
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?