Aligned Bayshore Holdings, LLC v. Westchester Surplus Lines Insurance Company

Filing 109

ORDER On Plaintiff's Motion for Reconsideration. Order granting in part and denying in part 89 Motion for Reconsideration and to Vacate Final Judgment; denying as moot 92 Motion to Strike the Motion for Reconsideration. The Clerk is directed to reopen this case. Signed by Judge Robert N. Scola, Jr on 9/12/2019. See attached document for full details. (kpe)

United States District Court
for the
Southern District of Florida
Aligned Bayshore Holdings, LLC,
Plaintiff,
v.
Westchester Surplus Lines
Insurance Company, Defendant.

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) Civil Action No. 18-21692-Civ-Scola
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Order on Plaintiff’s Motion for Reconsideration
This matter is before the Court on Plaintiffs’ motion for reconsideration
and motion to vacate judgment. (ECF No. 89.) The Defendants responded (ECF
No. 93) and the Plaintiffs timely replied (ECF No. 95). Having considered the
parties’ arguments, the record, and the relevant legal authority, the Court grants
in part and denies in part the Plaintiffs’ motion. (ECF No. 89.)
I.

Background

Westchester issued an insurance policy to Aligned that provided coverage
for Aligned’s windstorm and flood damage claims, including physical damage
and business interruption to both Monty’s Restaurant (the building) and the
marina area. (ECF No. 48 at ¶ 2). On September 10, 2017, Aligned sustained
losses due to the impacts of Hurricane Irma. (Id. at ¶ 3.) Aligned notified
Westchester of its losses, but claims Westchester did not promptly pay all
covered losses to Aligned. (ECF No. 6 at ¶¶ 9-11.) Aligned alleges that its damages
exceeds $15.5 million, with the majority of the damage sustained to the marina.
(ECF No. 49 at ¶ 35.) Westchester has paid over $3 million in insurance claims
to Aligned. (ECF No. 48 at 4.)
Aligned’s position is that the insurance policy provides $10 million in
blanket flood damage coverage. This $10 million flood coverage is not subject to
a statement of values. Aligned alleges in its breach of contract claim that
Westchester willfully misinterpreted the insurance policy by improperly relying
on an unverified statement of values to cap its coverage. (See id. at ¶ 19–20.)
Westchester maintains that it properly interpreted the contract based on the
statement of values on file and has paid out the policy maximum under the
insurance policy’s flood coverage. (ECF No. 48 at 1.) Aligned argues that if the
Court were to find that a statement of values applies, the correct statement of
values is the one attached to Aligned’s insurance application. (ECF No. 54 at 11.)

The parties cross-moved for summary judgment. (ECF Nos. 48 and 49.)
The Court granted summary judgment in favor of Westchester and found that a
statement of values applies to the flood coverage under the insurance policy and
that the statement of values on file with Westchester governs. Aligned now moves
for reconsideration and asks the Court to vacate the final judgment entered in
favor of Westchester. (ECF No. 89.)
II.

Legal Standard

The decision to grant or deny a motion for reconsideration is committed to
the district court’s sound discretion. See Chapman v. AI Transport, 299 F.3d
1012, 1023–24 (11th Cir. 2000) (review reconsideration decision for abuse of
discretion). Reconsideration is appropriate only in very limited circumstances,
such as where “the Court has patently misunderstood a party, where there is an
intervening change in controlling law or the facts of a case, or where there is
manifest injustice.” See Vila v. Padron, No. 04-20520-CIV, 2005 WL 6104075, at
*1 (S.D. Fla. Mar. 31, 2005) (Altonaga, J.). “Such problems rarely arise and the
motion to reconsider should be equally rare.” See id. (citation omitted). To obtain
reconsideration, “the party must do more than simply restate its previous
arguments, and any arguments the party failed to raise in the earlier motion will
be deemed waived.” See id. “[A] motion for reconsideration should not be used
as a vehicle to present authorities available at the time of the first decision or to
reiterate arguments previously made.” Z.K. Marine Inc. v. M/V Archigetis, 808 F.
Supp. 1561, 1563 (S.D. Fla. 1992) (Hoeveler, J.).
III.

Analysis
A. Whether a Statement of Values Applies to Flood Coverage

Aligned reiterates arguments made in its motion for summary judgment
and opposition to Weschester’s motion for summary judgment. Namely, that the
Court must consider the policy as a whole in determining the scope of the flood
coverage. (ECF No. 89 at 3.) With regard to Aligned’s specific argument that the
Earthquake and Volcanic Eruption Coverage Form references a Statement of
Values and therefore the Flood Coverage Form’s failure to mention a Statement
of Values means that it does not apply, the Court finds this argument
unpersuasive. The policy is a complicated and lengthy document. (See ECF No.
47-1.) There are a number of provisions that seem inconsistent if read in isolation
and other provisions that remain opaque even when read in context. For
example, the Earthquake and Volcanic Eruption Endorsement, which Aligned
wants the Court to compare to the Flood Endorsement, states:
For property or coverage that is subject to a Blanket
Limit on Earthquake – Volcanic Eruption (as shown in

the Earthquake – Volcanic Eruption Coverage Schedule
or in the Declarations), we will not pay more than we
would pay in the absence of such Blanket Limit.
Therefore, the maximum amount payable for any such
item of property or coverage is the Limit of Insurance or
stated value (as shown in the Statement of Values on
file with us) specific to that item of property or
coverage[.]
(ECF No. 47-1 at 93.) Here, the policy states that if there is blanket coverage,
Westchester will not pay more than it would pay in the absence of blanket
coverage and therefore the statement of values applies. The policy is reasserting
the applicability of the statement of values even when there is blanket coverage.
This section of the policy may actually bolster the Court’s holding in its Order on
the parties’ cross motions for summary judgment: because flood coverage is not
subject to blanket coverage, the policy does not need to clarify that the statement
of values applies even when there is blanket coverage. But the Court does not
find it helpful to look at other coverage provisions to understand the flood
coverage because the inclusion or exclusion of some language creates more
confusion than clarity in this instance.
Aligned also reiterates its arguments that (1) the statement of values is
only applicable to those covered causes of loss contained in the causes of lossspecial form; (2) certain language was removed from the Flood Declarations
without Aligned’s knowledge; and (3) that Aligned paid a significant premium for
flood coverage. The Court did not find these arguments persuasive in the first
instance nor are they persuasive on reconsideration.
B. The Statement of Values and Westchester’s Judicial Admission
Aligned also seeks reconsideration of the Court’s ruling that the applicable
statement of values is the following:

(ECF No. 47-12.) In Westchester’s Answer, Westchester stated that, “the
Schedule of Values were included in a Commercial Insurance Application, which
application was, on information and belief, signed by both the producer
(insurance broker) and the applicant (the insured).” (ECF No. 27 at ¶ 20.) This
admission contradicts the position taken by Westchester in its summary

judgment papers. Westchester’s position is that the applicable statement of
values was the one on file with Westchester, not the one attached to the
application. Aligned argues that, given Westchester’s admission in its Answer,
the Court improperly put the burden on Aligned to refute the position taken by
Westchester in its motion for summary judgment. (ECF No. 89 at 5.)
Westchester argues that this was an inadvertent admission and moved to
amend its Answer. (ECF No. 65.) Judge Torres denied Westchester’s motion to
amend on June 3, 2019. (ECF No. 79.) Westchester’s objections to Judge Torres’s
order were due on June 17, 2019, the same day the Court ruled on the crossmotions for summary judgment. Accordingly, the Court’s order mooted any
potential objections to Judge Torres’s order. Westchester advised the Court that
it prepared, but never filed, its objections to Judge Torres’s order. (ECF No. 93
at n.10.)
Upon reconsideration, the Court finds that it should have fully resolved
the issue of Westchester’s admission and whether it should have been granted
leave to amend. Accordingly, the Court vacates its holding as to Part B (“Which
Statement of Values Applies”) in its Order on the parties’ cross-motions for
summary judgment (ECF No. 86) and the Final Judgment in favor of Westchester
(ECF No. 87.) The Court directs Westchester to file its Objections to Judge
Torres’s Order (ECF No. 79.) by September 18, 2019. Once the objections to
Judge Torres’s order are resolved, the parties will be directed to file renewed
motions for summary judgment solely on the issue of which statement of value
applies.1
IV.

Conclusion

Accordingly, the Court grants in part and denies in part the Plaintiff’s
motion for reconsideration and to vacate final judgment. (ECF No. 89.) The Court
vacates its holding as to Part B in its Order and vacates the Final Judgment in
favor of Westchester (ECF No. 79). The Court directs Westchester to file its
Objections to Judge Torres’s Order (ECF No. 79.) by September 20, 2019. The
Defendant’s motion to strike the motion for reconsideration is denied as moot.
(ECF No. 92.) The Clerk is directed to reopen this case.

Aligned requested that the Court vacate the Final Judgment during the
pendency of the motion for reconsideration because, if allowed to stand, Aligned
would have to file its notice of appeal before the motion was resolved. As correctly
pointed out by Westchester, Aligned’s motion for reconsideration filed pursuant
to Federal Rule 59(e) and Rule 60(b) properly tolled the time for filing a notice of
appeal. See Fed. R. App. P. 4(a)(4).
1

Done and ordered in chambers, at Miami, Florida, on September 12,
2019.

Robert N. Scola, Jr.
United States District Judge