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

Filing 153

ORDER on Parties' Renewed Cross-Motions for Summary Judgment. Ordergranting 125 Motion for Summary Judgment; denying 126 Motion for Summary Judgment; denying as moot 141 Motion to Strike ; denying as moot 144 Motion to Strike. Signed by Judge Robert N. Scola, Jr on 2/5/2020. 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 Parties’ Renewed Cross-Motions for Summary Judgment
This matter is before the Court on the parties’ renewed motions for
summary judgment. (ECF Nos. 125, 126.) The motions are fully briefed and ripe
for the Court’s review. Upon careful review, the Court grants Plaintiff’s motion
for summary judgment (ECF No. 125) and denies the Defendant’s motion for
summary judgment (ECF No. 126).
I.

Background and Procedural History

Defendant Westchester Surplus Lines Insurance Company (“Westchester”)
issued an insurance policy to Plaintiff Aligned Bayshore Holdings (“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. 6 at ¶ 7). On September 10, 2017,
Aligned sustained losses due to the impacts of Hurricane Irma. (Id. at ¶ 8.)
Aligned notified Westchester of its losses but Westchester, according to the
complaint, did not promptly pay all covered losses to Aligned. (Id. at ¶¶ 9-11.)
Aligned alleges that its damages exceed $15.5 million, with the majority of the
damage sustained by the marina. (ECF No. 49 at ¶ 35.) Westchester has paid
over $3 million in insurance claims to Aligned. (ECF No. 48 at 4.)
Aligned alleges in its breach of contract claim that Westchester willfully
misinterpreted the insurance policy by (1) imposing limits on flood coverage
where the policy provides for blanket flood coverage and (2) 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 and has paid out
the policy maximum under the insurance policy’s flood coverage and operative
statement of values. (ECF No. 48 at 1.)
The parties cross moved for summary judgment. (ECF Nos. 48 and 49.)
The Court entered an order granting the Defendant’s motion for summary
judgment and held that the flood coverage was not blanket coverage and was

subject to a statement of values. (ECF No. 86 at 5.) On the second issue, the
Court held that the applicable statement of values (“SOV”) was the AmRisc form
created by Glenn Peterson, not the Premises Schedule included in Aligned’s
insurance application. (Id. at 8.)
On reconsideration, the Court vacated Part B of its Summary Judgment
Order regarding which statement of values applied. (ECF No. 109 at 4.) The basis
for the Court’s decision was Westchester’s admission in its Amended Answer and
Affirmative Defenses. (Id.) In its motion for reconsideration, Aligned argued that
Westchester’s Answer admitted that the operative statement of values was
included in the Commercial Insurance Application and it was not Aligned’s
burden to prove otherwise. (Defendant’s Amended Answer at ¶ 20, ECF No. 27.)
In response, Westchester argued that it moved to amend its Answer when it
realized its mistake, but Judge Torres denied its motion to amend. This Court
ruled on the motions for summary judgment before any objections to Judge
Torres’s order were ever filed. Accordingly, the Court determined, on
reconsideration, that it should fully resolve the issue of Judge Torres’s order and
Westchester’s admission.
The Court adopted Judge Torres’s order and denied Westchester’s motion
for leave to amend its Answer. (ECF No. 122.) At the Court’s direction, the parties
filed renewed motions for summary judgment on the narrow issue of which
statement of values applies. The parties’ motions are now ripe for the Court’s
review.
II.

Legal Standard

Summary judgment is proper if following discovery, the pleadings,
depositions, answers to interrogatories, affidavits and admissions on file show
that there is no genuine issue as to any material fact and that the moving party
is entitled to judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317,
322 (1986); Fed. R. Civ. P. 56. In reviewing a motion for summary judgment, the
Court must “view the evidence and all factual inferences therefrom in the light
most favorable to the non-moving party, and resolve all reasonable doubts about
the facts in favor of the non-movant.” Feliciano v. City of Miami Beach, 707 F.3d
1244, 1247 (11th Cir. 2013) (quoting Skop v. City of Atlanta, Ga., 485 F.3d 1130,
1143 (11th Cir. 2007)). So, when a conflict arises between the facts presented by
the parties, the Court must credit the nonmoving party’s version. Id. The moving
party bears the burden of proof to demonstrate the absence of a genuine issue
of material fact. Celotex, 477 U.S. at 323.

III.

Analysis

The parties cross-move for summary judgment on the issue of which
statement of values applies to flood coverage. (ECF Nos. 125, 126.) Westchester
maintains that the applicable statement of values is the AmRisc SOV created by
Glen Peterson. (ECF No. 126 at 4.) Aligned asserts that it never received the
AmRisc SOV and the correct statement of values is the Premises schedule
submitted with Aligned’s commercial insurance application. (ECF No. 125 at 9.)
Aligned argues that Westchester’s Answer and Affirmative Defenses admitted
that the applicable statement of values was the one included in Aligned’s
commercial insurance application. (Id. at 4.) Because this is a judicial admission,
Westchester is bound by its admission. Upon careful review, the Court agrees
with Aligned.
“The general rule is that a party is bound by the admissions in his
pleadings.” Cooper v. Meridian Yachts, Ltd., 575 F.3d 1151, 1177 (11th Cir. 2009)
(citations and quotations omitted). “Indeed, facts judicially admitted are facts
established not only beyond the need of evidence to prove them, but beyond the
power of evidence to controvert them.” Id. at 1178. “Moreover, once a judicial
admission is made, the subject matter ought not be reopened in the absence of
a showing of exceptional circumstances, but a court, unquestionably, has the
right to relieve a party of his judicial admission if it appears that the admitted
fact is clearly untrue and the party was laboring under a mistake when he made
the admission.” Castellanos v. Portfolio Recovery Assocs., 297 F. Supp. 3d 1301,
1311 (S.D. Fla. 2017) (Ungaro, J.).
Here, Westchester’s Answer and Affirmative Defenses states the following:
19) …Although loss or damage caused by Flood is
covered, it is subject to all other applicable policy
provisions, including the limits contained in the
Schedule of Values. In further response to this
allegation, 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). All remaining allegations are denied.
20) Denied. In further response to this allegation, the
Schedule of Values were included in a Commercial
Insurance Application, which application was, on
information and believe, signed by both the produce
(insurance broker) and the applicant (the insured).

(ECF No. 27 at 4.)
NINTH AFFIRMATIVE DEFENSE
Defendant issued payment of policy limits pursuant to
the Statement of Values on file with the Company which
limits are expressly contained in a Commercial
Insurance Application, which on information and belief
was signed by the insured.
(Id. at 11.)
Westchester unequivocally and repeatedly stated that the applicable statement
of values was the one included in the Commercial Insurance Application.
Westchester argues that those statements were made “to point out that Aligned
Bayshore was aware of the limits set forth in the applicable AmRisc SOV and
had knowledge of those limits.” (ECF No. 130 at 4.) But Westchester has never
asserted that the AmRisc SOV was attached to the Commercial Insurance
Application. (See ECF No. 126 at 4-5.) Moreover, in its motion to amend
“inadvertent statement made in its Amended Answer,” Westchester admits that
these statements were “inadvertently made” and “inaccurate.” (ECF No. 65 at 1.)
To now argue that it actually meant something else or that it could be referring
to another document is disingenuous. “Defendant offers no reason whatsoever,
much less shows exceptional circumstances, warranting relief from Defendant’s
judicial admission.” Castellanos, 297 F. Supp. 3d at 1311.
Moreover, there is no evidence that Westchester was “laboring under a
mistake when [it] made the admission.” Id. Westchester amended its original
Answer to add the language that is currently at issue. (Compare ECF No. 21 at
¶ 20 and ECF No. 27 at ¶ 20.) The parties’ depositions probed this issue and the
parties moved for summary judgment on this question. It was not until after the
issue was raised in the summary judgment briefing that the Defendant moved
to amend its Answer to retract its admission. The Defendant cannot attempt to
amend its statement to avoid summary judgment. See United States v. Bayless,
No. 16-2757-T33MAP, 2017 WL 882109, at *5 (M.D. Fla. Mar. 6, 2017) (“requests
to amend should be denied when they are designed to avoid an impending
adverse summary judgment”). Nor can the Defendant put forth evidence in an
attempt to contradict its admission. See Columbus Bank & Trust Co. v. McKenzie
Trucking & Leasing LLC, No. 07-cv-189, 2009 WL 3526648, at *9 (M.D. Ga. Oct.
23, 2009) (“By [defendant’s] admission in his Answer, this fact has been
conclusively established. Thus, [defendant’s] subsequent attempt to controvert
this undisputed fact is unavailing.”). The Defendant’s judicial admission took the
issue out of contention. Accordingly, the Plaintiff has met his burden of

establishing that there are no disputed issues of fact regarding the applicable
statement of values. See id.
IV.

Conclusion

Accordingly, the Court grants Plaintiff’s motion for summary judgment
(ECF No. 125) and denies the Defendant’s motion for summary judgment (ECF
No. 126). The Court also denies as moot the Defendant’s motion to strike the
affidavit of Jose Hevia (ECF No. 141) and the Plaintiff’s motion to strike the
affidavit of Kimberly Tarver (ECF No. 144) as the Court did not rely on these
affidavits in ruling on the parties’ motions.
The parties have not moved on the issue of damages, if any, owed to
Aligned. Accordingly, this Order does not dispose of the case. The Court will
therefore set this case for trial by separate order on the remaining issue of
damages and any unresolved affirmative defenses.
Done and ordered in chambers at Miami, Florida on February 5, 2020.

________________________________
Robert N. Scola, Jr.
United States District Judge