BVM Merriam, LLC v. American Family Mutual Insurance Company

Filing 46

MEMORANDUM AND ORDER denying 39 Plaintiff's Motion for Partial Summary Judgment. Signed by District Judge John W. Lungstrum on 07/16/2018. (ses)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS

BVM MERRIAM, LLC,

)
)
Plaintiff,
)
)
v.
)
)
AMERICAN FAMILY MUTUAL
)
INSURANCE COMPANY,
)
)
Defendant.
)
)
_______________________________________)

Case No. 17-2563-JWL

MEMORANDUM AND ORDER
In this action, plaintiff insured asserts claims for benefits against defendant insurer
relating to damage to plaintiff’s motel. Specifically, plaintiff alleges that a hail and wind
storm on April 26, 2016, caused damage to the property’s roof, which in turn resulted in
water damage. This matter presently comes before the Court on plaintiff’s motion for
summary judgment on the issue of liability (Doc. # 39). For the reasons set forth below,
the Court denies the motion.
1.

As an initial matter, defendant argues that summary judgment1 should be

denied because a question of fact remains concerning whether plaintiff LLC owns the
damaged property and thus has an insurable interest. See Price v. Trinity Universal Ins.

1

Summary judgment is appropriate if the moving party demonstrates that there is
“no genuine dispute as to any material fact” and that it is “entitled to a judgment as a matter
of law.” Fed. R. Civ. P. 56(a).

Co., 8 Kan. App. 2d 223, 224 (1982). Defendant relies on the warranty deed and purchase
agreement for the property that plaintiff produced in discovery, which show that the
property was purchased not by plaintiff LLC but by three individuals (presumably, the
members of the LLC). In reply, plaintiff points to deposition testimony by one of those
individuals that the LLC was formed for the purpose of acquiring the motel. Another of
those individuals testified that plaintiff LLC had an interest in the property, but when
confronted with the warranty deed, he testified that he did not remember whether the three
individuals actually did transfer the property to the LLC. Thus, plaintiff has not submitted
any evidence that the property was in fact transferred to the LLC or that the LLC presently
owns the property. Thus, when the evidence is viewed in defendant’s favor, a question of
fact remains concerning whether plaintiff LLC did own the property during the relevant
period. In light of that remaining question of fact, summary judgment in favor of plaintiff
on the question of liability is not warranted.
2.

A question of fact also remains concerning whether plaintiff provided timely

notice to defendant of the occurrence for which plaintiff seeks benefits, as required by the
applicable insurance policy. In its statement of facts, plaintiff states that timely notice was
given, but it does not support that statement with any citation to the record. Defendant
controverts plaintiff’s assertion of timely notice, citing evidence that although leaks were
noted in May 2016, plaintiff did not give notice or assert a claim on the policy until October
2016. Plaintiff did not address this issue in its reply brief; thus plaintiff has not explained
why its notice should be deemed timely as a matter of law or why the untimeliness does

2

not affect its present claim. For this reason as well, then, plaintiff has not shown that it is
entitled to summary judgment on the question of liability. 2
3.

Because plaintiff could also have sought summary judgment with respect to

a particular issue, see Fed. R. Civ. P. 56(g), the Court nevertheless considers whether
plaintiff has shown that its loss is covered by the policy as a matter of law. In support of
its claim that the property suffered damage from the April 2016 storm, plaintiff appears to
rely solely on the report of its expert.3 Defendant’s expert concluded in his report, however,
that the property’s roof did not suffer any damage from storms occurring after February 1,
2016 (when plaintiff allegedly acquired the property). Thus, a dispute of fact remains
whether plaintiff’s property suffered damage from a storm in April 2016 as claimed. In its
reply, plaintiff argues that defendant’s expert did not offer any opinion concerning the
cause of interior water damage. The theory pursued by plaintiff in its complaint and in its
summary judgment motion, however, is that it is entitled to benefits because of harm to the

Because the issues are material, the Court grants defendant’s motion to strike
plaintiff’s statements of fact, made without citation to the record, concerning its ownership
of the property and its providing timely notice to defendant (statements 1 and 2). The Court
denies the motion to strike statements 3, 4, and 7, for the following reasons: defendant’s
claim number (statement 3) is uncontroverted and is not material to the issues; the
statement concerning defendant’s expert’s report (statement 4) is supported by evidence
submitted by plaintiff (the report itself); and plaintiff’s statement concerning its retention
of an expert (statement 7) is uncontroverted and is supported by that expert’s report, which
plaintiff submitted.
2

With its motion, plaintiff submitted only the policy, defendant’s denial letter, the
two parties’ expert reports, and a small bit of testimony by defendant’s adjuster. Contrary
to plaintiff’s argument, however, the adjuster in that excerpt did not testify that any water
damage was caused by any particular weather event.
3

3

property’s roof caused by a storm occurring on April 26, 2016, and defendant has provided
evidence to refute that theory. Accordingly, plaintiff is not entitled to summary judgment
on the issue of coverage.4

IT IS THEREFORE ORDERED BY THE COURT THAT plaintiff’s motion for
partial summary judgment (Doc. # 39) is hereby denied.

IT IS SO ORDERED.

Dated this 16th day of July, 2018, in Kansas City, Kansas.

s/ John W. Lungstrum
John W. Lungstrum
United States District Judge

4

In light of this ruling, the Court declines at this time to address the applicability of
any particular policy exclusion.
4