Nationwide Mutual Insurance Company v. Evanston Insurance Company et al
Filing
49
Memorandum Opinion and Order Denying Defendant Markel Corporation's Motion to Dismiss 13 . Signed by District Judge Halil S. Ozerden on March 26, 2014. (NM)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
NORTHERN DIVISION
NATIONWIDE MUTUAL
INSURANCE COMPANY
v.
EVANSTON INSURANCE
COMPANY, MARKEL
CORPORATION, ABC
INDIVIDUALS, and XYZ ENTITIES
§
§
§
§
§
§
§
§
§
PLAINTIFF
CIVIL NO. 3:13cv196-HSO-RHW
DEFENDANTS
MEMORANDUM OPINION AND ORDER DENYING
DEFENDANT MARKEL CORPORATION’S MOTION TO DISMISS
BEFORE THE COURT is Defendant Markel Corporation’s Motion to Dismiss
[13]. Plaintiff has filed a Response in Opposition [20] to the Motion, and Markel has
filed its Rebuttal [21]. Having considered the parties’ submissions, the record, and
relevant legal authority, the Court is of the opinion that Markel’s Motion to Dismiss
should be denied.
I. BACKGROUND
On April 3, 2013, Plaintiff filed a Complaint against Evanston Insurance
Company (“Evanston”) and Markel Corporation (“Markel”) stemming from a lawsuit
pending in the Circuit Court of Hinds County, Mississippi, civil action number 25111-465CIV (“the Underlying Lawsuit”). On April 29, 2013, Plaintiff filed its First
Amended Complaint, which is nearly identical to the Complaint but includes an
allegation specifying that the amended complaint was brought pursuant to Rule
15(a) of the Federal Rules of Civil Procedure. First Am. Compl. 1 [11].
1
The First Amended Complaint alleges that Evanston and Markel issued an
insurance policy to The Pines/Jackson LLC (“The Pines”). Id. at ¶ 6. Plaintiff
maintains that a dispute has arisen over coverage obligations related to claims
asserted against The Pines and Plaintiff’s insured, B&B Management Group, LLC
(“B&B”), in the Underlying Lawsuit. Id. at ¶¶ 5-7. Plaintiff claims that Evanston
considered The Pines to be an “additional insured” under the terms of the insurance
policy issued by Plaintiff to B&B. Id. at ¶¶ 17-20. Plaintiff contends that B&B was
actually a primary insured under the terms of Evanston and Markel’s insurance
policy. Id. at ¶ 24. Plaintiff further asserts that it was forced to provide primary
coverage for both B&B and The Pines, and that it settled the Underlying Lawsuit
subject to a non-waiver agreement with Evanston and Markel. Id. at ¶¶ 6-11.
Pursuant to the non-waiver agreement, Plaintiff retained the right to bring this
civil action to resolve the coverage dispute with Evanston and Markel. Id. at 25-26.
Based on these allegations, Plaintiff advances a claim against Evanston and
Markel for a declaration that the policy of insurance Evanston and Markel issued to
The Pines afforded primary coverage for the claims asserted against both The Pines
and B&B in the Underlying Lawsuit. Id. at ¶¶ 28-35. Plaintiff asserts a claim for
“wrongful breach” of Evanston and Markel’s insurance contract on the basis that
B&B was a primary insured under that contract. Id. at ¶¶ 37-41. Plaintiff also
seeks indemnity and/or contribution from Evanston and Markel related to the
payment Plaintiff made in settling the Underlying Lawsuit. Id. at ¶¶ 43-47.
2
Markel has moved to dismiss the First Amended Complaint on grounds that
Markel neither issued nor was a party to the insurance contract between Evanston
and The Pines and thus cannot be liable on that contract. Mem. Br. in Supp. of
Mot. to Dismiss 2-3 [14]. Markel also contends that it was a known agent for
Evanston, a disclosed principal, such that Markel cannot be liable to Plaintiff
absent allegations of fraud, which the First Amended Complaint does not contain.
Id. at 3.
Plaintiff opposes Markel’s Motion insisting that Evanston and Markel issued
a policy of insurance to The Pines and that both Evanston and Markel were parties
to the non-waiver agreement. Resp. in Opp’n to Mot. to Dismiss 2, 4 [20]. Plaintiff
further posits that Markel can be liable to Plaintiff even if Markel was a known
agent of a disclosed principal because Markel’s conduct “constitute[d] gross
negligence, malice, or reckless disregard for another’s rights.” Id. at 6-7. Plaintiff
contends that its allegations that Evanston and Markel issued the policy to The
Pines, that Evanston and Markel refused to provide coverage “without legitimate or
arguable reason,” and that Evanston and Markel “wrongfully” breached their
insurance contract in “callous disregard” for the rights of B&B, are sufficient to
state a claim against Markel. Id. at 7-8.
II. DISCUSSION
A.
Legal Standard
A motion to dismiss under Rule 12(b)(6) “is viewed with disfavor and is rarely
granted.” Kaiser Aluminum & Chem. Sales v. Avondale Shipyards, 677 F.2d 1045,
3
1050 (5th Cir.1982). “Under Rule 12(b)(6), a claim should not be dismissed unless
the court determines that it is beyond doubt that the plaintiff cannot prove a
plausible set of facts that support the claim and would justify relief.” Lane v.
Halliburton, 529 F.3d 548, 557 (5th Cir. 2008) (citing Bell Atl. Corp. v. Twombly,
550 U.S. 544, 555-58 (2007)). All well-pleaded facts must be viewed in the light
most favorable to the plaintiff. Fin. Acquisition Partners LP v. Blackwell, 440 F.3d
278, 286 (5th Cir. 2006). On the other hand, the plaintiff must plead specific facts,
not conclusory allegations, to avoid dismissal. Id.
To survive a motion to dismiss, a complaint must contain sufficient
factual matter, accepted as true, to “state a claim to relief that is
plausible on its face.” A claim has facial plausibility when the plaintiff
pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged. The
plausibility standard is not akin to a “probability requirement,” but it
asks for more than a sheer possibility that a defendant has acted
unlawfully. Where a complaint pleads facts that are “merely consistent
with” a defendant’s liability, it “stops short of the line between
possibility and plausibility of ‘entitlement to relief.’”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (U.S. 2009) (quoting Twombly, 550 U.S. at 55657, 570).
B.
Analysis
“[I]n Mississippi, an ‘agent for a disclosed principal is not liable for the torts
of the principal.’ To be liable, the agent must commit ‘individual wrongdoing.’ In
other words, the agent incurs no personal liability absent fraud or equivalent
misconduct.” Estate of Gibson ex rel. Gibson v. Magnolia Healthcare, Inc., 91 So. 3d
616, 624 (Miss. 2012). This concept applies in the context of claims for a breach of
contract. Gray v. Edgewater Landing, Inc., 541 So. 2d 1044, 1047 (Miss. 1989)
4
(affirming directed verdict for individual agents on breach of lease claim because
“[a]s agents for a disclosed principal . . . [the agents] incur no individual liability,
absent fraud or other equivalent conduct”).
The First Amended Complaint alleges that Evanston and Markel issued a
policy of general liability insurance to The Pines. First Am. Compl. ¶ 6. Markel,
however, does not point the Court to any specific portion of the policy it is alleged to
have issued along with Evanston which indicates that the policy was issued by
Evanston alone. Markel’s sole support for its position is a general citation to the
policy in support of its Motion to Dismiss and an unsupported, conclusory assertion
in its rebuttal brief. See Mem. Br. in Supp. of Mot. to Dismiss 2 [14] (“The contract
of insurance for which Nationwide seeks to impart liability upon Markel was issued
by Evanston. See Exhibit B to Plaintiff’s Complaint.”) and Reply in Supp. of Mot. to
Dismiss 2 [21] (“The contract of insurance is clearly issued by Evanston Insurance
Company, not Markel Corporation.”). The Court, however, is under no duty to scour
the record to find support for these statements. See de la O v. Hous. Auth. of City of
El Paso, Tex., 417 F.3d 495, 501 (5th Cir. 2005) (quoting United States v. Dunkel,
927 F.2d 955, 956 (7th Cir. 1991)).
Plaintiff also alleges that Markel wrote a letter to Plaintiff on Evanston’s
behalf. First Am. Compl. ¶ 19. Aside from this allegation, Markel does not direct
the Court to any specific portion of the record or of the insurance policy issued to
The Pines which indicates that Evanston was a disclosed principal for whom Markel
serves as an agent. Plaintiff, moreover, does not allege that Markel acted as an
5
agent for Evanston or that Evanston was a disclosed principal. Viewed in a light
most favorable to Plaintiff, the allegation that Markel wrote a letter to Plaintiff on
Evanston’s behalf does not equate to an allegation that Markel was an agent of a
disclosed principal.
While Markel may later seek summary judgment and submit sufficient
evidence supporting its position that it was merely an agent of a disclosed principal,
the Court cannot reach such a conclusion given the present record and the current
procedural posture of this case. Markel’s Rule 12(b)(6) Motion therefore must be
denied.
III. CONCLUSION
IT IS, THEREFORE, ORDERED AND ADJUDGED that Defendant
Markel Corporation’s Motion to Dismiss [13] is DENIED.
SO ORDERED AND ADJUDGED, this the 26th day of March, 2014.
s/ Halil Suleyman Ozerden
HALIL SULEYMAN OZERDEN
UNITED STATES DISTRICT JUDGE
6
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?