BRIGHTVIEW ENTERPRISE SOLUTIONS, LLC F/K/A BRICKMAN FACILITY SOLUTIONS, LLC v. FARM FAMILY CASUALTY INSURANCE COMPANY

Filing 56

OPINION. Signed by Judge Evelyn Padin on 2/7/2023. (qa, )

NOT FOR PUBLICATION

UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
BRIGHTVIEW ENTERPRISE
SOLUTIONS, LLC f/k/a BRICKMAN
FACILITY SOLUTIONS, LLC,

Case No. 20cv7915 (EP) (AME)
OPINION

Plaintiff,
v.
FARM FAMILY CASUALTY
INSURANCE COMPANY.,
Defendant.
PADIN, District Judge.
Before the Court are two fully-briefed motions for summary judgment pursuant to Fed. R.
Civ. P. 56. Defendant
summary judgment dismissing Plaintiff BrightView Enterprise Solutions, LLC f/k/a Brickman
Facility Solutions

bad faith breach of contract claim. See D.E. 47-

BrightView moves for summary judgment dismissing

counterclaim

seeking declaratory relief and recoupment of defense costs incurred in an underlying suit. See
D.E. 46-

al

argument. See Fed. R. Civ. P. 78(b); L.Civ.R.78(b). For the reasons set forth below, Farm
DENIED
I.

GRANTED.

BACKGROUND
BrightView is a landscaping company with operations throughout New Jersey and its

services for CBRE,
Id. ¶ 7; see generally D.E. 47-

-BrightView

Id. ¶ 9. The subcontracting agreement with BrightView
-Retzko

Retzko from further subcontracting any of its

duties and explicitly required that all work be performed by licensed personnel. D.E. 53-2
-

D.E. 47-8 ¶¶ 8(c), 16(d).

Also pursuant to the BrightView-Retzko Subcontract, Retzko obtained liability insurance
from Farm Family, a property and casualty insurance provider authorized to write insurance in
New Jersey with its corporate headquarters in New York. Compl. ¶¶ 4, 11-12; see generally D.E.
47-6

; BrightView-Retzko Subcontract ¶ 9. The Insurance Policy named

BrightView and CBRE as additional insureds and provided a $1 million coverage limit. Compl.
¶¶ 11-12; see also Insurance Policy at 5, 37; D.E. 47In January 2015, on behalf of BrightView and CBRE, Retzko planned to overhaul the
exterior landscape irrigation system at the BoA Premises. Compl. ¶¶ 13-14; Def. SOMF ¶ 4.
Retzko did not perform this work directly; instead, Retzko contracted with Jim Dun
Landscaping

Compl. ¶ 15; D.E. 47-9
; Def. SOMF ¶ 4.

-Dunphy

owner indicated that it was his understanding that while

New Jersey required a license to install new irrigation systems, no license was required to perform
repairs or modifications to existing irrigation systems. See BrightView Pre-Trial Report at 18.
Dunphy was not licensed.
Morciglio

a Bank of America employee slipped and

fell on a puddle of water while on duty on the BoA Premises. Def. SOMF ¶ 7; D.E. 47-10

2

The parties dispute whether Morciglio hit her head when she fell.
1

striking her

head. Def. SOMF ¶ 9; Morciglio Compl. In a state suit brought against CBRE, BrightView,
Retzko, and Dunphy, Morciglio alleged that she was permanently disabled as a result of her first
slip-and-fall on the BoA Premises

Morciglio Suit

See Def. SOMF ¶ 9; Morciglio Compl.

Pursuant to the terms of the Insurance Contract, 2 Farm Family agreed to defend and provide
coverage on a primary, non-contributory basis up to its $1 million policy limit to CBRE,
BrightView, and Retzko. Def. SOMF ¶ 13.
In January 2020, at a settlement conference, just days before the start of the trial in the
Morciglio Suit, Judge Harrington indicated that an offer in the range of $650,000 to $750,000 from
Farm Family offered on behalf of all three defendants (CBRE, BrightView, and Retzko) would
likely settle the case. D.E. 47-

-4, 94:23-95:2. The day before that

conference, Bonnie Stiehl3
glio case an
See id.; see also D.E. 47-20,

-25. But Farm Family did not cede to
ara

Dep. at 37:13-38:15.
Christopher

4

testified that Farm Family reached the $400,000 number after

approximately one hour of cumulative internal discussion and that the number

1
2

Not caused by water.
And a declaration stating the same from Farm Family that BrightView was entitled to additional

3

Stiehl was the Farm Family claim examiner tasked with evaluating the Morciglio Suit.

4

with evaluating the Morciglio Suit.
3

expertise and the knowledge and the judgment of the p
not an established process, such as a checklist or computer program. Id. at 39:3-40:10. But
$400,000 was never offered to Morciglio; $250,000 was the highest settlement offer made. Id. at
43:3-18.
BrightView then sent Farm Family a letter demanding that it try to settle the Morciglio Suit
on its behalf within the policy limits. D.E. 5just over

economic losses

Id. And BrightView notified Farm Family that it would settle the Morciglio

Suit on behalf of itself and CBRE, and later would seek to recover that settlement amount from
Farm Family. See id. BrightView followed through and settled the Morciglio Suit on behalf of
itself and CBRE for $350,000. Def. SOMF ¶ 22; D.E. 47-24.
Farm Family proceeded to trial on the Morciglio Suit, but the only remaining defendant
was Retzko, as all other defendants had settled. Def. SOMF ¶ 24; D.E. 47-25. The jury did not
return a verdict in favor of Morciglio. Def. SOMF ¶ 26.
Following through on its statement to Farm Family, that it would seek to recover from it
the settlement amount BrightView paid on behalf of CBRE and itself in the Morciglio Suit,
BrightView filed a bad faith breach of contract claim against Farm Family. See generally Compl.
Farm Family filed a counterclaim seeking declaratory relief and a recoupment of the costs it paid
to defend BrightView in the Morciglio Suit. D.E. 15.
Both parties move for summary judgment: Farm Family moves for summary judgment on

4

II.

LEGAL STANDARD

dispute as to any material fact and the [moving party] is entitled to jud
Fed. R. Civ. P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Conoshenti v.
Pub. Serv. Elec. & Gas Co., 364 F.3d 136, 145affect the outcome of the suit u

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Disputes over irrelevant or
unnecessary facts will not preclude a court from granting a summary judgment motion. See id.
The moving party must support its motion by citing to specific materials in the record. Fed.
R. Civ. P. 56(c)(1)(A). Once the moving party has adequately supported its motion, the burden

depositions, answers to interrogatories, and admissions on file, designate specific facts showing
that there is a genuine issue for tr
omitted).

Celotex Corp., 477 U.S. at 324 (internal quotation marks

The nonmoving party must identify specific facts and affirmative evidence that

contradict the moving party. Anderson, 477 U.S. at 250. But t
an issue of fact merely by [] denying averments [] without producing any support evidence of the
Thimons v. PNC Bank,

Messa v. Omaha Prop. & Cas. Ins. Co., 122 F. Supp.
2d 523, 528 (D.N.J. 2000) (quoting Anderson, 477 U.S. at 249could differ as to the import of the evidenc

Anderson,

477 U.S. at 250-51.

5

Marina v.
Indus. Crating Co., 358 F.3d 241, 247 (3d Cir. 2004) (quoting Anderson, 477 U.S. at 255). But if
the existence of an element

summary judgment is appropriate. Celotex Corp., 477 U.S. at 322.
III.

DISCUSSION

A. Genuine Disputes of Material Fact Preclude
Claim
Farm Family argues that it is entitled to summary judgment

bad faith

breach of contract claim, because there is no genuine dispute that it negotiated in good faith with
the plaintiff in the Morciglio Suit, and thus, it satisfies the applicable Rova Farms good faith
standard.
evaluation of the Morciglio Suit

settlement value was cursory and not intelligently made, and

therefore, settlement negotiations were not in good faith. The Court concludes that genuine
disputes of material fact exist as to whether Farm Family acted in good faith.
In the pivotal case of Rova Farms Resort, Inc. v. Investors Insurance Co. of America, an
insured brought a third-party suit against its insurer after the insurer, over the protestations of the
insured who feared an excess verdict and whose insurance policy limit was $50,000, made a
settlement offer of only $12,500 in the underlying suit, opting instead to contest liability at trial.
See 65 N.J. 474, 481 (1974). The jury returned a verdict of $225,000 in the underlying suit. Id.
The insurer paid the policy limit and the insured then filed a third-party suit against its insurer to

6

recoup the excess judgment above the policy limit that it paid the underlying plaintiff $175,000.
See id.
The New Jersey Supreme Court ultimately
restricted the independent negotiating power of its insured, has a positive fiduciary duty to take
Id. at 496; see also
Am. Hardware Mut. Ins. Co. v. Harley Davidson of Trenton, Inc.
(outlining the Rova Farms good faith standard required by an insurer in settlement negotiations:

[underlying plaintiff] is willing to settle within the policy limit, then (4) in order to be deemed to
have acted in good faith, the insurer must initiate settlement negotiations and exhibit good faith in
Additionally,
the boundaries of good faith become more compressed in favor of the insured, and the carrier can
justly serve its interests and those of its insured only by treating the claim as if it alone might be
Rova Farms at 493.
Notably, the court outlined
policy limits:
be a realistic one when tested by the necessarily assumed expertise
of the [
a consideration of all the factors bearing upon the advisability of a
settlement for the protection of the insured. While the view of the
[insurer] or its attorney as to liability is one important factor, a good
faith evaluation requires more. It includes consideration of the
anticipated range of a verdict, should it be adverse; the strengths and
weaknesses of all of the evidence to be presented on either side so
far as known; the history of the particular geographic area in cases
of similar nature; and the relative appearance, persuasiveness, and
likely appeal of the claimant, the insured, and the witnesses at trial.

7

Id. at 489-90 (emphasis in original) (quoting Bowers v. Camden Fire Ins. Assoc., 51 N.J. 62, 71
(1968)). But the mere rejection of a settlement offer within the policy limit and a trial verdict in
excess of that policy limit does not, without more establish bad faith. Radio Taxi Service, Inc. v.
Lincoln Mutual Ins. Co., 31 N.J. 299, 305 (1960).

Hartford Cas. Ins. v. Liberty Mut. Fire Ins. Co., 2021 U.S. Dist. LEXIS 60663, at *11, *17 (D.N.J.
Mar. 29, 2021) (citations and internal quotation marks omitted); see also Palmer v. New Jersey
Manufacturers Ins. Co., 2017 N.J. Super. Unpub. LEXIS 3060, at *8 (App. Div. Dec. 14, 2017)

goodIn another pivotal case,

tford, the New

Jersey Supreme Court held that where an insurer acts in bad faith, and the insured settles the
underlying suit, then the insured may recover that settlement amount from its insurer up to the
policy limit, so long as that amount is reasonable and paid in good faith. 72 N.J. 63, 76 (1976);
see id. at 71 (noting that while it is the insurer who typically enjoys the right to control settlements,

insur
Critically, in Wood v. New Jersey Mfrs. Ins. Co., the New Jersey Supreme Court recognized
that a Rova Farms bad faith claim will hinge, to some degree, upon the credibility and
persuasiveness of fact witnesses, as well as on expert testimony concerning what went wrong in
settlement negotiations and why. 206 N.J. 562, 571 (2011). The court held that determining

8

whether an insurer acted reasonably, and thus, whether the Rova Farms good faith standard is
satisfied, is a question of fact, for a jury. See id. at 579.
With this context, whether Farm Family acted in good faith in its settlement negotiations
in the Morciglio Suit involves questions of fact
summary judgment motion if no genuine disputes remain as to whether Farm Family acted in good
faith remain. As detailed below, genuine disputes of material fact supported by record evidence
persist, and ther
Specifically, the parties dispute whether

evaluation of the Morciglio Suit

settlement value was made in bad faith.
cursory and not made in an objective and intelligent manner; and therefore, when Farm Family
made its final settlement offer of $250,000, it was made in bad faith. See
4-5, 9-10. Farm Family argues that its evaluation was not made in bad faith, because, in short, it
believed that its insureds had a strong case in the underlying suit. See Def. Mot. at 7-9.
The first piece of record evidence supporting the denial of summary judgment in Farm
can be

Just days before the scheduled Morciglio Suit

trial, Stiehl notified her supervisors that Judge Harrington believed Farm Family could settle the
suit on behalf of its three insureds for $650,000, and recommended that the case be settled for that
amount. See Stiehl Dep. at 91:1-4, 94:23-95:2. Specifically, Stiehl recommended that Farm
Family should:
try and settle the case, if possible, rather than try it. The reason
to do in the courthouse,
knew, and I did explain this verbally, that, you know, this is [] Judge[

9

Id. at 92:11-24.
highest settlement authority Farm Family
gave for the Morciglio Suit was $400,000. See id. at 95:15-19, 101:21-102:11. But Farm Family,
through Stiehl, never actually offered the full $400,000; instead, the highest settlement offer made
was $250,000. See D.E. 5-

see also D.E. 5-17;

at 43:9-18.

Notably, one day before trial, BrightView informed Farm Family that it found the $250,000
settlement offer
-17. Farm Family still chose not to raise its settlement offer.
The fact that Judge Harrington informed Farm Family that it could settle the Morciglio Suit
for $650,000,

should authorize a

$650,000 settlement, raises a genuine dispute as to whether Farm Family acted intelligently, and
in turn, in good faith, when it decided to limit settlement authority to $400,000 and offered only
$250,000.
The second piece of record evidence supporting the denial of summary judgment in Farm
can be
$400,000

When asked how Farm Family reached the
testified:

[The committee] would have looked at the liability situation and
add[ed] our view of the chances and the prospects of success for the
plaintiff. We would have looked at the full value, the wors[t] case
scenario, and we would have made a judgment as to whether we
thought the plaintiff had a likelihood of prevailing at trial and what
number would have been appropriate to offer the plaintiff to avoid
having to take the case to trial, and $400,000 would have been the
number that was considered reasonable as a settlement number.
at 37:24-38:15.
Additionally, when asked how much time the Farm Family
come up with the final $400,000 number

:
10

committee spent to

[B]etween the time that all of us put into the consideration, I would
approximate maybe an hour. You know, bear in mind we had all
become somewhat familiar with the file at this point but in rereviewing things in considering what was in the file, new
going to be asked to put a number on it, I would
guess an hour.
Id. at 39:3-11.
Then, when asked whether Farm Family had a document outlining the process Farm Family
used for evaluations and whether a specific process, checklist, or computer program was used to
reach the $400,000 number in the Morciglio Suit

Id. at 39:13-40:10.
also asked how much time the committee spent on each claim during a typical
meeting. In response, h
of them can be relatively quick, others can extend for

Id. at 49:13-19.

With respect to the Morciglio Suit
Id. at 49:2050:1.
The statements set out above from

de that
and not made intelligently, such that those

negotiations were in bad faith. For example,
committee spent only 15 to 20 minutes discussing the Morciglio Suit at a meeting, unlike other
claims discussed for up to 45 minutes, and his testimony that the cumulative amount of time and
consideration Farm Family gave to the Morciglio Suit was about an hour, could lead a jury to find
that Farm Family evaluation was cursory
did not have a procedure for evaluating the settlement value of claims, but instead, that the final
11

settlement value was derived only through the
committee, could also

Morciglio Suit was

subjective and cursory.
enuine disputes of material

will be denied.
B.
by Any Authority
Next, the Court addresses
declaratory judgment counterclaim, which seeks two forms of relief: a declaration that Farm
Family has no obligation to reimburse BrightView for its voluntary settlement in the Morciglio
Suit, as well as the recoupment of costs Farm Family incurred to defend BrightView in the
Morciglio Suit. BrightView contends that Farm Fa

redundant because it

, and
terclaim moot. Farm Family does not directly respond to
this contention; instead, Farm Family, argues that it seeks affirmative relief: that the Court compel
BrightView to reimburse Farm Family for the defense costs it paid to BrightView in the Morciglio
Suit. The Court agrees with BrightView.
First, the Court will address Farm Family

counterclaim may be stricken as redundant since a resolution of the original claim will render the
request

ProCentury Ins. Co. v. Harbor House Club Condo.
, 652 F. Supp. 2d 552, 556 (D.N.J. 2009) (quotations omitted); see also Aldens, Inc. v.

Packel, 524 F.2d 38, 51-52 (3d Cir. 1975) (noting that a court may dismiss a counterclaim for
12

Kieran v. Johnson-March Corp., 7 F.R.D. 128, 131
bound to result in one of two ways, and where either
result will set the matter at rest forever, then defendant, under the guise of invoking the declaratory
judgment statute, should not be permitted to say in substance that he wants a judgment in his favor,

party might challenge the counterclaim on the ground that it is redundant and the court should

counterclaim would be subsumed by the
adjudication on the merits of

See Lilac Dev. Grp.,

LLC v. Hess Corp., 2016 U.S. Dist. LEXIS 73862, at *9 (D.N.J. June 7, 2016). Specifically, if
position

in its counterclaim

that it has

no obligation to reimburse BrightView for its unilateral settlement in the Morciglio Suit is
inherently incorrect. But
that it need not reimburse BrightView will inherently be correct. In other words, finding that Farm
Family acted in bad faith in the Morciglio Suit settlement negotiations will resolve both
declaratory judgment
counterclaim. Accordingly, the Court will strike F
See
ProCentury Ins. Co., 652 F. Supp. 2d at 556 (citing University Patents, Inc. v. Kligman, 1991 U.S.
Dist. LEXIS 11917, at *2-3 (E.D. Pa. 1991)) (internal citation omitted).

13

Next, the Court addresses
BrightView in the Morciglio Suit. This turns on the terms of the

Insurance Contract.

Interpretation of an insurance contract is a question of law for a court to determine. See, e.g.,
Simonetti v. Selective Ins. Co., 372 N.J. Super. 421, 428 (App. Div. 2004). In
v. Zurich Am. Ins. Co., the New Jersey Supreme Court provided the following helpful guidance:
Insurance policies are construed in accordance with principles that
enforced as written when its terms are clear in order that the
expectations of the parties will be fulfilled. The terms of insurance
contracts are given their plain and ordinary meaning, with
ambiguities resolved in favor of the insured. Nonetheless, courts
cannot write for the insured a better policy of insurance than the one
purchased.
210 N.J. 512, 414 (2012) (citation omitted).

defense in any lawsuit brought against the insured that alleges and seeks damages for an event
covered by the insurance polic

Republic Franklin Ins. Co. v. Travelers Cas. Ins. Co. of Am.,

2022 U.S. Dist. LEXIS 118407, at *13 (D.N.J. July 6, 2022) (citations omitted).
Here, the parties do not dispute that Farm Family had a contractual obligation
Insurance Contract
47-

under the

to provide BrightView with a legal defense in the Morciglio Suit. See D.E.
agreement to defend and indemnify BrightView on a primary, non-

contributory basis up to its $1 million policy limit in the Morciglio Suit without any reservation);
see also Insurance Policy at 22-

s to defend

ategy). Significantly, the Insurance
provide for the relief that Farm Family now seeks; namely, that Farm
Family is entitled to recoup expended defense costs if BrightView breaches its contractual
14

obligations. And Farm Family does not point to any other record evidence that suggests it is
entitled to such relief, nor does Farm Family argue that there are any relevant ambiguities in the
insurance contract that could lead to the interpretation that it is entitled to recoup defense costs
from BrightView.
Furthermore, as BrightView points out, Farm Family presents no precedential authority for
its proposition that it is entitled to recoup defense costs from its insured where, as here, it is not
required by the Insurance Contract. Thus, the Court is satisfied that Farm Family has not raised
any genuine disputes of material fact that preclude summary judgment in favor of BrightView as
request to recoup defense costs in its counterclaim. Accordingly, the Court will
strike
Because
to recoup defense costs from BrightView,

will be dismissed in its

entirety.
IV.

CONCLUSION
For

will be DENIED

will be

GRANTED. An appropriate Order accompanies this Opinion.

Dated: February 7, 2023

___________________
Evelyn Padin, U.S.D.J.

15