Anczarski et al v. Travelers Indemnity Company, The
Filing
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MEMORANDUM OPINION AND ORDER by District Judge James O. Browning granting the Defendant's The Travelers Indemnity Company's Motion for Summary Judgment 31 , and granting the Plaintiffs' Motion to Supplement the Record with Correct Information 46 . (jdf) Modified on 7/17/2017 (kw).
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
JOHN J. ANCZARSKI, as biological parent of
John R. Anczarski, deceased, and as Personal
Representative for the Estate of John R.
Anczarski, and JOYCE A. ANCZARSKI,
biological parent of John R. Anczarski,
deceased,
Plaintiffs,
vs.
No. CIV 16-0856 JB/SCY
THE TRAVELERS INDEMNITY COMPANY,
Defendant.
MEMORANDUM OPINION AND ORDER
THIS MATTER comes before the Court on: (i) the Defendant’s The Travelers
Indemnity Company’s Motion for Summary Judgment, filed April 6, 2017 (Doc. 31)(“Motion”);
and (ii) the Plaintiffs’ Motion to Supplement the Record with Correct Information, filed June 28,
2017 (Doc. 46)(“Motion to Supplement Record”). The Court held a hearing on June 8, 2017.
The primary issues are: (i) whether the Plaintiffs John J. Anczarski and Joyce A. Anczarski may
supplement the record with the Certificate of Liability Insurance 2010 (executed January 2,
2010), filed April 36, 2017 (Doc. 46-1)(“2010 Certificate of Liability Insurance”), and John J.
Anczarski’s Amended Verification (sworn January 4, 2017), filed June 28, 2017 (Doc. 462)(“Amended Verification”), where the Anczarskis inadvertently had filed an immaterial
Certificate of Liability Insurance 2004 (executed December 8, 2004), filed April 26, 2017 (Doc.
35-1)(“2004 Certificate of Liability Insurance”) that reflects Travelers Indemnity Company
policies and where the Anczarskis inadvertently omitted to file a verification in support of John
J. Anczarski’s Supplemental Answers to Defendant’s First Set of Interrogatories, filed April 26,
2017 (Doc. 35-3)(“John J. Anczarski’s Supplemental Answers”); (ii) whether Pennsylvania or
New Mexico law applies to the Anczarskis’ breach-of-contract claim and uninsured or
underinsured motorist claim against Travelers Indemnity, where Travelers Indemnity issued two
insurance policies to Mark’s Supply, which is a hardware store in Pennsylvania that the
Anczarskis own, but where their son was fatally struck by a vehicle in New Mexico; and (iii)
whether, in light of The Travelers Indemnity Company Certified Common Policy at 1-145, filed
April 6, 2017 (Doc. 31-1)(“Travelers CGL Policy”), and The Travelers Indemnity Company
Certified Commercial Excess Liability (Umbrella) Insurance Policy at 1-40, filed April 6, 2017
(Doc. 31-2)(“Travelers Excess Liability Policy”), which Travelers Indemnity issued to the
Anczarskis, there is a genuine issue of material fact regarding the Anczarskis’ breach-of-contract
claim and uninsured or underinsured motorist claim that precludes Travelers Indemnity from
seeking summary judgment. The Court concludes: (i) that the Anczarskis may supplement the
record to include the 2010 Certificate of Liability Insurance, and John J. Anczarski’s Amended
Verification in support of his Supplemental Answers; (ii) that under New Mexico’s lex loci
contractus choice-of-law rule, Pennsylvania contract law applies to the Anczarskis’ breach-ofcontract claim and uninsured or underinsured motorist claim, because the commercial general
liability and excess liability policies at issue were executed in Pennsylvania; and (iii) that, in
light of the Travelers CGL Policy and the Travelers Excess Liability Policy at issue, there is no
genuine issue of material fact whether Travelers Indemnity had an obligation to provide
uninsured or underinsured motorist coverage to the Anczarskis or otherwise breached any
contractual obligation owed to the Anczarskis under either insurance contract. Accordingly, the
Court: (i) grants the Anczarskis’ Motion to Supplement Record, (ii) grants Travelers Indemnity’s
Motion, and (iii) enters summary judgment in Travelers Indemnity’s favor.
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FACTUAL BACKGROUND
The Court draws its presentation of the facts from: (i) Travelers Indemnity’s Statement of
Material, Undisputed Facts, see Motion ¶¶ 1-16, at 3-6; and (ii) the Anczarskis’ Statement of
Undisputed Facts, see Plaintiff’s [sic] Response to Defendant’s Motion for Summary Judgment
at 2, filed April 26, 2017 (Doc. 35)(“Response”). “John R. Anczarski, the son of Plaintiffs John
J. Anczarski and Joyce A. Anczarski, died after being struck by a vehicle during a bicycle ride
across the country for breast cancer awareness.” Motion ¶ 1, at 4 (stating this fact)(citing
Plaintiff’s Complaint for Underinsured/Uninsured Motorist Claim ¶¶ 3, 13, at 2-3 (filed in state
court on June 17, 2016), filed in federal court on July 26, 2016 (Doc. 1-1)(“Complaint”)). See
Response at 2 (not disputing this fact). “The bicycle ridden by the son was struck by a vehicle
driven by Gilbert Waconda in Cibola County, New Mexico.” Motion ¶ 2, at 4 (stating this
fact)(citing Complaint ¶ 4, at 2). See Response at 2 (not disputing this fact). “Waconda’s
negligence caused the collision and the death of the son.” Motion ¶ 3, at 4 (stating this
fact)(citing Complaint ¶¶ 11-12, at 2). See Response at 2 (not disputing this fact).
“Plaintiffs John J. Anczarski and Joyce Anczarski are residents of Pennsylvania and own
and operate a business in Pennsylvania known as Mark’s Supply.” Motion ¶ 4, at 4 (stating this
fact)(citing Complaint ¶¶ 1, 5, at 2). See Response at 2 (not disputing this fact). “Mark’s Supply
is a sole proprietorship owned by the Anczarskis or by John J. Anczarski.” Motion ¶ 5, at 4
(stating this fact)(citing Complaint ¶ 5, at 2; John J. Anczarski’s Answers to Defendant’s Second
Set of Interrogatories ¶ 17, at 5 filed April 6, 2017 (Doc. 31-5)(“John Anczarski’s Second
Interrogatory Answers”). See Response at 2 (not disputing this fact). “John J. Anczarski is the
personal representative for the Estate of John R. Anczarski.” Motion ¶ 6, at 4 (stating this
fact)(citing Complaint at 1). See Response at 2 (not disputing this fact).
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“At the time of the collision and death of the son, there were in effect a commercial
general liability (‘CGL’) policy and a commercial excess liability policy issued by the Travelers
Indemnity Company to ‘Mark’s Supply’ as the named insured.” Motion ¶ 7, at 4 (citing Joint
Status Report and Provisional Discovery Plan, Stipulations ¶ 3, at 2, filed September 27, 2016
(Doc. 13)(“Joint Status Report Stipulations”)(asserting this fact).
See Response at 2 (not
disputing this fact). “The CGL policy and commercial excess liability policy were the only
Travelers policies in effect at the time of the accident for any of the Anczarskis or Mark’s
Supply.” Motion ¶ 8, at 4 (citing Joint Status Report Stipulations ¶ 4, at 3)(asserting this fact).
See Response at 2 (not disputing this fact). Travelers issued a “commercial general liability
(‘CGL’) policy . . . to Mark’s Supply as the named insured in Frackville, Pennsylvania.” Motion
¶ 9, at 5 (citing Travelers CGL Policy at 1-145)( asserting this fact). See Response at 2 (not
disputing this fact). Travelers issued “commercial excess liability policies . . . to Mark’s Supply
as the named insured at 1 S. Lehigh Ave., Frackville, Pennsylvania.” Motion ¶ 10, at 5 (citing
Travelers Excess Liability Policy at 1-40)(asserting this fact). See Response at 2 (not disputing
this fact). “The Travelers CGL and commercial excess liability policies were issued in the State
of Pennsylvania to Mark’s Supply as the named insured at 1 S. Lehigh Ave., Frackville,
Pennsylvania.” Motion ¶ 11, at 5 (citing Travelers CGL Policy at 1-145; Travelers Excess
Liability Policy at 1-40)(asserting this fact). See Response at 2 (not disputing this fact). “The
CGL policy and the commercial excess liability policy were both issued for the policy period of
12-25-09 to 12-25-10, which included the date of the accident in this case.” Motion ¶ 12, at 5
(citing Travelers CGL Policy at 1-145; Travelers Excess Liability Policy at 1-40)(asserting this
fact). See Response at 2 (not disputing this fact).
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“At the time of the collision and death of the son, Mark’s Supply Company did not own,
title or register any motor vehicles.”
Motion ¶ 13, at 5 (citing John Anczarski’s Second
Interrogatory Answers ¶ 14, at 5; John J. Anczarski’s Objections and Responses to Defendant’s
Second Set of Requests for Production ¶¶ 11-12, at 9, filed April 6, 2017 (Doc. 31-5). See
Response at 2 (not disputing this fact). “Mark’s Supply Company did not own, title or register
any vehicles at any time from the year 2000 to the present.” Motion ¶ 14, at 5 (citing John
Anczarski’s Interrogatory Answers ¶ 16, at 5). See Response at 2 (not disputing this fact). “At
the time of the accident and death of the son, the Anczarskis were insured under a motor vehicle
liability
insurance
policy
issued
by
Erie
Insurance
Exchange
that
contained
uninsured/underinsured motorist coverage.” Motion ¶ 15, at 5-6 (citing John J. Anczarski’s
Answers to Defendant’s Interrogatories ¶ 5, at 3, filed April 6, 2017 (Doc. 31-6)(“John
Anczarski’s Interrogatory Answers”); Erie Insurance Group Policy and Declarations at 1-23,
filed April 6, 2017 (Doc. 31-3). See Response at 2 (not disputing this fact). “The Anczarskis
made an underinsured motorist claim to Erie Insurance for the death of their son, which claim
was paid by Erie Insurance.” Motion ¶ 15, at 6 (John Anczarski’s Interrogatory Answers ¶ 5, at
3; Erie Insurance Exchange/Eire Insurance Company Release and Agreement at 4-5, filed April
6, 2017 (Doc. 31-4)). See Response at 2 (not disputing this fact). On December 8, 2004,
Seabury & Smith, Inc. issued Mark’s Supply a Certificate of Liability Insurance, under which
The Travelers Indemnity Company provided Mark’s Supply with coverage for commercial
general liability, automobile liability for hired autos and non-owned autos, and excess liability,
for the period commencing on December 25, 2004, and terminating on December 25, 2005. See
Response at 3 (asserting this fact); Reply at 3 (not disputing this fact); 2004 Certificate of
Liability Insurance.
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PROCEDURAL BACKGROUND
On June 17, 2016, the Anczarskis filed the Plaintiff’s [sic] Complaint for
Underinsured/Uninsured Motorist Claim (filed in state court on June 17, 2016), filed in federal
court on July 26, 2016 (Doc. 1-1)(“Complaint”), in which they alleged a claim “under the
Underinsured/Uninsured Motorists provision” of certain Travelers Indemnity’s business and
automobile policies. Complaint ¶ 16, at 3. The Anczarskis seek “relief, general and special, at
law or in equity, to which [they] are entitled including punitive damages, hedonic and all
damages that Plaintiffs would be entitled to receive under New Mexico law.” Complaint at 3.
Under 28 U.S.C. §§ 1332, 1441 & 1446, Travelers Indemnity filed a Notice of Removal, filed
July 26, 2016 (Doc. 1)(“Notice of Removal”).
The Anczarskis responded to Travelers Indemnity’s Notice of Removal. See Plaintiff’s
[sic] Response Motion to Defendant’s Notice of Removal, filed August 15, 2016 (Doc.
7)(“Response to Notice of Removal”). The Anczarskis argue that Travelers Indemnity’s removal
defectively alleges grounds for diversity jurisdiction, because Travelers Indemnity did not
“allege its principal place of business” and the Anczarskis alleged that Travelers Indemnity’s
principal place of business is located in Pennsylvania, the state of which the Anczarskis are
citizens. Response to Notice of Removal ¶ 3, at 2. Travelers Indemnity sought leave to amend
its Notice of Removal. See Defendant’s Motion to Amend Notice of Removal to Cure Defect in
Allegations as to Principal Place of Business of Defendant at 1-7, filed August 16, 2016 (Doc. 8).
The Court granted that motion. See Order Granting Motion to Amend Notice of Removal, filed
November 21, 2016 (Doc. 23).
On November 21, 2016, Travelers Indemnity filed an Amended Notice of Removal, filed
November 21, 2016 (Doc. 24)(“Amended Notice of Removal”), in which Travelers Indemnity
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conceded that, in its Notice of Removal, it inadvertently omitted its principal place of business.
See Amended Notice of Removal at 3. Travelers Indemnity corrected this omission, indicating
that its principal place of business is Hartford, Connecticut. See Amended Notice of Removal ¶
8, at 3 (citing Affidavit of Jonathan A. Decker in Support of Motion to Amend Notice of
Removal ¶ 3, at 1 (executed August 16, 2016), filed August 16, 2016 (Doc. 8-1)(“The Travelers
Indemnity Company has its principal place of business in Hartford, Connecticut.”)).
The Anczarskis then filed two motions to amend the Complaint. On December 5, 2016,
the Anczarskis filed Plaintiffs [sic] Motion to Amend the Complaint and Join Additional Parties,
filed December 5, 2016 (Doc. 25)(“First Motion to Amend”). Then, on April 6, 2017, the
Anczarskis filed Plaintiffs [sic] Stipulated Motion to Amend the Complaint and Join Additional
Parties, filed April 6, 2017 (Doc. 32)(“Second Motion to Amend”). In these motions, the
Anczarskis seek to join “Hudson Insurance Company, Tribal Nation Insurance Services and
Gilbert Waconda, in his Official Capacity” as Defendants. First Motion to Amend at 1. See
Second Motion to Amend at 1. Travelers did not oppose the Anczarskis’ motions to amend to
join additional parties. See Second Motion to Amend at 2 (“Defendant’s attorney did contact
Counsel for Plaintiffs on December 13, 2017 and informed her that he did not oppose the filing
of the Amended Complaint.”); Draft Transcript of Motion Proceedings at 2:24-3:3, taken June 8,
2017 (“Tr.”)1(Court, Eaton)(Court: “I think there is a motion to amend the complaint and to join
additional parties. It looked to me like that one was unopposed.” Eaton: “Yes, Your Honor.”).
At the hearing the Anczarskis represented to the Court that they would not “join any additional
parties.”
Tr. at 3:6-7 (Aragon).
The Anczarskis maintained, however, their interest “in
1
The Court’s citations to the transcript of the hearing refer to the court reporter’s original,
unedited version. Any final transcript may contain slightly different page and/or line numbers.
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amending the complaint,” presumably to add either a breach-of-contract claim against Travelers
Indemnity or a negligence claim against Travelers Indemnity’s insured, Mark’s Supply. Tr. at
3:7-8 (Aragon).
See Plaintiff’s Amended Complaint for Breach of Contract and
Underinsured/Uninsured Motorist Claim ¶ 9, at 3, filed December 5, 2016 (Doc. 211)(“Amended Complaint”)(alleging that “Mark’s Supply failed to research and plan the best
route for the bicycle route”). The Court stated that the Anczarskis need not “file another motion”
but only “a notice withdrawing” that part of the Motion to Amend to Join Additional Parties. Tr.
at 3:15-17 (Court). See Tr. at 3:25-42 (Court). The Anczarskis have yet to file a notice
withdrawing their intention to add additional party Defendants.
1.
Travelers Indemnity’s Motion.
Travelers
Indemnity
moves
for
summary
judgment
on
the
Anczarskis’
uninsured/underinsured motorist claim, because Travelers Indemnity “did not issue any policy of
motor vehicle liability insurance to Plaintiffs that would provide coverage for the death of the
Plaintiff’s son caused by the negligence of an underinsured motorist.” Motion at 1. Travelers
Indemnity argues that, because it “did not issue a policy of motor vehicle liability insurance, it
was not required to and did not offer uninsured/underinsured motorist (‘UM/UIM’) coverage to
Plaintiffs or their business, Mark’s Supply.” Motion at 1. Travelers Indemnity also argues that it
“was not required to offer UM/UIM coverage under the commercial excess policy and general
commercial liability (‘CGL’) policy that Travelers Indemnity had issued to Mark’s Supply.”
Motion at 1. In sum, Travelers Indemnity argues that the Court should grant summary judgment
in its favor, because: (i) “Travelers did not issue a motor vehicle liability policy”; and (ii) “there
is no UM/UIM coverage in either the commercial general liability policy or umbrella policy that
were issued by Travelers to Mark’s Supply.” Motion at 3.
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Travelers Indemnity indicates that there “were only two Travelers policies in existence
for either Mark’s Supply or the Anczarskis at the time of the accident and death of John J.
Anczarski -- an excess liability policy and a commercial general liability policy.” Motion at 6
(citing Travelers CGL Policy at 1-145; Travelers Excess Liability Policy at 1-40). Travelers
Indemnity maintains that the commercial general liability policy “provided business[]owners
property coverage and commercial general liability coverage,” containing “an ‘each occurrence’
limit of $1 million.” Motion at 6 (citing Travelers CGL Policy at 1-145). Travelers Indemnity
also asserts that “the declarations do not list any vehicles as insured under the policy.” Motion at
6. Turning to the excess liability policy, Travelers Indemnity argues that “[t]here is no indication
that this . . . policy is anything other than an excess or umbrella policy that could provide liability
coverage above certain specified underlying liability coverage.” Motion at 7 (citing Travelers
Excess Liability Policy at 1-40). Travelers Indemnity also maintains that excess liability policy
“specifically excludes coverage for any liability under any UM/UIM laws.” Motion at 7 (citing
Travelers Excess Liability Policy at 11).
Travelers Indemnity next addresses which law the Court should apply when interpreting
the two insurance policies at issue. See Motion at 8-9. Travelers Indemnity states that the Court,
when sitting in diversity, applies New Mexico choice-of-law principles to determine which
state’s substantive law to apply. See Motion at 8 (citing Sellers v. Allstate Ins. Co., 82 F.3d 350,
352 (10th Cir. 1996)). Travelers Indemnity then states:
Generally, in New Mexico, “in determining the appropriate law to apply when an
accident occurs in one state and an insurance contract has been entered in another,
the law of the place of the accident applies to determine the plaintiff’s right to
determine the plaintiff’s right to recover from the negligent party, and the law of
the place of the contract, the lex loci contractus, applies to interpret the terms of
the contract.”
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Motion at 8 (quoting Wilkerson v. State Farm Mutual Auto. Ins. Co., 2014-NMCA-077, ¶ 5, 329
P.3d 749, 750 (citing State Farm Auto. Ins. Co. v. Ovitz, 1994-NMSC-047, ¶ 8, 873 P.2d 979)).
Travelers Indemnity then argues that Pennsylvania law applies to the two insurance policies at
issue, because the “policies were issued in Pennsylvania to Mark’s Supply, a sole proprietorship
owned and operated in Pennsylvania by Pennsylvania residents John J. and Joyce Anczarski at a
Pennsylvania address.” Motion at 8 (citing Travelers CGL Policy at 1-145; Travelers Excess
Liability Policy at 1-40).
Travelers Indemnity also argues that “Pennsylvania’s statutes and case law that limit the
requirement to offer UM/UIM coverage to a motor vehicle policy do not conflict in any way with
New Mexico law or public policy,” because, like Pennsylvania law, “New Mexico’s
uninsured/underinsured motorist statute specifically applies only to a ‘motor vehicle or
automobile liability policy’ that is delivered or issued in New Mexico.” Motion at 9 (quoting
N.M. Stat. Ann. § 66-5-301). “Under both statutes,” Travelers contends, “the obligation to over
UM/UIM coverage applies only [to] a motor vehicle liability policy.” Motion at 9 (alteration
added)(internal quotation marks omitted).
Therefore, Travelers Indemnity argues, the
application of Pennsylvania would not “‘result in a violation of fundamental principles of justice’
of New Mexico[,]” thereby, under New Mexico choice-of-law principles, requiring the
application of New Mexico law. Motion at 9 (quoting State Farm Mut. Auto. Ins. Co. v. Ballard,
2002-NMSC-30, ¶ 9, 54 P.3d 537). Travelers Indemnity additionally notes that Pennsylvania
and New Mexico law are in accord, because, like in Pennsylvania, “New Mexico courts have
held that the UM/UIM statute does not extend its reach beyond a motorist’s primary automobile
liability insurance policy.” Motion at 9 (citing Archunde v. Intl. Surplus Lines Ins. Co., 1995NMCA-110, 905 P.2d 1128)). Accordingly, Travelers Indemnity concludes that “Pennsylvania
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law would apply to insurance contracts issued to Pennsylvania residents in the State of
Pennsylvania.” Motion at 9.
Travelers Indemnity then turns to its substantive argument that there is no viable
underinsured/uninsured motorist claim for the death of John. R. Anczarski under the two
Travelers Indemnity policies.
See Motion at 10.
Travelers Indemnity notes that, under
Pennsylvania law, “‘[i]n actions arising under an insurance policy . . . it is a necessary
prerequisite for the insured to establish that his claim falls within the coverage provided by the
insurance policy.’” Motion at 10 (alterations added)(quoting Peters v. Nat’l Interstate Ins. Co.,
108 A.3d 38, 43 (Pa. Super. Ct. 2014))(citing McEwing v. Lititz Mut. Ins. Co., 77 A.3d 639, 646
(Pa. Super. Ct. 2013)). Travelers Indemnity consequently states that, “[i]n order to make out a
valid UM/UIM claim, it must be established that the injured person qualified as an insured under
the UM/UIM coverage in question.” Motion at 10. Travelers Indemnity argues that, in this case,
“there is no allegation that the son was an insured under the CGL and excess liability policies
issued to Mark’s Supply.” Motion at 10. Travelers Indemnity further maintains that “[t]here is
no allegation that Travelers provided a motor vehicle liability insurance policy to Mark’s
Supply.” Motion at 11 (alteration added). Travelers Indemnity further asserts that “[t]here is no
allegation that [it] was required to offer UM/UIM coverage in excess or commercial general
liability policies.”
Motion at 11 (alterations added).
Consequently, Travelers Indemnity
concludes that “there are no allegations in Plaintiff’s Complaint . . . to support the element of any
perceived UM/UIM claim.” Motion at 11 (alteration added).
Travelers Indemnity next argues that Pennsylvania law “[d]id [n]ot and [d]oes [n]ot”
require that it offer uninsured or underinsured motorist coverage under a commercial general
liability or excess liability policy. Motion at 11 (alterations added). Travelers Indemnity adverts
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to Title 17, §1731 of the Pennsylvania Consolidate Statutes, which requires insurers offering
motor vehicle liability insurance policies to also offer uninsured motorist and underinsured
motorist coverage. See Motion at 11 (citing 17 Pa. Const. Stat. §1731 (1994)). Travelers
Indemnity states that, at the time of the accident, Erie Insurance had issued to the Anczarskis a
motor vehicle liability policy containing uninsured or underinsured motorist coverage. See
Motion at 11. Travelers Indemnity also maintains that it did not “issue a motor vehicle liability
policy, because Mark’s Supply did not own or operate any motor vehicle at the time of this
accident or for many years prior to the accident.” Motion at 11.
Travelers Indemnity next states that, under Pennsylvania law, neither a commercial
general liability policy nor an excess liability policy is a “motor vehicle liability policy” that
implicates an insurer’s requirement to offer uninsured or underinsured motorist coverage.
Motion at 11. See Motion at 12-13 (citing Northern Ins. Co. of N.Y. v. Dottery, 43 F. Supp. 2d
509, 513 (E.D. Pa. 1998)(Robreno, J.); Lonesathirath v. Avis Rent A Car Sys. Inc., 937
F. Supp. 367 (E.D. Pa. 1995)(Padova, J.); Stoumen v. Pub. Serv. Mut. Ins. Co., 834 F. Supp. 140
(E.D. Pa. 1993)(Hutton, J.); Been v. Empire Fire and Mar. Ins. Co., 751 A.2d 238 (Pa. Super. Ct.
2000); Ranocchia v. Erie Ins., No. 2166-MDA-2015, 2016 WL 5418191 (Pa. Super. Ct. Aug. 19,
2016)). Travelers Indemnity notes that New Mexico courts have reached the same conclusion.
See Motion at 13 (citing Pielhau v. RLI Ins. Co., 2008-NMCA-099, 189 P.3d 687, overruled on
other grounds by Progressive N.W. Ins. Co. v. Weed Warrior Services, 2010-NMSC-050, 245
P.3d 1209; Archunde v. Intl. Surplus Lines Ins. Co., 1995-NMCA-110, 905 P.2d 1128)).
Travelers Indemnity presses that, in this case, “the Store PAC policy clearly is labeled as
including commercial general liability coverage and not motor vehicle liability coverage.”
Motion at 13 (internal quotation marks omitted)(citing Travelers CGL Policy at 1-145).
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Travelers Indemnity emphasizes that “[n]o vehicles are listed on the CGL declarations.” Motion
at 13 (citing Travelers CGL Policy at 1-145). “The named insured is Mark’s Supply,” Travelers
Indemnity states, and Mark’s Supply “did not own any vehicles and had not owned any vehicles
in many years.” Motion at 13. Turning to the excess liability policy, Travelers Indemnity asserts
that it “specifically excludes coverage under any UM/UIM laws.” Motion at 13 (citing Travelers
Excess Liability Policy at 11). Travelers Indemnity again maintains that the excess liability
policy “does not list any vehicles on the declarations, nor does it contain any other features of a
motor vehicle liability policy.” Motion at 13. Accordingly, Travelers Indemnity concludes that
it “was not required under Pennsylvania law (or under New Mexico law) to offer UM/UIM
coverage to Mark’s Supply, and its policies do not provide such coverage.” Motion at 14.
Last, Travelers Indemnity argues that, if the Anczarskis intend to allege a negligence
claim against Mark’s Supply, the applicable statute of limitations bars such claim. See Motion at
14. Travelers Indemnity states that John R. Anczarski was involved in an accident occurring on
June 21, 2010, and died on June 22, 2010. See Motion at 14. Travelers Indemnity then argues
that the “New Mexico statute of limitations for personal injuries or wrongful death ran out at
least by 2013.” Motion at 14 (citing N.M. Stat. Ann. §§ 37-1-8, 41-2-2). Travelers Indemnity
additionally maintains that, “[u]nder Pennsylvania law . . . the statute of limitations for a
wrongful death and survival action is two years.” Motion at 14 (citing 42 Pa. Const. Stat. § 5524
(2001); Krapf v. St. Luke’s Hospital, 4 A. 3d 642 (Pa. Super. Ct. 2010)). Travelers Indemnity
concludes that the negligence claim that the Anczarskis seek to bring against its insured, Mark’s
Supply, is futile. See Motion at 14.
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2.
The Anczarskis’ Response.
The Anczarskis argue that the Court should deny summary judgment in Travelers
Indemnity’s favor. See Response at 1. The Anczarskis maintain that “they should recover from
Travelers for the death of their son pursuant to the contractual provisions and/or
uninsured/underinsured motorist coverage provided by [Travelers Indemnity].” Response at 1
(alterations added). The Anczarskis argue that Travelers Indemnity “did insure Mark’s Supply
under an automobile liability policy for hired and non-owned automobiles.” Response at 1.
In their Response, the Anczarskis decline to cite any Pennsylvania law. See Response at
1-10. Rather, they exclusively rely on New Mexico cases. See Response at 4-10 (citing Gov’t
Emps. Ins. Co. v. Welch, 2004-NMSC-014, 90 P.3d 471; Ponder v. State Farm Mut. Auto. Ins.
Co., 2000-NMSC-033, 12 P.3d 960). The Anczarskis state that to exclude the injuries pertaining
to John R. Anczarski’s death from coverage under either the commercial general liability policy
or the excess liability policy “would be against New Mexico public policy.” Motion at 10.
Turning to their substantive argument, the Anczarskis contend that, under both the
commercial general liability policy and the excess liability policy, they should recover from
Travelers Indemnity for the death of their son. See Motion at 3-10. The Anczarskis argue that
the commercial general liability policy lists “hired auto and non-owned auto liability
coverage . . . contrary to the defendant’s claim that Travelers did not issue any policy of motor
vehicle liability insurance.” Motion at 3 (citing Travelers CGL Policy at 1-145). Turning to the
excess liability policy, the Anczarskis argue that, under that policy, “an insured is defined as
‘anyone using an auto you own, hire or borrow.’” Motion at 3 (citing Travelers Excess Liability
Policy at 12). See Motion at 10 (citing Travelers Excess Liability Policy at 12). The Anczarskis
contend that “[t]heir son was ‘anyone’ using such an auto.” Motion at 10. Accordingly, the
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Anczarskis reasons that the decedent, John R. Anczarski, “was an insured according to the
provisions of the policies . . . .” Motion at 4. Further, the Anczarskis contend that the excess
liability policy covers the injuries related to John R. Anczarski’s death, because the excess
liability policy not only includes “death within the definition of bodily injury,” but also states
that it “‘applies to bodily injury or property damage from the ownership, operation and use of an
auto.’”
Motion at 3 (quoting Travelers Excess Liability Policy at 20).
Furthermore, the
Anczarskis reason that the insurance policies that Travelers issued to Mark’s Supply include the
damage resulting from the John R. Anczarski’s death, because John R. Anczarski was “using a
motor vehicle owned and registered to his father, John J. Anczarski, who loaned him the vehicle,
sponsored and supported his ride across America . . . under the purview of the business, Mark’s
Supply.” Motion at 4.
The Anczarskis next contend that “[t]he auto provisions as provided in the [excess
liability] policy conflict with the provision that excludes coverage for liability [for]
uninsured/underinsured motorist coverage.” Motion at 3 (alterations added). They note that
“several separate sections of the Plaintiff’s policy conflict with one another.” Motion at 7. The
Anczarskis compare the 2004 Certificate of Liability Insurance, “which certifies coverage for
automobile accidents involving hired or nonowned vehicles with a liability limit of $1,000,000,”
Motion at 7 (citing 2004 Certificate of Liability Insurance at 1), against their excess liability
police, which “unambiguously excludes uninsured and underinsured motorist coverage,” Motion
at 7 (citing Travelers Excess Liability Policy at 1-40). In light of this alleged discrepancy, the
Anczarskis argue “that the mere fact their umbrella policy does not include or does exclude UM
and/or UIM coverage is not in and of itself determinative against them,” because the Anczarskis’
“umbrella policy in question includes coverage for motor vehicle accidents in excess of the limits
- 15
required by law.” Motion at 5 (citing 2004 Certificate of Liability Insurance at 1). To bolster
their argument that the Travelers’ policies are ambiguous, the Anczarskis advert to John J.
Anczarski’s Supplemental Answers ¶ 12, at 3.2 At John J. Anczarski states:
I am not able to recall specific details of discussions that I had with the Traveler’s
[sic] Indemnity Company that occurred years ago. I do contend that my purpose
in buying insurance from Traveler’s [sic] would have been to ensure that Mark’s
Supply was fully covered by insurance that would have protected Mark’s Supply
and my family. So I contend that I would have made this clear to whomever I
spoke with at The Traveler’s [sic] Indemnity Company. I contend that the reasons
that I purchased the insurance coverage would have been based on the assurances
from the Traveler’s [sic] Indemnity Company that they were providing us with
full insurance coverage to include uninsured/underinsured motorist coverage.
Response at 7 (citing John J. Anczarski’s Supplemental Answers ¶ 12, at 3). As a result, the
Anczarskis contend that “[t]here is clearly a genuine issue of material fact[] and the Defendant is
not entitled to a Judgment in their favor as a matter of law.” Motion at 10. Accordingly, the
Anczarskis conclude that the Court should deny the Motion. See Motion at 10.
3.
Travelers Indemnity’s Reply.
In reply, Travelers Indemnity states that the Anczarskis “fail to identify a single word,
sentence, paragraph or provision in either Travelers policy that provides uninsured (‘UM’) or
underinsured (‘UIM’) motorist coverage.”
The Travelers Indemnity Company’s Reply to
Plaintiffs’ Response to Motion for Summary Judgment at 1, filed May 9, 2017 (Doc.
38)(“Reply”). Travelers Indemnity also maintains that the Anczarskis “fail to identify any
contractual provisions of either liability policy that would provide coverage for the death of their
son caused by a third party.” Reply at 1 (internal quotation marks omitted). Accordingly,
Travelers Indemnity concludes that the Anczarskis “have failed to controvert the undisputed
2
John J. Anczarski’s Supplemental Answers are unverified. See John J. Anczarski’s
Supplemental Answers at 4 (lacking John J. Anczarski’s and a Notary Public’s signature). On
June 28, 2017, the Anczarskis filed an Amended Verification that corresponds to John J.
Anczarski’s Supplemental Answers.
- 16
evidence that neither policy contains UM/UIM coverage or any other provisions that would
provide coverage here.” Reply at 1.
Travelers Indemnity notes that the Anczarskis “point out that the Travelers CGL policy
contained an endorsement that could cover Mark’s Supply Company for liability for injuries
caused by Mark’s Supply’s use of nonowned or hired autos.” Reply at 1. Travelers Indemnity
emphasizes, however, that “Plaintiffs offer no facts or arguments as to how that endorsement
would apply.” Reply at 2. Travelers Indemnity notes that “Mark’s Supply is not named as a
defendant and has never been sued for causing or contributing to the death of John R.
Anczarski.” Reply at 2.
Travelers Indemnity next turns to the Anczarskis’ assertion that “one or both liability
policies issued by Travelers to Mark’s Supply Company contain UM/UIM coverage or that the
liability coverages somehow apply . . . .” Reply at 4. Travelers Indemnity maintains that the
Anczarskis “fail to point to any UM/UIM coverage provisions in either liability policy, other
than an exclusion for UM/UIM benefits in the umbrella liability policy.” Reply at 5. Travelers
Indemnity notes the Anczarskis’ observation that the commercial general liability policy
“contains an endorsement entitled ‘Hired Auto and Nonowned Auto Liability.’” Reply at 5
(citing Travelers CGL Policy at 1-145). Travelers Indemnity additionally notes the Anczarskis’
observation of “provisions in the umbrella policy that refer to auto liability coverage if the
underlying policy provides auto liability coverage.”
Reply at 5.
Travelers Indemnity
emphasizes, however, that the Anczarskis do not “explain how or why [auto] liability coverage
would apply here.” Reply at 5 (alteration added).
Travelers Indemnity next walks through the commercial general liability policy that it
issued to Mark’s Supply. See Reply at 7. Travelers Indemnity explains that the commercial
- 17
general liability policy “provides that: ‘We [Travelers Indemnity] will pay those sums that the
insured becomes legally obligated to pay as damages because of ‘bodily injury’ or ‘property
damage’ to which this insurance applies.” Reply at 5 (alteration original)(quoting Travelers
CGL Policy at 95). Travelers Indemnity explains that “if the insured, Mark’s Supply, caused
bodily injury to which the policy applied, it would provide coverage for Mark’s Supply for such
liability . . . .” Reply at 5. Travelers Indemnity argues that this provision is inapplicable, stating
that “[n]either the Plaintiffs nor their business, Mark’s Supply, are defendants, nor have they
ever been sued for the death of John R. Anczarski . . . .” Reply at 5.
Travelers Indemnity then addresses the commercial general liability policy’s “‘Hired
Auto and Nonowned Auto Liability Endorsement.’” Reply at 5 (quoting Travelers CGL Policy
at 21). Travelers Indemnity explains that “[t]he endorsement expands the liability coverage of
the CGL policy to apply to bodily injury ‘arising out of the maintenance or use of a hired auto or
nonowned auto.’” Reply at 5 (alteration added)(quoting Travelers CGL Policy at 21). “[I]f
Mark’s Supply caused bodily injury arising out of Mark’s Supply’s use of a ‘hired auto’ or
‘nonowned auto,’” Travelers reasons, “coverage may apply.”
Reply at 5 (alteration
added)(quoting Travelers CGL Policy at 21). Travelers Indemnity argues that “[t]here is no
evidence that Mark’s Supply was using a vehicle that it hired, rented or borrowed or that was
being used in the course of Mark’s Supply’s business, or that any such vehicle caused or
contributed to the death of John R. Anczarski.” Reply at 6. Travelers Indemnity contends that
the Anczarskis’
Response nowhere suggests Plaintiffs are alleging that they, as the owners of
Mark’s Supply Company, should be liable for the death of their son. No suit has
ever been filed against Mark’s Supply Company or the Anczarskis for the death
of their son. Even if such a claim were to be made now or in the future, it would
be barred by the applicable statutes of limitations . . . .
- 18
Reply at 6. In sum, Travelers Indemnity argues that the endorsement does not apply, not only
because a “hired or nonowned auto did not cause or contribute to the death of John R.
Anczarski,” but also because “there is and has never been a suit or claim that the Plaintiffs,
through their business Mark’s Supply, caused bodily injuries to the death of John R. Anczarski
through the use of a hired or nonowned auto.” Reply at 6. Accordingly, Travelers Indemnity
concludes that “the CGL policy, even with the Hired and Nonowned Auto Liability endorsement,
simply does not provide coverage for the Plaintiffs’ claims that a third party caused the death of
John R. Anczarski.” Reply at 7.
Travelers Indemnity next addresses the excess liability policy’s references to auto
liability. See Reply at 7-9. Travelers Indemnity notes the Anczarskis’ observation that “the
umbrella policy contains an ‘Auto Liability - Following Form’ and that the definition of insured
includes ‘anyone using an auto you own, hire or borrow.’” Reply at 7 (quoting Travelers Excess
Liability Policy at 12, 20). Travelers Indemnity indicates that the excess liability policy’s auto
liability provision applies “to liability for bodily injury arising out of the use of any auto, but
only if such bodily injury ‘would be covered by underlying insurance shown in Item 6
SCHEDULE OF UNDERLYING INSURANCE of the Declarations . . . .’” Reply at 7 (quoting
Travelers Excess Liability Policy at 20). Travelers Indemnity then states that “Item 6, [in] the
Schedule of Underlying Insurance, shows the CGL policy as the underlying policy.” Reply at 7
(citing Travelers Excess Liability Policy at 20). Travelers Indemnity explains that, as a result of
these provisions, “for the umbrella policy to apply, the underlying CGL policy must provide
liability coverage for the bodily injury.” Reply at 7. Travelers then reemphasizes that “there is
and has never been a claim or lawsuit against the insured, Mark’s Supply, for the death of John
- 19
R. Anczarski, nor is there any evidence to suggest that an auto used by Mark’s Supply caused the
death of the son.” Reply at 7.
Travelers Indemnity also replies to the Anczarskis’ contention that their son, John R.
Anczarski, is an insured under the excess liability policy. See Reply at 7. Travelers Indemnity
states that, “[w]ith regard to the definition of insured in the umbrella liability policy, the policy
does not define insured, with respect to the auto hazard, as anyone using an auto you own, hire or
borrow . . . .” Reply at 7 (internal quotation marks omitted)(citing Travelers Excess Liability
Policy at 12). Travelers Indemnity explains that “the insuring agreement of the umbrella policy,
similar to the CGL policy, provides liability coverage for an amount ‘which the insured becomes
legally obligated to pay as damages because of bodily injury . . . to which this insurance applies.”
Reply at 7 (alteration original)(quoting Travelers Excess Liability Policy at 7).
Travelers
Indemnity again restates that “[n]o vehicle that Mark’s Supply owned, hired or borrowed caused
or contributed to the death of John R. Anczarski,” and, accordingly, concludes that “there is no
basis for any liability coverage to apply in this case.” Reply at 8.
Travelers Indemnity next turns to the Anczarskis’ reliance on the 2004 Certificate of
Liability Insurance and their corresponding Anczarskis’ argument that Travelers Indemnity’s
insurance policies are somehow ambiguous or in conflict.
See Reply at 8-9.
Travelers
Indemnity asserts that the 2004 Certificate of Liability Insurance is an unverified “2004
certificate of liability insurance for a policy period in 2004-2005.” Reply at 8 (citing 2004
Certificate of Liability Insurance at 1). Accordingly, Travelers Indemnity asserts that the 2004
Certificate of Liability Insurance “has no applicability to the instant case.” Reply at 8 (citing
2004 Certificate of Liability Insurance at 1).
- 20
Travelers Indemnity then addresses the Anczarskis’ reliance on John J. Anczarski’s
Supplemental Answers ¶ 12, at 3, and the Anczarskis’ related argument that the coverage
included within the Travelers Indemnity’s policies is ambiguous. See Reply at 8. Travelers
Indemnity notes that, under Pennsylvania law, a “court may consider the ‘reasonable
expectations of the insured’ when interpreting an ambiguous contract.” Reply at 8 (quoting
Nationwide Mut. Co. v. Nixon, 682 A.2d 1310, 1313 (Pa. Super. Ct. 1996)). “However,”
Travelers Indemnity emphasizes, “‘[w]hen the language [of the contract] is clear and
unambiguous, [a] court is required to give effect to that language.’” Reply at 8 (first alteration
original, second and third alterations added)(quoting Standard Venetian Blind Co. v. Am. Empire
Ins. Co., 469 A.2d 563, 566 (Pa. 1983)). Travelers Indemnity also maintains that “[t]he parties’
reasonable expectations remain ‘best evidenced by the language of the insurance policy[.]’”
Reply at 8-9 (second alteration original, first alteration added)(quoting Allstate Ins. Co. v.
McGovern, No. 07-2486, 2008 WL 2120722, at *2 (E.D. Pa. May 20, 2008)(Kelly, J.)).
Travelers Indemnity maintains that the Anczarskis “do not point to any ambiguities in the
insurance policies themselves, nor are any apparent.” Reply at 9. “Simply put,” Travelers
Indemnity states “there is nothing in either the CGL liability policy or the umbrella liability
policy that would suggest that either policy contains UM/UIM coverage. In fact, the umbrella
liability policy contains a clear exclusion of UM/UIM coverage. Plaintiffs have offered not
authority or reasons why the exclusion is not valid.” Reply at 9 (citation omitted). Travelers yet
again presses that “Mark’s Supply did not own any vehicles, and the Anczarskis did have motor
vehicle liability coverage and UM/UIM coverage for their vehicles through a different insurer.”
Reply at 9.
- 21
Last, Travelers Indemnity contends that the Anczarskis do not state that Travelers
Indemnity was required to provide uninsured or underinsured coverage.
Reply at 9-11.
Travelers Indemnity notes that the Anczarskis do not dispute Travelers Indemnity’s contention
that, under Pennsylvania law, “an insurer under an umbrella policy or commercial liability policy
is not obligated to offer UM/UIM coverage.” Reply at 9. See Reply at 10 (citing Mulford v.
Altria Grp., 242 F.R.D. 615, 622 n.5 (D.N.M. 2007)(Vasquez, J.)(“Failure to respond to an
argument is generally deemed an acquiescence.”); D.N.M.LR-Civ. 7.1(b)(“The failure of a party
to file and serve a response in opposition to a motion . . . constitutes consent to grant the
motion.”)(alteration added)). Rather, according to Travelers Indemnity, the Anczarskis “allege
that the CGL policy and umbrella liability policy somehow provide coverage for injuries caused
not by fault of the insured but by the negligence of a third party.” Reply at 9. Travelers
Indemnity replies that “neither the Travelers CGL policy nor the umbrella policy provides
uninsured/underinsured motorist coverage or even mentions such coverage, other than the
umbrella policy expressly excludes such coverage.”
Reply at 10 (citing Travelers Excess
Liability Policy at 11). Further, Travelers Indemnity maintains that “[i]t is absolutely clear under
both Pennsylvania and New Mexico law that an insurer under an excess or umbrella policy is not
required to offer UM/UIM coverage.” Reply at 11 (citing Northern Ins. Co. of N.Y. v. Dottery,
43 F. Supp. 2d 509, 513 (E.D. Pa. 1998)(Robreno, J.); Archunde v. Intl. Surplus Lines Ins. Co.,
1995-NMCA-110, 905 P.2d 1128)). Travelers Indemnity concludes that the Anczarskis
do not claim that UM/UIM coverage should have been offered. They do not point
the Court to any provisions of either liability policy that provide UM/UIM
coverage. They do not explain how liability coverage would apply when the acts
of a negligent third party, nor the acts of an insured, caused the bodily injuries.
Reply at 11. Accordingly, Travelers Indemnity requests the Court to enter summary judgment in
its favor.
- 22
4.
The Hearing.
The Court held a motion hearing on June 8, 2017. See Tr. at 1:22 (Court). Regarding the
Motion, the Court began by asking the Anczarskis for their “best theory . . . against Travelers as
to why they should pay.” Tr. at 4:6-7 (Court). The Anczarskis replied that Travelers Indemnity
issued a “certificate of liability insurance,” which “indicates that there is a commercial liability
and general liability policy.” Tr. at 5:7-9 (Aragon). “[U]nder the general liability policy,” the
Anczarskis maintain, “there is an auto, nonowned auto provision that specifically indicates that
they would be covered for a certain amount [because] at [that] point in time, Mr. Anczarski owns
Mark’s Supply.” Tr. at 5:10-14 (Aragon)(alterations added). The Anczarskis further stated the
decedent was riding his bicycle in support of “a nonprofit that was funded and sponsored by
Mark’s Supply.” Tr. at 5:16-17 (Aragon). “The vehicle that was used during that trip,” the
Anczarskis additionally asserted, “was owned by Mr. Anczarski.” Tr. at 5:17-18 (Aragon). The
Anczarskis concede that Mark’s Supply did not own the bicycle that the decedent was riding
when the injury occurred, but argue that “the provisions indicate that there is at least cover[age]
under the bodily injury provision and is insured pursuant to the . . . owned car policy.” Tr. at
5:20-23 (Aragon)(alterations added).
The Court expressed some skepticism of the Anczarskis’ argument:
[I]f you were just to walk up and say to me we’re talking about the nonowned
provision of the general commercial liability policy, this is what I would think
[we] would be . . . talking about[:] if Mr. Anczarski’s company went out and
bought, you know was using, say, a U-Haul vehicle or they rented a tractor or
rented some equipment that would not be owned by the company but it would still
provide some coverage if they were using it. Digging a hole, digging a ditch,
driving something around and they hit somebody. That would be what I would
think it would be. But this situation is that their son was hit by somebody else’s
vehicle so I’m having a hard time figuring out how the policy here would cover
this incident rather than it being some other policy, the policy of the driver here,
would be the one that’s covering.
- 23
Tr. at 5:25-6:16 (Court)(alteration added). The Court then asked the Anczarskis to respond to its
impression. See Tr. at 6:16 (Court).
The Anczarskis responded by emphasizing Mark’s Supply’s sponsorship of the bike ride:
[M]ark’s Supply sponsored the bike ride. They provided the vehicles[;] they
provided the insurance[;] they provided the gas[;] they paid for the trip[;] the paid
for the stickers[;] they paid for the equipment[;] they maintained [the]
vehicle[; . . .] and they used . . . the advertisement of this with stickers on their
website. So they were involved in promoting this. . . . Mark’s Supply was behind
it.
Tr. at 6:18-7:1 (Aragon)(alterations added).
The Court conveyed that it understood “the
connection between the bike ride and the company.” Tr. at 7:4-5 (Court). The Court indicated
that it was “struggling with the insurance policy, how, where the nonowned vehicle is.” Tr. at
7:5-7 (Court). The Court explained that it was “trying to figure out how that came into play here
as far as the accident.” Tr. at 7:7-9 (Court).
The Anczarskis responded that “the vehicle itself was not involved in the accident.” Tr.
at 7:10-11 (Aragon). The Anczarskis explicated: “Johnny Anczarski was not hit by that vehicle.
That vehicle was what they call a chaser vehicle that was used in the bike rides [that] went along
with them, was the one[] that carried the supplies, worked along with them.” Tr. at 7:11-15
(Aragon)(alterations added). The Anczarskis then pivoted to the crux of their argument. See Tr.
at 7:16-8:1 (Aragon)
I’m basing it based on the fact that there is ambiguity in regards to the insurance
policy. The ambiguity states that underinsured, uninsured is excluded. However
the other policies indicate[] that Johnny was an insured and that he was also
covered. So I’m basing it on the fact that there [are] those requirements [and] that
ambiguity in regards to the case and that if there is ambiguity it goes in favor of
the party.
Tr. at 7:16-8:1 (Aragon)(alterations added). The Court interjected, inquiring whether “that [is]
your biggest or best theory or is that your only theory that it comes within the nonowner
- 24
coverage of the general commercial policy?
Is that the ball game, deciding whether that
coverage is available?” Tr. at 8:2-7 (Court)(alteration added). The Anczarskis answered that
“the injury is covered in that . . . . [S]o based on that, yes . . . , all including that as the primary
argument.”
Tr. at 8:8-12 (Aragon)(alterations added).
The Court then asked Travelers
Indemnity for its argument. See Tr. at 13-16 (Court).
Travelers began by reviewing the policies that it issued to Mark’s Supply. See Tr. at
8:24-9:11 (Eaton).
So there were two policies issued by Travelers that were in effect at the time of
this accident there. [One] was [a] business owner’s policy that included the
commercial general liability policy. And the endorsement that y’all were talking
about is part of that CGL policy. Then there is a separate umbrella policy. Both
of these are liability policies. So neither policy mentions uninsured motorist
coverage. . . . [The] umbrella policy has a specific exclusion for uninsured
motorist coverage. But there are no provisions in either policy that look like
uninsured motorist coverage or purport to provide any uninsured motorist
coverage.
Tr. at 8:24-9:11 (Eaton). The Court then asked for clarification whether the Anczarskis were
“trying to get uninsured motorist coverage.” Tr. at 9:17-18 (Court). “Does that come from the
complaint,” the Court inquired. Tr. at 9:18-19 (Court).
Travelers Indemnity explained: “Judge, it comes from the title of the complaint and from
the title of this proposed amended complaint. But I agree, if you read the body of the complaint
or the body of the proposed amended complaint it’s not so clear.” Tr. at 9:20-24 (Eaton).
Travelers Indemnity then provided its best interpretation of the Anczarskis’ underinsured or
uninsured motorist claim. See Tr. at 9:25-10:11 (Eaton).
So the complaint is titled plaintiff’s complaint . . . underinsured/uninsured
motorist claims, and then the relevant parts of the complaint are . . . paragraph 7,
the son was operating a [bicycle] under the policies issued by Travelers. Mark’s
Supply was insured by Travelers, . . . [and] entitled to recover from Travelers the
maximum amount recoverable under the respective policies of
- 25
insurance . . . . [T]he complaint says plaintiffs are entitled to recover under the
uninsured/underinsured provision of the Travelers indemnity policy . . . .
Tr. at 9:25-10:11 (Eaton). The Court interjected: “[A]nd you’re telling me there is just
not one there.”
Tr. at 10:11-12 (Court).
Travelers Indemnity responded in the
affirmative and rehearsed the main of their argument. See Tr. at 10:13-11:6 (Eaton).
There is not an uninsured motorist policy. There is simply not and in the facts the
plaintiffs haven’t disputed the facts so I think the facts are clear. But so if we’re
talking about the liability policies and . . . specifically this nonowned auto
endorsement. I mean they both are liability policies. And the umbrella policy
only applies if the underlying [policy] applies. So [the] liability policy would
protect Mark’s Supply and its owners and employees, et cetera, if they injured
somebody and were sued because of those injuries, I mean that’s obviously what
the liability policies do. And . . . Mark’s Supply did not injury anybody, and the
plaintiffs did not injure their son. And they have never been sued for the death of
young Mr. Anczarski. And there is no claim against Mark’s Supply or any of the
Travelers insureds that they should be held liable for causing injuries to their son.
Tr. at 10:13-11:6 (Eaton). Travelers Indemnity further argued that “there can’t be” a claim
against Mark’s Supply to recover for injuries relating to John R. Anczarski’s death. Tr. at 11:7
(Eaton). Travelers Indemnity noted: “This accident happened in 2010. New Mexico has a threeyear statute of limitations. Pennsylvania, where all of the insurance transactions occurred, has I
believe a two-year statute of limitations. So, there is simply no legal way that today Mark’s
Supply and Mr. and Mrs. Anczarski could be sued . . . .” Tr. at 11:8-13 (Eaton). The Court
asked whether any claims had been filed against Mark’s Supply or the Anczarskis. See Tr. at
11:15 (Court).
“They haven’t been yet,” Travelers Indemnity replied, elaborating that “they’re
not defendants in this case or any other case.” Tr. at 11:18 (Eaton). Travelers Indemnity stated
that, “in terms of a liability policy[,] . . . it doesn’t apply.” Tr. at 11:19-20 (Eaton). Travelers
Indemnity explained that “the policy kicks in when there is an action against the insured and the
policy provides that a defense will be provided, and the insurance company will indemnify
assuming its covered. But there has got to be a claim, a lawsuit, something against the insureds.
- 26
And here there is simply not.” Tr. at 12:6-11 (Eaton). The Court then asked whether the
Anczarskis were “trying to bring in the company with any of these amended motions.” Tr. at
12:12-13 (Court). Travelers Indemnity replied in the negative. See Tr. at 12:14 (Eaton).
Travelers Indemnity concluded that “just on the basis of the undisputed facts on the pleadings
there is nothing here to which a liability policy would apply.” Tr. at 12:22-25 (Eaton). Travelers
Indemnity then offered to address “the uninsured motorist claim if there is such a claim.” Tr. at
12:25-13:1 (Eaton).
The Court then asked the Anczarskis whether they “are trying to make at this point any
sort of uninsured motorist claim or is that dropped out.”
Tr. at 13:10-12 (Court).
The
Anczarskis replied that they “are trying to make an underinsured/uninsured motorist claim.” Tr.
at 13:13-14 (Aragon). The Anczarskis then offered their argument for that claim. See Tr. at
13:15-14:15 (Aragon).
Although it specifically states there is an exclusion there are other provisions in
the policy that create confusion as to what is covered under nonowned and owned
auto liability. Although it falls under the general liability insurance and it’s not
specifically stated and checked as automobile liability insurance, it says auto
owned and not owned within that policy under the general liability policy. And
our argument is that if there is ambiguity in regards to what is covered in regards
to underinsured and uninsured that if there is any ambiguity in the policies . . . as
to what is covered, what’s not covered, and saying underinsured and uninsured is
not covered here . . . it creates confusion . . . and the case law does specifically
state that when there is confusion and ambiguity that there is a material issue
of . . . material fact.
Tr. at 13:15-14:15 (Aragon).
The Court confirmed that the Anczarskis’ underinsured or
uninsured motorist claim was “still in the case.” Tr. at 14:17 (Court). The Court then asked for
Travelers Indemnity’s argument. See Tr. at 14:18 (Eaton).
Travelers Indemnity stated that “the commercial general liability policy that contains the
nonowned auto endorsement . . . doesn’t have any uninsured motorist provisions in it . . . I mean
- 27
it’s purely a liability policy.” Tr. at 14:20-24 (Eaton)(alterations added). Travelers Indemnity
asserted that “[t]he endorsement that [the Anczarskis] refer[] to is purely a liability
endorsement. . . . If Mark’s Supply borrowed a car, hired a car, rented a car and injured
somebody, that endorsement . . . provide[s] liability protection if they were sued by the injured
party.” Tr. at 14:24-15:5 (Eaton)(alterations added). Travelers Indemnity argued that this policy
“has nothing to do with uninsured motorist coverage.”
Tr. at 15:5-6 (Eaton).
Travelers
Indemnity then pivoted to the Anczarskis’ ambiguity argument. See Tr. at 15:7-16:12 (Eaton).
I don’t know where the ambiguity is. [The Anczarskis] didn’t point out anywhere
that there was an ambiguity. . . . [The Anczarskis] attached a certificate of
liability insurance that wasn’t prepared by Travelers. It was prepared we don’t
know by whom from 2004. And that showed that there was automobile liability
coverage. And [the Anczarskis] argued that that certificate showing auto liability
coverage created an ambiguity with this 2010 policy. But that certificate . . . was
five years previous. . . . [It] doesn’t have anything to do with this policy. I think
what we can see from the documents is that Mark’s Supply had auto liability
coverage, and maybe uninsured motorist coverage through Travelers back in 2004
and 2005. What we then can see . . . [is] an email from an agent that, in 2009 and
it says something like . . . Travelers is going to issue both policies. So somewhere
between 2004 when Mark’s Supply may have been covered by Travelers for auto
liability, commercial general liability and umbrella, somewhere between then and
2010, they switched their auto liability coverage to Erie Exchange. And in fact in
this case they made a UM claim to Erie Exchange and got paid on that claim. So
it seems clear that the insureds Mark’s Supply and the Anczarskis had auto
coverage, and at one point it was with Travelers, but five years before this
accident they switched that auto coverage to an entirely different insurance
company.
Tr. at 15:7-16:12 (Eaton)(alterations added). The Court then asked: “So this policy just simply
doesn’t have the uninsured motorist coverage?” Tr. at 16:13-14 (Court). Travelers Indemnity
responded that not only “[i]t doesn’t have the uninsured coverage,” Tr. at 16:15 (Eaton), but also
it did not understand the Anczarskis references to “ambiguities,” Tr. at 16:18 (Eaton).
The Court then asked the Anczarskis “what would you point to . . . in the commercial
general liability policy . . . [where] you see uninsured motorist coverage or anything that you
- 28
[are] claiming is uninsured motorist coverage.” Tr. at 17:4-9 (Court)(alterations added). In
positing the question, the Court also referenced the exclusion of uninsured or underinsured
motorist coverage in the excess liability policy. See Tr. at 18:4-5 (Court). The Anczarskis stated
that they “have a certificate of liability insurance policy effective 12/25/2009 to
12/25/2010 . . . .” Tr. at 18:18-20 (Aragon)(alteration added). The Court suggested: “Let’s put
aside the certificates. What about the policy itself. Is there something in the CGL that you’re
thinking provides uninsured or underinsured motorist coverage?” Tr. at 18:23-25 (Court). The
Anczarskis responded: “I’m thinking under the hired [auto] and the nonowned auto . . . .” Tr. at
19:2-3 (Aragon)(alteration added).
Travelers Indemnity then replied to the Anczarskis’ reference to the hired and nonowned
auto endorsement provisions. See Tr. at 19:5-19:20 (Eaton).
[T]hat’s a very short endorsement. . . . It does what we’re saying it does[:] it
provides liability coverage to Mark’s Supply for liability that may be assessed
against Mark’s Supply for causing bodily injury . . . [by a] nonowned or hired
auto. It simply doesn’t apply to the facts of this case . . . . [T]he guys [on] the
bicycle ride were using a van that Mr. Anczarski personally lent to his son and the
other folks . . . that van had nothing to do with this accident. It wasn’t involved in
any way. So had the van injured somebody else it would be a whole different
story. . . . But that’s not what happened.
Tr. at 19:5-19:20 (Eaton)(alterations added). Travelers Indemnity accordingly expressed its
puzzlement regarding the hired and nonowned auto endorsement. See Tr. at 20:7-8 (Eaton).
The Anczarskis addressed their assertion that the Travelers insurance policy documents
contain an ambiguity. See Tr. at 20:13-21 (Aragon).
The ambiguity goes to, if you look at the listing of forms, endorsements, and
schedule numbers, it specifically under the umbrella excess [policy] indicates UM
03450200
auto
liability . . . . [T]he
exclusion
specifically
states
underinsured/uninsured is excluded, but yet it mentions auto liability in other
provisions and documents, forms, listings and endorsements that were included in
the copy that my client received . . . .
- 29
Tr. at 20:13-21 (Aragon)(alterations added).
The Court then asked for Travelers Indemnity’s response. See Tr. at 21:1 (Court).
Travelers Indemnity replied to the Anczarskis’ assertion of ambiguity regarding coverage. See
Tr. at 21:2-22:16 (Eaton).
I guess now we’re talking about the umbrella policy. Under the umbrella policy,
Judge, that’s a liability policy. It applies if there is coverage under the
underlying CGL policy. So first there has to be coverage under the CGL policy
for the umbrella [to apply]. It’s a liability policy . . . [I]t protects the insured if
they get sued for injuring somebody. It’s not an uninsured motorist policy. And
in fact it specifically includes an exclusion for uninsured motorist claims.
Tr. at 21:2-12 (Eaton)(alterations added). Travelers Indemnity further argued that both the
Pennsylvania and the New Mexico “mandatory financial responsibility statutes that talk about
the requirement of providing UM or UIM coverage specifically by case law do not apply to
excess policies.” Tr. at 21:22-22:1 (Eaton).
Travelers Indemnity then again emphasized that
the commercial general liability policy does not apply. See Tr. at 22:6 (Eaton). Travelers
Indemnity again asserted, “I just, I don’t know what the ambiguity is and I don’t know where the
coverage is. It’s not in these policies.” Tr. at 22:14-16 (Eaton). The Court then invited the
Anczarskis to argue in opposition to Travelers Indemnity’s Motion. See Tr. at 23:2-5 (Court).
Referring to various certificates of liability, the Anczarskis argued:
According to the certificate of liability insurance and the insurance
documents . . . it specifically states in the endorsement lists of forms,
endorsements, and schedule numbers, auto liability following . . . umbrella excess
coverage in regards to that. . . . If you look at the certificate of liability insurance
that was issued since 2004, 2005, it checks under A, general liability, it says
general commercial liability and it says policy occur check. Then there is another
section called automobile liability policy and on there is hired [auto], nonowned
[auto], and then on the bottom is excess liability occurrence retention. In
comparison to the current certificate of liability, insurance the general liability
component, which was initially checked on the first one commercial general
liability the automobile hired auto nonowned auto was added to that. The
automobile liability portion is not checked in the 2009, 2010 certificate of liability
insurance. And also checked under excess liability, excess umbrella policy there
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is nothing indicating underinsured, nothing indicating [auto]. The mere indication
that there is reference to use of an automobile, there is reference to use of an
automobile, nonuse of an automobile does create confusion as to what is covered
under . . . an automobile policy, an underinsured policy, an uninsured motorist
automobile policy, or the general liability, commercial liability policy.
Tr. at 23:7-24:21 (Aragon). The Anczarskis also adverted to the excess liability policy, stating
that it “[s]pecifically identifies under section 2 who is the insured.” Tr. at 26:20-21 (Aragon).
The Anczarskis referenced sections 2A1 and 2A2 of the excess liability policy. See Tr. at 26:2324 (Aragon).
The Anczarskis further stated that, under those policy provisions, “an
insured defendant is anyone using an auto you own, hire, or borrow.” Tr. at 27:5-6 (Aragon).
The Anczarskis then argued:
Based on this we believe there is a genuine issue of material fact. The policy is
ambiguous . . . [and therefore] goes in favor of the insured, and the law does
provide as we stated in our response ambiguities arise when separate sections of
the policy appear to be in conflict with one another. When the language of the
provision is susceptible to more than one meaning, when the structure of the
contract is illogical or when a particular matter of coverage is not explicitly
addressed by the policy. . . . In this case it’s clear that the policy does conflict in
regards to the sections stated. And pursuant to the law as cited coverage applies
equally to the victims of accidents whether or not they are family members . . . .
Tr. at 27:6-24 (Aragon)(alterations added). The Anczarskis additionally argued that, under
Gov’t Emps. Ins. Co. v. Welch, 2004-NMSC-014, 90 P.3d 471, the Court should conclude that,
“[i]f an insurance company offers insurance in excess of limits required by law, and it contains
vehicle coverage, then it applies equally to victims of such accidents whether they’re family
members or not.” Tr. at 29:14-18 (Mendoza). The Anczarskis concluded “that there is . . . a
genuine issue of material fact . . . .” Tr. at 31:6-7 (Aragon)(alterations added). The Anczarskis
also offered John J. Anczarski’s testimony, as he was present for the hearing. See Tr. at 31:8
(Aragon). The Court then invited Travelers Indemnity’s response and specifically solicited
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Travelers Indemnity’s thoughts on the introduction of John J. Anczarski’s testimony at a hearing
on a summary judgment motion. See Tr. at 31:10-15.
Travelers Indemnity replied:
[T]he policies were not disputed, and they’re before the Court. . . . [T]his is
purely a question of the Court looking at the policies and then determining
whether either policy provides applicable coverage. So . . . for them to have Mr.
Anczarski testify now and who knows what he might say, but it’s really not
relevant to the legal issue before the Court, and the interpretation of these
contracts. Even if Mr. Anczarski were to testify [-- “]I thought I was getting
uninsured motorist coverage. I wanted uninsured motorist coverage[” --] that
goes to the reasonable expectations theory that only potentially could come into
play, if there is ambiguities in these policies, which there is not. So I don’t think
it’s appropriate or reasonable or fair to have witness testify here at the summary
judgment hearing on this motion that’s been before the Court . . . several weeks.
Tr. at 31:19-32:11 (Eaton). Travelers Indemnity then concluded:
I want to make sure it’s really clear that Travelers issued two policies. And in the
plaintiff’s exhibit which is at docket 35-2, is an email from somebody called
Karen Crow at Marsh [Commercial Business Center3], and/or Karen Crow writes
to Mr. Anczarski [-- “]good afternoon John, per our conversation I have
confirmed that both of your policies referenced above are in effect at this time[” -] and the policies referenced above are the business owner’s policy and the
umbrella policy. No auto policy because -- and this is document 31-3 in the Court
docket, the Anczarskis obtained auto coverage from Erie Insurance Group. So
they had automobile coverage. It just wasn’t through Travelers.
Tr. at 32:17-33:7 (Eaton).
The Court refused to allow Mr. Anczarski’s viva voce testimony, but suggested to the
Anczarskis that they could file an opposed or unopposed motion to supplement the record, first
asking for Travelers Indemnity’s position on adding the proffered documents to the record. See
Tr. at 33:10-25 (Court). See also Tr. at 35:17-21 (Court)(“But once you print and run it past Mr.
Eaton and Mr. Eaton may think it’s irrelevant and not have any opposition to it coming in. On
3
Marsh is a wholly owned subsidiary of Marsh & McLennan Companies and conducts
business in insurance broking and risk management.
See Marsh “Who We Are,”
https://www.marsh.com/us/about-marsh/aboutus.html (last visited, July 11, 2017).
- 32
the other hand if he opposes it, you can file a motion on that score to get it in.”). The Court then
stated that it was “just not seeing coverage . . . that is going to cause Travelers to be liable.” Tr.
at 34:1-2 (Court)(alteration added). The Court thanked the parties for their presentations. See
Tr. at 37:3-4 (Court).
5.
The Anczarskis’ Motion to Supplement Record.
On June 28, 2017, the Anczarskis filed their Motion to Supplement Record.
The
Anczarskis note that, at the hearing, they informed the Court “that they inadvertently uploaded
the wrong Certificate of Liability Insurance . . . issued by Travelers Indemnity Company as
reference in Plaintiffs’ Response to Defendant’s Motion for Summary Judgment.” Motion to
Supplement Record at 1. The Anczarskis submit “the correct Certificate of Liability Insurance
issued by Travelers Indemnity Company with the policy effective date of 12/25/2009 and policy
expiration date of 12/25/2010.” Motion to Supplement Record at 1. The Anczarskis state that
they provide this document to Travelers Indemnity on January 3, 2017, and, consequently, that
“Defendant would not be prejudiced by this information.” Motion to Supplement Record at 2.
See 2010 Certificate of Liability Insurance. Additionally, the Anczarskis submit the Amended
Verification that corresponds to John J. Anczarski’s Supplemental Answers. The Anczarskis
also attach the Affidavit of John J. Anczarski Supplementing the Record (sworn June 23, 2017),
filed June 28, 2017 (Doc. 46-3)(“Anczarski’s Supplemental Affidavit”), in conjunction with the
supplemental exhibits, because “his testimony was not allowed at the motion hearing.” Motion
to Supplement Record at 2. John J. Anczarski states that he received the 2010 Certificate of
Liability Insurance “from Traveler’s [sic] Indemnity Company” and that the certificate “has not
been changed or altered.” Anczarski’s Supplemental Affidavit ¶¶ 2-4, at 1.
- 33
6.
Travelers’ Response to the Anczarskis’ Motion to Supplement Record.
On July 3, 2017, Travelers Indemnity filed The Travelers Indemnity Company’s
Response to Plaintiffs’ Motion to Supplement the Record, filed July 3, 2017 (Doc.
47)(“Response to Motion to Supplement”). Travelers Indemnity argues that the Court should
deny the Motion to Supplement Record as untimely. See Response to Motion to Supplement at
1. Travelers Indemnity further contends that the Anczarskis’ “proposed ‘correct exhibits’ do not
raise any new facts or create any disputed issues of material fact.” Response to Motion to
Supplement at 1.
“Even if the ‘corrected exhibits’ are considered,” Travelers Indemnity
maintains, “they do not change the basic fact that Plaintiffs have not and cannot point to any
provision in either Travelers liability policy that would provide uninsured/underinsured
(‘UN/UIM’) motorist coverage.” Response to Motion to Supplement at 1. Travelers Indemnity
reemphasizes that the Anczarskis “cannot dispute that liability coverage does not apply because
no cause of action has ever been brought against Travelers’ insured, Mark’s Supply.” Response
to Motion to Supplement at 1. Moreover, Travelers Indemnity presses that “[a]ny claim by the
Estate of John R. Anczarski against his parents or their company in the future would be frivolous
as barred by the applicable statute of limitations.” Response to Motion to Supplement at 1
(alteration added).
Travelers Indemnity next turns to the 2010 Certificate of Liability Insurance.
See
Response to Motion to Supplement at 2. Travelers Indemnity states that “[t]his certificate shows
there was no automobile insurance policy issued to the insured, Mark’s Supply.” Response to
Motion to Supplement at 2. Moreover, Travelers Indemnity argues that the 2010 Certificate of
Liability Insurance is not admissible into evidence, because there “is also no evidence as to who
prepared the certificate, thus leaving it without any foundation whatsoever.” Response to Motion
- 34
to Supplement at 2. “[E]ven if it is considered,” Travelers Indemnity insists, the 2010 Certificate
of Liability Insurance “does not add any new facts or change any facts already before the Court.”
Response to Motion to Supplement at 2. Travelers Indemnity then addresses the Amended
Verification, arguing that, even when verified, “Mr. Anczarski’s interrogatory answers before the
Court do not change the clear language of the insurance policies or create any ambiguities in the
policies’ language.” Response to Motion to Supplement at 2. Travelers Indemnity concludes:
These proposed exhibits add nothing to the issue of whether the two Travelers
policies provided UM/UIM coverage or any other applicable coverage.
Moreover, they do not change the fact that Plaintiffs did not and still do not
dispute any of Travelers’ enumerated material facts, nor do they change the fact
that Plaintiffs failed to submit any enumerated facts of their own.
Response to Motion to Supplement at 1-2.
Travelers Indemnity then states that summary judgment is appropriate with or without
these exhibits. See Response to Motion to Supplement at 3. Travelers Indemnity asserts that, at
the most, the Anczarskis have argued “that there is some unspecified ambiguity because the
excess liability policy mentions excess auto liability coverage if an underlying policy provides
auto liability coverage, but excludes UM/UIM claims.” Response to Motion to Supplement at 3.
Nevertheless, Travelers Indemnity maintains that summary judgment is warranted.
Response to Motion to Supplement at 3.
Travelers Indemnity states that its “policies are
absolutely clear that they do not provide UM/UIM coverage.”
Response to Motion to
Supplement at 3. Travelers Indemnity concludes:
The facts are absolutely clear that Plaintiffs have never brought a claim or cause
of action against themselves in which they allege that they are responsible for
their son’s death. The Plaintiffs and their business have never been named as
defendants in a wrongful death lawsuit. The law is absolutely clear that any such
action now would be barred by the statutes of limitations in both Pennsylvania
(where the policies were issued) and New Mexico (where the vehicle-bicycle
accident occurred). In short, there is not coverage under either policy for the
- 35
See
death of John R. Anczarski. . . . This case presents a classic situation under which
summary judgment is appropriate.
Response to Motion to Supplement at 3.
LAW REGARDING MOTIONS FOR SUMMARY JUDGMENT
Rule 56(a) of the Federal Rules of Civil Procedure states: “The court shall grant summary
judgment if the movant shows that there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). “The movant bears the
initial burden of ‘show[ing] that there is an absence of evidence to support the nonmoving
party’s case.’”
Herrera v. Santa Fe Pub. Sch., 956 F. Supp. 2d 1191, 1221 (D.N.M.
2013)(Browning, J.)(quoting Bacchus Indus., Inc. v. Arvin Indus., Inc., 939 F.2d 887, 891 (10th
Cir. 1991)). See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)(“Celotex”).
Before the court can rule on a party’s motion for summary judgment, the moving
party must satisfy its burden of production in one of two ways: by putting
evidence into the record that affirmatively disproves an element of the nonmoving
party’s case, or by directing the court’s attention to the fact that the non-moving
party lacks evidence on an element of its claim, “since a complete failure of proof
concerning an essential element of the nonmoving party’s case necessarily renders
all other facts immaterial.” Celotex, 477 U.S. at 323-25. On those issues for
which it bears the burden of proof at trial, the nonmovant “must go beyond the
pleadings and designate specific facts to make a showing sufficient to establish
the existence of an element essential to his case in order to survive summary
judgment.” Cardoso v. Calbone, 490 F.3d 1194, 1197 (10th Cir. 2007).
Plustwik v. Voss of Nor. ASA, 2013 WL 1945082, at *1 (D. Utah May 9,
2013)(Sam, J.)(emphasis added). “If the moving party will bear the burden of persuasion at trial,
that party must support its motion with credible evidence -- using any of the materials specified
in Rule 56(c) -- that would entitle it to a directed verdict if not controverted at trial.” Celotex,
477 U.S. at 331 (Brennan, J., dissenting)(emphasis in original).4 Once the movant meets this
4
Although the Honorable William J. Brennan, Jr., Associate Justice of the Supreme Court
of the United States of America, dissented in Celotex, this sentence is widely understood to be an
- 36
burden, rule 56 requires the nonmoving party to designate specific facts showing that there is a
genuine issue for trial. See Celotex, 477 U.S. at 324; Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 256 (1986)(“Liberty Lobby”).
The party opposing a motion for summary judgment must “set forth specific facts
showing that there is a genuine issue for trial as to those dispositive matters for which it carries
the burden of proof.” Applied Genetics Int’l, Inc. v. First Affiliated Sec., Inc., 912 F.2d 1238,
1241 (10th Cir. 1990).
See Vitkus v. Beatrice Co., 11 F.3d 1535, 1539 (10th Cir. 1993)
(“However, the nonmoving party may not rest on its pleadings but must set forth specific facts
showing that there is a genuine issue for trial as to those dispositive matters for which it carries
the burden of proof.”)(internal quotation marks omitted). Rule 56(c)(1) provides: “A party
asserting that a fact . . . is genuinely disputed must support the assertion by . . . citing to
particular parts of materials in the record, including depositions, documents, electronically stored
information, affidavits or declarations, stipulations (including those made for purposes of the
motion only), admissions, interrogatory answers, or other materials.” Fed. R. Civ. P. 56(c)(1). It
is not enough for the party opposing a properly supported motion for summary judgment to “rest
on mere allegations or denials of his pleadings.”
Liberty Lobby, 477 U.S. at 256.
See
Abercrombie v. City of Catoosa, 896 F.2d 1228, 1231 (10th Cir. 1990); Otteson v. United States,
622 F.2d 516, 519 (10th Cir. 1980)(“[O]nce a properly supported summary judgment motion is
made, the opposing party may not rest on the allegations contained in his complaint, but must
respond with specific facts showing the existence of a genuine factual issue to be tried.” (citation
omitted)(internal quotation marks omitted)).
accurate statement of the law. See 10A Charles Allen Wright & Arthur R. Miller, Federal
Practice and Procedure § 2727, at 470 (3d ed. 1998)(“Although the Court issued a five-to-four
decision, the majority and dissent both agreed as to how the summary-judgment burden of proof
operates; they disagreed as to how the standard was applied to the facts of the case.”).
- 37
Nor can a party “avoid summary judgment by repeating conclusory opinions, allegations
unsupported by specific facts, or speculation.” Colony Nat’l Ins. Co. v. Omer, No. CIV 07-2123
JAR, 2008 WL 2309005, at *1 (D. Kan. June 2, 2008)(Robinson, J.)(citing Argo v. Blue Cross &
Blue Shield of Kan., Inc., 452 F.3d 1193, 1199 (10th Cir. 2006); Fed. R. Civ. P. 56(e)). “In
responding to a motion for summary judgment, ‘a party cannot rest on ignorance of facts, on
speculation, or on suspicion and may not escape summary judgment in the mere hope that
something will turn up at trial.’” Colony Nat’l Ins. Co. v. Omer, 2008 WL 2309005, at *1
(quoting Conaway v. Smith, 853 F.2d 789, 794 (10th Cir. 1988)).
To deny a motion for summary judgment, genuine factual issues must exist that “can be
resolved only by a finder of fact because they may reasonably be resolved in favor of either
party.” Liberty Lobby, 477 U.S. at 250. A mere “scintilla” of evidence will not avoid summary
judgment. Vitkus v. Beatrice Co., 11 F.3d at 1539 (citing Liberty Lobby, 477 U.S. at 248).
Rather, there must be sufficient evidence on which the fact finder could reasonably find for the
nonmoving party.
See Liberty Lobby, 477 U.S. at 251 (quoting Schuylkill & Dauphin
Improvement Co. v. Munson, 81 U.S. 442, 448 (1871)(“Schuylkill”); Vitkus v. Beatrice Co., 11
F.3d at 1539. “[T]here is no evidence for trial unless there is sufficient evidence favoring the
nonmoving party for a jury to return a verdict for that party.
If the evidence is merely
colorable . . . or is not significantly probative, . . . summary judgment may be granted.” Liberty
Lobby, 477 U.S. at 249 (citations omitted). Where a rational trier of fact, considering the record
as a whole, could not find for the nonmoving party, there is no genuine issue for trial. See
Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).
When reviewing a motion for summary judgment, the court should keep in mind certain
principles. First, the court’s role is not to weigh the evidence, but to assess the threshold issue
- 38
whether a genuine issue exists as to material facts requiring a trial. See Liberty Lobby, 477 U.S.
at 249. Second, the ultimate standard of proof is relevant for purposes of ruling on a summary
judgment, such that, when ruling on a summary judgment motion, the court must “bear in mind
the actual quantum and quality of proof necessary to support liability.” Liberty Lobby, 477 U.S.
at 254. Third, the court must resolve all reasonable inferences and doubts in the nonmoving
party’s favor, and construe all evidence in the light most favorable to the nonmoving party. See
Hunt v. Cromartie, 526 U.S. 541, 550-55 (1999); Liberty Lobby, 477 U.S. at 255 (“The evidence
of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor.”).
Fourth, the court cannot decide any issues of credibility. See Liberty Lobby, 477 U.S. at 255.
There are, however, limited circumstances in which the court may disregard a party’s
version of the facts. This doctrine developed most robustly in the qualified immunity arena. In
Scott v. Harris, 550 U.S. 372 (2007), the Supreme Court of the United States of America
concluded that summary judgment was appropriate where video evidence “quite clearly
contradicted” the plaintiff’s version of the facts. 550 U.S. at 378-81. The Supreme Court
explained:
At the summary judgment stage, facts must be viewed in the light most
favorable to the nonmoving party only if there is a “genuine” dispute as to those
facts. Fed. Rule Civ. Proc. 56(c). As we have emphasized, “[w]hen the moving
party has carried its burden under Rule 56(c), its opponent must do more than
simply show that there is some metaphysical doubt as to the material facts . . . .
Where the record taken as a whole could not lead a rational trier of fact to find for
the nonmoving party, there is no ‘genuine issue for trial.’” Matsushita Elec.
Industrial Co. v. Zenith Radio Corp., 475 U.S. [at] 586-587 . . . (footnote
omitted). “[T]he mere existence of some alleged factual dispute between the
parties will not defeat an otherwise properly supported motion for summary
judgment; the requirement is that there be no genuine issue of material fact.”
Anderson v. Liberty Lobby, Inc., 477 U.S. [at] 247-248 . . . . When opposing
parties tell two different stories, one of which is blatantly contradicted by the
- 39
record, so that no reasonable jury could believe it, a court should not adopt that
version of the facts for purposes of ruling on a motion for summary judgment.
That was the case here with regard to the factual issue whether respondent
was driving in such fashion as to endanger human life. Respondent’s version of
events is so utterly discredited by the record that no reasonable jury could have
believed him. The Court of Appeals should not have relied on such visible
fiction; it should have viewed the facts in the light depicted by the videotape.
Scott v. Harris, 550 U.S. at 380-81 (emphasis in original).
The United States Court of Appeals for the Tenth Circuit applied this doctrine in
Thomson v. Salt Lake County and explained:
[B]ecause at summary judgment we are beyond the pleading phase of the
litigation, a plaintiff’s version of the facts must find support in the record: more
specifically, “[a]s with any motion for summary judgment, when opposing parties
tell two different stories, one of which is blatantly contradicted by the record, so
that no reasonable jury could believe it, a court should not adopt that version of
the facts.” York v. City of Las Cruces, 523 F.3d 1205, 1210 (10th Cir. 2008)
(quoting Scott, 550 U.S. at 380); see also Estate of Larsen ex rel. Sturdivan v.
Murr, 511 F.3d 1255, 1258 (10th Cir. 2008).
Thomson v. Salt Lake Cnty., 584 F.3d at 1312 (brackets omitted). “The Tenth Circuit, in Rhoads
v. Miller, [352 F. App’x 289 (10th Cir. 2009)(Tymkovich, J.)(unpublished),5] explained that the
5
Rhoads v. Miller is an unpublished opinion, but the Court can rely on an unpublished
opinion to the extent its reasoned analysis is persuasive in the case before it. See 10th Cir. R.
32.1(A)(“Unpublished opinions are not precedential, but may be cited for their persuasive
value.”). The Tenth Circuit has stated:
In this circuit, unpublished orders are not binding precedent, . . . and we have
generally determined that citation to unpublished opinions is not favored.
However, if an unpublished opinion or order and judgment has persuasive value
with respect to a material issue in a case and would assist the court in its
disposition, we allow a citation to that decision.
United States v. Austin, 426 F.3d 1266, 1274 (10th Cir. 2005)(citations omitted). The Court
finds that Rhoads v. Miller, Lobozzo v. Colo. Dep’t of Corr., 429 F. App’x 707 (10th Cir. 2011),
United States v. Ceballos, 355 F. App’x 226 (10th Cir. 2009), and United States v. Aragones, 483
- 40
blatant contradictions of the record must be supported by more than other witnesses’
testimony[.]”
Lymon v. Aramark Corp., 728 F. Supp. 2d 1222, 1249 (D.N.M.
2010)(Browning, J.)(citation omitted), aff’d, 499 F. App’x 771 (10th Cir. 2012).
Rule 56(c) of the Federal Rules of Civil Procedure also provides guidance regarding how
to support an assertion that a fact is, or cannot be, genuinely disputed. See Fed. R. Civ. P. 56(c).
That subsection provides:
(c) Procedures.
(1) Supporting Factual Positions. A party asserting that a fact cannot be or is
genuinely disputed must support the assertion by:
(A) citing to particular parts of materials in the record, including
depositions, documents, electronically stored information, affidavits or
declarations, stipulations (including those made for purposes of the motion
only), admissions, interrogatory answers, or other materials; or
(B) showing that the materials cited do not establish the absence or
presence of a genuine dispute, or that an adverse party cannot produce
admissible evidence to support the fact.
(2) Objection That a Fact Is Not Supported by Admissible Evidence. A party may
object that the material cited to support or dispute a fact cannot be presented in a
form that would be admissible in evidence.
(3) Materials Not Cited. The court need consider only the cited materials, but it
may consider other materials in the record.
(4) Affidavits or Declarations. An affidavit or declaration used to support or
oppose a motion must be made on personal knowledge, set out facts that would be
admissible in evidence, and show that the affiant or declarant is competent to
testify on the matters stated.
Fed. R. Civ. P. 56(c).
F. App’x 415 (10th Cir. 2012), have persuasive value with respect to material issues, and will
assist the Court in its preparation of this Memorandum Opinion and Order.
- 41
LAW REGARDING NEW MEXICO CHOICE-OF-LAW RULES
Where a plaintiff invokes a federal district court’s diversity jurisdiction, the district court
looks to the forum state’s choice-of-law rules to determine which state’s substantive law to
apply. See Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496-97 (1941); Pepsi-Cola
Bottling Co. v. PepsiCo, Inc., 431 F.3d 1241, 1255 (10th Cir. 2005). The first step in a New
Mexico choice-of-law analysis is to characterize the claim by “area of substantive law -- e.g.,
torts, contracts, domestic relations -- to which the law of the forum assigns a particular claim or
issue.” Terrazas v. Garland & Loman, Inc., 2006-NMCA-111, ¶ 11, 142 P.3d 374, 377. There
are only a few categories within which claims might fall -- “[t]ort cases, i.e., all ‘civil wrongs,’
are one class; contracts, i.e., every kind of enforceable promise, is another single class.” J.
McLaughlin, Conflict of Laws: the Choice of Law Lex Loci Doctrine, the Beguiling Appeal of a
Dead Tradition, Part One, 93 W. Va. L. Rev. 957, 989 (1991)(describing the categories as “tort,
contract, or some other”). The court is then to apply the New Mexico choice-of-law rule
applicable to that category of claim to determine what state’s substantive law to apply. See
Guidance Endodontics, LLC v. Dentsply Intern., Inc., 749 F. Supp. 2d 1235, 1257 (D.N.M.
2010)(Browning, J.).
When a claim sounds in contract, New Mexico will generally apply the choice-of-law
rule of lex loci contractus -- the law of the place of contracting. See Ferrell v. Allstate Ins. Co.,
2008-NMSC-042, ¶ 51, 188 P.3d 1156, 1172 (2008). Like most states, however, “New Mexico
respects party autonomy; the law to be applied to a particular dispute may be chosen by the
parties through a contractual choice-of-law provision.” Fiser v. Dell Computer Corp., 2008NMSC-046, ¶ 7, 188 P.3d 1215, 1218 (2008)(citing N.M. Stat. § 55-1-301(A)). See United
Wholesale Liquor Co. v. Brown-Forman Distillers Corp., 1989-NMSC-030, ¶¶ 12-14, 775 P.2d
- 42
233, 236. “[W]hen application of the law chosen by the parties offends New Mexico public
policy,” however, a New Mexico court “may decline to enforce the choice-of-law provision and
apply New Mexico law instead.” Fiser v. Dell Computer Corp., 2008-NMSC-046, ¶ 7, 188 P.3d
at 1218. “New Mexico courts will not give effect to another state’s laws where those laws would
violate some fundamental principle of justice.” Fiser v. Dell Computer Corp., 2008-NMSC-046,
¶ 7, 188 P.3d at 1218 (internal quotations omitted). Where the plaintiff has invoked the federal
district court’s diversity jurisdiction, the court will accept New Mexico’s law regarding whether
to honor a contractual choice-of-law provision. See MidAmerica Constr. Mgmt., Inc. v. MasTec
N. Am., Inc., 436 F.3d 1257, 1260 (10th Cir. 2006)(“In cases like this one, where subject matter
jurisdiction is based on diversity of citizenship, federal courts must look to the forum state’s
choice-of-law rules to determine the effect of a contractual choice-of-law clause.”). See also
Estate of Anderson v. Denny’s Inc., 987 F. Supp. 2d 1113, 1139-40 (D.N.M.
2013)(Browning, J.).
The Supreme Court of New Mexico has recognized one exception to the lex loci
contractus rule. See State Farm Mut. Auto. Ins. Co. v. Ballard, 2002-NMSC-030, 54 P.3d 537,
539. “To overcome the rule favoring the place where a contract is executed, there must be a
countervailing interest that is fundamental and separate from general policies of contract
interpretation.”
Shope v. State Farm Ins. Co., 1996-NMSC-052, ¶ 9, 925 P.2d 515, 517.
Application of the rule must result in a violation of “fundamental principles of justice” before
applying New Mexico law rather than the law of the jurisdiction where the contract was signed.
Shope v. State Farm Ins. Co., 1996-NMSC-052, ¶ 7, 925 P.2d at 517. See Reagan v. McGee
Drilling Corp., 1997-NMCA-014, ¶ 9, 933 P.2d 867, 869 (“The threshold . . . is whether giving
effect to another state’s policies would ‘violate some fundamental principle of justice, some
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prevalent conception of good morals, some deep-rooted tradition of the common weal’ of the
forum state.”)(alteration added)(citation omitted). “This exception applies only in ‘extremely
limited’ circumstances.” Reagan v. McGee Drilling Corp., 1997-NMCA-014, ¶ 9, 933 P.2d at
869 (citation omitted).
If the underlying claim is categorized as a tort, “New Mexico courts follow the doctrine
of lex loci delicti commissi -- that is, the substantive rights of the parties are governed by the law
of the place where the wrong occurred.” Terrazas v. Garland & Loman, Inc., 2006-NMCA-111,
¶ 12, 142 P.3d at 377. The lex loci delicti rule defines the state where the wrong occurred as “the
state where the last event necessary to make an actor liable for an alleged tort takes place.”
Restatement (First) Conflicts of Law § 377 & cmt. a (1934). Where the elements of the
underlying claim include harm, the place of the wrong is the place where the harm occurred. See
First Nat’l Bank in Albuquerque v. Benson, 1976-NMCA-072, ¶ 9, 553 P.2d 1288, 1289
(referring to the rule as requiring application of “the law of the State of injury”); Guidance
Endodontics, LLC v. Dentsply Int’l, Inc., 663 F. Supp. 2d 1138, 1150-51 (D.N.M.
2009)(Browning, J.).
LAW REGARDING THE INTERPRETATION OF INSURANCE CONTRACTS UNDER
PENNSYLVANIA LAW
Under Pennsylvania law, it is the Court’s province to interpret insurance contracts. See
Reliance Ins. Co. v. Moessner, 121 F.3d 895, 900 (3d Cir.1997)(citing Standard Venetian Blind
Co. v. American Empire Ins. Co., 469 A.2d 563, 566 (Pa. 1983)). The inquiry’s focus is the
insured’s reasonable expectation, and the Court must examine the totality of the insurance
transaction.
See Bubis v. Prudential Property & Cas. Ins. Co., 718 A.2d 1270, 1272
(Pa. Super. Ct. 1998)(citing Dibble v. Security of America Life Ins. Co., 590 A.2d 352, 354
(Pa. Super. Ct. 1991)). “While reasonable expectations of the insured are the focal points in
- 44
interpreting the contract language of insurance policies, an insured may not complain that his or
her reasonable expectations were frustrated by policy limitations which are clear and
unambiguous.”
Bubis v. Prudential Property & Cas. Ins. Co., 718 A.2d at 1272 (internal
citations omitted). Consequently, if “the language of the contract is clear and unambiguous, a
court is required to give effect to that language.’” Bensalem Township v. International Surplus
Lines Ins. Co., 38 F.3d 1303, 1309 (3d Cir. 1994)(quoting Standard Venetian Blind, 469 A.2d at
566 (1983)). Determining whether a policy is ambiguous is a question of law. See Pacific
Indem. Co. v. Linn, 766 F.2d 754, 760 (3d Cir. 1985)). “A provision is ambiguous only if
reasonably intelligent persons, considering it in the light of the entire policy, can honestly differ
as to its meaning.” Curbee, Ltd. v. Rhubart, 594 A.2d 733, 735 (Pa. Super. Ct. 1991). See also
N. Ins. Co. of N.Y. v. Dottery, 43 F. Supp. 2d 509, 512 (E.D. Pa. 1998)(Wieand, J.).
LAW REGARDING CONTRACT AMBIGUITY UNDER PENNSYLVANIA
CONTRACT LAW
In cases of a written contract, the intent of the parties is the writing itself. If left
undefined, the words of a contract are to be given their ordinary meaning. Pines
Plaza Bowling, Inc. v. Rossview, Inc., 145 A.2d 672 (Pa. 1958). When the terms
of a contract are clear and unambiguous, the intent of the parties is to be
ascertained from the document itself. Hutchison v. Sunbeam Coal Corp., 519
A.2d 385, 390 (Pa. 1986). When, however, an ambiguity exists, parol evidence is
admissible to explain or clarify or resolve the ambiguity, irrespective of whether
the ambiguity is patent, created by the language of the instrument, or latent,
created by extrinsic or collateral circumstances. Steuart v. McChesney, 444 A.2d
659, 663 (Pa. 1982); Herr’s Estate, 161 A.2d 32, 34 (Pa. 1960). A contract is
ambiguous if it is reasonably susceptible of different constructions and capable of
being understood in more than one sense. Hutchison, 519 A.2d at 390. While
unambiguous contracts are interpreted by the court as a matter of law, ambiguous
writings are interpreted by the finder of fact. Community College v. Society of
the Faculty, 375 A.2d 1267, 1275 (Pa. 1977).
Kripp v. Kripp, 849 A.2d 1159, 1163 (Pa. 2004). See Metzger v. Clifford Realty Corp., 476
A.2d 1, 5 (Pa. Super. Ct. 1984). Under Pennsylvania law, a contract will be found to be
ambiguous:
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“[I]f, and only if, it is reasonably or fairly susceptible of different constructions
and is capable of being understood in more senses than one and is obscure in
meaning through indefiniteness of expression or has a double meaning. A
contract is not ambiguous if the court can determine its meaning without any
guide other than a knowledge of the simple facts on which, from the nature of
language in general, its meaning depends; and a contract is not rendered
ambiguous by the mere fact that the parties do not agree upon the proper
construction.”
Metzger v. Clifford Realty Corp., 476 A.2d 1, 5 (Pa. Super. Ct. 1984)(quoting Commonwealth
State Highway and Bridge Authority v. E.J. Albrecht Co., 430 A.2d 328, 330 (Pa. Commw. Ct.
1981)).
LAW REGARDING RELIANCE ON THE SUPERIOR COURT OF PENNSYLVANIA’S
CASE LAW
The Court considers Superior Court of Pennsylvania opinions with the understanding
that, while the Court certainly may and will consider such opinions in making its determination,
the Court is not bound by a Superior Court of Pennsylvania decision in the same way that it
would be bound by a Supreme Court of Pennsylvania decision. See Mosley v. Titus, 762 F.
Supp. 2d 1298, 1332 (D.N.M. 2010)(Browning, J.)(alterations added)(noting that, where the only
opinion on point is “from the Court of Appeals [of as state], . . . the Court’s task, as a federal
district court sitting in this district, is to predict what the Supreme Court [of a state] would do if
the case were presented to it”)(alterations added)(citing Wade v. EMCASCO Ins. Co., 483 F.3d
657, 666 (10th Cir. 2007)(explaining that, “[w]here no controlling state decision exists, the
federal court must attempt to predict what the state’s highest court would do,” and that, “[i]n
doing so, it may seek guidance from decisions rendered by lower courts in the relevant state”)).
The Supreme Court has addressed what the federal courts may use when there is not a
decision on point from the state’s highest court. See Comm’r v. Estate of Bosch, 387 U.S. 456,
- 46
465 (1967). In the past, the Supreme Court directed federal courts, in the absence of controlling
authority from the highest state court, to follow intermediate state court decisions:
The highest state court is the final authority on state law, but it is still the duty of
the federal courts, where the state law supplies the rule of decision, to ascertain
and apply that law even though it has not been expounded by the highest court of
the State. An intermediate state court in declaring and applying the state law is
acting as an organ of the State and its determination, in the absence of more
convincing evidence of what the state law is, should be followed by a federal
court in deciding a state question. We have declared that principle in West v.
American Telephone and Telegraph Co., 311 U.S. 223 (1940), decided this day.
It is true that in that case an intermediate appellate court of the State had
determined the immediate question as between the same parties in a prior suit, and
the highest state court had refused to review the lower court’s decision, but we set
forth the broader principle as applicable to the decision of an intermediate court,
in the absence of a decision by the highest court, whether the question is one of
statute or common law. . . . The question has practical aspects of great importance
in the proper administration of justice in the federal courts. It is inadmissible that
there should be one rule of state law for litigants in the state courts and another
rule for litigants who bring the same question before the federal courts owing to
the circumstance of diversity of citizenship. In the absence of any contrary
showing, the rule [set forth by two New Jersey trial courts, but no appellate
courts] appears to be the one which would be applied in litigation in the state
court, and whether believed to be sound or unsound, it should have been followed
by the Circuit Court of Appeals.
Fid. Union Trust Co. v. Field, 311 U.S. 169, 177-80 (1940)(footnotes and citations omitted).
“The Supreme Court has softened this position over the years.” Anderson Living Trust v.
WPX Energy Prod., LLC, 27 F. Supp. 3d 1188, 1243 (D.N.M. 2014)(Browning, J.). Federal
courts are no longer bound by state trial or intermediate court opinions, but “should attribute
[them] some weight . . . where the highest court of the State has not spoken on the point.”
Comm’r v. Estate of Bosch, 387 U.S. at 465 (citing King v. Order of United Commercial
Travelers, 333 U.S. 153, 159 (1948)). See 17A James Wm. Moore et al., Moore’s Federal
Practice § 124.20[2], at 124-75 (3d ed. 1999)(“Decisions of intermediate state appellate courts
- 47
usually must be followed . . . [and] federal courts should give some weight to state trial courts
decisions.”)(emphasis and title case omitted). See also Anderson Living Trust v. WPX Energy
Prod., LLC, 27 F. Supp. 3d at 1243.
NEW MEXICO LAW REGARDING UNINSURED MOTORIST COVERAGE
N.M.S.A. 1978, § 66-5-301(A) and (C), in relevant part, state:
A.
No motor vehicle or automobile liability policy insuring against loss
resulting from liability imposed by law for bodily injury or death suffered
by any person and for injury to or destruction of property of others arising
out of the ownership, maintenance or use of a motor vehicle shall be
delivered or issued for delivery in New Mexico with respect to any motor
vehicle registered or principally garaged in New Mexico unless coverage
is provided therein or supplemental thereto in minimum limits for bodily
injury or death and for injury to or destruction of property as set forth in
Section 66-5-215 NMSA 1978 and such higher limits as may be desired
by the insured, but up to the limits of liability specified in bodily injury
and property damage liability provisions of the insured’s policy, for the
protection of persons insured thereunder who are legally entitled to
recover damages from owners or operators of uninsured motor vehicles
because of bodily injury, sickness or disease, including death, and for
injury to or destruction of property resulting therefrom, according to the
rules and regulations promulgated by, and under provisions filed with and
approved by, the superintendent of insurance.
....
C.
. . . . [T]he named insured shall have the right to reject uninsured motorist
coverage as described in Subsections A and B of this section; provided
that unless the named insured requests such coverage in writing, such
coverage need not be provided in or supplemental to a renewal policy
where the named insured has rejected the coverage in connection with a
policy previously issued to him by the same insurer.
N.M. Stat. Ann. § 66-5-301(A) & (C). Regulation 13.12.3.9, which elaborates § 66-5-301,
provides: “The rejection of the provisions covering damage caused by an uninsured or unknown
motor vehicle as required in writing by the provisions of Section 66-5-301 NMSA 1978 must be
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endorsed, attached, stamped, or otherwise made a part of the policy of bodily injury and property
damage insurance.” N.M. Admin. Code § 13.12.3.9.
The Supreme Court of New Mexico has recognized that § 66-5-301 “embodies a public
policy of New Mexico to make uninsured motorist coverage a part of every automobile liability
insurance policy issued in this state, with certain limited exceptions,” and that the statute is
“intended to expand insurance coverage and to protect individual members of the public against
the hazard of culpable uninsured motorists.” Romero v. Dairyland Ins. Co., 1990-NMSC-111,
803 P.2d 243, 245.
Based upon those observations, the Supreme Court of New Mexico
considers § 66-5-301 a remedial statute and, thus, maintains that it be liberally interpreted to
further its purpose, construing exceptions to uninsured motorist coverage strictly to protect the
insured. See Romero v. Dairyland Ins. Co., 1990-NMSC-111, ¶ 6. The Supreme Court of New
Mexico has noted that an insured may reject uninsured motorist coverage, but that such rejection
must satisfy the applicable regulations. See Romero v. Dairyland Ins. Co., 1990-NMSC-111,
¶ 8. To be valid, a rejection of uninsured motorist coverage must be made a part of the policy by
endorsement on the declarations sheet, by attachment of the written rejection to the policy, or by
some other means that makes the rejection a part of the policy so as to clearly and
unambiguously call to the insured’s attention that uninsured motorist coverage has been waived.
See Romero v. Dairyland Ins. Co., 1990-NMSC-111, ¶ 8.
With respect to the regulation
requiring that the rejection be made a part of the policy delivered to the insured, the Supreme
Court of New Mexico has stated:
[Regulation 13.12.3.9] ensure[s] that the insured has affirmative evidence of the
extent of coverage. Upon further reflection, consultation with other individuals,
or after merely having an opportunity to review one’s policy at home, an
individual may well reconsider his or her rejection of uninsured motorist
coverage. Providing affirmative evidence of the rejection of the coverage
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comports with a policy that any rejection of the coverage be knowingly and
intelligently made. Any individual rejecting such coverage should remain well
informed as to that decision. We find that the regulation of the superintendent of
insurance furthers a legislative purpose to provide for the inclusion of uninsured
motorist coverage in every automobile liability policy unless the insured has
knowingly and intelligently waived such coverage.
Romero v. Dairyland Ins. Co., 1990-NMSC-111, ¶ 9. Based upon that assessment of § 66-5-301
and N.M. Admin. Code § 13.12.3.9, the Supreme Court of New Mexico has held that, unless the
named insured rejects uninsured motorist coverage in a manner consistent with statutory and
administrative requirements, uninsured motorist coverage shall be read into an insured’s policy
regardless of the parties’ intent or the fact that the insured has not paid a premium. See Kaiser v.
DeCarrera, 1996-NMSC-050, 923 P.2d 588, 590 (quoting Romero v. Dairyland Ins. Co., 1990NMSC-111, ¶ 1). In Kaiser v. DeCarrera, the Supreme Court of New Mexico ruled that a valid
rejection of uninsured motorist coverage did not take place and, therefore, read uninsured
motorist coverage into the policy. See 1996-NMSC-050, ¶ 17. The plaintiff had signed a
rejection as part of the application for insurance, and the insurance company sent an amended
policy reflecting the rejection to the address on the application that was returned to sender. See
1996-NMSC-050, ¶ 10. The Supreme Court of New Mexico found that the plaintiff was never
provided a policy with the rejection included and that, as a result, uninsured motorist coverage
should be read into the policy. See 1996-NMSC-050, ¶ 10.
In Montano v. Allstate Indemnity Co., 2004-NMSC-020, 92 P.3d 1255, the Supreme
Court of New Mexico addressed the stacking of insurance coverage, noting that its cases had
“expressed a public policy in favor of stacking,” and that “it is unfair not to allow stacking when
multiple premiums are paid or when the policy is otherwise ambiguous.” 135 N.M. at 685, 92
P.3d at 1259 (emphasis original). The Supreme Court of New Mexico indicated that it would
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take the opportunity to “chart a new course.” Montano v. Allstate Indem. Co., 135 N.M. at 686,
92 P.3d at 1260. Interpreting § 66-5-301(A) and (C), the Supreme Court of New Mexico held
that “an insurance company should obtain written rejections of stacking in order to limit its
liability based on an anti-stacking provision,” and that, with “written waivers, insureds will know
exactly what coverage they are receiving and for what cost.” Montano v. Allstate Indem. Co.,
135 N.M. at 686-87, 92 P.3d at 1260-61. The Supreme Court of New Mexico also illustrated its
holding:
[I]n a multiple-vehicle policy insuring three cars, the insurer shall declare the
premium charge for each of the three [uninsured or underinsured motorist]
coverages and allow the insured to reject, in writing, all or some of the offered
coverages. Thus, hypothetically, in the case of a $25,000 policy, if the premium
for one [uninsured or underinsured motorist] coverage is $65, two coverages is an
additional $60, and three coverages $57, the insured who paid all three (for a total
premium of $182) would be covered up to $75,000 in [uninsured or underinsured
motorist] bodily injury coverage. However, the insured may reject, in writing, the
third available coverage and pay $125 for $50,000 of uninsured motorist
coverage; or the insured may reject, in writing, the third available coverage and
pay $65 for $25,000 of [uninsured or underinsured motorist] coverage; or the
insured may reject all three [uninsured or underinsured motorist] coverages. In
any event, the coverage would not depend on which vehicle, if any, was occupied
at the time of the injury. Thus, the insured’s expectations will be clear, and an
insured will only receive what he or she paid for.
Montano v. Allstate Indem. Co., 135 N.M. at 687, 92 P.3d at 1261.
In Marckstadt v. Lockheed Martin Corp., 2010-NMSC-001, 147 N.M. 678, 229 P.3d 462,
the Supreme Court of New Mexico consolidated cases before it, including a case that the Tenth
Circuit certified to it, to answer the question what is required under § 66-5-301 and N.M.A.C.
§ 13.12.3.9 to effectively reject uninsured motorist coverage. See 2010-NMSC-001, ¶ 13.6 The
6
The Tenth Circuit certified Federated Serv. Inc. Co. v. Martinez, 300 F. App’x 618 (10th
Cir. 2008)(unpublished), and the question: “For a valid rejection of [uninsured or underinsured
motorist] coverage under New Mexico law, must that rejection be written, signed by the insured,
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Supreme Court of New Mexico held that, “in order for the offer and rejection requirements of
Section 66-5-301 to effectuate the policy of expanding [uninsured or underinsured motorist]
coverage, the insurer is required to meaningfully offer such coverage and the insured must
knowingly and intelligently act to reject it before it can be excluded from a policy.” Marckstadt
v. Lockheed Martin Corp., 2010-NMSC-001, ¶ 16 (emphasis in original). It found that “the
rejection which the regulation requires to be in writing must be the act of rejection described in
the statute” and held that an insured must reject uninsured motorist coverage in writing.
Marckstadt v. Lockheed Martin Corp., 2010-NMSC-001, ¶ 22 (emphasis in original).
In
Progressive Northwestern Insurance Co. v. Weed Warrior Services, 2010-NMSC-050, 245 P.3d
1209, the Supreme Court of New Mexico answered
in the affirmative the question, certified to us by the United States Court of
Appeals for the Tenth Circuit, of whether election by an insured to purchase
[uninsured or underinsured motorist] coverage in an amount less than the policy
limits constitutes a rejection of the maximum amount of [uninsured or
underinsured motorist] coverage permitted under Section 66-5-301.
2010-NMSC-050, ¶ 1.7 It found that § 66-5-301 provides that insurers must offer uninsured
motorist coverage, or underinsured motorist coverage, in an amount greater than the minimums
and attached to the policy.” 300 F. App’x at 619. In the district court, the Honorable James A.
Parker, Senior United States District Judge for the District of New Mexico, granted the plaintiffs’
motion for summary judgment and found that the defendant’s employer had validly rejected
uninsured motorist coverage for its employees. See Federated Serv. Inc. Co. v. Martinez, No.
06-638, 2007 WL 8045157, at *4 (D.N.M. July 14, 2006)(Parker, J.), rev., 385 F. App’x 845.
After the Supreme Court of New Mexico decided Marckstadt v. Lockheed Martin Corp., the
Tenth Circuit reversed Senior Judge Parker’s judgment. See Federated Serv. Ins. Co. v.
Martinez, 385 F. App’x 845, 849-50 (10th Cir. 2010).
7
Citing the split among the district judges in the United States District Court for the
District of New Mexico, the Tenth Circuit certified, in Progressive Northwestern Ins. Co. v.
Weed Warrior Services, 368 F. App’x 853 (10th Cir. 2010)(unpublished), the question: “Does
the election to take [uninsured or uninsured motorist] coverage for less than the general policy
liability limits constitute a rejection under the New Mexico uninsured motorist statute, N.M. Stat.
- 52
required. See Progressive N.W. Ins. Co. v. Weed Warrior Servs., 2010-NMSC-050, ¶ 10. The
Supreme Court of New Mexico held that the “Legislature intended for drivers to have the option
of carrying UM/UIM coverage equal to their policy limits,” and rejected “any suggestion that
Section 66-5-301 places a burden on the insured to request UM/UIM coverage.” Progressive
N.W. Ins. Co. v. Weed Warrior Servs., 2010-NMSC-050, ¶¶ 12-13. It noted that the right to
reject coverage cannot be meaningfully exercised without an offer of coverage equal to policy
limits, and that it would not “impose on the consumer an expectation that she or he will be able
to make an informed decision as to the amount of UM/UIM coverage desired or required without
first receiving information from the insurance company.” Progressive N.W. Ins. Co. v. Weed
Warrior Servs., 2010-NMSC-050, ¶ 13.
In Jordan v. Allstate Ins. Co., 2010-NMSC-051, 254 P.3d 1214, the Supreme Court of
New Mexico granted certiorari in three cases and consolidated them for review. In all three
cases, the insured was injured in an accident involving an uninsured motorist. See Jordan v.
§ 66-5-301(A).” 368 F. App’x at 854. In its certification order, the Tenth Circuit noted that the
Court had held, in Farm Bureau Mutual Insurance Co. v. Jameson, 472 F. Supp. 2d 1272
(D.N.M. 2006)(Browning, J.), that election to take uninsured motorist coverage in an amount
less than the general coverage constitutes a rejection under the New Mexico statute. See
Progressive N.W. Ins. Co. v. Weed Warrior Servs., 368 F. App’x at 857 (citing Farm Bureau Ins.
Co. v. Jameson, 472 F. Supp. 2d at 1280)(the Tenth Circuit incorrectly stated the Court’s
holding, stating that “election to take UM/UIM coverage in amount less than the general
coverage constitutes a rejection under the New Mexico statute,” when the Court held that such
election does not constitute a rejection without a signed, written rejection). In the district court,
in Progressive N.W. Ins. Co. v. Weed Warrior Servs., the Honorable Judith C. Herrera, United
States District Judge for the District of New Mexico, denied both the defendant’s and the
plaintiff’s motions for summary judgment. See 588 F. Supp. 2d 1281, 1282 (D.N.M.
2008)(Herrera, J.). Judge Herrera found that the policy at issue “should be enforced as written,
to provide $100,000 in [uninsured or underinsured motorist] coverage, which is offset by the
$100,000 already received from the tortfeasor, rather than being reformed to provide $1 million
in [uninsured or underinsured motorist] coverage.” Progressive N.W. Ins. Co. v. Weed Warrior
Servs., 588 F. Supp. 2d at 1288. After the Supreme Court of New Mexico reached its decision,
the Tenth Circuit reversed Judge Herrera. See Progressive N.W. Ins. Co. v. Weed Warrior
Servs., 405 F. App’x 284, 288 (10th Cir. 2010)(unpublished).
- 53
Allstate Ins. Co., 2010-NMSC-051, ¶¶ 5-1. The Supreme Court of New Mexico held that “a
rejection of UM/UIM coverage equal to the liability limits in an automobile insurance policy
must be made in writing and must be made a part of the insurance policy delivered to the
insured.” 2010-NMSC-051, ¶ 2. It then further found that:
In order to honor these requirements effectively, insurers must provide the insured
with the premium charges corresponding to each available option for UM/UIM so
that the insured can make a knowing and intelligent decision to receive or reject
the full amount of coverage to which the insured is statutorily entitled. If an
insurer fails to obtain a valid rejection, the policy will be reformed to providing
UM/UIM coverage equal to the limits of liability.
2010-NMSC-051, ¶ 2. It noted that “insurers continue to offer UM/UIM] coverage in ways that
are not conducive to allowing the insured to make a realistically informed choice,” and
concluded it “necessary to prescribe workable requirements for a valid and meaningful rejection
of UM/UIM coverage in amounts authorized by statute.” 2010-NMSC-051, ¶ 20. The Supreme
Court of New Mexico then provided:
When issuing an insurance policy, an insurer must inform the insured that he or
she is entitled to purchase [uninsured or underinsured motorist] coverage in an
amount equal to the policy’s liability limits and must also provide the
corresponding premium charge for that maximum amount of [uninsured or
underinsured motorist] coverage. The premium cost for the minimum amount of
[uninsured or underinsured motorist] coverage allowed by Section 66-5-301(A)
must also be provided, as well as the relative costs for any other levels of
[uninsured or underinsured motorist] coverage offered to the insured. The insured
must be informed that he or she has a right to reject [uninsured or underinsured
motorist] coverage altogether. Providing the insured with a menu of coverage
options and corresponding premium costs will enable the insured to make an
informed decision . . . .
2010-NMSC-051, ¶ 21. It held that, unless these requirements are met, the “policy will be
reformed to provide UM/UIM coverage equal to the liability limits.” 2010-NMSC-051, ¶ 22.
The Supreme Court of New Mexico also found that the rules that it announced should be applied
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retroactive, because, on balance, “we deem it more equitable to let the financial detriments be
borne by insurers, who were in a better position to ensure meaningful compliance with the law”
and because retroactive application “will ensure that all insureds will be treated equally.” Jordan
v. Allstate Ins. Co., 2010-NMSC-051, ¶ 29.
In State Farm Mutual Automobile Insurance Co. v. Safeco Insurance Co., 2013-NMSC006, 298 P.3d 452, the Court of Appeals of New Mexico certified to the Supreme Court of New
Mexico the question “whether the primary or the secondary underinsured motorist (‘UIM’)
insurer, if either, should be given the statutory offset for the tortfeasor’s liability coverage.”
2013-NMSC-006, ¶ 1. The Supreme Court of New Mexico explained the problem through a
hypothetical:
A was a passenger in a vehicle driven by B, which was struck by a vehicle
negligently driven by C. A sustains $500,000 in damages. C has liability
coverage of $100,000. B has $100,000 in UIM coverage with XYZ Insurance Co.
Because A was a passenger in the vehicle insured by XYZ, A is a Class II insured
under the XYZ policy, and XYZ is the primary insurer because it insured the
vehicle involved in the collision -- the car closest to the risk. A also has UIM
coverage under three other policies, with policy limits of $100,000, $50,000, and
$25,000, respectively. A is a Class I insured under the three policies because A is
a named insured in each policy. Because these policies did not insure the vehicle
involved in the collision, the insurers who issued the policies are considered to be
secondary insurers. Therefore, A has $100,000 in primary UIM coverage, plus
$175,000 in secondary UIM coverage, for a total of $275,000 in UIM coverage.
2013-NMSC-006, ¶ 2. In analyzing “whether XYZ Insurance Co. or the secondary insurers
should receive an offset for the $100,000 of liability coverage available from C, the tortfeasor,”
the Supreme Court of New Mexico said “neither the primary nor the secondary insurers are
directly awarded the offset because . . . the offset is applied before any UIM insurer is required to
pay UIM benefits.” 2013-NMSC-006, ¶¶ 3-4. The Supreme Court of New Mexico explained
that, first, “one must determine both the tortfeasor’s liability limits and the insured’s total UIM
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coverage, which may include multiple stacked policies.” 2013-NMSC-006, ¶ 8. If the insured’s
damages exceed the tortfeasor’s liability coverage, the insured may pursue a claim against the
UIM insurers to recover the difference between his or her UIM coverage, and the tortfeasor’s
liability coverage, or the difference between his or her damages and the tortfeasor’s liability
coverage, whichever is less. See 2013-NMSC-006, ¶¶ 9, 15. The primary insurer must pay its
policy limits before the secondary insurers pay in proportion to their respective policy limits.
See 2013-NMSC-006, ¶¶ 4, 11.
Under the hypothetical, the difference between A’s UIM
coverage and C’s liability coverage -- $175,000.00 -- is less than the difference between A’s
damages and C’s liability coverage -- $400,000.00 -- and, thus, A may pursue from the UIM
insurers $175,000.00. See 2013-NMSC-006, ¶ 18.
The primary UIM insurer pays its entire $100,000, leaving the secondary UIM
insurers obligated to pay a prorated portion of $75,000. One secondary insurer
pays $42,857.14, which is 4/7ths (100,000/175,000) of $75,000; one pays
$21,428.57, which is 2/7ths (50,000/175,000) of $75,000; and the remaining
secondary insurer pays $10,714.29, which is 1/7th (25,000/175,000) of $75,000.
In no case will the insured receive more than the limits of the insured’s UIM
coverage minus the tortfeasor’s liability payment or more than the insured’s
damages minus the tortfeasor’s liability payment, whichever is less.
2013-NMSC-006, ¶ 19. Because the tortfeasor’s liability limits are taken into consideration in
what the UIM insurers must pay the injured insured, there is no “offset” to award: the injured
insured will not receive more than he or she is permitted under the UIM statute. 2013-NMSC006, ¶ 15. See Graham v. Troncoso, No. CIV 14-0745 JB/WPL, 2015 WL 1568433, at *17-22
(D.N.M. Mar. 30, 2015)(Browning, J.).
ANALYSIS
The Court concludes the following: First, the Anczarskis may supplement the record to
include the 2010 Certificate of Liability Insurance, and John J. Anczarski’s Amended
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Verification in support of his Supplemental Answers. Second, under New Mexico’s lex loci
contractus choice-of-law rule, Pennsylvania contract law applies to the Anczarskis’ breach-ofcontract claim and uninsured or underinsured motorist claim, because the commercial general
liability and excess liability policies at issue were executed in Pennsylvania. Third, in light of
the Travelers CGL Policy and the Travelers Excess Liability Policy at issue, there is no genuine
issue of material fact whether Travelers Indemnity had an obligation to provide uninsured or
underinsured motorist coverage to the Anczarskis or otherwise breached any contractual
obligation owed to the Anczarskis under either insurance contract.
I.
THE COURT GRANTS THE ANCZARSKIS’ MOTION TO SUPPLEMENT THE
RECORD UNDER ITS INHERENT POWER TO MANAGE ITS DOCKET.
After the summary judgment motion hearing, the Anczarskis moved to supplement the
record, submitting (i) “the correct Certificate of Liability Insurance issued by Travelers
Indemnity Company with the policy effective date of 12/25/2009 and policy expiration date of
12/25/2010”; (ii) John J. Anczarski’s Amended Verification corresponding to his Supplemental
Answers; and (iii) John J. Anczarski’s Supplemental Affidavit. Motion to Supplement Record at
1. See 2010 Certificate of Liability Insurance; Amended Verification; Anczarski’s Supplemental
Affidavit. Travelers Indemnity opposes the Anczarskis’ motion to supplement the record. See
Response to Motion to Supplement at 1-4. The Anczarskis do not state the authority under
which they file their motion to supplement the record. See Motion to Supplement Record at 1.
Nor does Travelers Indemnity expressly advert to a rule of procedure that prohibits the admission
the supplement exhibits. See Response to Motion to Supplement at 1-4. No party disputes,
however, that the Court may allow the Anczarskis to supplement the record with correct exhibits.
See United States v. Schneider, 594 F.3d 1219, 1226 (10th Cir. 2010)(“The power of district
courts to manage their dockets is deeply ingrained in our jurisprudence.”); United States v.
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Nicholson, 983 F.2d 983, 988 (10th Cir. 1993)(“District courts generally are afforded great
discretion regarding trial procedure applications (including control of the docket and parties),
and their decisions are reviewed only for abuse of discretion.”).
The Anczarskis move to supplement the record, because “they inadvertently uploaded the
wrong Certificate of Liability Insurance . . . issued by Travelers Indemnity Company as
referenced in Plaintiffs’ Response to Defendant’s Motion for Summary Judgment . . . .” Motion
to Supplement at 1. Indeed, the 2004 Certificate of Liability Insurance that the Anczarskis
attached to their Response indicates December 25, 2004, as the “POLICY EFFECTIVE DATE”
and December 25, 2005, as the “POLICY EXPIRATION DATE,” which the Anczarskis
stipulate is immaterial to this litigation. 2004 Certificate of Liability Insurance at 1. See Motion
to Supplement at 1. Attached to their Motion to Supplement, the Anczarskis “submit the correct
Certificate of Liability Insurance issued by Travelers Indemnity Company with the policy
effective date of 12/25/2009 and policy expiration date of 12/25/2010.” Motion to Supplement
at 1 (citing 2010 Certificate of Liability Insurance). To support the authenticity of the 2010
Certificate of Liability Insurance, the Anczarskis also submit Anczarski’s Supplemental
Affidavit. See Anczarski’s Supplemental Affidavit ¶¶ 1-5, at 1. Additionally, because the
Anczarskis inadvertently failed to attach a verification to John J. Anczarski’s Supplemental
Answers, the Anczarskis move to supplement the record with the Amended Verification. See
Motion to Supplement at 2 (citing Amended Verification).
The Court credits the Anczarskis’ assertions that filling the 2004 Certificate of Liability
and the omission of a verification were inadvertent. See Motion to Supplement Record at 1.
Further, the Court cannot soundly conclude that admitting the 2010 Certificate of Liability
Insurance -- which is at best cumulative of Travelers CGL Policy and Travelers Excess Liability
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Policy -- would introduce new evidence. The Court is satisfied that the Anczarskis erroneously
filed the 2004 Certificate of Liability Insurance and omitted to verify John J. Anczarski’s
Supplemental Answers, and the Court has the power to correct these misstatements and
omissions in the record. Accordingly, the Court (i) grants the Motion to Supplement; (ii) admits
2010 Certificate of Liability Insurance, Amended Verification, and Anczarski’s Supplemental
Affidavit; and (iii) considers those record materials when adjudicating Travelers Indemnity’s
summary judgment motion.
II.
PENNSYLVANIA LAW APPLIES TO THE ANCZARSKIS’ CONTRACT AND
UNINSURED MOTORIST CLAIMS.
Where a plaintiff invokes a federal district court’s diversity jurisdiction, the district court
looks to the forum state’s choice-of-law rules to determine which state’s substantive law to
apply. See Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. at 496-97; Pepsi-Cola Bottling Co. v.
PepsiCo, Inc., 431 F.3d at 1255. The first step in a New Mexico choice-of-law analysis is to
characterize the claim by “area of substantive law -- e.g., torts, contracts, domestic relations -- to
which the law of the forum assigns a particular claim or issue.” Terrazas v. Garland & Loman,
Inc., 2006-NMCA-111, ¶ 11, 142 P.3d at 377. The Court then applies the New Mexico choiceof-law rule applicable to that category of claim to determine what state’s substantive law to
apply. See Guidance Endodontics, LLC v. Dentsply Intern., Inc., 749 F. Supp. 2d at 1257.
In this diversity action, the Anczarskis assert a breach-of-contract claim, and a claim for
underinsured or insured motorist coverage, against Travelers Indemnity.
See Amended
Complaint ¶¶ 12, 25-26, at 3-4. The Court accordingly looks to New Mexico’s choice-of-law
rules to determine which state’s substantive law to apply. See Klaxon Co. v. Stentor Elec. Mfg.
Co., 313 U.S. at 496-97; Pepsi-Cola Bottling Co. v. PepsiCo, Inc., 431 F.3d at 1255. The Court
applies the New Mexico choice-of-law rule for insurance contract claims, because the
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Anczarskis assert two claims arising out of their insurance contracts with Travelers Indemnity.
See Terrazas v. Garland & Loman, Inc., 2006-NMCA-111, ¶ 11, 142 P.3d at 377; Amended
Complaint ¶¶ 12, 25-26, at 3-4. The Supreme Court of New Mexico has “stated that the policy
of New Mexico is to interpret insurance contracts according to the law of the place where the
contract was executed.” Shope v. State Farm Ins. Co., 1996-NMSC-052, ¶ 9, 925 P.2d 515, 517.
See Valencia v. Colo. Cas. Ins. Co., 560 F. Supp. 2d 1080, 1085 (D.N.M.
2007)(Browning, J.)(citing State Farm Mut. Auto. Ins. Co. v. Ballard, 2002-NMSC-030, ¶ 7, 54
P.3d 537, 539).
In New Mexico, an insurance contract is executed at the place to which the insurance
policy is issued. See Wilkeson v. State Farm Mut. Auto. Ins. Co., 2014-NMCA-077, ¶¶ 2, 5, 329
P.3d 749, 750 (holding that “California law would govern as to issues pertaining to the insurance
policies,” because the “policies were issued to Plaintiff while she resided in California, and the
policy covering the car in the accident, the only policy of record, lists her California address”).8
Cf. McGee v. Stonebridge Life Ins. Co., No. 05-4002-JAR, 2006 WL 2422399, at *5 (D. Kan.
Aug. 14, 2006)(Robinson, J.)(concluding that the lex loci contractus rule “requires the court to
interpret the contract according to the law of the state in which the parties performed the last act
necessary to form the contract . . . [and] in the context of a group insurance policy, the last act is
generally the delivery of the master insurance policy”). The two insurance contracts at issue in
8
Wilkeson v. State Farm Mut. Auto. Ins. Co., 2014-NMCA-077, 329 P.3d 749, is a case
decided by the Court of Appeals of New Mexico. Federal courts are no longer bound by state
trial or intermediate court opinions, but “should attribute [them] some weight . . . where the
highest court of the State has not spoken on the point.” Comm’r v. Estate of Bosch, 387 U.S.
456, 465 (1967)(citing King v. Order of United Commercial Travelers, 333 U.S. 153, 159
(1948)). See 17A James Wm. Moore et al., Moore’s Federal Practice § 124.20[2], at 124-75 (3d
ed. 1999)(“Decisions of intermediate state appellate courts usually must be followed . . . [and]
federal courts should give some weight to state trial courts decisions.”)(emphasis and title case
omitted). See also Anderson Living Trust v. WPX Energy Prod., LLC, 27 F. Supp. 3d 1188,
1243 (D.N.M. 2014)(Browning, J.).
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this case -- the Travelers CGL Policy and the Travelers Excess Liability Policy -- were executed
in Pennsylvania, because Travelers Indemnity issued both policy documents to Mark’s Supply at
its Frackville, Pennsylvania address.
See Travelers CGL Policy at 2 (“Frackville, PA”);
Travelers Excess Liability Policy at 3 (same). Accordingly, Pennsylvania substantive contract
law applies to the Anczarskis’ breach-of-contract, and underinsured or insured motorist coverage
claims.
The Anczarskis do not argue that New Mexico law should apply because the lex loci
contractus rule’s application would contravene fundamental principles of justice and New
Mexico public policy. See Shope v. State Farm Ins. Co., 1996-NMSC-052, ¶ 7, 925 P.2d at 517
(explaining New Mexico’s policy exception to the application of New Mexico’s choice-of-law
rules); Reagan v. McGee Drilling Corp., 1997-NMCA-014, ¶ 9, 933 P.2d 867, 869 (same).
“[W]here counsel has failed to provide the Court with even the minimal factual and legal
research necessary to the Court’s analysis of the issues presented, the Court is under no
obligation to, and will not, do counsel’s work for them.” Abbasid, Inc. v. Los Alamos Nat.
Bank, No. CV-09-00354 JP/LFG, 2010 WL 9485873, at *1 (D.N.M. July 23, 2010)(Parker,
J.)(alteration added). The Court notes that, despite omitting a choice-of-law argument, the
Anczarskis nevertheless rely on New Mexico case law to support their opposition to Traveler’s
Motion -- principally Government Employees Insurance Co. v. Welch, 2004-NMSC-014, 90
P.3d 471, and Ponder v. State Farm Mutual Automobile Insurance Co., 2000-NMSC-033, 12
P.3d 960. See Response at 4-7. Accordingly, the Court pauses to clarify that New Mexico case
law does not apply to direct the Court’s interpretation of the Travelers CGL Policy and the
Travelers Excess Liability Policy, because New Mexico’s policy exception to its lex loci
contractus choice-of-law rule does not apply.
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Pennsylvania and New Mexico share concordant approaches to the inclusion of uninsured
and underinsured motorist coverage in automobile insurance contracts. Compare 75 Pa. Cons.
Stat. § 1731, with N.M. Stat. § 66-5-301(A)-(C). Each state requires that insurers offering motor
vehicle liability insurance also offer uninsured motorist coverage, and each state allows an
insured not to purchase uninsured motorist coverage when purchasing a primary automobile
insurance policy. See N.M. Stat. § 66-5-301(A)-(C); 75 Pa. Cons. Stat. § 1731. Furthermore,
both New Mexico and Pennsylvania case law hold, under the respective statutory provisions, that
an insurer offering an excess liability policy9 is not required to also offer uninsured motorist
coverage. See Kromer v. Reliance Ins. Co., 677 A.2d 1224, 1230 (Pa. Super. Ct. 1996)(holding
that excess umbrella and commercial excess liability insurance policies did not and were not
required to provide uninsured motorist coverage), aff’d, 696 A.2d 152 (Pa. 1997); Archunde v.
Int’l Surplus Lines Ins. Co., 1995-NMCA-110, ¶ 8, 905 P.2d 1128 (same). In light of the
consistency between Pennsylvania’s and New Mexico’s approaches to uninsured or underinsured
motorist coverage, the Court concludes that New Mexico’s public policy exception to the
application of its lex loci contractus choice-of-law rule does not apply.
Consequently,
Pennsylvania substantive contract law applies to the Anczarskis’ breach of contract and
underinsured or insured motorist coverage claims.
III.
TRAVELERS INDEMNITY IS ENTITLED TO SUMMARY JUDGMENT ON
THE ANCZARSKIS’ INSURANCE CONTRACT CLAIMS.
The Supreme Court of Pennsylvania has stated that “it is a necessary prerequisite to
recovery upon a policy for the insured to show a claim within the coverage provided by the
9
“‘An [excess liability or] ‘umbrella’ policy is a supplemental insurance policy which
protects insureds against losses in excess of the amount covered by their other liability insurance
policies and fills in gaps in coverage.’” Dottery, 43 F. Supp. 2d at 514 (quoting Fratus v.
Republic Western Ins. Co., 147 F.3d 25, 27 n.1 (1st Cir. 1998)).
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policy.” Miller v. Boston Ins. Co., 218 A.2d 275, 277 (Pa. 1966). See McEwing v. Lititz Mut.
Ins. Co., 77 A.3d 639, 646 (Pa. Super. Ct. 2013)(“In an action arising under an insurance policy,
our courts have established a general rule that it is a necessary prerequisite . . . for the insured to
show a claim within the coverage provided by the policy.”)(alteration original)(internal quotation
marks and citation omitted). Two insurance policies that Travelers issued to Mark’s Supply and
to John J. Anczarski and Joyce Anczarski,10 were in effect when a vehicle that Waconda drove
fatally struck John R. Anczarski -- namely, the Travelers CGL Policy and the Travelers Excess
Liability Policy. See Travelers CGL Policy at 2; Travelers Excess Liability Policy at 2. The
record does not reflect a genuine issue of material fact whether either the Travelers CGL Policy
or the Travelers Excess Liability Policy provides Mark’s Supply with uninsured or underinsured
motorist coverage -- or any other coverage -- for the losses related to the collision. In light of
Travelers CGL Policy and the Travelers Excess Liability Policy’s unambiguous language,
Travelers did not insure Mark’s Supply against losses arising from the collision. Accordingly,
Travelers is entitled to summary judgment on the Anczarskis’ claims.
A.
THERE IS NO GENUINE ISSUE OF MATERIAL FACT REGARDING
UNINSURED OR UNDERINSURED MOTORIST COVERAGE, AND
TRAVELERS INDEMNITY IS ENTITLED TO JUDGMENT ON THE
ANCZARSKIS’ UNDERINSURED OR UNINSURED MOTORIST CLAIM
UNDER PENNSYLVANIA LAW.
The Travelers CGL Policy does not refer to any coverage for a loss that an underinsured
or uninsured motorist causes. See Travelers CGL Policy at 1-145. The Travelers CGL Policy
provides coverage, however, for a defined and delimited category of automobile liability. See
Travelers CGL Policy at 21-22. Specifically, the policy includes an endorsement for “HIRED
10
The Court observes that Travelers CGL Policy named both John J. Anczarski and Joyce
Anczarski as additional insureds under the “Commercial General Liability Coverage.” See
Travelers CGL Policy at 19.
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AUTO AND NONOWNED AUTO LIABILITY.” Travelers CGL Policy at 21. The Anczarskis
build their claims upon this provision, contending (i) that the Hired Auto and Nonowned Auto
Liability endorsement creates an ambiguity regarding whether Travelers Indemnity provides
them with uninsured or underinsured motorist coverage; and (ii) that this ambiguity, coupled
with John J. Anczarskis’ belief that the Travelers’ policies provided uninsured or underinsured
motorist coverage, creates a genuine issue of material fact precluding summary judgment in
Travelers Indemnity’s favor. See Response at 5, 7 & 10.
The Hired Auto and Nonowned Auto Liability endorsement is unambiguous, however.
See Travelers CGL Policy at 21-22. “While reasonable expectations of the insured are the focal
points in interpreting the contract language of insurance policies, an insured may not complain
that his or her reasonable expectations were frustrated by policy limitations which are clear and
unambiguous.”
Bubis v. Prudential Property & Cas. Ins. Co., 718 A.2d at 1272 (internal
citations omitted). “A provision is ambiguous only if reasonably intelligent persons, considering
it in the light of the entire policy, can honestly differ as to its meaning.” Curbee, Ltd. v. Rhubart,
594 A.2d at 735. In this case, the Hired Auto and Nonowned Auto Liability does not afford
reasonable differences as to whether it provides uninsured or underinsured motorist coverage. It
plainly does not. See Travelers CGL Policy at 21-22.
In light of its plain language, the Hired Auto and Nonowned Auto Liability endorsement
insures Mark’s Supply and the Anczarskis against (i) bodily injury that non-employees suffer;
and (ii) damage to property not owned by Mark’s Supply that arises from Mark’s Supply’s use of
an automobile that Mark’s Supply does not own. See Travelers CGL Policy at 21-22. Looking
to the Hired Auto and Nonowned Auto Liability policy provision’s terms, it provides coverage
for “‘bodily injury’ and ‘property damage’ arising out of the maintenance or use of a ‘hired auto’
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or ‘nonowned auto.’” Travelers CGL Policy at 21. The Hired Auto and Nonowned Auto
Liability policy provision excludes from coverage for bodily injury any bodily injury to Mark’s
Supply’s employees acting in the scope of Mark’s Supply’s business. See Travelers CGL Policy
at 21 (excluding “[a]ny fellow ‘employee’ of the insured arising out of and in the course of: (a)
Employment by the insured”). The policy schedule also excludes from coverage damage to
property owned, transported by, rented or loaned to Mark’s Supply, or within its care, custody, or
control. See Travelers CGL Policy at 21. Next, under the Hired Auto and Nonowned Auto
Liability policy schedule, a “hired auto” means any “auto” that the insured leases, hires, rents, or
borrows, excluding any auto hired, leased, or rented for a period of 180 days or more and any
auto hired, leased, or rented from an employee, partner, stockholder, or household member.
Travelers CGL Policy at 22. A “nonowned auto,” in turn, refers to any “autos” that the insured
does not own, lease, hire, rent or borrow that are being used in the course and scope of the
insured’s business at the time of an occurrence that gives rise to liability, including autos owned
by employees, partners, or household members, but only while used in the course and scope at
the time of an occurrence giving rise to liability. Travelers CGL Policy at 22. This language
shows that the Hired Auto and Nonowned Auto Liability endorsement provides coverage for
third-party injuries arising out of Mark’s Supply’s use of nonowned vehicles, and not for an
insured’s injuries arising out of any underinsured or uninsured motorist’s use of any vehicle. See
Travelers CGL Policy at 21. Hence, the Hired Auto and Nonowned Auto Liability endorsement
does not provide the Anczarskis with uninsured or underinsured motorist coverage.
To be sure, Pennsylvania case law requires the Court to construe an insurance contract
against the writer. See Miller v. Boston Ins. Co., 420 Pa. at 570. Yet, the application of that
hornbook canon of contract interpretation to the Travelers CGL Policy is unavailing for the
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Anczarskis. If “the language of the contract is clear and unambiguous, a court is required to give
effect to that language.’” Bensalem Township v. International Surplus Lines Ins. Co., 38 F.3d at
1309 (quoting Standard Venetian Blind, 469 A.2d at 566). The terms of the Hired Auto and
Nonowned Auto Liability endorsement do not mention underinsured or uninsured motorist
claims. See Travelers CGL Policy at 21-22. Rather, by its plain language, the Hired Auto and
Nonowned Auto Liability endorsement covers third-party injuries arising out of Mark’s Supply’s
use of nonowned vehicles, and not an insured’s injuries arising out of any underinsured or
uninsured motorist’s use of any vehicle. See Travelers CGL Policy at 21.
In reaching this contract interpretation, the Court considers the Superior Court of
Pennsylvania’s opinion in Kromer v. Reliance Ins. Co., 677 A.2d 1224, 1230 (Pa. Super. Ct.
1996), aff’d, 696 A.2d 152 (Pa. 1997). There, the Superior Court of Pennsylvania interpreted a
commercial excess liability policy and concluded that, under the policy’s plain language, it did
not “provide underinsured motorist coverage.” 677 A.2d at 1230. To arrive at its holding, the
Superior Court of Pennsylvania considered the policy language at issue and concluded that
“[c]overage under the [insured’s] excess policies is only triggered by claims of liability against
the insured from third parties.
Such coverage is not triggered by claims from first party
uninsured motorist coverage.”
677 A.2d at 1230.
The Superior Court of Pennsylvania
explained:
Here, the appellee Hoch is obviously the insured. [The insurance company’s]
obligation as insurer[] of Hoch, is to pay on the part of Hoch, sums Hoch is
legally obligated to pay to third parties. As the trial court properly concluded
“[t]he underinsured motorists claims of [appellants] do not constitute sums which
the insured is legally obligated to pay nor are they payments made on behalf of
the insured.” Here . . . employees of Hoch, are making a claim for first party
underinsured motorist coverage under [a commercial excess policy] . . . when the
language of both clearly indicates that no such coverage exist.
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677 A.2d at 1230 (first, second, fifth and sixth alterations added, third and fourth alterations
original).
While the Hired Auto and Nonowned Auto Liability endorsement “applies to ‘bodily
injury’ and ‘property damage’ arising out of the maintenance or use of a ‘hired auto’ or
‘nonowned auto,’” the provision excludes bodily injury of Mark’s Supply’s employees or Mark’s
Supply’s property. Travelers CGL Policy at 21-22. The Hired Auto and Nonowned Auto
Liability endorsement provides coverage for the insured’s liability to third parties, not coverage
for bodily injury and property damage suffered by Mark’s Supply or its employees.
Travelers CGL Policy at 21-22.
See
Hence, the Hired Auto and Nonowned Auto Liability
endorsement does much the same work as the insurance contract at issue in Kromer v. Reliance
Insurance Co.: both provide coverage for losses for which the insured is liable. Compare
Travelers CGL Policy at 21-22 (providing coverage for “Hired Auto Liability [and] Nonowned
Auto Liability”), with Kromer v. Reliance Insurance Co., 677 A.2d at 1230 (“[I]t is clear from
the language of both policies that they provide third party liability coverage only.”). As with the
insurance contracts that the Superior Court of Pennsylvania considered in Kromer v. Reliance
Insurance Co., it is clear from the Hired Auto and Nonowned Auto Liability endorsement’s
language that the policy provides “third party liability coverage only.” 677 A.2d at 1230. See
Travelers CGL Policy at 21-22.
Like the insurance contracts that the Superior Court of
Pennsylvania considered in Kromer v. Reliance Insurance Co., the Hired Auto and Nonowned
Auto Liability endorsement does not “express any intention of providing first party underinsured
motorist coverage.” 677 A.2d at 1230. See Travelers CGL Policy at 21-22. Consequently, the
Hired Auto and Nonowned Auto Liability policy provision unambiguously does not include
coverage for an insured’s injuries that underinsured or uninsured motorists caused; rather, it
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supplies coverage for third-party injuries arising out of Mark’s Supply’s use of nonowned
vehicles. See Travelers CGL Policy at 21-22. See also Dottery, 43 F. Supp. 2d at 517 (holding,
under Pennsylvania law, that a commercial insurance policy did not provide underinsured
motorist coverage, because “the language of the policy provides that it is a liability policy”).
Next, the Travelers Excess Liability Policy unambiguously does not include underinsured
or uninsured motorist coverage. See Travelers Excess Liability Policy at 8, 11. In fact, the
excess liability policy specifically excludes underinsured or uninsured motorists from its
coverage. See Travelers Excess Liability Policy at 11. The policy’s exclusion provision states:
“This insurance does not apply to . . . Uninsured Motorist, Underinsured Motorists, ‘Auto’ NoFault . . . . Any liability imposed on the insured, or the insured’s insurer, under any of the
following laws: (1) Uninsured Motorist; (2) Underinsured Motorists.” Travelers Excess Liability
Policy at 8, 11. This contract language is dispositive, because where “the language of the
contract is clear and unambiguous, a court is required to give effect to that language.” Standard
Venetian Blind, 469 A.2d at 566. Consequently, the Travelers Excess Liability Policy does not
include coverage for injuries caused by underinsured or uninsured motorists.
See Travelers
CGL Policy at 21-22.
The Anczarskis acknowledge that the excess liability policy expressly excludes uninsured
or underinsured motorist coverage; however, they argue that the Hired Auto and Nonowned Auto
Liability endorsement in the underlying commercial general liability policy creates “confusion”
whether the two Travelers Indemnity policies afford them an uninsured or underinsured motorist
claim. Tr. at 13:15-14:15 (Aragon)(“Although it specifically states there is an exclusion there
are other provisions in the policy that create confusion as to what is covered under nonowned
and owned auto liability.”). The Anczarskis advert to the 2010 Certificate of Liability to support
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their argument there is an equivocation regarding whether Travelers Indemnity had provided
them with uninsured or underinsured motorist coverage. See Tr. at 18:18-20 (Aragon)(relying
on “a certificate of liability insurance policy effective 12/25/2009 to 12/25/2010”). The 2010
Certificate of Liability reflects, however, only the coverages provided by the Travelers CGL
Policy and the Travelers Excess Liability, noting that Travelers Indemnity provided coverage for
(i) “COMMERCIAL GENERAL LIABILITY,” (ii) “HIRED AUTO,” (iii) “NON OWNED
AUTO,” and “EXCESS/UMBRELLA LIABILITY.” 2010 Certificate of Liability. The 2010
Certificate of Liability does not afford any indication that Travelers Indemnity provided the
Anczarskis with uninsured or underinsured motorist coverage and, resultingly, does not create
any genuine issue of material fact regarding the same.
The Anczarskis also rely on John J. Anczarski’s Supplemental Answers to support their
contention that there is “confusion” whether the two Travelers Indemnity policies afford them an
uninsured or underinsured motorist claim. Tr. at 13:15-14:15 (Aragon). See John J. Anczarski’s
Supplemental Answers ¶ 12, at 3. John J. Anczarski avers “that the reasons that I purchased the
insurance coverage would have been based on the assurances from the Traveler’s [sic] Indemnity
Company that they were providing us with full insurance coverage to include
uninsured/underinsured motorist coverage.” John J. Anczarski’s Supplemental Answers ¶ 12, at
3. John J. Anczarski statement does not, however, create an ambiguity regarding whether the
two Travelers Indemnity policies provided the Anczarskis with uninsured or underinsured
motorist coverage. Under Pennsylvania law, “[w]hile reasonable expectations of the insured are
the focal points in interpreting the contract language of insurance policies, an insured may not
complain that his or her reasonable expectations were frustrated by policy limitations which are
clear and unambiguous.” Bubis v. Prudential Property & Cas. Ins. Co., 718 A.2d at 1272
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(internal citations omitted). If “the language of the contract is clear and unambiguous, a court is
required to give effect to that language.’” Bensalem Township v. International Surplus Lines
Ins. Co., 38 F.3d 1303, 1309 (3d Cir. 1994)(quoting Standard Venetian Blind, 469 A.2d at 566
(1983)). “A provision is ambiguous only if reasonably intelligent persons, considering it in the
light of the entire policy, can honestly differ as to its meaning.” Curbee, Ltd. v. Rhubart, 594
A.2d 733, 735 (Pa. Super. Ct. 1991).11 Considering the language of the entire Travelers CGL
Policy and the entire Travelers Excess Liability Policy, the Court cannot soundly conclude that
there are grounds for a reasonable difference regarding whether either policy affords uninsured
or underinsured motorist coverage.
See Travelers CGL Policy at 21-22; Travelers Excess
11
The Court notes parenthetically that Pennsylvania’s approach to deciding whether a
contract is ambiguous differs from the approach that the Supreme Court of New Mexico has
adopted. In United Nuclear Corp. v. Allstate Ins. Co., 2012-NMSC-032, 285 P.3d 644, 648, the
Supreme Court of New Mexico stated:
“New Mexico law . . . allows the court to consider extrinsic evidence to make a
preliminary finding on the question of ambiguity.” Mark V, Inc. v. Mellekas,
1993-NMSC-001, ¶ 12, 845 P.2d 1232, 1235. This general principle of New
Mexico contract law has been reaffirmed in the specific context of insurance
coverage disputes. See, e.g., State Farm Mut. Aut. Ins. Co. v. Ponder, 2000NMSC-033, ¶ 13, 12 P.3d 960 (interpreting provisions of an automobile insurance
policy and noting that “[i]n abandoning reliance only on the four-corners
approach, courts are now allowed to consider extrinsic evidence in determining
whether an ambiguity exists in the first instance, or to resolve any ambiguities that
a court may discover”).
United Nuclear Corp. v. Allstate Ins. Co., 2012-NMSC-032, ¶ 13, 285 P.3d 644, 648 (alterations
original). See, e.g., Mesa Oil, Inc. v. Ins. Co. of N.A., 123 F.3d 1333, 1340-41 (“New Mexico
courts generally allow a party to introduce extrinsic evidence of a[n insurance] contract’s
meaning to determine whether an ambiguity exists and how that ambiguity should be
resolved.”)(alterations original). Pennsylvania case law takes a different tack. Under
Pennsylvania law, “[w]hile reasonable expectations of the insured are the focal points in
interpreting the contract language of insurance policies, an insured may not complain that his or
her reasonable expectations were frustrated by policy limitations which are clear and
unambiguous.” Bubis v. Prudential Property & Cas. Ins. Co., 718 A.2d at 1272 (internal
citations omitted). As the Court has explained, Pennsylvania law controls whether the
Anczarskis have claims under either Travelers Indemnity insurance contract at issue. See supra
at II.
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Liability Policy at 8, 11. They do not. See Travelers CGL Policy at 21-22; Travelers Excess
Liability Policy at 8, 11.
The policies that Travelers Indemnity issued to the Anczarskis do not betray any
confusion or inconsistency. On the one hand, the Travelers CGL Policy does not provide
uninsured or underinsured motorist coverage, because the Hired Auto and Nonowned Auto
Liability endorsement’s language indicates that the policy provides only third-party liability
coverage. See Travelers CGL Policy at 21-22. See also Dottery, 43 F. Supp. 2d at 517; Kromer
v. Reliance Insurance Co., 677 A.2d at 1230. On the other hand, the Travelers Excess Liability
Policy does not provide uninsured or underinsured motorist coverage, because it expressly says
that it does not. Travelers Excess Liability Policy at 8, 11. See Standard Venetian Blind, 469
A.2d at 566. The policies are neither confused nor confusing.
Accordingly, Travelers Indemnity is entitled to summary judgment on the Anczarskis’
uninsured or underinsured motorist claim. Again, to recover on this claim, the Anczarskis must
“show [the] claim [is] within the coverage provided by the policy.” Miller v. Boston Ins. Co.,
218 A.2d at 277 (alteration added). See McEwing v. Lititz Mut. Ins. Co., 77 A.3d at 646. They
cannot do so, because there is no genuine issue of material fact regarding whether the two
Travelers Indemnity’s policies at issue afford such coverage. See Travelers CGL Policy at 2122; Travelers Excess Liability Policy at 8, 11. The policies unambiguously do not include
uninsured or underinsured motorist coverage; accordingly, Travelers Indemnity is entitled to
summary judgment on the Anczarskis’ uninsured or underinsured motorist claim.
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B.
THERE IS NO GENUINE ISSUE OF MATERIAL FACT AND
TRAVELERS INDEMNITY IS ENTITLED TO JUDGMENT ON THE
ANCZARSKIS’
BREACH-OF-CONTRACT
CLAIM
UNDER
PENNSYLVANIA LAW.
In their Amended Complaint, the Anczarskis also allege a breach-of-contract claim
against Travelers Indemnity. See Amended Complaint ¶¶ 12, 25-26, at 3-4. The Anczarskis
contend that they “are entitled to recover under the Travelers Indemnity Policy . . . .” Amended
Complaint ¶ 25, at 4 (alteration added). They state that they “made a demand . . . and that
demand has not been honored.”
Amended Complaint ¶ 12, at 3 (alteration added).
The
Anczarskis resultingly concluded that they “are entitled to recover from Defendants the
maximum amount recoverable under the respective policies of insurance and Plaintiffs make a
claim for such herein.”
Amended Complaint ¶ 25, at 4.
Travelers Indemnity moves for
summary judgment on the Anczarskis’ breach-of-contract claim, contending that it “did not issue
any policy of motor vehicle liability insurance to Plaintiffs that would provide coverage for the
death of the Plaintiff’s son caused by the negligence of an underinsured motorist.” Motion at 1.
There is no genuine dispute of material fact whether either the Travelers CGL Policy or
the Travelers Excess Liability Policy obligates Travelers Indemnity to indemnify the Anczarskis
for the losses arising from the collision between Waconda and John R. Anczarski.
It is
undisputed that the injuries for which the Anczarskis seek to recover through their breach-ofcontract action arose out of a collision between “a vehicle driven by Gilbert Waconda in Cibola
County, New Mexico,” and a bicycle that their son rode.
Motion ¶ 2, at 4 (stating this
fact)(citing Complaint ¶ 4, at 2). See Response at 2 (not disputing this fact). The dispute
between the Anczarskis and Travelers Indemnity -- i.e., whether Travelers Indemnity is
contractually obligated to indemnify the Anczarskis -- is legal. See Miller v. Boston Ins. Co.,
218 A.2d at 277; McEwing v. Lititz Mut. Ins. Co., 77 A.3d at 646. The Supreme Court of
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Pennsylvania has stated that “it is a necessary prerequisite to recovery upon a policy for the
insured to show a claim within the coverage provided by the policy.” Miller v. Boston Ins. Co.,
218 A.2d at 277. See McEwing v. Lititz Mut. Ins. Co., 77 A.3d 639, 646 (Pa. Super. Ct.
2013)(“In an action arising under an insurance policy, our courts have established a general rule
that it is a necessary prerequisite . . . for the insured to show a claim within the coverage
provided by the policy.”)(alteration original)(internal quotation marks and citation omitted). The
Anczarskis cannot “show a claim within the coverage provided” by either the Travelers CGL
Policy or the Travelers Excess Liability. Miller v. Boston Ins. Co., 218 A.2d at 277.
The Travelers CGL Policy is a commercial liability policy. See Travelers CGL Policy at
4-6. The Travelers CGL Policy’s only provision that provides coverage relating to injuries
caused by motor vehicles is the Hired Auto and Non-Owned Auto Liability schedule. See
Travelers CGL Policy at 21-22. The Anczarskis assert their breach-of-contract claim under the
Hired Auto and Non-Owned Auto Liability schedule. See Tr. at 5:20-23 (Aragon)(alterations
added)(arguing that “the provisions indicate that there is at least cover[age] under the bodily
injury provision and is insured pursuant to the . . . [non]owned car policy”). That provision does
not, however, support the contractual claim that the Anczarskis assert.
The Hired Auto and Non-Owned Auto Liability schedule provides coverage for “‘bodily
injury’ and ‘property damage’ arising out of the maintenance or the insured’s use of a ‘hired
auto’ or ‘nonowned auto.’” Travelers CGL Policy at 21. Under the Hired Auto and Nonowned
Auto Liability policy schedule, a “hired auto” means any “auto” that the insured leases, hires,
rents, or borrows, excluding any auto hired, leased, or rented for a period of 180 days or more,
and any auto hired, leased, or rented from an employee, partner, stockholder, or household
member. Travelers CGL Policy at 22. A “nonowned auto,” in turn, refers to any “autos” that the
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insured does not own, lease, hire, rent or borrow that are being used in the course and scope of
the insured’s business at the time of an occurrence that gives rise to liability, including autos
owned by employees, partners, or household members, but only while used in the course and
scope at the time of an occurrence giving rise to liability. Travelers CGL Policy at 22. The
policy schedule also excludes from coverage damage to property owned, transported by, rented
or loaned to Mark’s Supply, or within their care, custody, or control. See Travelers CGL Policy
at 21. It additionally excludes from coverage bodily injury to any of the insured’s employees
arising out of or in the course of employment. See Travelers CGL Policy at 21. Accordingly, it
is clear that the Hired Auto and Nonowned Auto Liability endorsement provides “third party
liability coverage only.” Kromer v. Reliance Insurance Co., 677 A.2d at 1230. See Bensalem
Township v. International Surplus Lines Ins. Co., 38 F.3d at 1309 (stating that where “‘the
language of the contract is clear and unambiguous, a court is required to give effect to that
language’”)(quoting Standard Venetian Blind, 469 A.2d at 566).
Under the Travelers CGL Policy’s language, the Hired Auto and Non-Owned Auto
Liability schedule covers Mark’s Supply and the Anczarskis if a Mark’s Supply employee causes
a third party bodily injury or property damage while using a hired or an otherwise non-owned
vehicle. See Travelers CGL Policy at 21-22. It is undisputed, however, that a vehicle that
Waconda negligently operated -- and not any hired or non-owned vehicle that either a Mark’s
Supply employee or the Anczarskis operated -- struck John R. Anczarski. Motion ¶ 2, at 4
(stating this fact)(citing Complaint ¶ 4, at 2). See Response at 2 (not disputing this fact). See
also Tr. at 7:11-15 (Aragon)(explaining that the alleged Mark’s Supply vehicle, which is not
alleged to be either hired or otherwise non-owned, did not collide with John R. Anczarski).
Further, John R. Anczarski’s estate has not filed a claim against Travelers Indemnity’s
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insureds -- namely, Mark’s Supply and the Anczarskis. See Tr. at 11:15-18 (Court, Eaton); id. at
12:12-13-14 (Court, Eaton). Accordingly, the Anczarskis cannot “show a claim within the
coverage provided by” the Travelers CGL Policy. Miller v. Boston Ins. Co., 218 A.2d at 277.
Next, the Anczarskis also cannot “show a claim within the coverage provided” by the
Travelers Excess Liability Policy. Miller v. Boston Ins. Co., 218 A.2d at 277. With respect to
auto liability, the Travelers Excess Liability Policy provides that it “applies to ‘bodily injury’ or
‘property damage’ arising out of the ownership, operation, . . . or, entrustment to others of any
auto that is owned, operated, maintained, used . . . or loaned to any insured . . . .”
Travelers
Excess Liability Policy at 6. The Travelers Excess Liability Policy states that it applies “only if
such ‘bodily injury’ or ‘property damage’ would be covered by ‘underlying insurance’ shown
in [the] SCHEDULE OF UNDERLYING INSURANCE of the Declarations, or the renewal or
replacement of such ‘underlying insurance’ but for the exhaustion of the applicable limits of
insurance of the ‘underlying insurance.” Travelers Excess Liability Policy at 20. The Travelers
Excess Liability Policy’s “SCHEDULE OF UNDERLYING INSURANCE,” in turn, refers only
to the Travelers CGL Policy. Travelers Excess Liability Policy at 2, 6. Consequently, the
Travelers Excess Liability Policy provides excess liability coverage for a loss only if the
Travelers CGL Policy also covers part of that loss. See Travelers Excess Liability Policy at 2, 6,
20. Because the Travelers CGL Policy does not cover losses arising from John R. Anczarski’s
collision with the vehicle that Waconda negligently operated, see supra at III.A., the umbrella
policy does not cover those loses, see Travelers Excess Liability Policy at 2, 6 & 20. As a result,
the Anczarskis cannot “show a claim within the coverage provided by” the Travelers Excess
Liability Policy. Miller v. Boston Ins. Co., 218 A.2d at 277. Accordingly, Travelers Indemnity
is entitled to summary judgment, because there are no genuine issues of material fact and the
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Anczarskis cannot “show a claim within the coverage provided by” either Travelers Indemnity
policy at issue. Miller v. Boston Ins. Co., 218 A.2d at 277.
IT IS ORDERED that: (i) the Plaintiffs’ Motion to Supplement the Record with Correct
Information, filed June 28, 2017 (Doc. 46), is granted; and (ii) the Defendant The Travelers
Indemnity Company’s Motion for Summary Judgment, filed April 6, 2017 (Doc. 31), is granted.
________________________________
UNITED STATES DISTRICT JUDGE
Counsel:
Nicholas Mendoza
Nicholas Mendoza, Attorney at Law
Tijeras, New Mexico
-- and -Cynthia Aragon
Cynthia Aragon, Attorney at Law, LLC
Albuquerque, New Mexico
Attorneys for the Plaintiffs
P. Scott Eaton
Eaton Law Office PC
Albuquerque, New Mexico
Attorneys for the Defendant
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