Rafer Rokeach v. Hanover Insurance Company
Filing
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MEMORANDUM OPINION AND ORDER re: 34 MOTION for Summary Judgment of Defendant Hanover Insurance Company, filed by Hanover Insurance Company. The plaintiffs motion for summary judgment is denied. The Clerk of Court is directed to close the motion pending at docket number 34. (Signed by Judge Gregory H. Woods on 5/19/2015) (kko)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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RAFER ROKEACH d/b/a DOUBLE
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R WELDING, INC.,
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Plaintiff,
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-v :
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HANOVER INSURANCE COMPANY,
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Defendant.
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USDC SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC #: _________________
DATE FILED: 5/19/15
1:13-cv-5011-GHW
MEMORANDUM OPINION
AND ORDER
GREGORY H. WOODS, District Judge:
I.
INTRODUCTION
Hanover Insurance Company denied the plaintiff’s claim for $80,000 in losses arising from a
series of thefts on the plaintiff’s property. While Hanover acknowledges that the losses were
covered by its policy, it argues that the policy’s deductibles provision precludes the plaintiff from
obtaining any recovery. The deductibles provision requires the payment of a $1,000 deductible for
each “occurrence” that gives rise to a loss. Hanover argues that each of the multiple instances of
theft was a separate “occurrence,” and that the plaintiff cannot prove that the loss in any one
occurrence exceeded the $1,000 deductible, which, in Hanover’s view, bars all recovery. The
plaintiff argues, among other things, that the series of thefts on his property should be treated as a
single occurrence, subject to a single deductible. Because the Court finds that the meaning of the
undefined term “occurrence” used in the deductibles provision of this first party property insurance
policy is ambiguous, the Court denies the defendant’s motion for summary judgment.
II.
BACKGROUND
a. The Theft
The plaintiff, Mr. Rafer Rokeach d/b/a Double R Welding, Inc., operates a welding business
in Uniondale, New York. Plaintiff’s Response to Defendant’s Rule 56.1 Statement (“Pl. Resp. 56.1”)
at ¶ 1. The plaintiff stored a considerable amount of metal in an ungated yard on his property. Id. at
¶ 2.
Mr. Rokeach’s business was robbed in the summer of 2011. Mr. Rokeach first noticed that
material had been stolen in mid-June, when one of his employees pointed out that a scrap bin was
empty. Defendant’s Response to Plaintiff’s Rule 56.1 Counterstatement (“Def. Resp. 56.1”) at ¶ 1,
2. After he discovered the theft, the plaintiff inspected the property and found that he was missing a
“massive amount of material.” Id. at ¶ 2. Mr. Rokeach’s inspection also revealed to him that the
thieves had staged additional material for future removal by dragging some items from one end of
his property to the other. Id. at ¶ 5. Mr. Rokeach later testified that he believed that multiple people
and multiple loads were required to remove the stolen materials from his property. Pl. Resp. 56.1 at
¶ 9.
Mr. Rokeach reported the theft of materials from his property to the police. Def. Resp. 56.1
at ¶ 6. Then he spoke with his neighbors, who told him that they had heard noise late at night on
his property for “a few weeks.” Pl. Resp. 56.1 at ¶ 5; Def. Resp. 56.1 at ¶ 6. According to Mr.
Rokeach, while the neighbors had heard loud noises on the property at night over a period of weeks,
“[t]hey never thought anything of it because sometimes I work around the clock.” Deposition of
Mr. Rafer Rokeach (“Rokeach Dep.”) at 103:9-11; Def. Resp. 56.1 at ¶ 7. One neighbor, a former
police officer, told Mr. Rokeach that about a week before Mr. Rokeach reported the theft to the
police, the neighbor’s wife had heard a lot of noise in a short period of time, and then that they had
seen a truck with a trailer come into the property. Rokeach Dep. at 132:18-133:13; Pl. Resp. 56.1 at
¶ 8.
Another neighbor, who lives 200 feet from Mr. Rokeach’s property, provided even more
detail regarding the thefts. He stated that he saw the same two men on Mr. Rokeach’s property on
four separate occasions, starting in the middle of June 2011. Affidavit of Peter Arrichio, Ex. 3 to
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Affidavit of Roman Rabinovich (“Arrichio Aff.”), Docket No. 43, at ¶¶ 2-6. He saw the two men
taking metal goods from Mr. Rokeach’s property and loading it into a pickup truck; they used the
same pickup truck on each occasion. Id. Mr. Arrichio says that it took the men “approximately an
hour each to take the items over the course of a couple trips per instance.” Id. at ¶ 5. Like Mr.
Rokeach’s other neighbors, Mr. Arrichio did not think that the men were thieves, believing, instead,
that they were they working for Mr. Rokeach.
Once they were alerted to the series of thefts from Mr. Rokeach’s property, Mr. Rokeach’s
neighbors were “very upset.” Rokeach Dep. at 52:20-25. They began to look after the property. Id.
Mr. Arrichio, in particular, realized that the men he had observed on Mr. Rokeach’s property were
thieves. Arrichio Aff. at ¶ 10. The next time that Mr. Arrichio saw the men on the property, he
called the police, and they were arrested. Id. at ¶ 11. The arrest occurred on July 21, 2011. Def.
Resp. 56.1 at ¶ 8.1
b. The Claim
After the thieves were arrested, on July 21, 2011, Mr. Rokeach reported his losses to his
insurance provider, Hanover Insurance Company, the defendant in this case. Declaration of
Christopher Tivnan (“Tivnan Aff.”), Docket No. 36, at ¶ 3. Mr. Rokeach claimed reimbursement
for his losses under a business owner’s policy issued by Hanover on November 11, 2011, which
covered the period from February 22, 2011 to February 22, 2012. Pl. Resp. 56.1 at ¶ 13. As
described in more depth below, the policy provided broad coverage for both property losses and
claims for liability against the plaintiff’s business.
The plaintiff submitted a sworn proof of loss on May 15, 2012, claiming $80,000 in covered
losses from the theft on his property. Tivnan Aff. at ¶ 5, Ex. 3. Mr. Rokeach provided a hand
There is some inconsistency on the record regarding the precise date of the arrest. Mr. Arrichio affirmed that the date
was July 1, 2011. Arrichio Aff. at ¶ 11. According to the testimony of Mr. Rokeach, however, the police report
regarding the incident correctly stated July 21, 2011 as the date of the incident. Rokeach Dep. at 114:8-13.
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written inventory of the stolen property, consisting of $77,722.16 of his own property and $3,247.18
of property belonging to others. Def. Resp. 56.1 at ¶ 10. The plaintiff prepared that inventory of
stolen goods after the thefts occurred, using replacement cost values based on the original purchase
price of the items that he identified as stolen. Id. at ¶ 11.
Hanover ultimately denied the plaintiff’s claim. In a letter dated June 11, 2012, Hanover
explained the basis for its decision as follows:
We have determined that the materials stolen happened over time with several
trips/occurrences. Each occurrence of theft is a separate claim subject to a separate
deductible. Based on the load tickets provided by the NYPD, the value of each load
falls below the $1000 policy deductible. Accordingly, we will be unable to issue any
payment for the damages sustained.
Tivnan Aff. Ex. 4. Hanover separately asserted that the plaintiff’s lack of a written inventory of his
property prior to the loss was a basis for its decision not to reimburse the claim. Def. Resp. 56.1 at
¶ 17. At the same time, Hanover acknowledges that its policy does not expressly require that an
insured person maintain an inventory. Id. at ¶ 18. This case turns, therefore, on Hanover’s
interpretation of the deductibles provision of its policy—and, in particular, the meaning of the term
“occurrence” as it appears in that provision of the policy.
c. The Policy
Hanover’s insurance policy provides coverage for “direct physical loss of or damage to
Covered Property at the premises described in the Declarations caused by or resulting from any
Covered Cause of Loss, except as limited or excluded within this policy form . . . .” Ex. 5 to Tivnan
Aff. (the “Policy”) Businessowners Coverage Form at p. 4 of 66. The covered property includes
“Business Personal Property located in or on the buildings . . . or in the open (or in a vehicle) within
1000 feet of the described premises.” Id. “Theft” is a covered cause of loss under the Policy. Id. at
p. 46 of 66. It is not disputed that the stolen property, located in the open at the plaintiff’s premises,
was covered by the Policy; nor is it disputed that the plaintiff was the victim of a theft covered under
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the Policy. None of the Policy’s limitations or exclusions apply to the plaintiff’s claim. Id. at pp. 6,
31-36 of 66; Deposition of Christopher Tivnan, Ex. 1 to Rabinovich Aff. (“Tivnan Dep.”) at 138:1618 (“theft is not excluded in the policy and theft is a covered cause of loss.”).
The Policy limits the amount that it will cover for losses or damage: “The most we will pay
for loss or damage in any one ‘occurrence’ is the applicable Limit of Insurance shown in the
Declarations.” Policy, Businessowners Coverage Form at p. 36 of 66. Hanover does not, however,
argue that the amount of the plaintiff’s claim exceeded the amount of coverage provided for theft
under the policy.
Instead, the basis for Hanover’s decision not to reimburse the plaintiff rests on the Policy’s
deductibles provision. That provision of the Policy reads as follows:
We will not pay for loss or damage in any one occurrence until the amount of loss or
damage exceeds the Deductible shown in the Declarations. We will then pay the
amount of loss or damage in excess of the Deductible up to the applicable Limit of
Insurance . . . .
Id. at p. 37 of 66. The deductible amount applicable to theft under the Policy’s declarations is
$1,000. Policy, Businessowners Declaration at p. 1 of 2.
The Policy defines the term “occurrence” as follows:
“Occurrence” means all loss or damage that is attributable directly or indirectly to:
a. One cause, act, event, or a series of similar, related causes, acts or events
involving one or more persons; or
b. One cause, act or event, or a series of similar related causes, acts or events not
involving any person.
Policy, Businessowners Coverage Form at p. 45 of 66. However, as Hanover points out, the Policy
also states that “words and phrases that appear in quotation marks have special meaning.” Policy,
Businessowners Coverage Form at p. 4 of 66.2 And the term “occurrence” in the deductibles
The Policy points the reader to “Paragraph H. Property Definitions in Section I-Property . . . .” Policy,
Businessowners Coverage Form at p. 4 of 66. The Court notes that the reference should properly be to Paragraph G.
Id. at p. 42 of 66.
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provision of the Policy does not appear within quotation marks. As a result, Hanover argues that
the term “occurrence” as used in the deductibles provision of the policy must be read in a way that
does not permit a series of related events to be treated as a single “occurrence.”
At oral argument on this motion, the parties stipulated on the record that the laws of the
State of New York apply to the interpretation of the Policy. Rightly so, given that the Policy was
written in New York to insure a property and business located in New York.
III.
PROCEDURAL HISTORY
The Plaintiff served a summons and complaint on the defendant in this action on June 24,
2013. The defendant removed the case from the Supreme Court of New York, New York County,
to this Court on July 18, 2013. The case was reassigned to the undersigned on April 17, 2014, and
the Court put in place a case management plan and scheduling order on May 13, 2014. After
conducting discovery, the defendant filed this motion for summary judgment on February 18, 2015.
The motion was fully briefed on March 12, 2015.
IV.
LEGAL STANDARD
The Plaintiff in this case is entitled to summary judgment on a claim if he can show that
“there is no genuine issue as to any material fact and that [defendant is] entitled to judgment as a
matter of law.” Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986) (citing Fed. R. Civ. P. 56(c)). A
dispute is genuine if “the evidence is such that a reasonable jury could return a verdict for the
nonmoving party,” while a fact is material if it “might affect the outcome of the suit under
governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
To defeat a motion for summary judgment, the defendant “must come forward with
‘specific facts showing that there is a genuine issue for trial.’” Matsushita Elec. Indus. Co., Ltd. v. Zenith
Radio Corp., 475 U.S. 574, 587 (1986) (quoting Fed. R. Civ. P. 56(e))(emphasis removed). “[M]ere
speculation or conjecture as to the true nature of the facts” will not suffice. Hicks v. Baines, 593 F.3d
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159, 166 (2d Cir. 2010) (citations and internal quotations omitted). Nor will wholly implausible
alleged facts or bald assertions that are unsupported by evidence. See Carey v. Crescenzi, 923 F.2d 18,
21 (2d Cir. 1991); Argus Inc. v. Eastman Kodak Co., 801 F.2d 38, 45 (2d Cir. 1986) (citing Matsushita,
475 U.S. at 585-86). The issue of fact must be genuine—plaintiff “must do more than simply show
that there is some metaphysical doubt as to the material facts.” Matsushita, 475 U.S. at 586.
In determining whether there exists a genuine dispute as to a material fact, the Court is
“required to resolve all ambiguities and draw all permissible factual inferences in favor of the party
against whom summary judgment is sought.” Johnson v. Killian, 680 F.3d 234, 236 (2d Cir. 2012)
(citing Terry v. Ashcroft, 336 F.3d 128, 137 (2d Cir. 2003)). The Court’s job is not to “weigh the
evidence or resolve issues of fact.” Lucente v. Int’l Bus. Machines Corp., 310 F.3d 243, 254 (2d Cir.
2002). Rather, the Court must decide whether a rational juror could find in favor of the non-moving
party. Id.
This case requires that the Court analyze the terms of the Policy to determine their meaning.
In White v. Continental Cas. Co., 848 N.Y.S. 2d 603 (2007), the New York State Court of Appeals
provided the following guidance to courts evaluating insurance contracts governed by New York
law:
As with any contract, unambiguous provisions of an insurance contract must be
given their plain and ordinary meaning, and the interpretation of such provisions is a
question of law for the court. It is well settled that ‘[a] contract is unambiguous if
the language it uses has ‘a definite and precise meaning, unattended by danger of
misconception in the purport of the [agreement] itself, and concerning which there is
no reasonable basis for a difference of opinion’. ‘Thus, if the agreement on its face is
reasonably susceptible of only one meaning, a court is not free to alter the contract
to reflect its personal notions of fairness and equity’. If the terms of a policy are
ambiguous, however, any ambiguity must be construed in favor of the insured and
against the insurer.
White v. Continental Cas. Co., 848 N.Y.S. 2d 603, 605 (2007) (citations omitted).
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V.
DISCUSSION
There is no material dispute as to the facts at issue in this case. Thieves collected and carted
away multiple separate loads of Mr. Rokeach’s property between mid-June 2011 and the date of their
arrest on July 21, 2011. The evidence suggests that the thefts were linked—the two thieves who
were ultimately arrested were seen on the property multiple times; the thieves “staged” material
during some trips for removal in other trips; they used the same means to steal the property—
pulling up in the same truck in the same location multiple times to load the material.
The Court believes that this linked series of thefts would fall within the Policy’s definition of
the term “occurrence.” The record supports the conclusion that the series of thefts suffered by the
plaintiff were “similar, related . . . acts involving one or more persons.” Policy, Businessowners
Coverage Form at p. 45 of 66. If the defined term “occurrence” applied in the deductible provision,
therefore, Mr. Rokeach could make a single claim for a single loss, subject to a single $1,000
deductible.
For that reason, Hanover argues that the term “occurrence” when used in the deductibles
provision “is not subject to the definition, and is instead subject to its usual meaning in a property policy
setting.” Defendant’s Reply Memorandum of Law (“Reply”), Docket No. 45, at 2 (emphasis added).
Notably, however, Hanover provides no reference to any law or case that establishes the “usual
meaning in a property policy setting” of the term “occurrence.” The question for the Court is
whether the undefined term has a clear, unambiguous meaning that precludes the possibility of
aggregating a series of related events, as Hanover’s argument assumes.
The Second Circuit confronted this issue in a prominent case arising from the events of
September 11, 2001. World Trade Center Properties, LLC v. Hartford Fire Ins. Co., 345 F.3d 154 (2d Cir.
2003), abrogated on other grounds by Wachovia Bank v. Schmidt, 126 S.Ct. 941 (2006). As here, the
question in that case was whether the meaning of the undefined term “occurrence” in a first party
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property insurance policy was ambiguous. The stakes were much higher in that case than in this
case—many millions of dollars turned on the question of whether the orchestrated terrorist attacks
on the Twin Towers constituted a single occurrence or two separate occurrences. Still, the analysis
applies equally well to this case, where the question is whether a series of related criminal acts
constituted a single occurrence or multiple occurrences.
The Second Circuit concluded that the use of the undefined term “occurrence” in a first
party property insurance policy was ambiguous, reasoning as follows:
. . . even if we were to agree with the Silverstein Parties that the approved jury
instruction and our separate definition of “occurrence” are applicable to this case (a
question we need not and do not reach), the one thing Newmont Mines makes certain
is that the question of how many occurrences the events of September 11th
constituted is a question properly left to the fact-finder. To be sure, a jury could find
two occurrences in this case, as it did in Newmont Mines, or it could find that the
terrorist attack, although manifested in two separate airplane crashes, was a single,
continuous, planned event causing a continuum of damage that resulted in the total
destruction of the WTC, and, thus, was a single occurrence. Instead of supporting
the Silverstein Parties’ argument that New York law mandates a finding of two
occurrences under the Travelers binder as a matter of law, Newmont Mines confirms
our belief that in a first-party property insurance case, the meaning of the undefined term
“occurrence” is an open question as to which reasonable finders of fact could reach different
conclusions.
World Trade Center Properties, LLC, 345 F3d at 190 (emphasis added).
Here too, the meaning of the undefined term “occurrence” in the deductibles provision of
the Policy is ambiguous. There is a reasonable basis for a difference of opinion as to the term’s
meaning—particularly as to whether the term permits the aggregation of a series of separate, related
events into a single “occurrence.” Hanover is correct that the term “occurrence” does not appear in
quotation marks in the deductibles provision of the Policy. As a result, the expansive meaning of
the defined term “occurrence” does not necessarily apply in that context. However, it is not clear
that the undefined term “occurrence” must be interpreted in a manner that would preclude the
aggregation of multiple visits by a set of thieves to a single property into a single “occurrence”—
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indeed, it may be that a jury will determine that the term was meant to be understood in substantially
the same way as the defined term.
Because the undefined term “occurrence” is ambiguous, a finder of fact must determine its
meaning. In this case, a jury will determine whether the series of thefts should be understood a
single occurrence, subject to a single deductible, or multiple occurrences, subject to multiple
deductibles.3
VI.
CONCLUSION
The plaintiff’s motion for summary judgment is denied. The Clerk of Court is directed to
close the motion pending at docket number 34.
SO ORDERED.
Dated: May 19, 2015
New York, New York
_____________________________________
GREGORY H. WOODS
United States District Judge
In the event that the term “occurrence” is found to preclude the aggregation of a series of events into a single
occurrence, as Hanover argues, the finder of fact will also be able to evaluate how many “occurrences” are at issue, and,
therefore, the appropriate deductible amount to be subtracted from the plaintiff’s claim.
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