North Star Mutual Insurance Company v. Streeter
ORDER by Judge Ronald A. White granting Plaintiff's Motion for Summary Judgment and Brief in Support filed 11/23/16 ( 17 Motion for Summary Judgment ) (lal, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF OKLAHOMA
NORTH STAR MUTUAL INSURANCE
Case No. 16-CIV-301-RAW
CINDY STREETER, and
SPECIALIZED LOAN SERVICING, LLC,
Before the court is Plaintiff’s Motion for Summary Judgment [Docket No. 17].
The complaint in this matter was filed on July 7, 2016 [Docket No. 3]. On November 15,
2016, the Clerk of the Court entered Default against Defendants Cindy Streeter and
Specialized Loan Servicing, LLC [Docket No. 16]. Plaintiff requests the court enter
judgement against the Defendants pursuant to F.R.Cv.P. 56. Both Defendants have failed
to answer the complaint or respond to the instant motion.
Plaintiff issued a Homeowners Policy to Defendant Streeter (“Streeter”) in
December 2015. The policy period was from December 28, 2015 to December 28, 2016.
A premium was due on May 31, 2016, but was not paid by Streeter. An invoice for the
premium was mailed to Streeter on or about May 13, 2016. A letter was mailed to Streeter
on or about June 7, 2016, stating that the policy would cease to be effective at 12:01 a.m.
(CST) on June 20, 2016, unless the premium was received by that date. Plaintiff did not
timely receive the premium payment. Plaintiff deemed the policy canceled on June 20,
Unfortunately, a fire occurred on the premises on or about June 24, 2016 and
Streeter submitted a fire loss claim to Plaintiff. On June 28, 2016, Plaintiff received a
check from Streeter dated June 21, 2016. The payment was fully refunded to Streeter.
During all relevant times herein, Defendant Specialized Loan Servicing, LLC
(“Specialized”) held a mortgage or other security interest in the subject property.
Specialized received notice of the June 7, 2016 correspondence to Streeter, but Specialized
took no action to maintain coverage or pay the policy premium.
As previously stated, both Defendants failed to answer the complaint or respond to
the pending motion for summary judgment.
Rule 8 of the Federal Rules of Civil
Procedures states: “An allegation … is admitted if a responsive pleading is required and
the allegation is not denied.” F.R.Cv.P. 8(b)(6). Additionally,
By failing to submit an answer or other pleading denying the factual
allegations of Plaintiff's complaint, Defendant admitted those allegations,
thus placing no further burden upon Plaintiff to prove its case factually.
Fed.R.Civ.P. 8(d) (“Averments in a pleading to which a responsive pleading
is required ... are admitted when not denied in the responsive pleading.”).
Burlington N. R. Co. v. Huddleston, 94 F.3d 1413, 1415 (10th Cir. 1996).
In a declaratory action, however, after default has been entered (as in this case), a
court must construe the undisputed facts along with the policy language before granting
The failure of the defendant to appear and answer in a declaratory judgment
proceeding may constitute an admission on the part of the defendant of all
material facts pleaded, but the court must, nevertheless, proceed to construe
such facts or instruments set out therein and enter judgment thereon, in order
to comply with the meaning and purpose of the Act. It does not entitle the
petitioner to a judgment based on his construction of the law applicable to
such facts. 26 C.J.S. Declaratory Judgments § 158; 16 Am.Jur., Declaratory
Judgments, § 68; Central Oregon Irr. Dist. v. Deschutes County et al. 168 Or.
493, 124 P.2d 518; Hurley v. Hurley, 298 Ky. 178, 182 S.W.2d 652;
Prudential Ins. Co. of America v. Rader, D.C., 98 F.Supp. 44.
Hall v. Hartley, 119 S.E.2d 759, 762,
146 W.Va. 328, 332-3 (1961).
The court has considered the applicable case law as to whether Plaintiff effectively
canceled Streeter’s policy for failure to pay the premium. Plaintiff gave notice of the
policy cancellation that was clear and unequivocal after Streeter’s failure to pay by the due
date. See Equity Ins. Co. v. City of Jenks, 184 P.3d 541, 544-45. See also, Bufogle v.
Equity Ins. Co., 525 Fed.Appx. 802 (10th Cir. 2013). Streeter was notified that the
premium payment was due by May 31, 2016. On June 7, 2016, Plaintiff sent a letter to
Streeter clearly stating that the policy would cease to be effective unless payment was
received by June 20, 2016 at 12:01 a.m. Payment was not received by the required date
prior to cancellation of the policy. The court, therefore, declares that the policy was
effectively cancelled on June 20, 2016 due to non-payment of the premium.
Additionally, Plaintiff provided notice to Specialized on June 7, 2016 that the policy
premium had not been paid. Specialized failed to take any action to maintain coverage or
pay the premium. Due to Specialized’s failure, the declaratory judgment is binding on
Specialized for the same reasons stated above. See Penn-America Ins. Co. v. Zertuche,
770 F.Supp.2d 832, 847 (W.D. Tex. 201) (finding policy properly canceled for
non-payment of premium where proper notice given to insured and mortgage company).
Plaintiff’s Motion for Summary Judgment [Docket No. 17] is GRANTED. As
specified above, the court finds that the homeowner’s policy was properly canceled for
non-payment of the premium, that Plaintiff owed no duty to indemnify Defendant Cindy
Streeter for the property loss that occurred on or about June 24, 2016, and that declaratory
judgment is binding on both Defendant Cindy Streeter and Defendant Specialized Loan
Dated this 17th day of January, 2017.
HONORABLE RONALD A. WHITE
UNITED STATES DISTRICT JUDGE
EASTERN DISTRICT OF OKLAHOMA
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