NATIONAL FIRE INSURANCE COMPANY OF HARTFORD et al v. BURNS & SCALO ROOFING COMPANY
MEMORANDUM OPINION. SIGNED BY HONORABLE NITZA I QUINONES ALEJANDRO ON 1/26/2017. 1/26/2017 ENTERED AND COPIES E-MAILED.(amas)
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
NATIONAL FIRE INSURANCE
COMPANY OF HARTFORD and
BURNS & SCALO ROOFING COMPANY :
NITZA I. QUIÑONES ALEJANDRO, J.
JANUARY 26, 2017
Plaintiffs National Fire Insurance Company of Hartford and Transportation Insurance
Company (“Plaintiffs”) filed this civil action under the Declaratory Judgment Act,1 seeking a
determination regarding insurance coverage, and related rights and duties, if any, for the defense
and/or indemnification owed to Defendant Burns & Scalo Roofing Company (“Defendant” or
“Burns & Scalo”) in an underlying state court action.2 [ECF1].
Presently before this Court is Plaintiffs‟ motion for summary judgment filed pursuant to
Federal Rule of Civil Procedure (“Rule”) 56, requesting judgment in their favor and a declaration
that Plaintiffs do not owe a further duty to defend and/or indemnify Defendant in the abovereferenced state court action. [ECF 33]. Defendant filed a response in opposition, [ECF 35], and
28 U.S.C. §§ 2201-2202.
The underlying action captioned Bremer et al. v. Burns and Scalo Roofing, Inc. et al., Court of
Common Pleas of Philadelphia County, October Term, 2014, No. 1409-04424, (“the State Court
Action”), was filed on October 1, 2014, by Carl and Lori Bremer against Defendant.
Plaintiffs filed a reply. [ECF 42]. The issues raised in the motion for summary judgment have
been fully briefed by the parties and are now ripe for disposition. For the reasons stated herein,
Plaintiffs‟ motion for summary judgment is granted.
Briefly, in the underlying state court action filed by Carl and Lori Bremer (collectively
“the Bremers”) against Burns & Scalo, (the same Defendant in this federal case), Carl Bremer
(“Dr. Bremer”) contends that during the summer months of the years 1973 through 1976, he was
employed by Defendant, was exposed to asbestos dust and fibers during his employment and, as
a result of this exposure, developed malignant mesothelioma. (See State Court Compl., attached
as Ex. 1, Pltfs. Mot. for Summ. J., at ¶¶ 4-5, 8). In said complaint, his wife, Lori Bremer, pled a
claim for loss of consortium.4 (See id. at ¶¶ 3, 8). The state court complaint incorporated, by
reference, allegations and causes of action asserted in a master long form complaint filed as In re
Asbestos Litigation in Philadelphia Court of Common Pleas, No. 8610-0001 (“the Master Long
Form Complaint”), including, inter alia, an allegation in Count VII that the Dr. Bremers‟ injuries
resulted from Defendant‟s intentional tortious conduct as Bremer‟s employer. (Id. at ¶ 9). The
nine-paragraph state court complaint contains very little by way of factual allegations. However,
it explicitly alleges that Dr. Bremer was employed by Defendant, and that his exposure to
asbestos dust and fiber during the course of his employment with Defendant was the proximate
cause of his injuries. (Id. ¶¶ 4-5).
Because an insurer‟s duty to defend an action against its insured is generally determined on the
basis of the allegations contained in the complaint against the insured, the facts set forth in this section are
primarily drawn from the state court complaint filed against Burns & Scalo. See State Farm Fire & Cas.
Co. v. Estate of Mehlman, 589 F.3d 105, 108 n.3 (3d Cir. 2009) (citing Donegal Mut. Ins. Co. v.
Baumhammers, 938 A.2d 286, 290-92 (Pa. 2007)).
When Carl Bremer died on November 4, 2014, (see Def. Res. to Pl. Mot. for J. on Pl. at 3), the
Administrator of his Estate was substituted as a named party. (Id.).
In the state court matter, Defendant sought a defense and indemnification from Plaintiffs
consistent with the provisions of the general liability insurance occurrence policies issued to
Defendant between the years 1988 and 1992 (“the Policies”). (See Pltfs. Mot. for Summ. J., Ex.
9-12). The Policies, which contained identical provisions, essentially provide for a defense and
indemnification in any lawsuit seeking damages for “bodily injury” that occurs during the policy
coverage period. (See, e.g., Pltfs. Mot. for Summ. J, Ex. 9 at Section I, ¶ 1.a.). The Policies
defined the term “bodily injury” as “bodily injury, sickness or disease sustained by a person,
including death resulting from any of these at any time.” (See id. at Section V, ¶ 3). The
Policies contained a liability exclusion provision, (“the Exclusion”), which reads as follow:
This insurance does not apply to:
e. “Bodily injury” to:
(1) An employee of the insured arising out of and in the
course of employment by the insured; or
(2) The spouse, child, parent, brother or sister of that
employee as a consequence of (1) above.
This exclusion applies:
(1) Whether the insured may be liable as an employer or in
any other capacity; and
(2) To any obligation to share damages with or repay
someone else who must pay damages because of the
(Id. at Section 1, ¶ 2.e.). The term “employee” is not defined anywhere within the Policies.
After being served with the state court complaint, Defendant provided Plaintiffs with the
notice of the underlying state court action. On August 26, 2015, Plaintiffs denied insurance
coverage. Defendant sought reconsideration and, on November 6, 2015, Plaintiffs informed
Defendant that, although they believed they were under no obligation to defend and/or indemnify
Defendant in the underlying state court action, they would provide a defense under a reservation
of rights. Thereafter, Plaintiffs filed the instant declaratory judgment action.
In the interim, on September 12, 2016, a jury trial in the state court action commenced.
The Bremers, as the plaintiffs therein, presented evidence of Dr. Bremer‟s summer employment
with Defendant between 1973 and 1976, of his exposure to asbestos during that employment
period, and his subsequent diagnosis of malignant mesothelioma. To challenge this testimony,
Defendant offered the testimony of Harry Trybus and Randy Trybus, the owners of Trybus
Roofing. Mr. Harry Trybus essentially testified that Dr. Bremer worked directly for Trybus
Roofing as a laborer during the summers of 1975 and 1976. While the jury was deliberating but
before a verdict was rendered, Defendant and the Bremers reached a confidential settlement for
an amount within the Policies‟ limits.
Rule 56 governs the summary judgment motion practice. Specifically, this rule provides
that summary judgment is appropriate “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). A fact is “material” if proof of its existence or non-existence might affect the outcome of
the litigation, and a dispute is “genuine” if “the evidence is such that a reasonable jury could
return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986). The movant bears the burden of proving the absence of a genuine issues of material fact.
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Under Rule 56, the court must view the
evidence in the light most favorable to the non-moving party. Galena v. Leone, 638 F.3d 186,
196 (3d Cir. 2011).5
Here, although Plaintiffs‟ motion is one for summary judgment, it relies upon a legal
interpretation of the insurance policies in question rather than on an analysis of facts and/or
evidence. As detailed below, whether an insurer owes a duty to defend an insured, in a litigation
brought against the insured, is an issue generally determined by considering the allegations in the
complaint against the insured and the language of the insurance policy at issue. See Mehlman,
589 F.3d at 110 (citing Donegal, 938 A.2d at 290)).
Under Pennsylvania law,6 an insurer‟s duty to defend is broader than its duty to
indemnify. Sikirica v. Nationwide Ins. Co., 416 F.3d 214, 225 (3d Cir. 2005). However, “there
is no duty to indemnify if there is no duty to defend.” Id. To determine whether Plaintiffs owe a
Generally, Rule 56(c) provides that the movant bears the initial burden of informing the court of
the basis for the motion and identifying those portions of the record which the movant “believes
demonstrate the absence of a genuine issue of material fact.” Celotex, 477 U.S. at 323. This burden can
be met by showing that the nonmoving party has “fail[ed] to make a showing sufficient to establish the
existence of an element essential to that party‟s case.” Id. at 322. After the moving party has met its
initial burden, summary judgment is appropriate if the nonmoving party fails to rebut the moving party‟s
claim by “citing to particular parts of materials in the record, including depositions, documents,
electronically stored information, affidavits or declarations, stipulations . . . , admissions, interrogatory
answers, or other materials” that show a genuine issue of material fact or by “showing that the materials
cited do not establish the absence or presence of a genuine dispute.” See Rule 56(c)(1)(A-B). The
nonmoving party must “do more than simply show that there is some metaphysical doubt as to the
material facts.” Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). The
nonmoving party may not rely on bare assertions, conclusory allegations or suspicions, Fireman’s Ins.
Co. of Newark v. DuFresne, 676 F.2d 965, 969 (3d Cir. 1982), nor rest on the allegations in the pleadings.
Celotex, 477 U.S. at 324. Rather, the nonmoving party must “go beyond the pleadings” and either by
affidavits, depositions, answers to interrogatories, or admissions on file, “designate „specific facts
showing that there is a genuine issue for trial.‟” Id.
In their respective briefs, both parties rely upon and, therefore, appear to agree that Pennsylvania
law applies to this action. Because the homeowner insurance policy at issue was issued to a Pennsylvania
corporation, this Court agrees that Pennsylvania law applies. See Cat Internet Servs., Inc. v. Providence
Washington Ins. Co., 333 F.3d 138, 141 (3d Cir. 2003) (holding that “Pennsylvania conflict of laws
principles dictate that an insurance contract is guided by the law of the state in which it is delivered.”).
duty to defend and/or indemnify Burns & Scalo, the allegations in the state court complaint and
the language of the insurance policies issued to Burns & Scalo, must be examined. As stated:
an insurer‟s duty to defend an action against the insured is
measured, in the first instance, by the allegations in the
plaintiff‟s pleadings . . . . In determining the duty to defend,
the complaint claiming damages must be compared to the
policy and a determination made as to whether, if the
allegations are sustained, the insurer would be required to pay
[the] resulting judgment . . . . [T]he language of the policy and
the allegations of the complaint must be construed together to
determine the insurers‟ obligation.
Donegal, 938 A.2d at 290 (quoting Gene’s Rest. Inc. v. Nationwide Ins. Co., 548 A.2d 246, 247
(Pa. 1988)); see also Kvaerner Metals Div. of Kvaerner U.S., Inc. v. Commercial Union Ins. Co.,
908 A.2d 888, 896 (2006) (noting that it is well-settled Pennsylvania law that “[a] carrier‟s duty
to defend and indemnify an insured in a suit brought by a third party depends upon a
determination of whether the third party‟s complaint triggers coverage.”). If the underlying
complaint alleges an injury “which may be within the scope of the policy, the company must
defend the insured until the insurer can confine the claim to a recovery that the policy does not
cover.” United Servs. Auto. Ass’n v. Elitzky, 517 A.2d 982, 985 (Pa. Super. Ct. 1986). However,
“[t]o prevent artful pleading designed to avoid policy exclusions, it is necessary to look at the
factual allegations in the complaint, and not how the underlying plaintiff frames the request for
relief.” Mut. Benefit Ins. Co. v. Haver, 725 A.2d 743, 745 (Pa. 1999). “[T]he particular cause of
action that a complainant pleads is not determinative of whether coverage has been triggered.”
Id. Instead “it is necessary to look at the factual allegations contained in the complaint.” Id.;
Scopel v. Donegal Mut. Ins. Co., 698 A.2d 602, 605 (Pa. Super. Ct. 1997) (“[I]n focusing
attention upon the cause of action pled, [claimants] run afoul of our case law, which dictates that
the factual averments contained in a complaint determine whether an insurer must defend.”)
(emphasis in original). The duty to defend is properly denied where the allegations fall within a
clear and unambiguous exclusion of coverage. Harrison v. Aetna Life & Cas., 473 A.2d 636,
636 (Pa. Super. Ct. 1984). The burden rests upon the insurer to demonstrate that the allegations
of the complaint cast that pleading solely and entirely within the policy exclusions. Erie Ins.
Exch. v. Transamerica Ins. Co., 533 A.2d 1363, 1366 (Pa. 1987) (citing Miller v. Boston Ins.
Co., 218 A.2d 275, 277 (Pa. 1966)).
Here, Plaintiffs move for summary judgment on the premise that they have no duty to
defend Defendant in the underlying state court matter because the facts and injuries therein
alleged unambiguously fall within the exclusionary provision of the Policies. Defendant does
not dispute Plaintiffs‟ characterization of the factual allegations in the state court complaint.
Rather, Defendant argues that Plaintiffs have not foreclosed the possibility that the allegations in
the state court complaint fall outside the Exclusion. Defendant‟s argument is misguided.
In determining if a duty to defend exists, the court is charged with deciding whether the
underlying complaint creates any possibility of coverage. Here, in the underlying state court
complaint, Dr. Bremer alleges that he was employed by Defendant as a roofer during the summer
months of 1973 to 1976.
(See State Court Compl. at ¶ 4(a)).
The Bremers‟ complaint
incorporated, by reference, Count VII of the Master Long Form Complaint which, inter alia,
alleged that the claim was against “Defendant-Employer Burns and Scalo, for whom Plaintiff
was last employed between 1973 and 1976 . . . .” (Id. at ¶ 9) (emphasis added). Count VII of the
Master Long Form Complaint further alleged that Defendant Burns and Scalo is liable as a
“defendant employer” for, inter alia:
failing to advise plaintiffs of the presence of asbestos . . . which they were
working with in connection with their employment;
failing to provide plaintiffs with appropriate protective equipment and
applicances [sic] necessary in order to protect them from … becoming
injured or disabled by way of exposure to asbestos and asbestos related
failing to provide plaintiffs with a safe place to work;
failing to provide proper instruction and supervision to plaintiffs in the
performance of their duties in handling asbestos or asbestos products;
failing to provide plaintiffs with necessary and proper safety equipment to
use while performing their work duties in and around asbestos and
failing to take adequate precautions to prevent plaintiffs from suffering
injuries as a result of their employment;
being otherwise negligent, reckless, and careless in failing to protect the
health, safety and welfare of their employees;
failing to advise plaintiffs of the results of their x-rays, examinations and
pulmonary function tests which were taken by or on behalf of defendant
employer during the course of their employment and/or failing to advise
plaintiffs to cease further asbestos exposure; and
failing to advise plaintiffs after plaintiffs‟ exposure to asbestos ceased,
about the dangers of exposure to asbestos, about the dangers of past or
present asbestos exposure in combination with smoking or exposure to
other fumes and dust, and about the need for future medical surveillance.
(See Pltf. Mot for Summ. J., Ex. 4 at 100-101) (emphasis added). The factual allegations of the
underlying state court complaint clearly and unmistakably indicate that the Bremers‟ causes of
action arose out of the exposure to asbestos during the course of Dr. Bremer‟s employment with
Defendant. The Bremers successfully litigated their state court action based upon these facts.
Therefore, based upon this Court‟s review of the allegation of the state court complaint
and the exclusionary provision of the Polices, it is patently clear that the allegations in the
underlying state court complaint fall within the Exclusion provisions and, therefore, outside the
scope of any insurance coverage. The state court complaint has the hallmarks of an action
asserted by an employee against his employer for an occupational disease as described in Tooey
v. AK Steel Corp., 81 A.3d 851, 856 (Pa. 2013).7 In fact, the state court complaint expressly
alleges damages “pursuant to Tooey.” (State Court Compl. at ¶ 9). The factual averments pled
give no indication, as Defendant so advances, that Dr. Bremer was exposed to asbestos while
working for another employer, or that he was anything other than Defendant‟s employee.
Nothing in the state court complaint supports an interpretation of the facts other than the one
advanced by Plaintiffs.
Notwithstanding, Defendant contends that these general allegations do not necessarily
foreclose the theoretical possibility that Dr. Bremer was not Burns & Scalo‟s employee during
the entire period of his exposure to asbestos. Defendant urges this Court to consider a wide array
of extrinsic evidence, including the testimony of the Trybuses in the underlying action, to
conclude that Dr. Bremer was an independent contractor or subcontractor.
Pennsylvania law is clear that Plaintiffs‟ duty to defend a suit must be determined solely by the
four corners of the underlying complaint. See Kvaerner, 908 A.2d at 896 (holding that the
Superior Court erred in looking beyond the allegations raised in the underlying complaint and
finding “no reason to expand upon the well-reasoned and long-standing rule that an insurer‟s
duty to defend is triggered, if at all, by the factual averments contained in the complaint”); Aetna
Cas. & Sur. Co. v. Roe, 650 A.2d 94, 99 (Pa. Super. Ct. 1994) (“The insurer is obligated to
defend if the factual allegations of the complaint on its face comprehend an injury which is
actually or potentially within the scope of the policy”); see also State Auto. Mut. Ins. Co. v.
Christie, 802 A.2d 625, 626-29 (Pa. Super. Ct. 2002) (interpreting identical exclusion and ruling
that laborer injured while cleaning a cement machine fell within limits of the exclusion). Though
In Tooey, the Pennsylvania Supreme Court held that employees could pursue common law causes
of action against their employers for injuries relating to occupational disease manifesting more than 300
weeks after the last occupational exposure. 81 A.3d at 865.
Defendant‟s speculative factual arguments may have aided it in the defense of the underlying
action, they are not relevant to the inquiry here. See State Farm Fire and Cas. Co. v. Kim’s Asia
Constr., 2016 WL 5848851, at *4 (E.D. Pa. Oct. 5, 2016) (rejecting an insured‟s hypotheses that
the underlying claim fell within coverage because the underlying complaint alleged only facts
falling outside coverage). The factual allegations in the state court complaint unequivocally
indicate that the underlying injuries arose out of and in the course of Dr. Bremer‟s employment
by Defendant. The state court complaint did not allege any facts that could potentially fall
within the scope of coverage. Consequently, because the claims alleged in the state court
complaint fall within the Exclusion provisions, Plaintiffs have no duty to defend or to indemnify
Defendant in the underlying action.
For the reasons stated herein, Plaintiffs‟ motion for summary judgment is granted.
Plaintiffs have no further duty to defend and/or indemnify Defendant in the underlying law suit
identified as Bremer, et al. v. Burns and Scalo Roofing, Inc., Civil Action No. 149004424, Court
of Common Pleas of Philadelphia County, Pennsylvania.
An Order consistent with this Memorandum Opinion follows.
NITZA I. QUIÑONES ALEJANDRO, U.S.D.C. J.
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