Griggs v. State Farm Lloyds

• Decision Date: 20 July 1999
• Docket Number: No. 98-20217,98-20217
• Citation: 181 F.3d 694
• Parties: (5th Cir. 1999) GERRY M. GRIGGS, Plaintiff-Appellant, v. STATE FARM LLOYDS; LARK P. BLUM, Defendants-Appellees
• Court: U.S. Court of Appeals — Fifth Circuit

Page 694

181 F.3d 694 (5th Cir. 1999)

GERRY M. GRIGGS, Plaintiff-Appellant, v. STATE FARM LLOYDS; LARK P. BLUM, Defendants-Appellees.

No. 98-20217

UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

July 20, 1999, Decided

As Revised August 5, 1999.

Rehearing Denied August 23, 1999

Appeal from the United States District Court for the Southern District of Texas. H-97-CV-2374. Lynn N Hughes, US District Judge.

Edward James Westmoreland, Kelly, Sulter, Mount & Kendrick, Houston, TX, for Plaintiff-Appellant.

Warren Royal Taylor, Beth M. Taylor, Amy Marie Evans, Taylor & Taylor, Houston, TX, for Defendants-Apellees.

Before GARWOOD, DAVIS, and DeMOSS, Circuit Judges.

DeMOSS, Circuit Judge:

Gerry M. Griggs appeals from the district court's orders dismissing defendant Lark P. Blum as fraudulently joined, granting Blum's motion for attorney fees, and granting summary judgment in favor of State Farm Lloyds as to all claims. We affirm.

BACKGROUND

This is an insurance dispute governed by Texas law. Between 1986 and 1992, Griggs maintained a homeowner's insurance policy issued by State Farm Lloyds. Griggs procured the insurance through Blum, who is an independent State Farm Lloyds' agent. At all times relevant to this suit, that policy provided coverage in the amount of $ 495,640 for unscheduled personal property and $ 49,564 for personal property stored off premises.

Griggs is an avid collector of sports cards and other memorabilia. In December 1992, burglars entered a public storeroom leased by Griggs and absconded with valuable sports memorabilia. The locks on the storeroom were undisturbed, and Griggs did not immediately discover the burglary. Even when Griggs entered the storeroom and began to suspect that at least one box was missing, he was unsure whether it was missing or merely misplaced in another storeroom or in his home. Griggs finally became certain that some of his collection was missing on January 16, 1993, when he observed unique items from his personal collection being offered for sale by other dealers at a large trade show. While at the show, Griggs solicited the help of a Houston Police Officer and began interviewing dealers to determine where the stolen merchandise had been purchased.

That night, while Griggs was at the trade show, his house was burglarized. This time, the burglars forcibly entered through a rear door and left with a substantial portion of Griggs' collection, as well as personal effects such as jewelry, cameras, and a lap top computer.

Griggs estimates his loss from the burglaries in sports memorabilia alone to be in excess of $ 1.2 million, with approximately $ 700,000 in sports memorabilia being taken from the storeroom and approximately $ 516,000 in sports memorabilia being taken from his home. Griggs reported both burglaries to the police, which resulted in the conviction of at least one person. Griggs also reported both burglaries to State Farm Lloyds as required by the policy.

In February 1993, State Farm Lloyds opened a claim file, Griggs gave a recorded statement concerning his losses, and State Farm Lloyds sent Griggs a letter requesting that he complete an enclosed sworn proof of loss. State Farm Lloyds claims it never received the requested proof of loss from Griggs. In March 1993, Griggs notified State Farm Lloyds that he was in the process of documenting what he knew to be stolen, as well as attempting to recover stolen memorabilia. State Farm Lloyds replied that Griggs' claim file remained open pending receipt of the required documentation of his losses.

In April 1993, Griggs again notified State Farm Lloyds that he was attempting to recover stolen property and requested their assistance in recovering property out of state. In June 1993, State Farm Lloyds responded that it encouraged but was unable to assist Griggs' efforts to recover out-of-state property, and that State Farm Lloyds could not process Griggs' claim until Griggs returned a sworn proof of loss and some documentation of his loss. The next month, in July 1993, State Farm Lloyds advised Griggs that it was closing his claim file because Griggs had not forwarded any information about his known losses. State Farm Lloyds informed Griggs that it would be happy to reopen the file when Griggs was able to provide the requested documentation.

Six months later, in January 1994, and again in March 1994, Griggs informed State Farm Lloyds that he was still trying to recover stolen property. In July 1994, one year after his claim file was closed, Griggs advised State Farm Lloyds that he would soon be ready to provide State Farm Lloyds with information about his known losses.

In August 1994, more than nineteen months after his original loss, Griggs delivered three boxes of documentation to the State Farm Lloyds office. Griggs purported to include, among other things, a sworn proof of loss, and inventories of the stolen property with estimated values. A State Farm Lloyds employee signed for the boxes. State Farm Lloyds claims it never received the proof of loss, and Griggs was unable to produce a copy of any proof of loss during the discovery phase of this lawsuit.

The following summer, in July and August 1995, State Farm Lloyds assigned a new claims representative, who contacted Griggs about his claim. That representative again requested that Griggs provide a sworn proof of loss. Griggs claims he returned two sworn proofs of loss on the required forms. Despite State Farm Lloyds' discovery request, Griggs never produced copies of those sworn proof of loss forms until shortly before the district court granted summary judgment in favor of State Farm Lloyds. Copies of those documents are in the summary judgment record, but do not reflect any notary's seal. State Farm Lloyds claims that the sworn proof of loss forms were never received.

In September 1995, State Farm Lloyds informed Griggs that the sworn proof of loss forms were never received, and requested that he forward additional information, including completed personal property inventory forms (provided by State Farm Lloyds) and supporting documentation. Griggs received the letter in October 1995, and informed State Farm Lloyds that the information was being copied by a third party.

In November 1995, Griggs and the assigned claims agent arranged to meet to discuss Griggs' documentation. The State Farm Lloyds agent missed two scheduled meetings. Later that month, another State Farm Lloyds representative sent Griggs a reservation of rights letter indicating that State Farm Lloyds had not received required and requested documentation, and that State Farm Lloyds was not waiving any rights arising from Griggs' failure to comply with policy terms requiring him to document his loss.

In December 1995, Griggs met with State Farm Lloyds representative to review the status of his claim. State Farm Lloyds explained to Griggs the documentation of items stolen and their values that was required to process his claim. In mid-December 1995, three years after the loss, Griggs provided State Farm Lloyds with an inventory of the items stolen. The inventory was not provided on the standardized forms provided by State Form for the purpose, but was instead compiled using a variety of undecipherable and inconsistent recording systems. State Farm Lloyds hired an accountant and a sports card expert to interpret the Griggs inventories. Sample pages in the summary judgment record from the approximately 1,000 page inventory do not ascribe values or cost bases to the items cryptically described. Moreover, the inventory apparently reflects all of Griggs' collection without delineating which items were stolen, which had been recovered, and which were still missing. State Farm Lloyds' accountant asked for a variety of documents that would help to substantiate Griggs' claim. Griggs refused to tender all of the documents, but did give the accountant twenty boxes of personal financial records, which contained everything from receipts for dry cleaning to receipts for cards that were not being reported stolen. At some point, the accountant reduced the Griggs inventories to spreadsheet form, which revealed that the inventories contained duplicative pages and both duplicative and illegible entries. Neither State Farm Lloyds nor the experts hired for the purpose were able to document Griggs' claim for him from the materials provided.

On January 22, 1996, State Farm Lloyds sent Griggs a detailed letter by certified mail advising Griggs that he had not complied with his duties under the policy to provide a sworn proof of loss, an accurate inventory with supporting documentation, and access to all of the pertinent records and documents. The State Farm Lloyds policy provides, in relevant part:

3. YOUR DUTIES AFTER LOSS. In case of a loss to covered property caused by a peril insured against, you must:

d. furnish a complete inventory of damaged personal property showing the quantity, description and amount of loss. Attach all bills, receipts and related documents which you have that justify the figures in the inventory.

e. as often as we reasonably require:

(2) provide us with pertinent records and documents that we request and permit us to make copies.

f. send to us or our agent, if we request, your signed sworn proof of loss within 91 days of our request on a standard form supplied by us.

There is no dispute about the fact that the policy is worded in such a way that the insured's compliance with each of these duties is a condition precedent to coverage.

State Farm Lloyds informed Griggs that, notwithstanding Griggs' failure to respond to requests made in February 1993, June 1993, June 1995, and November 1995 for a sworn proof of loss, State Farm Lloyds was willing to extend the deadline for filing a sworn and notarized proof of loss one final time. The letter unequivocally stated that Griggs would have ninety-one days from the date he received the certified letter to file a...