Allstate Vehicle & Prop. Ins. Co. v. Scott

• Decision Date: 31 March 2020
• Docket Number: 1:18-CV-1461 (LEK/CFH)
• Citation: 450 F.Supp.3d 230
• Parties: ALLSTATE VEHICLE AND PROPERTY INSURANCE COMPANY, Plaintiff, v. Lisa H. SCOTT, et al., Defendants.
• Court: U.S. District Court — Northern District of New York

450 F.Supp.3d 230

ALLSTATE VEHICLE AND PROPERTY INSURANCE COMPANY, Plaintiff,

v.Lisa H. SCOTT, et al., Defendants.

1:18-CV-1461 (LEK/CFH)

United States District Court, N.D. New York.

Signed March 31, 2020

Karen M. Berberich, Lewis, Johs Law Firm, Islandia, NY, for Plaintiff.

Arthur R. Frost, Frost, Kavanaugh Law Firm, Troy, NY, for Defendant Marie Barbera.

Steven Jay Monn, Penino & Moynihan, LLP, White Plains, NY, for Defendants Luis Marmolejo, Alexandra Maria Joa-Gilbert.

MEMORANDUM-DECISION AND ORDER

Lawrence E. Kahn, U.S. District Judge

I. INTRODUCTION

Plaintiff Allstate Vehicle and Property Insurance Company seeks a declaratory judgment under 28 U.S.C. § 2201 and Federal Rule of Civil Procedure 57¹ that it has no obligation to defend or indemnify its insured, Lisa H. Scott, in an underlying personal injury action filed in New York state court ("Underlying Action"). Dkt. Nos. 1 ("Complaint"); 1-1 ("State Court Complaint"); 1-2 ("Scott's Allstate Home & House Policy" or the "Policy"). In addition to Scott, several individuals involved in the Underlying Action are defendants in this case, including Marie Barbera, Luis Marmolejo, and Alexandra Maria Joa-Gilbert. Compl.; State Court Compl. Plaintiff has moved for judgment on the pleadings pursuant to Federal Rule of Civil Procedural 12(c). Dkt. Nos. 22 ("Rule 12(c) Motion"); 22-1 ("Plaintiff's Memorandum"). Marmolejo and Joa-Gilbert have collectively opposed the Rule 12(c) Motion, Dkt. Nos. 24 ("Marmolejo and Joa-Gilbert Opposition"); 24-1 ("Marmolejo and Joa-Gilbert Memorandum"), as has Barbera, Dkt. Nos. 27 ("Barbera Opposition"); 27-1 ("Barbera Memorandum").² Plaintiff has filed a single reply to the oppositions. Dkt. No. 29 ("Reply").

For the reasons that follow, Plaintiff's Rule 12(c) Motion is granted.

II. BACKGROUND

"On a [Rule] 12(c) motion, the court considers ‘the complaint, the answer, any written documents attached to them, and any matter of which the court can take judicial notice for the factual background of the case.’ " L-7 Designs, Inc. v. Old Navy, LLC, 647 F.3d 419, 422 (2d Cir. 2011) (quoting Roberts v. Babkiewicz, 582 F.3d 418, 419 (2d Cir. 2009) ). "A complaint is deemed to include any written instrument attached to it as an exhibit, materials incorporated in it by reference, and documents that, although not incorporated by reference, are ‘integral’ to the complaint." Id. (quoting Sira v. Morton, 380 F.3d 57, 67 (2d Cir. 2004) ).

A. The Underlying Action

On June 10, 2017, Marmolejo, Joa-Gilbert, Barbera, and Barbera's son, J.B., were at Scott's home. Compl. ¶ 15; State Court Compl. ¶ 17. At some point after gathering at the Scott household, Scott permitted J.B. and Scott's daughter³ to travel in a 2016 Kia automobile owned by Joa-Gilbert yet driven by Marmolejo. Compl. ¶¶ 11–14, 16; State Court. Compl. ¶ 13. J.B., Scott's daughter, and Marmolejo then got into a car accident. Compl. ¶ 10.

Barbera, individually and on behalf of J.B., has sued Scott for negligently allowing J.B. to ride in a vehicle with an insufficient number of seatbelts to restrain all passengers as required by New York Vehicle Traffic Law § 501(2)(a) and with a driver, Marmolejo, who possessed a "Class DJ" (i.e., junior) license. Compl. ¶ 17; State Court Compl. ¶¶ 13–14. Barbera further alleges that Scott unreasonably endangered J.B.'s physical safety and negligently inflicted emotional distress upon J.B. State Court Compl. ¶¶ 48–49. She also seeks recovery from Scott, Marmolejo, and Joa-Gilbert for loss of J.B.'s "services, society, and companionship" and the expenses she incurred for J.B.'s "hospital, medical and psychological care and treatment." Id. ¶ 60.

B. The Insurance Policy

Plaintiff initially agreed to defend Scott in the Underlying Action based on Scott's Policy that she had with Plaintiff at the time of the June 10, 2017 car accident. Compl. ¶ 19. Subsequently, Plaintiff "issued a disclaimer of coverage based upon the motor vehicle exclusion and the negligent supervision exclusion" in the Policy. Id.

The "Motor Vehicle Exclusion" states in pertinent part:

We do not cover bodily injury or property damage arising out of the ownership, maintenance, use, occupancy, renting, loaning, entrusting, loading or unloading of any motor vehicle or trailer. We will not apply this exclusion to:

a) a motor vehicle in dead storage or used exclusively on an insured premises;

b) any motor vehicle designed principally for recreational use off public roads, unless that vehicle is owned by an insured person and is being used away from an insured person;

c) a motorized wheelchair;

d) a vehicle used to service an insured premises which is not designed for use on public road and not subject to motor vehicle registration;

e) a golf cart owned by an insured person when used for golfing purposes;

f) a trailer of the boat, camper, home or utility type unless it is being towed or carried by a motorized land vehicle;

g) lawn or garden implements under 40 horsepower; or

h) bodily injury to a residence employee.

Policy at 20.

The "Negligent Supervision Exclusion" states in pertinent part:

We do not cover bodily injury or property damage arising out of:

a) the negligent supervision by any insured person of any person;

* * *

arising from the ownership, maintenance, use, occupancy, renting, loaning, entrusting, loading or unloading of any aircraft, watercraft, hovercraft, motorized land vehicle or trailer which is not covered under Section II of this policy.

Id.

C. Plaintiff's Claims

Plaintiff alleges that the Motor Vehicle Exclusion and the Negligent Supervision Exclusion bar coverage for the claims levied against Scott in the Underlying Action. Compl. ¶¶ 24–44. Plaintiff also avers that Barbera's claim for loss of services, society, and companionship is barred since such injuries do not qualify as bodily injury or property damage under the Policy. Id. ¶¶ 45–55. Plaintiff seeks a declaratory judgment that it has no duty to defend or indemnify Scott against Barbera's claims in the Underlying Action because the Policy does not cover those claims. Id. ¶¶ 30, 41, 52.

III. LEGAL STANDARD

Any party may move for judgment on the pleadings "[a]fter the pleadings are closed—but early enough not to delay trial." Fed. R. Civ. P. 12(c). "Judgment on the pleadings is appropriate where material facts are undisputed and where a judgment on the merits is possible merely by considering the contents of the pleadings." Sellers v. M.C. Floor Crafters, Inc., 842 F.2d 639, 642 (2d Cir. 1988). Courts will assess whether judgment on the pleadings is warranted "by the same standard as Rule 12(b)(6) motions to dismiss for failure to state a claim upon which relief can be granted." Rubeor v. Town of Wright, 191 F. Supp. 3d 198, 202–03 (N.D.N.Y. 2016) (Kahn, J.). To survive a motion to dismiss under Rule 12(b)(6), "a complaint must contain sufficient factual matter ... ‘to state a claim to relief that is plausible on its face.’ " Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). The plausibility standard "asks for more than a sheer possibility that a defendant has acted unlawfully." Id. at 678, 129 S.Ct. 1937 (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955 ). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. Put another way, a claim is plausible if it is supported by "enough fact[s] to raise a reasonable expectation that discovery will reveal evidence of [the alleged misconduct]." Twombly, 550 U.S. at 556, 127 S.Ct. 1955. In assessing whether this standard has been met, courts must "accept as true all allegations in the complaint." Houston v. Colvin, No. 12-CV-3842, 2014 WL 4416679, at *4 (E.D.N.Y. Sept. 8, 2014) (quoting Vietnam Ass'n for Victims of Agent Orange v. Dow Chem. Co., 517 F.3d 104, 115 (2d Cir. 2008) ). "[B]ecause [the] plaintiff is the moving party, the Court will view the pleadings in the light most favorable to, and draw all reasonable inferences in favor of [the] defendant[s]." Am. Mgmt. Servs., Inc. v. Ray Weiner, LLC, No. 12-CV-947, 2014 WL 381470, at *1 (D. Conn. Feb. 3, 2014) (citing Madonna v. U.S., 878 F.2d 62, 65 (2d Cir. 1989) ).

IV. DISCUSSION

Before determining whether Plaintiff has a duty to defend and indemnify Scott, the Court must determine which jurisdiction's law applies to this action.

A. Choice of Law

Plaintiff has invoked the Court's diversity jurisdiction over this case. Compl. ¶ 7. "A federal court sitting in diversity ... must apply the substantive law of the state in which it is sitting, including the state's choice of law rules." Young Men's Christian Ass'n of Plattsburgh v. Philadelphia Indem. Ins. Co., No. 18-CV-565, 2018 WL 6267923, at *3 (N.D.N.Y. Nov. 30, 2018) (Kahn, J.) (citing Erie R.R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938) ). Plaintiff argues that New York law applies to this action. Pl.'s Mem. at 7–8.⁴ Barbera, Marmolejo, and Joa-Gilbert do not contest this assertion, and, in any event, the Court agrees with Plaintiff. See Young Men's Christian Ass'n of Plattsburgh, 2018 WL 6267923, at *3 ("The dispute here must be resolved under New York Law, as the [insurance] policy was issued to a New York [resident] insuring activities and property in New York."). Therefore, the Court applies New York law to this case.

B. Duty to Defend and Indemnify

Because the parties agree the Policy governs the dispute, there are no issues of material fact regarding Plaintiff's obligation to defend or indemnify Scott in the Underlying Action. Hence, the Court must determine whether Plaintiff has a duty to defend and indemnify Scott under the Policy "as a matter of law." See Great Am. Ins. Co. v. Houlihan Lawrence, Inc., No. 19-CV-1055, 2020 WL 1487294, at *6 (S.D.N.Y. Mar. 27, 2020) (citing Sellers v. M.C. Floor Crafters, Inc., 842...