Allstate Fire & Cas. Ins. Co. v. Paolino

• Decision Date: 04 May 2015
• Docket Number: CASE NO. 14-61934-CIV-ALTONAGA/O'Sullivan
• Court: U.S. District Court — Southern District of Florida
• Parties: ALLSTATE FIRE AND CASUALTY INSURANCE COMPANY, Plaintiff, v. LOUIS PAOLINO; JOHN NIXON, III; and DOROTHY MAE STEDMAN, Defendants.

ALLSTATE FIRE AND CASUALTY INSURANCE COMPANY, Plaintiff, v. LOUIS PAOLINO; JOHN NIXON, III;and DOROTHY MAE STEDMAN, Defendants.

CASE NO. 14-61934-CIV-ALTONAGA/O'Sullivan

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA MIAMI DIVISION

May 4, 2015

ORDER

THIS CAUSE came before the Court for oral argument on April 30, 2015 [ECF No. 49], regarding Plaintiff, Allstate Fire and Casualty Insurance Company's ("Allstate['s]") Motion for Summary Judgment . . . ("Motion") [ECF No. 36], filed along with a Statement of Material Facts Not in Dispute . . . ("Pl.'s SMF") [ECF No. 37], on March 16, 2015. Defendants, Louis Paolino ("Paolino") and Dorothy Mae Stedman ("Stedman") (together, "Defendants"), filed their Response in Opposition . . . ("Response") [ECF No. 38], along with a Statement of Material Facts Not in Dispute . . . ("Defs.' SMF") [ECF No. 39], on April 2, 2015. Defendant, John Nixon, III ("Nixon") did not respond. Allstate filed its Reply . . . ("Reply") [ECF No. 40], on April 9, 2015. The Court has carefully reviewed the parties' written and oral submissions, the record, and applicable law.

I. UNDISPUTED MATERIAL FACTS

Allstate issued Paolino an automobile insurance policy ("Policy") for the period July 14, 2011 to December 25, 2011. (See Complaint . . . [ECF No. 1] Composite Ex. A [ECF No. 1-5]; see also Pl.'s SMF ¶ 1). The Policy carried liability coverage in the amount of $250,000 for eachperson and $500,000 per occurrence, subject to its terms, limitations, and exclusions. (See id. ¶ 2). At the time of the accident at issue, the Policy listed four automobiles on the declarations pages: a 2010 Land Rover Range Rover, a 2011 Mercedes Benz, a 2011 Land Rover, and a 2008 Mercedes Benz. (See id. ¶ 3).

The insuring obligation and the liability coverage provisions of the Policy are found at "Part I - Automobile Liability Insurance Bodily Injury - Coverage AA Property Damage - Coverage BB," and state in part:

We will pay for all damages an insured person is legally obligated to pay because of bodily injury or property damage.

Under these coverages, your policy protects an insured person from claims for accidents arising out of the ownership, maintenance or use, loading or unloading of the auto we insure.

We will defend an insured person if sued as the result of a covered auto accident. We will defend that person at our own expense, with counsel of our choice and, [sic] may settle any claim or suit if we feel this is appropriate. We will not defend an insured person sued for damages which are not covered by this policy.

(Policy 27¹ (emphasis in original; alteration added)). "We," "us," or "our" in the Policy refers to Allstate; "you" or "your" is defined as "the policyholder named on the Policy Declarations and that policyholder's resident spouse." (Id. 10, 21 (emphasis in original)). In this case, "Louis D [sic] and Sarah Jo Paolino Jr [sic]" (together, the "Paolinos") appear as the "policyholder." (Id. (alterations added)).

"Insured person" is defined as follows:

a. While using your insured auto

(i) you;

(ii) any resident[;] or

(iii) any other person using it with your permission; b. While using a non-owned auto

(i) you[;]

(ii) any resident relative of your household using a four wheel private passenger auto or utility auto; or

c. Any other person or organization liable for the use of an insured auto if the auto is not owned or hired by that person or organization, provided the use is by an insured person under 1. or 2. above and then only for that person's acts or omissions.

(Id. 28 (emphasis in original; alterations added)).

The Policy defines "insured auto" as follows:

a. any auto described on the Policy Declarations. This includes the four wheel private passenger auto or utility auto with which you replace it;

b. an additional four wheel private passenger auto or utility auto of which you acquire ownership during the policy period.

The additional four wheel private passenger auto or utility auto will be covered by us for 30 days immediately after you acquire ownership if:

(i) we or one of our affiliates insures all other auto(s) you own;

(ii) the newly acquired four wheel private passenger auto or utility auto is not covered under any other automobile insurance policy; and

(iii) you pay any additional premium.

Coverage will be continued beyond this 30-day period only if:

(i) you ask us to continue coverage within 30 days after you acquire the additional four wheel private passenger auto or utility auto;

(ii) we or one of our affiliates agrees to continue coverage for this additional four wheel private passenger auto or utility auto; and

(iii) you pay any additional premium.

c. a substitute four wheel private passenger auto or utility auto, not owned by you or a resident, being temporarily used with the permission of the owner while your insured auto is being serviced or repaired, or if your insured auto is stolen or destroyed;

d. a non-owned auto used by you or a resident relative with the owner's permission. This auto must not be available or furnished for the regular use of an insured person; ore. a trailer, while attached to an insured auto, as defined in a. through d. above, designed for use with an auto. This trailer can not [sic] be used for business purposes with other than a four wheel private passenger auto or utility auto.

(Id. 27-28 (emphasis in original; alteration added)).

Among the Policy's exclusions, with regard to "damages an insured person is legally obligated to pay," Allstate "will not pay": "10. bodily injury or property damage arising out of the use of a non-owned auto, substitute auto or non-owned utility auto, being driven by someone other than you or a resident relative." (Id. (emphasis in original)).

Paolino is one of the policyholders named in the Policy's declarations. (See Pl.'s SMF ¶ 9). Nixon brought an action in the state court in Broward County, Florida ("state court case"), naming Stedman and Paolino as defendants. (See id. ¶ 10). In the state court case, Nixon alleges Paolino rented a car that Stedman operated with Paolino's permission and consent. (See id. ¶ 12). The state court complaint alleges Stedman negligently operated the rental vehicle, colliding with Nixon. (See id. ¶ 13). At the time of the accident, Stedman was not related to Paolino, but rather was employed as his housekeeper. (See id. ¶¶ 14-15).

The car driven by Stedman was not owned by Paolino, but was rented by him from Enterprise Leasing Company ("Enterprise"). (See id. ¶¶ 16, 18). The car was used by Stedman exclusively for the benefit of Paolino. (See Defs.' SMF ¶ 21). At the time of the accident, Stedman was returning to the Paolino residence after having picked up items for Paolino at Wal-Mart. (See id. ¶¶ 22, 24). The only person to use the car involved in the accident was Stedman, and she used it solely at Paolino's request, to pick up his children, shop, and complete errands for him. (See id. ¶ 23). The car was primarily parked at the Paolino residence and in its garage. (See id. ¶ 25).

Paolino rented the car for Stedman to use because the car Stedman owned, a Hyundai Sonata, had been totaled in a prior accident. (See Pl.'s SMF ¶ 19). Stedman's Sonata was insured by GEICO. (See id. ¶ 20).

II. STANDARD

Summary judgment shall be rendered if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and the movant is entitled to judgment as a matter of law. See FED. R. CIV. P. 56(a), (c). In making this assessment, the Court "must view all the evidence and all factual inferences reasonably drawn from the evidence in the light most favorable to the nonmoving party," Stewart v. Happy Herman's Cheshire Bridge, Inc., 117 F.3d 1278, 1285 (11th Cir. 1997), and "must resolve all reasonable doubts about the facts in favor of the non-movant," United of Omaha Life Ins. Co. v. Sun Life Ins. Co. of Am., 894 F.2d 1555, 1558 (11th Cir. 1990). "An issue of fact is material if it is a legal element of the claim under the applicable substantive law which might affect the outcome of the case." Burgos v. Chertoff, 274 F. App'x 839, 841 (11th Cir. 2008) (quoting Allen v. Tyson Foods Inc., 121 F.3d 642, 646 (11th Cir. 1997) (internal quotation marks omitted)). "A factual dispute is genuine 'if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.'" Channa Imps., Inc. v. Hybur, Ltd., No. 07-21516-CIV, 2008 WL 2914977, at *2 (S.D. Fla. July 25, 2008) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)).

The movant's initial burden on a motion for summary judgment "consists of a responsibility to inform the court of the basis for its motion and to identify those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact."Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115 (11th Cir. 1993) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (alterations and internal quotation marks omitted)). "[T]he plain language of Rule 56 mandates the entry of summary judgment against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Jones v. UPS Ground Freight, 683 F.3d 1283, 1292 (11th Cir. 2012) (quoting Celotex, 477 U.S. at 322 (alterations and internal quotation marks omitted)). The parties agree there are no material facts in dispute.

III. ANALYSIS

A. The Parties' Positions

Allstate filed this declaratory judgment action seeking a judicial interpretation or construction of the Policy pursuant to 28 U.S.C. section 2201(a).² (See Compl. ¶¶ 1, 29). Allstate requests a declaration that there is no insurance coverage afforded by Allstate for the claims against Paolino and Stedman in the Broward County state court case, and that...