Allstate Ins. Co. v. Naai

• Decision Date: 22 January 2010
• Docket Number: CV. No. 09-00350 DAE/BMK.
• Citation: 684 F. Supp.2d 1220
• Parties: ALLSTATE INSURANCE COMPANY, an Illinois Corporation, Plaintiff, v. David A. NAAI, individually, and as Trustee for the Herman H.A. Naai Trust and Trustee for the Helen Y. Naai Trust, Defendant.
• Court: U.S. District Court — District of Hawaii

684 F.Supp.2d 1220

ALLSTATE INSURANCE COMPANY, an Illinois Corporation, Plaintiff, v. David A. NAAI, individually, and as Trustee for the Herman H.A. Naai Trust and Trustee for the Helen Y. Naai Trust, Defendant.

CV. No. 09-00350 DAE/BMK.

United States District Court, D. Hawai`i.

January 22, 2010.

David R. Harada-Stone, Richard B. Miller, Tom Petrus & Miller, LLLC, Honolulu, HI, for Plaintiff.

Daniel T. Kim, Chee Markham & Feldman, Honolulu, HI, for Defendant.

ORDER GRANTING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT

DAVID ALAN EZRA, District Judge.

On January 19, 2010, the Court heard Plaintiff's Motion. Richard B. Miller, Esq., appeared at the hearing on behalf of Plaintiff; Daniel T. Kim, Esq., appeared at the hearing on behalf of Defendant. After reviewing the motion and the supporting and opposing memoranda, the Court GRANTS Plaintiff's Motion.

BACKGROUND

Plaintiff Allstate Insurance Company ("Plaintiff" or "Allstate") and Defendant David A. Naai, individually and as Trustee of the Herman A.H. Naai Trust and the Helen Y. Naai Trust ("Defendant" or "Naai") agree on all material facts, leaving no genuine issue of material fact before this Court.

I. The Underlying Lawsuit

On March 6, 2009, Adam Aku, individually and as Personal Representative of the Estate of Teyisa Punahelekeipipi Ipukalanio `Kekapua `Ikeakua Aku ("Teyisa"), a deceased minor, and as next friend of Keakaokalani Aku ("Keaka"), a minor; and Chantell Burke, individually and as next friend for Skyler Burke ("Skyler"), a minor, (collectively the "plaintiffs") filed a complaint in the First Circuit Court against various defendants, including Allstate insured Herman A.H. Naai, the Herman A.H. Naai Trust, Helen Y. Naai, the Helen Y. Naai Trust and David A. Naai in an action denominated Adam Aku, et al. v. Sherisse L. Thompson, et al., Civil No. 09-1-0533-03 EEH (the "Underlying Lawsuit"). (Plaintiff's Statement of Concise Facts "PSCS" ¶ 1, Doc. # 13.)

The facts in the Underlying Lawsuit are both tragic and compelling. The complaint alleges that Herman and Helen Naai, their respective trusts, and David Naai held legal title to property located at 53-224 Kamehameha Highway in Hauula, on which was situated a cluster of cabins and other structures. According to the plaintiffs, the Naais rented out the subject property and were its landlords. Also according to the plaintiffs, several other individuals and entities named as defendants in the Underlying Lawsuit acted as managers for the property. They further allege that they had entered into a rental agreement with the Naais and/or the property's managers and were living in Cabin H-2 on the property. (Id. ¶ 2.)

The complaint in the Underlying Lawsuit states that on or about March 6, 2007 another of the defendants, Sherisse L. Thompson, was reversing an SUV on a common area/playground area next to the resident manager's dwelling on the rental property when the vehicle struck 2-year-old Teyisa and her 4-year-old brother, Keaka. Teyisa was killed and Keaka seriously injured. Also according to the Complaint, plaintiffs Adam Aku, Chantell Burke and Teyisa's brother Skyler witnessed the accident. (Id. ¶ 3.)

According to the plaintiffs, Teyisa and Keaka were playing with the children of other tenants of the property at the time of the accident. Ms. Thompson had allegedly just picked up her son from the resident manager's dwelling when she was backing up near the children. (Id. ¶ 4.)

The plaintiffs allege that the Naais and their managing agents had a duty to prevent injury to children who they knew or should have known would be playing in the area where the accident occurred and breached that duty by allowing the resident manager's dwelling to be built in the middle of a common/playground area and allowing vehicles to drive and park on the common/playground area next to the resident manager's dwelling. The plaintiffs further allege that the Naai parties' negligence resulted in an unsafe and dangerous condition on the rental property. The plaintiffs also contend that the proximity of the common/playground area to the resident manager's dwelling and parking area created an attractive nuisance. (Id. ¶ 5.) The plaintiffs in the Underlying Lawsuit seek special and general damages, prejudgment interest, attorneys' fees and costs. (Id. ¶ 6.)

II. The Policy

Allstate issued a comprehensive personal liability Policy No. XXXXXXXXX to Herman Naai with an effective date of April 13, 1995 (the "Policy"). (Id. ¶ 7.) The Policy was in effect on the date of the subject accident. The Policy is written on form U10173, which includes the following liability insuring language:

Part 1 Coverage X—Family Liability Protection

Losses We Cover

We will pay all sums arising from a loss which an insured person becomes legally obligated to pay as damages because of bodily injury or property damage covered by this part of the policy.

We may investigate or settle any claim or suit for covered damages against an insured person. If an insured person is sued for these damages, we will provide a defense with counsel of our choice. We will defend even if the allegations are not true. We are not obligated to pay any claim or judgment or defend any suit after we have exhausted the limit of our liability.

(Id. ¶ 8 (emphasis in original).) The Policy also includes the following exclusion under both Part 1 Coverage X—Family Liability Protection and Part 2 Coverage Y—Guest Medical Protection:

Exclusions—Losses We Do Not Cover

. . . .

5. We do not cover bodily injury or property damage arising out of the ownership; operation; maintenance; use; occupancy; renting; loaning; entrusting; loading or unloading of any motorized land vehicle or trailer. This exclusion does not apply to:

a) a motorized land vehicle in dead storage or used exclusively on the residence premises;

b) any motorized land vehicle designed principally for recreational use off public roads, unless that vehicle is owned by an insured person and is being used away from the residence premises.

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

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

e) bodily injury to a residence employee.

....

(Id. ¶ 9 (emphasis in original).) The Policy also includes the following relevant definitions:

Definitions Used Throughout This Policy

1. "You" or "your"—mean the policyholder named on the declarations page and that policyholder's resident spouse.

....

3. "Insured Person"—means you and, if a resident of your household, any relative and any dependent person in your care.

Under the Family Liability Protection and Guest Medical Protection coverage, "insured person" also means:

a) any person or organization legally responsible for loss caused by animals or watercraft we cover which are owned by an insured person. We will not cover any person or organization using or having custody of animals or watercraft in any business or without permission of the owner.

b) with respect to the use of any vehicle we cover, any person while engaged in the employment of an insured person.

....

6. "Insured Premises"—means:

a) the residence premises; and

b) any other residence premises described on the declarations page;

c) any other residence premises acquired by you during the premium period;

d) any part of a premises not owned by an insured person but where an insured person in living temporarily;

e) cemetery plots or burial vaults owned by an insured person;

f) vacant land, other than farm land, owned by or rented to an insured person;

g) land owned by or rented to an insured person where a one, two, three or four family dwelling is being built as that person's residence.

....

9. "Residence Premises"—means a one, two, three or four family dwelling, where you reside, including other structures and land, which is described on the declarations page.

(Id. at ¶ 10 (emphasis in original).) The Policy also includes the following provision:

We Make The Following Agreements With You

....

4. Continued Coverage After Death

If you die, coverage will continue until the end of the premium period for:

a) Your legal representative but only with respect to your insured premises and property covered under this policy on the date of your death.

b) Any person having proper temporary custody of your insured premises until a qualified legal representative is appointed.

c) An insured person.

(Id. ¶ 11 (emphasis in original).) David Naai¹ has tendered defense of the Underlying Lawsuit to Allstate under the Policy.

On July 29, 2009, Allstate filed a Complaint for Declaratory Judgment asking this Court to find that Allstate has no duty to defend and/or indemnify Naai in any capacity under the Policy for the claims asserted against him in the Underlying Lawsuit, and for, costs, reasonable attorneys' fees, and any other relief awarded by the Court. (Doc. # 1.) On September 4, 2009, Defendant filed his Answer. (Doc. # 8.) On November 17, 2009, Plaintiff filed the instant Motion for Summary Judgment ("MSJ," Doc. # 12) and its Separate and Concise Statement of Facts. ("PSCS," Doc. # 13.) On December 29, 2009, Defendant filed his Opposition ("Opp'n," Doc. # 17) and Separate and Concise Statement of Facts. ("DSCS," Doc. # 18.) On January 5, 2010, Plaintiff filed its Reply. (Doc. # 19.)

STANDARD OF REVIEW

Rule 56 requires summary judgment to be granted when "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 that the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c); see also Porter v. Cal. Dep't of Corr., 419 F.3d 885, 891 (9th Cir.2005); Addisu v. Fred Meyer, Inc., 198 F.3d 1130, 1134 (9th Cir. 2000). A main purpose of summary judgment is to dispose of factually unsupported claims and defenses. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 106 S.Ct. 2548, 91 L.Ed.2d 265 (198...