Auto-Owners Ins. Co. v. Bailey

Decision Date27 March 2019
Docket NumberCASE NO.: 1:18-CV-38 (WLS)
Parties AUTO-OWNERS INSURANCE COMPANY, Plaintiff, v. Eric B. BAILEY, et al., Defendants.
CourtU.S. District Court — Middle District of Georgia

Melissa Kaye Kahren, Mark T. Dietrichs, Atlanta, GA, for Plaintiff.

Joseph Shane Hudson, James Lory King, II, Tifton, GA, for Defendants.

ORDER

W. LOUIS SANDS, SR. JUDGE

Before the Court is a Motion for Summary Judgment filed by Plaintiff Auto-Owners Insurance Company ("Auto-Owners"). (Doc. 14.) For the following reasons, Auto-Owners' Motion for Summary Judgment (Doc. 14) is GRANTED .

I. PROCEDURAL HISTORY

Plaintiff Auto-Owners filed a Complaint on February 15, 2018 seeking a declaratory judgment pursuant to Rule 57 of the Federal Rules of Civil Procedure and 28 USC § 2201. (Doc. 1.) The Complaint is brought against: Eric R. Bailey and Lauren T. Bailey, individually and d/b/a The Market Place Boutique (collectively, the "Market Place Defendants"); Susan Wiley, individually and d/b/a Place On The Pointe, Place On The Pointe, Inc. (collectively, the "Place On The Pointe Defendants"); and Mary Hood Stewart and Allen Stewart, III (collectively, the "Stewart Defendants"). Id. ¶ 1. In its Complaint, Plaintiff seeks "a declaration from this Court that no indemnification or duty to defend is owed to The Market Place Defendants for any liability or damages that may be incurred by The Market Place Defendants in [an] underlying lawsuit because they did not provide timely notice of the claim or suit under the terms and conditions of the policy." Id. ¶ 38. Plaintiff also seeks "a declaration from this Court that no indemnification or duty to defend is owed to the Market Place Defendants for any liability or damages to the extent that any of the Market Place Defendants do not qualify as ‘insureds’ under the policy." Id. ¶ 44.

On July 25, 2018, Plaintiff filed a Motion for Summary Judgment. (Doc. 14.) The Stewart Defendants timely responded thereto, and after receiving an extension, Plaintiff timely replied. (Docs. 17 & 23.) Accordingly, Plaintiff's Motion for Summary Judgment (Doc. 14) is ripe for review. See M.D. Ga. L.R. 7.3.1(A).

II. SUMMARY JUDGMENT STANDARD

A. Federal Rule of Civil Procedure 56

"Summary judgment is appropriate if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Chow v. Chak Yam Chau , 555 F. App'x 842, 846 (11th Cir. 2014) (citing Maddox v. Stephens , 727 F.3d 1109, 1118 (11th Cir. 2013) ). " ‘A genuine issue of material fact does not exist unless there is sufficient evidence favoring the nonmoving party for a reasonable jury to return a verdict in its favor.’ " Grimes v. Miami Dade Cnty. , 552 F. App'x 902, 904 (11th Cir. 2014) (quoting Chapman v. AI Transp. , 229 F.3d 1012, 1023 (11th Cir. 2000) ). "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." Allen v. Tyson Foods, Inc. , 121 F.3d 642, 646 (11th Cir. 1997) (citing Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ). "It is ‘genuine’ if the record taken as a whole could lead a rational trier of fact to find for the non-moving party." Tipton v. Bergrohr GMBH-Siegen , 965 F.2d 994, 998 (11th Cir. 1992) (citing Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) ).

The movant bears the initial burden of showing, by citing to the record, that there is no genuine issue of material fact. See Celotex Corp. v. Catrett , 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ; Barreto v. Davie Market Place, LLC , 331 F. App'x 672, 673 (11th Cir. 2009). The movant can meet that burden by presenting evidence showing there is no dispute of material fact, or by demonstrating that the nonmoving party has failed to present evidence in support of some element of its case on which it bears the ultimate burden of proof. See Celotex , 477 U.S. at 322-24, 106 S.Ct. 2548. Once the movant has met its burden, the nonmoving party is required "to go beyond the pleadings" and identify "specific facts showing that there is a genuine issue for trial." Id. at 324, 106 S.Ct. 2548. To avoid summary judgment, the nonmoving party must "do more than simply show that there is some metaphysical doubt as to the material facts.’ " Matsushita , 475 U.S. at 586, 106 S.Ct. 1348 (citations omitted). Instead, the non-movant must point to record evidence that would be admissible at trial. See Jones v. UPS Ground Freight , 683 F.3d 1283, 1294 (11th Cir. 2012) (quoting Macuba v. Deboer , 193 F.3d 1316, 1322 (11th Cir. 1999) ) (noting that hearsay may be considered on a motion for summary judgment only if it "could be reduced to admissible evidence at trial or reduced to admissible form."). Such evidence may include affidavits or declarations that are based on personal knowledge of the affiant or declarant. See Fed. R. Civ. P. 56(c)(4).

On a motion for summary judgment, the Court must view all evidence and factual inferences drawn therefrom in the light most favorable to the nonmoving party and determine whether that evidence could reasonably sustain a jury verdict. See Matsushita , 475 U.S. at 587-88, 106 S.Ct. 1348 ; Allen , 121 F.3d at 646. However, the Court must grant summary judgment if there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c).

1. Local Rule 56

Local Rule 56 requires the following:

The respondent to a motion for summary judgment shall attach to the response a separate and concise statement of material facts, numbered separately, to which the respondent contends there exists a genuine issue to be tried. Response shall be made to each of the movant's numbered material facts. All material facts contained in the moving party's statement which are not specifically controverted by the respondent in respondent's statement shall be deemed to have been admitted, unless otherwise inappropriate.

M.D. Ga. L.R. 56. Here, Plaintiff properly filed a summary judgment motion with a statement of undisputed material facts, as required by the Federal Rules of Civil Procedure and the Local Rules of this Court. (Docs. 14 & 14-2.) The Stewart Defendants then filed a response to Defendants' statement of material facts. (Doc. 18.) Having established the applicable standards, the Court will proceed to the facts.

III. RELEVANT FACTUAL BACKGROUND

The following facts are derived from the Complaint (Doc. 1); the Stewart Defendants' Answer (Doc. 5); Plaintiff's Statements of Undisputed Material Facts (Doc. 14-2); the Stewart Defendants' Response to Plaintiff's Statement of Undisputed Material Facts (Doc. 18); and the record in this case. Where relevant, the factual summary also contains undisputed and disputed facts derived from the pleadings, the discovery and disclosure materials on file, and any affidavits, all of which are construed in a light most favorable to the Stewart Defendants as the nonmoving party. See Fed. R. Civ. P. 56 ; Matsushita , 475 U.S. at 587-88, 106 S.Ct. 1348.

This insurance case arises from a lawsuit filed on May 8, 2017 by Defendants Mary Hood Stewart and Allen Stewart, III in the State Court of Dougherty County, Georgia, styled Mary Hood Stewart and Allen Stewart, III. v. Susan Wiley, individually and d/b/a Place On The Pointe, Place On The Pointe, Inc., Eric R. Bailey and Lauren T. Bailey, individually and d/b/a The Market Place Boutique , civil action file number 17SCV104 (the "underlying suit"). (Doc. 18 ¶ 1.) In the underlying suit, the Stewart Defendants seek damages and other relief against The Market Place Defendants, as well as Defendant Wiley and Defendant Place On The Pointe, Inc., related to alleged bodily injury and other alleged injuries and damages suffered as a result of an alleged slip and fall incident on or near the Market Place Defendants' premises on or about January 11, 2016. (Id. ¶ 2; Doc. 13-1.) The Market Place Defendants apparently contend that they are not at fault for the slip and fall and are not sure whether it occurred on their property. (Doc. 17 at 5; Doc. 13-11 at 6.) In the underlying suit, Plaintiff is providing a defense under a "complete reservation of rights," reserving the rights to either "withdraw its defense and/or disclaim coverage and indemnification for all or part of any judgment that may be obtained against the Market Place Defendants." (Doc. 18 ¶¶ 6-7.)

Although the Market Place Defendants were served with a copy of the summons and complaint in the underlying suit on May 16, 2017, they did not timely file an answer on or before June 15, 2017 to prevent the case from automatically going into default. (Doc. 18 ¶¶ 9-11; Doc. 17-8 at 1-2.) They did, however, file an answer on June 21, 2017, which the State Court of Dougherty County treated as sufficient to open default as a matter of right. (Doc. 17-8 at 1-4.) The Market Place Defendants also did not timely serve responses to the Stewart Defendants' requests for admissions, but were thereafter granted permission to serve responses, and those responses have been deemed timely. (Doc. 17-8 at 6-7.)

It appears that the Market Place Defendants notified Plaintiff of the underlying lawsuit for the first time on October 30, 2017, almost six months after the Stewart Defendants filed the underlying suit. (Doc. 18 ¶ 22.) Thereafter, counsel retained by Auto-Owners moved to open default and to withdraw the Market Place Defendants' Admissions. (Id. ¶ 23; Doc. 13-8.)

In the instant lawsuit, the Market Place Defendants' Answers to the Complaint were due in May 2018, but to date, they have filed no Answer. (Doc. 18 ¶ 28.) Plaintiff issued policy number 49-176-398-00 to named insured The Market Place with effective dates from June 1, 2015 through ...

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