Bauco v. Hartford Fire Ins. Co., No. 375290 (Conn. Super. 3/3/2004), No. 375290

CourtSuperior Court of Connecticut
Writing for the CourtLevin
Docket NumberNo. 375290
PartiesPhilip Bauco et al. v. Hartford Fire Insurance Company.
Decision Date03 March 2004

Page 1

Unpublished Opinion

Philip Bauco et al.
Hartford Fire Insurance Company.
No. 375290
Superior Court of Connecticut
Judicial District of Fairfield at Bridgeport
March 3, 2004


The principal issue raised by the defendant insurer in its motion for summary judgment is whether the plaintiffs violated the "concealment or fraud" provision of their dwelling policy, thereby forfeiting coverage.

The plaintiffs, Philip J. Bauco and Marc Pennino, filed a two-count amended complaint alleging that the defendant, Hartford Fire Insurance Company, failed to pay for damage to their building pursuant to an insurance policy. The plaintiffs have also alleged that the defendant breached a covenant of good faith and fair dealing by refusing to make a payment pursuant to their policy.

The parties' submissions fail to reflect a genuine issue of material fact as to the following. The plaintiffs are the owners of several rental properties. The plaintiff, Philip Bauco (hereafter, the plaintiff) is responsible for the subject property, which is a three-story, four-family rental property located in Bridgeport. The third story does not completely cover the second story. The building contains four rental units.

In 1999, two or three of the units were occupied by so-called "section 8 tenants," tenants whose rent was subsidized pursuant to Section 8 of the Housing and Community Development Act of 1974. 42 U.S.C. §1437f.1 In 1999, and for at least three years prior thereto, a second-floor apartment and part of the third floor was occupied by Antoinette Williams and her children. The Williams' apartment consisted of a front bedroom, occupied by Williams, and a rear bedroom, occupied by one of her children. The third floor of the building did not cover the portion of the second floor which contained this rear bedroom.

At various times during Williams' tenancy, between 1997 and 1999, portions of the ceiling in her second-floor apartment leaked when it rained. Pursuant to the requirements of the Section 8 program, the subsidized apartment was inspected at least once a year by inspectors from the Housing Authority. On September 4, 1997, officials of the Bridgeport Housing Authority inspected Williams' apartment. The apartment failed the inspection because, as evidenced by the visible water stains, the ceiling above the front and rear bedroom leaked. The apartment failed a second inspection on October 17, 1997, but passed its third inspection on November 5, 1997, at which time the inspectors noted that the problems with the bedroom ceilings had been corrected.

In 1998, the apartment failed a total of three inspections on August 31, 1998, September 17, 1998 and October 28, 1998. The inspectors noted that the ceiling tile in a rear room was bulging and had water stains. They also observed water stains on the ceiling elsewhere in the apartment. It appears that the plaintiffs continued to receive Section 8 assistance payments that year, so apparently, the apartment must have passed inspection sometime that year.

On August 31, 1999, Williams' apartment again failed inspection because, as noted in their report, the inspectors observed that the "2nd Floor Rear Bedroom Ceiling Leaks." The inspectors directed that this condition, and other deficiencies in the apartment, be corrected in order for the apartment to pass inspection. The inspectors also noted that the Williams' apartment was an "undesirable unit," "Home is a Dump . . . Roof Leaks—Ceili[ng] Falls—Many Violations . . ." That same year, the apartment failed a second inspection on October 4, 1999, a third inspection of October 22, 1999, and a fourth inspection on November 3, 1999. The apartment finally passed its fifth inspection.

Since April 10, 1999, the plaintiffs were named insureds on a dwelling policy covering the subject property issued by the defendant. The policy provided: "We insure for direct loss to the property covered caused by . . . Windstorm or hail. This peril does not include loss . . . to the interior of a building or the property contained in a building caused by rain . . . unless the direct force of wind or hail damages the building causing an opening in a roof or wall and the rain . . . enters through the opening . . ." Under "Exclusions," the policy stated: "We do not cover loss resulting directly or indirectly from . . . Neglect, meaning your neglect to use all reasonable means to save and preserve property at and after the time of a loss, or when property is endangered by a Peril Insured Against." Under "Conditions," the policy provided: "Concealment or Fraud. We do not provide coverage if you have intentionally concealed or misrepresented any material fact or circumstance relating to this insurance." The policy further provided that in the case of a covered loss, the insured was required to submit within sixty days a sworn statement of loss stating, inter alia, the time and cause of the loss, and to submit to an examination under oath.

The plaintiffs claim in their complaint that a windstorm on September 16, 1999 in Bridgeport "caused damage to [the] roof and allowed water to enter [the] building." The plaintiffs submitted a proof of loss to the defendant, dated December 29, 1999, claiming $19,744.76 in damages. On January 11, 2000, the defendant took the plaintiffs' examination under oath, pursuant to the provisions of the policy, and on February 2000 took a recorded statement from Antoinette Williams. The defendant also obtained the 1997, 1998 and 1999 inspection reports of the Williams' apartment issued by the Bridgeport Housing Authority. After the defendant refused to pay the plaintiffs' claim, the plaintiffs brought this action. Additional facts will be set forth as necessary.

In the first count of their amended complaint, the plaintiffs allege that on April 10, 1999, the defendant issued an insurance policy insuring the plaintiffs' building against, among other losses, water damage. They further allege that on September 16, 1998 storm caused water damage to the insured building that was covered under the policy. Although the plaintiffs had given the defendant notice of the loss, the defendant has refused to pay.

Incorporating the allegations of the first count, the plaintiffs allege in the second count that the defendant has acted in bad faith in that: (1) it failed to make payment pursuant to the insurance policy when in good faith it should have; (2) it failed to adopt and implement reasonable standards for the prompt investigation of claims arising under its insurance policies, was evidenced by its refusal to pay the plaintiffs' claims prior to conducting a reasonable investigation based upon all available information, and its failure to effectuate a prompt, fair and equitable settlement of the plaintiffs' claim in which liability had become reasonably certain; and (3) it made a pretextual claim of fraud against the plaintiffs for the purpose of denying their claim.

The defendant has filed an amended answer and special defenses. The first defense, which is the only defense at issue here, is that the plaintiffs violated a provision of the policy prohibiting the intentional concealment or misrepresentation of any material fact relating to the insurance. The defendant has moved for summary judgment on the basis that the plaintiffs violated this provision of the policy.

"In seeking summary judgment, it is the movant who has the burden of showing the nonexistence of any issue of fact . . . Although the party seeking summary judgment has the burden of showing the nonexistence of any material fact . . . a party opposing summary judgment must substantiate its adverse claim by showing that there is a genuine issue of material fact together with the evidence disclosing the existence of such an issue . . . In ruling on a motion for summary judgment, it is customary for the court to review documentary proof submitted by the parties to demonstrate the existence or nonexistence of issues of material fact. Practice Book §17-45.

"Practice Book §17-49 provides in relevant part: [J]udgment . . . shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material act and that the moving party is entitled to judgment as a matter of law." "In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party . . . The party seeking summary judgment has the burden of showing the absence of any genuine issue [of] material facts which, under applicable principles of substantive law, entitle him to a judgment as a matter of law . . . and the party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact . . . The test is whether a party would be entitled to a directed verdict on the same facts." Sorban v. Sterling Engineering Corp., 79 Conn.App. 444, 447-48, 830 A.2d 372, cert. denied, 266 Conn. 925, 835 A.2d 473 (2003).


The defendant claims that it is entitled to summary judgment because the plaintiffs breached the "concealment or fraud" condition of the insurance policy. Under "Conditions," the policy provides: "Concealment or Fraud. We do not provide coverage if you have intentionally concealed or misrepresented any material fact or circumstance relating to this insurance." In its motion for summary judgment, the defendant alleges that the plaintiffs violated this condition by: (1) stating that the water damage to the Williams Apartment and the other areas of premises was caused by rain water that entered the building through an open third-floor window; (2) stating that the water damage noted by the Housing Authority on August 31, 1999, was completely repaired prior to September 16, 1999; (3) stating that the property passed inspection by the Housing Authority between August 31, 1999 and September 16,...

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