Butler v. Clarendon America Ins. Co.
| Decision Date | 29 June 2007 |
| Docket Number | No. C06-03619 MJJ.,C06-03619 MJJ. |
| Citation | 494 F.Supp.2d 1112 |
| Parties | Matt BUTLER, Plaintiff, v. CLARENDON AMERICA INSURANCE CO., Defendant. |
| Court | U.S. District Court — Northern District of California |
George Wesley Nowell, John Henry Cigavic, III, Paul B. Arenas, Law Offices of George W. Nowell, San Francisco, CA, for Plaintiff.
Dale H. Thayer, Colleen Frances Van Egmond, Thayer, Harvey, Gregerson, Hedberg & Jackson, Modesto, CA, Michael Francis Hardiman, Hardiman & Carroll, San Francisco, CA, for Defendant.
ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT AND DENYING PLAINTIFF'S SECOND MOTION FOR PARTIAL SUMMARY JUDGMENT
Before the Court is Defendant Clarendon America Insurance Company's ("Defendant" or "Clarendon") Motion for Summary Judgment.1 Plaintiff Matt Butler d.b.a. San Rafael Yacht Harbor ("Plaintiff') opposes Defendant's motion. Also before the Court is Plaintiff's Second Motion for Partial Summary Judgment.2 Defendant opposes Plaintiffs motion. For the following reasons, the Court GRANTS Defendant's Motion for Summary Judgment, and DENIES Plaintiff's Second Motion for Partial Summary Judgment.
The instant action presents an insurance dispute between the insurer-Plaintiff and the insurer-Defendant arising from Defendant's refusal to defend Plaintiff in an underlying third-party lawsuit.
On April 4, 2007, this Court denied Plaintiff's Motion for Partial Summary Judgment (hereafter, "First Summary Judgment Order")3 and found that there was no potential for insurance coverage under the relevant policy provisions, based on the undisputed factual record then before the Court. As previously set forth in this Court's First Summary Judgment Order, the Court finds the following facts to be undisputed, unless otherwise indicated.
Plaintiff is the operator of the San Rafael Yacht Harbor in San Rafael, California. On February 12, 2004, pro se litigant Lloyd Victor Ramirez ("Ramirez") filed the first action against Plaintiff in the United States District Court for the Northern District of California, Case No. C04-0593 EMC. (Joint Statement of Undisputed Fact ("JJSUF") at ¶ 4.) On February 18, 2004, Ramirez filed the second action against Plaintiff in the Superior Court of California, County of Marin, Case No. CV040728. (Id. at 3.) These actions (collectively "the Ramirez action"), made identical allegations and claims against Plaintiff. (Id. at ¶¶ 3, 4.)4
Ramirez alleged that he was the owner of two vessels and Plaintiffs tenant at the San Rafael Yacht Harbor. (Id. at ¶¶ 3, 4.) According to Ramirez, a dispute arose between Ramirez and Plaintiff concerning fees and charges for berthing and other services, and as a result the dispute Ramirez moved his vessels from the San Rafael Yacht Harbor to the Loch Lomond Marina on February 10, 2003. (Id.) In his complaint, Ramirez alleged that on February 18, 2003, Plaintiff "improperly, unlawfully, and without the knowledge and consent and contrary to the desire and instructions of [Ramirez], converted [the two] vessels, trespassed thereon, and sold, disposed or converted them to [Plaintiff s] own use" and that "[Ramirez], was the true and lawful owner of [the] vessels ... and that [Plaintiff] did not have any legal title to [the] vessels". (Id.) Ramirez further alleged that Plaintiff "improperly, unlawfully, and without the knowledge and consent of [Ramirez], converted, sold or otherwise disposed of the personal property of [Ramirez], including boat tackle, spare parts and gear, accessories and equipment, and other personal belongings, including but not limited to clothing, and visual equipment and numerous other items." (Id.) According to Ramirez, he sustained injury and damage "by losing his principal place of abode, all to his great physical and emotional distress. ..." (Id.) Ramirez also alleged that Plaintiff's conduct "was intentional and deceitful with the intention of causing injury to [Ramirez]." (Id.) Ramirez asserted claims for: (1) possession of the vessels and damage for wrongful taking against Plaintiff; and (2) violation of privacy against Pat Lopez ("Lopez") and Loch Lomond Marina for releasing information regarding the location of Ramirez's vessels to Plaintiff. (Id.5
Defendant had previously issued two insurance policies to Plaintiff for periods of August 4, 2001 to August 4, 2002 and August 4, 2002 to August, 4, 2003. (collectively, "the policy") (Id. at ¶¶ 1, 2.) The policy provided coverage for "bodily injury" or "property damage" caused by an "occurrence" which is defined in the policy as an "accident." The relevant "Commercial General Liability" ("CGL") sections of the policy provided, in part:
SECTION I — COVERAGES
a. We will pay those sums that the insured becomes legally obligated to pay as damages because of "bodily injury" or "property damage" to which the insurance applies. We will have the right and duty to defend any "suit" seeking those damages. ...
b. This insurance applies to "bodily injury" and "property damage" only if:
(1) The "bodily injury" or "property damage" is caused by an "occurrence" that takes place in the "coverage territory," and
(2) The "bodily injury" or "property damage" occurs during the policy period.
. . . . .
This insurance policy does not apply to:
a. "Bodily injury" or "property damage" expected or intended from the standpoint of the insured. This exclusion does not apply to "bodily injury" resulting from the use of reasonable force to protect persons or property.
. . . . .
. . . . .
9. "Occurrence" means an accident, including continuous or repeated exposure to substantially the same general harmful conditions.
. . . . .
12. "Property damage" means:
a. Physical injury to tangible property, including all resulting loss of use of that property. All such loss of use shall be deemed to occur at the time of the physical injury that caused it; or
b. Loss of use of tangible property that is not physically injured. All such loss shall be deemed to occur at the time of the "occurrence" that caused it.
13. "Suit" means a civil proceeding in which damage because of "bodily injury," "property damage," "personal injury" or "advertising injury" to which this insurance applies are alleged. ...
(Id. at ¶¶ 1 and 2; MB000072-MB000080, MB000157-MB000168.)
The policy contained two additional relevant "special coverage" sections. First, on the Form HBDC, the policy contained "Special Boat Dealer/Marina Coverage" and provided, in part:
1. PROPERTY AND INTEREST INSURED:
This policy insures BUSINESS PERSONAL PROPERTY (including Tenant's Improvement and Betterments as provided herein), usual to the conduct of the Insured's business, the property of the Insured or the property of others in the actual or constructive custody of the insured.
The property insured is covered against all risk of direct physical loss or damage except as hereinafter excluded.
In the case of loss or damage to property of others held by the Insured, for which the Insured is liable, the rights to adjust such loss or damage with the owner of the property is reserved to the company, and receipt or release from owner in satisfaction thereof shall be in full satisfaction of any claim of the Insured. If legal proceeding be taken to enforce a claim against the Insured, to conduct and control the defense on behalf of and in the name of the Insured. No action of the company in such regard shall increase the liability of the Company under the policy.
(Id.; MB000095-MB000100, MB000175-MB000180.) Second, on the Form HMOL, the policy contained "Special Marina/Boat Repairers/Boat Dealers Legal Liability" and provided, in part:
1. In consideration of the premium and subject to the limits of liability, exclusions, conditions and other terms of the policy, this Company agrees to pay on behalf of the insured, all sums which the insured shall become obligated to pay by reason of the liability imposed upon him (them) by law for loss of or damage to watercraft, their motors, equipment and boat trailers; the property of others while in his (their) care, custody or control at the premises ... for any of the operations listed below:
. . . . .
(F) Property of others held for sale.
. . . . .
6. This Company agrees to indemnify the Insured to the extent of this policy's proportion of legal costs or fees or expenses of counsel occasioned by the defense of any claim against the Insured for any liability or alleged liability of the Insured covered by this policy, provided that such costs, fees or expenses are incurred with the prior written consent of this Company. The Company shall have the option of naming attorneys to represent the Insured in the defense of any claim insured hereunder, made against the Insured, and this Company may exercise exclusive direction and control of the said defense. ...
(Id.; MB000111-MB000113, MB000189-MB000191.)
On March 10, 2004, Plaintiff first tendered the Ramirez actions to Defendant and requested Defendant to defend and indemnify him. (Id. at 115.) In the tender letter, Plaintiff described his participation in the events leading up to the Ramirez actions. (Id.) Plaintiff explained that Ramirez was often late in paying rent and that in December 2002, Plaintiff hauled Ramirez's vessels from the water for rent amounts owed. (Id.) According to Plaintiff, in early February 2003 he launched the vessels after Ramirez had written two checks for rent amounts owed. (Id.) Plaintiff claims that Ramirez's rent checks...
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