Cappuccio v. Pub. Serv. Ins. Co.
| Decision Date | 03 February 2020 |
| Docket Number | Docket: 1677CV00694 |
| Parties | LINDA L. CAPPUCCIO, TRUSTEE OF THE STREGA REALTY TRUST v. PUBLIC SERVICE INSURANCE CO. & ANOTHER |
| Court | Massachusetts Superior Court |
Dates: February 3, 2020
Present: David A. Deakin Associate Justice
County: ESSEX, ss.
The plaintiff, Linda L. Cappuccio, sued her insurer, Public Service Insurance Co. ("Public Service"), for unfair settlement practices in connection with a claim that she filed for damage to her commercial property committed by disgruntled tenants as they vacated the premises. She also sued her insurance broker, the Allan Insurance Agency, Inc. ("Allan Insurance"), claiming that its president, Jerrold Kameras, both failed to obtain appropriate coverage for her business and, more centrally, gave her bad advice in the wake of the vandalism. Allan Insurance, in turn, brought a third-party action for contribution against the plaintiff s attorney at the time of the vandalism, Raymond H. Tomlinson, alleging that he had a professional obligation to advise the plaintiff in the matter.
All three defendants have brought motions for summary judgment pursuant to Mass. R. Civ. P. 56. Because the defendants have sustained their burden of demonstrating that there are no disputed issues of material fact and that they are entitled to judgment as a matter of law, see Kourouvacilis v. General Motors Corp., 410 Mass. 706, 711 (1991), the motions of Public Service Insurance Co., the Allan Insurance Agency, Inc., and third-party defendant Raymond H. Tomlinson for summary judgment are ALLOWED, and the case is DISMISSED WITH PREJUDICE.
Beginning in 2003, Cappuccio operated a restaurant called Strega at 92-96 Lafayette Street in Salem.2 The building was owned by the Strega Realty Trust (Strega Realty), a real estate enterprise run by Cappuccio. In May 2011, Strega Realty sold most of the restaurant's assets — but not the building or the land at 92-96 Lafayette Street — to Red Lulu Salem, LLC ("Red Lulu"). At the same time, Strega Realty and Red Lulu executed a ten-year lease, allowing Red Lulu to operate a restaurant on the premises. Red Lulu is not a party to this lawsuit.
From the beginning, the relationship between Cappuccio and Strega Realty, on one side, and Red Lulu and its owners, on the other, was a turbulent one. Red Lulu never opened a restaurant on the premises. In August 2011, Strega Realty sought a temporary restraining order against Red Lulu and its owners. Ultimately, in 2012, Strega Realty sued Red Lulu for breach of contract and default on a promissory note and sought to evict Red Lulu. The parties settled the lawsuit in August 2013. Among the provisions of the settlement was that Red Lulu was required to vacate the premises by October 31, 2013.3
After executing the settlement agreement but before Red Lulu had vacated the premises, Cappuccio had inspected the premises and found them to be "intact." (Dep. of Linda Cappuccio, March 16, 2017, p. 65,11. 4, 8.) Sometime after Cappuccio's inspection of the premises, however, their condition changed. On Saturday, November 2, 2013, Cappuccio reported to the Salem Police Department that, before vacating the building, Red Lulu's proprietors had caused substantial damage to the premises.4,5 No criminal charges were sought, and Strega Realty did not sue anyone for causing the damage.
After discovering the vandalism, Cappuccio contacted Jerrold Kameras, president of Allan Insurance, an insurance brokerage in Salem. Three months earlier, in July 2013, Cappuccio had approached Allan Insurance for help in renewing Strega Realty's commercial property insurance policy.6 As a result, Allan Insurance had caused Public Service to issue a renewal of the commercial property insurance policy that then covered the premises, effective July 27, 2013. Shortly after the reported vandalism (on or about November 3, 2013), Kameras went to the premises at Cappuccio's invitation to survey the damage. Also within days of discovering the vandalism, Cappuccio contacted Tomlinson, the attorney who had represented her in her lawsuit against Red Lulu and who had arranged the settlement in that matter. The two discussed, among other things, Strega Realty's insurance and how to recover for the damage allegedly caused by agents acting on behalf of Red Lulu. After Kameras's visit to inspect the damage, he and Cappuccio discussed filing an insurance claim to recover for the damage. There is no dispute that Kameras gave Cappuccio advice; the parties disagree strenuously, however, about the substance of that advice. Allan Insurance maintains that Kameras suggested to Cappuccio that Strega Realty should file claims under both Red Lulu's insurance policy (issued by Selective Insurance) and her own, issued by Public Service.7 Cappuccio alleges that Kameras suggested that she file a claim under only Red Lulu's policy. In any event, Cappuccio filed a claim with Selective Insurance, under Red Lulu's policy, but did not file a claim under her policy with Public Service.
Several months later, Selective Insurance sent Cappuccio a letter. It explained that Selective Insurance had denied coverage because its policy excluded damage resulting from vandalism committed by its insured, Red Lulu. Cappuccio sent the letter to Tomlinson, who was still her attorney at the time. There is no claim, however, that she notified Kameras or Allan Insurance of Selective Insurance's denial of coverage.
On November 6, 2015, Cappuccio contacted Public Service to give notice of the property damage on the premises that had occurred just over two years earlier. Public Service retained an adjuster to inspect the property, which Strega Realty had sold in the interim. On December 2, 2015, Public Service issued a reservation-of-rights letter to Cappuccio. The letter notified Cappuccio that, because she had failed to comply with the loss conditions in the Policy, liability under the Policy was not clear. Public Service relied on Cappuccio's failure to notify the company of the loss within two years as required under the Policy. Public Service did not send Strega Realty and/or Cappuccio a formal denial of the claim before Cappuccio filed this lawsuit in May 2016.
The complaint initially sought damages against Public Service for breach of contract (Count 1) and unjust enrichment (Count 2), as well as for unfair settlement practices under G.L. c. 176D and c. 93A (Count 4). The first two counts were dismissed by the court (Drechsler, J.) by operation of the statute of limitation. Thus, as to Public Service, only the claim for unfair settlement practices remains. The complaint alleges one count of negligence against Allan Insurance (Count 3). Allan Insurance, in turn, brought an action for contribution against Attorney Tomlinson.
A party is entitled to summary judgment pursuant to Mass. R. Civ. P. 56(c) if there is no genuine dispute of material fact and the party is entitled to judgment as a matter of law. See Boazova v. Safety Ins. Co., 479 Mass. 233, 237 (2012). The moving party bears "the burden of initially showing that there is an absence of evidence to support the case of the nonmoving party shouldering the burden of proof at trial." Kourouvacilis, 410 Mass. at 714. The moving party can meet this burden by "demonstrat[ing], by reference to material described in Mass. R. Civ. P. 56(c), unmet by countervailing materials, that the party opposing the motion has no reasonable expectation of proving an essential element of that party's case." Id. at 716. If the moving party meets its initial burden, the burden shifts to the non-moving party to provide specific facts to demonstrate that there is a genuine issue of material fact. See Drakopoulos v. U.S. Bank Nat. Ass 'n, 465 Mass. 775, 777-778 (2013). A court reviewing a motion for summary judgment must "draw all reasonable inferences in the light most favorable to the nonmoving party." Id., quoting Premier Capital, LLC v. KMZ, Inc., 464 Mass. 467, 474-475 (2013).
The plaintiff's lawsuit alleges a single count of negligence against Allan Insurance. (See Complaint at p.3, paras. 22-26.) At the heart of the plaintiff's cause of action against Allan Insurance is the charge that the defendant was negligent in allegedly advising the plaintiff to submit a claim for the vandalism purportedly committed by agents of Red Lulu against Red Lulu's insurance policy and not against her own Policy. Also, although not a model of clarity, the single negligence claim additionally appears to allege that Allan Insurance was negligent in failing to procure the proper coverage for her commercial situation.8 For analytic purposes, it is simplest to begin with an analysis of the latter claim.
1. Duty
In order to establish that Allan Insurance is liable to the plaintiff in negligence for failing to advise her properly about the coverage she should obtain, the plaintiff must prove: 1) that Allan Insurance owed a duty to the plaintiff to advise her about her coverage; 2) that it breached that duty; and 3) that the plaintiff suffered harm as a result. See Rayden Engineering Corp. v. Church, 337 Mass. 652, 660-661 (1958) (). See also McCue v. Prudential Ins. Co. of America, 371 Mass. 659, 661-662 (1976) (same). Even viewed in the light most favorable to the plaintiff, as it must be at this stage, the evidence in the record establishes none of these three things. The plaintiff, therefore, has no reasonable expectation of proving the essential elements of such a claim.
First, as to duty, the record is clear that, at the time of the events in question, Allan Insurance was an insurance...
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