Costabile v. Metropolitan Property and Cas. Ins.

• Decision Date: 28 March 2002
• Docket Number: No. 3:99CV2470(AHN).,3:99CV2470(AHN).
• Citation: 193 F.Supp.2d 465
• Parties: Catherine COSTABILE and Peter Costabile v. METROPOLITAN PROPERTY AND CASUALTY INSURANCE COMPANY
• Court: U.S. District Court — District of Connecticut

193 F.Supp.2d 465

Catherine COSTABILE and Peter Costabile v. METROPOLITAN PROPERTY AND CASUALTY INSURANCE COMPANY

No. 3:99CV2470(AHN).

United States District Court, D. Connecticut.

March 28, 2002.

COPYRIGHT MATERIAL OMITTED

John T. Bochanis, Thomas J. Weihing, Daly, Weihing & Bochanis, Bridgeport, CT, for Plaintiffs.

Joel J. Rottner, Laura Ondrush, Skelly Rottner, P.C., Hartford, CT, for Defendant.

RULING ON DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

NEVAS, District Judge.

The plaintiffs, Peter and Catherine Costabile ("the Costabiles") bring this insurance coverage action seeking money damages and other relief arising from fire damage to certain rental property they own. The plaintiffs made a claim under an insurance policy in effect at the time of the loss that was issued by the defendant, Metropolitan Property and Casualty Insurance Company ("Metropolitan"). Metropolitan denied coverage for the plaintiffs' loss pursuant to a "vandalism and malicious mischief exclusion." The plaintiffs brought the instant suit, asserting claims for: (1) breach of contract; (2) breach of the duty of good faith and fair dealing; (3) breach of fiduciary duty; (4) violations of the Connecticut Unfair Insurance Practices Act ("CUIPA"); and (5) violations of the Connecticut Unfair Trade Practices Act ("CUTPA").

Currently pending is Metropolitan's Motion for Summary Judgment (Doc. # 20). For the following reasons, the defendant's motion is DENIED.

BACKGROUND

The Costabiles are the owners of a two-story single family home that they rented to tenants, located at 6 Girard Street in Norwalk, Connecticut. The Costabiles entered into an insurance agreement ("the policy") with Metropolitan for the period from October 1, 1998 to October 1, 1999. The policy was a "Landlord's Rental Dwelling Policy" that insured the plaintiffs' rental property.

Sometime in April 1997, within days of a March 30, 1997 eviction order, the last tenants vacated the premises. No tenants resided in the home for more than a year and a half—from early April 1997 to December 1998.

On or about December 6, 1998, a fire occurred at the plaintiffs' property. The plaintiffs reported the fire to Metropolitan on or about December 8, 1998. On or about January 25, 1999, the plaintiffs filed a Sworn Statement in Proof of Loss. The proof of loss itemized damage as $80,900 for the dwelling; $13,500 for loss of rent; $8,090 for debris removal; and $2,500 for miscellaneous furniture and personal property.

Shortly after the plaintiffs submitted their proof of loss, Metropolitan requested that Peter Costabile be examined under oath. On February 24, 1999, Attorney Joel Rottner, counsel for Metropolitan, examined Peter Costabile without counsel for approximately five and a half hours. In a March 18, 1999 letter to Metropolitan, Attorney Rottner advised "we do not recommend a denial of this claim for arson." See Mar. 18, 1999 Letter from Joel J. Rottner to Metropolitan Senior Claim Representative Janice Palmer, attached as Exh. F to Pls.' Memo. of Law in Support of Obj. to Mot. for Summary Judgment.

Metropolitan nevertheless denied coverage in light of a routine investigation conducted by the Norwalk Fire Marshal's office that concluded that the fire was incendiary in nature and in light of another investigation conducted at its request by Ronald R. Mullen of Engineering and Fire Investigations that concluded that the fire was incendiary in nature as well. See Exh. J to Def.'s Memo. of Law in Support of Mot. for Summary Judgment.

In denying coverage, Metropolitan relied on an exclusion in the policy for "vandalism or malicious mischief" when the premises are vacant or unoccupied for more than thirty (30) consecutive days immediately prior to the loss. Metropolitan forwarded a letter to the plaintiffs, dated April 15, 1999, setting forth the reasons for the denial of their claim. That letter stated, in pertinent part:

After a careful evaluation of all the facts, Metropolitan Property and Casualty Insurance Company regrets to inform you that for the reasons outlined below, me must deny your claims.

Your policy of insurance at Section 1— LOSSES WE DO NOT COVER provides as follows:

1. We do not cover loss or damage to the property described in Coverage A and Coverage B which results directly or indirectly from any of the following ...

f. vandalism or malicious mischief or breakage of glass and safety glazing materials if the residence premises was vacant or unoccupied for more than thirty consecutive days immediately prior to the loss.

At page 146 of the Examination Under Oath of Peter Costabile, Mr. Costabile admitted that after 1997 the premises were unoccupied. Our investigation determined that the fire at the premises which occurred on December 6, 1998, was the result of a deliberate human act. Therefore, any loss as a result of this fire is excluded by the above quoted exclusion as a vandalism occurred after the premises were unoccupied for more than thirty consecutive days.

See Apr. 15, 1999 Letter from Metropolitan Claim Representative Janice Palmer to Peter and Catherine Costabile, attached as Exh. H to Def.'s Memo. of Law in Support of Mot. for Summary Judgment.

In light of Metropolitan's denial of coverage, the plaintiffs filed the instant action on or about December 2, 1999. Metropolitan now moves for summary judgment, arguing that the vandalism exclusion applies and that the undisputed facts show that the plaintiffs' claim is excluded by that exclusion.

STANDARD

Summary judgment is appropriate when the evidence demonstrates that "there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed. R.Civ.P. 56(c); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

When ruling on a summary judgment motion, the court must construe the facts in the light most favorable to the non-moving party and must resolve all ambiguities and draw all reasonable inferences against the moving party. Anderson, 477 U.S. at 255, 106 S.Ct. 2505; Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970); see also Aldrich v. Randolph Cent. Sch. Dist., 963 F.2d 520, 523 (2d Cir.) (court is required to "resolve all ambiguities and draw all inferences in favor of the nonmoving party"), cert. denied, 506 U.S. 965, 113 S.Ct. 440, 121 L.Ed.2d 359 (1992). When a motion for summary judgment is properly supported by documentary and testimonial evidence, however, the nonmoving party may not rest upon the mere allegations or denials of his pleadings, but rather must present significant probative evidence to establish a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Colon v. Coughlin, 58 F.3d 865, 872 (2d Cir.1995).

DISCUSSION

Metropolitan's motion for summary judgment, relying on one line of cases, argues that the plaintiffs' claim is not covered pursuant to the vandalism or malicious mischief exclusion, because an incendiary fire is a "subset" of vandalism and the fire here was intentionally set by an unknown arsonist or vandal. The plaintiffs, relying on another line of cases, argue that the exclusion does not apply because loss by fire is a named peril otherwise covered by the policy and if Metropolitan intended to exclude a fire loss to a dwelling vacant for more than thirty days it should have expressly done so.

Metropolitan's Argument

Metropolitan argues that it is entitled to judgment as a matter of law because the policy unambiguously excludes coverage for the plaintiffs' loss. Metropolitan argues that the policy is an "all-risk" policy which covers losses to the insured dwelling unless otherwise excluded. Metropolitan claims that this "all-risk" form differs from a "named perils" form, which would specify coverage for specific losses such as fire. Metropolitan claims that here, the fire was deliberately set by an unknown vandal, that loss to the insured dwelling by vandalism is expressly excluded, and that, in referring to "vandalism," the policy exclusion includes an incendiary fire.

In support of its motion Metropolitan argues that, because vandalism is not defined by the policy, it must be given its plain, ordinary meaning. It argues that the Connecticut Supreme Court relies primarily on Webster's Third New International Dictionary (1986) for definitions, which defines "vandalism" as follows: "Willful or malicious destruction or defacement of things of beauty or public or private property." It also claims that Webster's defines "arson" as "the willful or malicious burning of or attempt to burn any building, structure or property of another . . ." Metropolitan further argues that the Connecticut Supreme Court, in State v. McGowan, 20 Conn. 245 (1850), similarly defined arson as the "willful and malicious burning of the house of another."

Metropolitan argues that, given the similarity of the above definitions, arson is simply a subset of vandalism and is, in fact, included within the definition of vandalism. It further claims that the Connecticut Supreme Court expressed a view that arson is considered to be an act of vandalism by the Court's use of the terms "vandalism" and "arson" when describing the underlying facts of a criminal case involving such conduct. See Def.'s Memo. of Law in Support of Mot. for Summary Judgment at 12-13 (citing State v. Anonymous, 240 Conn. 708, 694 A.2d 766 (1997)).

Metropolitan further argues that, although there have been no Connecticut court cases interpreting vandalism exclusions similar to the one here, the weight of authority supports its position that arson is an act of vandalism within the meaning of the subject exclusion. Metropolitan argues that most courts that have evaluated the relationship between the word "arson" a...