Footman v. Liberty Ins. Corp.

• Decision Date: 27 March 2023
• Docket Number: 2:21-cv-00277-JAW
• Parties: JAMES FOOTMAN, Plaintiff, v. LIBERTY INSURANCE CORPORATION, Defendant.
• Court: U.S. District Court — District of Maine

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JAMES FOOTMAN, Plaintiff, v. LIBERTY INSURANCE CORPORATION, Defendant.

No. 2:21-cv-00277-JAW

United States District Court, D. Maine

March 27, 2023

ORDER ON CROSS-MOTIONS FOR SUMMARY JUDGMENT

JOHN A. WOODCOCK, JR. UNITED STATES DISTRICT JUDGE

On November 25, 2017, while hunting in the town of Oxford Maine, Zachary Mills shot James Footman, causing personal injuries. After Mr. Footman sued Mr. Mills in state court, an arbitration award of $1,436,330.76 was reduced to judgment against Mr. Mills. Liberty Insurance Corporation (Liberty) insured Mr. Mills' mother and grandparents through homeowner's insurance policies issued on their residences. Liberty declined to defend Mr. Mills and rejected claims for indemnification under the policies on the ground that Mr. Mills was not a resident of either home. Mr. Mills assigned all rights against Liberty to Mr. Footman, and, by virtue of the assignment, Mr. Footman sued Liberty to establish coverage under the homeowners' policies and to recover defense costs. After reviewing dueling motions for summary judgment, the Court concludes that Mr. Mills was not a resident of either home on November 25, 2017 and therefore grants judgment against Mr. Footman and in favor of Liberty.

I. PROCEDURAL HISTORY

On August 31, 2021, James Footman filed a complaint against Liberty in Oxford County Superior Court, alleging that it had improperly refused to provide insurance coverage for the November 25, 2017 hunting accident. Def. Notice of Removal (ECF No. 1), Attach. 2 Compl.^[1] On September 28, 2021, Liberty removed this case to federal court, Removal Order (ECF No. 3), and on January 21, 2022, it answered the Amended Complaint. Def.'s. Answer to Amended Complaint and Demand for Jury Trial (ECF No. 16) (Def.'s Answer). The Amended Complaint contains nine counts: Count I-breach of contract; Count II-unfair deceptive acts or practices; Count III-quantum meruit; Count IV-strict liability; Count V- negligence; Count VI-declaratory judgment; Count VII-unfair claims settlement; Count VIII reach and apply; and Count IX-punitive damages. Am. Compl. at 4-8.

On April 12, 2022, Liberty filed a motion for summary judgment, Def.'s Mot. for Summ. J. (ECF No. 19) (Def.'s Mot.), with a statement of facts. Def.'s Statement of Material Facts (ECF No. 20) (DSMF). On May 3, 2022, Mr. Footman filed a response to Liberty's statement of facts, Resp. to Def.'s Statement of Material Facts (ECF No. 26) (PRDSMF), and opposed Liberty's motion for summary judgment. Pl.'s Opp'n to Def.'s Mot. for Summ. J. (ECF No. 27) (Pl.'s Opp'n). On May 16, 2022, Liberty replied. Def.'s Reply to Pl.'s Opp'n to Def.'s Mot. for Summ. J. (ECF No. 28) (Def.'s Reply).

On April 12, 2022, Mr. Footman filed a cross-motion for partial summary judgment, Pl.'s Mot. for Summ. J. (ECF No. 21) (Pl.'s Mot.), along with his own statement of material facts. Pl.'s Statement of Material Facts (ECF No. 22) (PSMF). On May 2, 2022, Liberty responded to Mr. Footman's motion for partial summary judgment, Def's Opp'n to Pl.'s Mot. for Summ. J. (ECF No. 24) (Def.'s Opp'n), and filed a response to Mr. Footman's statement of material facts. Def.'s Resp. to Pl.'s Statement of Material Facts (ECF No. 25) (DRPSMF). Mr. Footman replied on May 17, 2022. Pl.'s Reply to Def.'s Resp. to Pl.'s Mot. for Summ. J. (ECF No. 29) (Pl.'s Reply).

II. THE SUMMARY JUDGMENT FACTS^[2],^[3]

A. The Hunting Accident and Liberty's Insurance Policies

On November 25, 2017, James Footman and Zachary Mills were hunting on property near 302 Number Six Road, Oxford, Maine, the home of Mr. Mills' girlfriend Bailey Bolduc (the Bolduc Residence). DSMF ¶¶ 6, 10; PRDSMF ¶¶ 6, 10. Thinking he saw a deer, Mr. Mills fired his weapon and accidentally hit Mr. Footman, who sustained injuries to both forearms. DSMF ¶¶ 1, 7; PRDSMF ¶¶ 1, 7; PSMF ¶ 1; DRPSMF ¶ 1.

At the time of the incident, Mr. Mills' mother, Jennifer Whittemore, had a homeowners insurance policy with Liberty (the Whittemore Policy) for her residence at 253 Damon Road in Sumner, Maine (the Whittemore Residence). PSMF ¶¶ 5-6; DRPSMF ¶¶ 5-6; DSMF ¶¶ 3, 24; PRDSMF ¶¶ 3, 24. At this same time, Mr. Mills' grandparents, Kathy and Charles Mason, also held a Liberty homeowner's insurance policy (the Mason Policy) for their home at 16 Eddies Road in Greenwood, Maine (the Mason Residence). PSMF ¶¶ 7, 9; DRPSMF ¶¶ 7, 9; DSMF ¶¶ 4, 31; PRDSMF ¶¶ 4, 31. Liberty is duly licensed to transact insurance business in the state of Maine. DSMF ¶ 2; PRDSMF ¶ 2.

The Whittemore and Mason Policies (collectively, the Policies) are identical, as relevant to this action. DSMF ¶ 5; PRDSMF ¶ 5. The “Definitions” sections of the Policies included the following:

In this policy, “you” and “your” refer to the “named insured” shown in the Declarations and the spouse if a resident of the same household....

3. “Insured” means you and residents of your household who are:

a. Your relatives; or

b. Other persons under the age of 21 and in the care of any person named above.

Under Section II [Liability Coverages], “insured” also means:

c. With respect to animals or watercraft to which this policy applies, any person or organization legally responsible for these animals or watercraft which are owned by you or any person included in 3.a. or 3.b. above. A person or organization using or having custody of these animals or watercraft in the course of any “business” or without consent of the owner is not an “insured”;

d. With respect to any vehicle to which this policy applies:

(1) Persons while engaged in your employ or that of any person included in 3.a. or 3.b. above; or

(2) Other persons using the vehicle on an “insured location” with your consent.

4. “Insured location” means:

a. The “residence premises”;

b. The part of other premises, other structures and grounds used by you as a residence and:

(1) Which is shown in the Declarations; or

(2) Which is acquired by you during the policy period for your use as a residence;

c. Any premises used by you in connection with a premises in 4.a.

and 4.b. above;

d. Any part of a premises:

(1) Not owned by an “insured”; and

(2) Where an “insured” is temporarily residing;

DSMF ¶ 5; PRDSMF ¶ 5 (Sections 4(e-h) omitted).^[4] The “Personal Liability” sections of the Policies stated that:

If a claim is made or a suit is brought against an “insured” for damages because of “bodily injury” or “property damage” caused by an ”occurrence” to which this coverage applies, we will:

1. Pay up to our limit of liability for the damages for which the “insured” is legally liable; and

2. Provide a defense at our expense by counsel of our choice, even if the suit is groundless, false or fraudulent. We may investigate and settle any claim or suit that we decide is appropriate. Our duty to settle or defend ends when the amount we pay for damages resulting from the “occurrence” equals our limit of liability.

DSMF ¶ 5; PRDSMF ¶ 5.

On November 25, 2017, when the hunting accident occurred, Mr. Mills was twenty-one years old. DSMF ¶ 11; PRDSMF ¶ 11; PSMF ¶ 2; DRPSMF ¶ 2. He was not a “named insured” on either the Whittemore or the Mason Policy. DSMF ¶¶ 3-4; PRDSMF ¶¶ 3-4.

B. Liberty's Investigation and James Footman's Suit Against Zachary Mills

Ms. Whittemore reported the incident to Liberty on July 30, 2018.^[5] DSMF ¶ 8; PRDSMF ¶ 8. Liberty set up claim files for both policies, commenced an investigation, and interviewed Mr. Mills. PSMF ¶¶ 11-12; DRPSMF ¶¶ 11-12; DSMF ¶¶ 9-10; PRDSMF ¶¶ 9-10. It ultimately decided to deny coverage because, in its view, Mr. Mills did not reside at the Whittemore Residence and therefore did not qualify as an “insured.”^[6] PSMF ¶ 13; DRPSMF ¶ 13; DSMF ¶ 12; PRDSMF ¶ 12. Liberty also denied coverage under the Mason Policy on the same basis. PSMF ¶ 14; DRPSMF ¶ 14; DSMF ¶ 45; PRDSMF ¶ 45.

On July 17, 2019, Mr. Footman filed a civil action against Mr. Mills in Oxford Superior Court, alleging that Mr. Mills' negligence caused the incident and his injuries.^[7] DSMF ¶ 13; PRDSMF ¶ 13; PSMF ¶ 3; DRPSMF ¶ 3. The complaint listed Mr. Mills' current address as the Whittemore Residence, although Mr. Footman contends that Mr. Mills was living at the Mason Residence at the time of the incident.^[8] PSMF ¶¶ 4, 8; DRPSMF ¶¶ 4, 8. It did not identify any familial relationship between Mr. Mills and Ms. Whittemore or the Masons. DSAMF ¶¶ 4546.

Liberty did not engage an attorney to defend Mr. Mills in the state civil action or provide coverage under a reservation of rights. PSMF ¶¶ 15-16; DRPSMF ¶ 1516. Mr. Mills hired an attorney to represent him, while Liberty engaged an attorney to represent its own interests with regards to the claims.^[9] PSMF ¶¶ 17-18; DRPSMF ¶¶ 17-18; DSMF ¶ 14; PRDSMF ¶ 14. On March 31 or April 1, 2020, Mr. Mills' attorney contacted Liberty to request policy language and Liberty responded by providing the policy language and reiterating its position that coverage was unlikely to apply because Mr. Mills was not a resident of Ms. Whittemore's house at the time of the incident. DSMF ¶ 15; PRDSMF ¶ 15. Mr. Mills' counsel forwarded this email to Mr. Footman's counsel. Id.

On January 13, 2021, Mr. Mills' attorney contacted Liberty to notify it that an arbitration was scheduled for later that month, and, in an ensuing email exchange, Mr. Mills' attorney informed Liberty that Mr. Mills was seeking coverage under both the Whittemore and Mason Policies. DSMF ¶¶ 16-17; PRDSMF ¶¶ 16-17. The parties dispute whether this was Liberty's first notice of the underlying action.^[10]DSMF ¶¶ 18-19; PRDSMF ¶¶ 18-19. On January 21, 2021, Liberty was provided with a copy of the complaint in the underlying action. DSMF ¶ 20; PRDSMF ¶ 20. Mr. Footman also provided Liberty with documents listing Mr. Mills' address as either the...