Lee v. Aig Cas. Co.
| Citation | 919 F.Supp.2d 219 |
| Decision Date | 24 January 2013 |
| Docket Number | No. 3:08CV01897.,3:08CV01897. |
| Court | U.S. District Court — District of Connecticut |
| Parties | Thomas LEE and Gloria Lee, Plaintiffs, v. AIG CASUALTY COMPANY, Defendant. |
OPINION TEXT STARTS HERE
Gerard N. Saggese, III, James A. Fulton, Whitman, Breed, Abbott & Morgan, Greenwich, CT, for Plaintiffs.
Michele C. Camerota, Nuzzo & Roberts, Cheshire, CT, for Defendant.
On December 18, 2009, the plaintiffs, Thomas Lee and Gloria Lee, filed a complaint seeking to compel coverage and recover damages as the result of an alleged breach of an insurance contract by the defendant, the AIG Casualty Company. The plaintiffs claim that the defendant failed to properly notify them of the cancellation of their automobile insurance pursuant to Connecticut General Statutes § 38a–343(a). They also claim violations of the covenant of good faith and fair dealing, the Connecticut Unfair Insurance Practices Act (“CUIPA”) and the Connecticut Unfair Trade Practices Act (“CUTPA”). The defendant claims that it has fulfilled the requirements of Conn. Gen. Stat. § 38a–343(a) and that the insurance coverage was properly cancelled.
Both the plaintiffs and the defendant have moved for summary judgment. For the reasons stated below, Plaintiffs' Motion for Summary Judgment (doc. # 61) is GRANTED in part and DENIED in part, and Defendant's Motion for Summary Judgment (doc. # 60) is GRANTED in part and DENIED in part.
The plaintiffs have been insured under multiple insurance policies written by the defendant company. Among those policies was a renewable personal automobile insurance policy for the cars owned by the plaintiffs. The defendant issued renewal personal automobile policy number AIG PCG 0007906716 for the policy period beginning on June 21, 2008, and ending on June 21, 2009. On July 22, 2008, AIG Casualty issued a notice of cancellation of the plaintiff's personal automobile policy due to non-payment of a premium. The cancellation was to take effect on August 2, 2008. At the time the notice was mailed, both plaintiffs were out of the state and away from their home.
The plaintiffs returned home on July 28, 2008. On August 3, 2008, Thomas Lee was involved in a motor vehicle accident that resulted in claims against him for bodily injury and property damage. Upon contacting the defendant on the morning of August 4, 2008, the plaintiff Thomas Lee was informed that the plaintiffs' automobile insurance had been cancelled. Upon inquiring as to the outstanding balance of payments, the defendant's agent informed Mr. Lee that a past-unpaid premium originally due June 28, 2008, totaled $1,735.20. Mr. Lee authorized payment from his checking account of the past-unpaid premium and the contemporaneous payment due on his payment plan on August 28th, 2008, totaling $2,602.80. Later that same day Mr. Lee discovered the notice of cancellation of the automobile insurance policy in a pile of mail within his home, as well as a billing statement indicating a past-unpaid premium of $1,735.20 and a current premium of $867.60, totaling $2,602.80. Further into the evening on August 4, 2008, another agent of AIG contacted Mr. Lee and informed him that the defendant would not be providing coverage for any claim arising from the accident on August 3, 2008, due to the cancellation of the plaintiffs' automobile insurance.
On August 5, 2008, Gloria Lee contacted the defendant separately and inquired about the outstanding balance. With the billing statement in front of her, Ms. Lee authorized payment of the full $2,602.80 on a credit card. On August 12, 2008, the plaintiffs received a letter from the defendant informing them that the cancellation of the insurance policy was still in effect and that no coverage would be provided for the August 3, 2008 accident. On August 28, 2008, the plaintiffs received a check from the defendant in the amount of $2,103.80. The defendant has characterized the $2,103.80 check as a return of “[u]nearned premium.” (Doc. # 60–3, at 69, ¶ 12).
The plaintiffs filed a complaint dated November 11, 2008, in the Superior Court of the State of Connecticut. On December 12, 2008, the defendants removed the case to the United States District Court for the District of Connecticut on the basis of diversity of citizenship. On December 18, 2009, the plaintiffs filed an Amended Complaint. The first count of the Amended Complaint alleges that the defendant failed to conform to the requirements of Conn. Gen. Stat. § 38a–343(a) and therefore the notice of cancellation of their automobile insurance was invalid. The second count alleges that the defendant acted in reckless disregard for the plaintiffs' rights and that the defendant acted to reinstate the insurance following the cancellation. It further alleges a breach of that reinstatement. The third count alleges a violation of the covenant of good faith and fair dealing. The fourth count alleges violations of CUIPA and CUTPA.
Both the defendant and the plaintiffs have moved for summary judgment on all counts. In a sur-reply to the plaintiffs' motion for summary judgment, the defendant recognized that the plaintiffs are now involved in a civil action resulting from the aforementioned accident. See Abreu v. Lee, Docket No. FST–CV–10–6006279S (Conn.Super.Ct. July 28, 2010) (ongoing). The defendant has asserted in its sur-reply that, subject to the outcome of the instant case in the defendant's favor, the plaintiff Thomas Lee faces a “gap in coverage, in the amount of $300,000” relating to the ongoing state court litigation. (Doc. # 106, at 2–3).
It is well settled that the burden is upon the party moving for summary judgment to establish that there are no genuine issues of material fact in dispute and that the party is entitled to judgment as a matter of law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Pouliot v. Paul Arpin Van Lines, Inc., 367 F.Supp.2d 267, 270 (D.Conn., 2005). Once the moving party has done so, the nonmoving party must then “set forth specific facts showing that there is a genuine issue for trial,” Anderson, 477 U.S. at 256, 106 S.Ct. 2505, and present such evidence as would allow a jury to reasonably find in the nonmoving party's favor. Graham v. Long Island R.R., 230 F.3d 34, 38 (2d Cir.2000); Exantus v. Metropolitan Property & Casualty Ins. Co., 582 F.Supp.2d 239, 245 (D.Conn.2008).
“In assessing the record, the trial court must resolve all ambiguities and draw all inferences in favor of the party against whom summary judgment is sought.” Pouliot, 367 F.Supp.2d at 270. “This remedy that precludes a trial is properly granted only when no rational finder of fact could find in favor of the non-moving party.” Carlton v. Mystic Transportation, Inc., 202 F.3d 129, 134 (2d Cir.2000). “When reasonable persons, applying the proper legal standards, could differ in their responses to the question,” the question must be left to the jury. Sologub v. City of New York, 202 F.3d 175, 178 (2d Cir.2000).
Neither side in this case alleges that there are disputed material facts. Both sides in their Rule 56(a)(1) and (2) statements have argued that there are no material issues of fact in dispute, and that those few facts in dispute are immaterial. Both, however, disagree strongly on the legal conclusions drawn from the evidence provided in the respective parties' Rule 56(a)1 statements. With this in mind, the issue before the Court is more strictly a question of which party, under the agreed-upon material facts, may be entitled to judgment as a matter of law.
The main issue disputed by both sides is whether the Lee's automobile insurance policy was properly cancelled and notice of cancellation properly provided. The defendant claims that it has followed the guidelines of Conn. Gen. Stat. § 38a–343(a), whereas the plaintiffs claim that the defendant's cancellation notice was defective under the same statute.
Both plaintiffs and defendant advance an argument based upon interpretations of Conn. Gen. Stat. § 38a–343(a). That statute provides that “[n]o notice of cancellation of a policy ... shall be effective unless sent, by registered or certified mail or by mail evidenced by a certificate of mailing, or delivered by the insurer to the named insured ... at least forty-five days before the effective date of cancellation, except that ... where cancellation is for nonpayment of any ... premium [other than the first premium on a new policy], at least ten days' notice of cancellation accompanied by the reason for cancellation shall be given.” The statute breaks the requirements for proper cancellation into two distinct parts. “For cancellation of a renewal policy, the statute requires that the notice of cancellation must be (1) timely and (2) properly mailed or delivered.” AIG Casualty Co. v. Schweiger, No. HHDCV084035100S, 2009 WL 3416139, at *4 (Conn.Super. Sept. 17, 2009). This Court addresses the second of these requirements first.
“The plain language of § 38a–343(a) clearly and unambiguously indicates that sending a notice of cancellation by mail evidenced by a certificate of mailing satisfies the obligation imposed by the statute.” Echavarria v. National Grange Mutual Ins. Co., 275 Conn. 408, 414, 880 A.2d 882 (2005). In the instant case, it is undisputed that the defendant sent notice by mail and produced evidence of such by a certificate of mailing. The issue addressed by both sides is whether the certificate of mailing was defective, and therefore invalid, under the requirements of the statute.
The plaintiffs claim that the certificate of mailing produced by the defendant was improper according to the U.S. Postal Service's Domestic Mail Manual. They further argue that strict compliance with § 38a–343(a) necessitates that each certificate reveal no flaws in any...
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