Mid-continent Cas. Co. v. Frank Casserino Constr. Inc.
| Decision Date | 16 June 2010 |
| Docket Number | Case No. 6:09-cv-1065-Orl-31GJK. |
| Citation | 721 F.Supp.2d 1209 |
| Parties | MID-CONTINENT CASUALTY COMPANY, Plaintiff, v. FRANK CASSERINO CONSTRUCTION, INC., and CED Construction Partners, Ltd., Defendants. CED Construction Partners, Ltd., Counter Claimant v. Mid-Continent Casualty Company, Counter Defendant. |
| Court | U.S. District Court — Middle District of Florida |
OPINION TEXT STARTS HERE
COPYRIGHT MATERIAL OMITTED.
John R. Catizone, Litchfield Cavo, LLP, Ft Lauderdale, FL, Stacey L. Papp, Litchfield Cavo, LLP, Tampa, FL, for Plaintiff, Counter Defendant.
Kevin Patrick Kelly, Mario Romero, Grayrobinson, PA, Orlando, FL, for Defendants.
This matter came before the Court without oral argument upon consideration of cross-motions for partial summary judgment filed by Plaintiff-Counterdefendant Mid-Continent Causality Company (“Mid-Continent”) (Doc. 30) and Defendant-Counterclaimant CED Construction Partners, Ltd. (“CED”) (Doc. 35); the parties' respective responses in opposition thereto (Docs. 39 and 40); and the parties' replies (Docs. 40 and 42).
Mid-Continent brought this action for declaratory relief to determine whether it has a duty to defend and indemnify its insured, Frank Casserino Construction, Inc. (“Casserino”), in two underlying state court actions brought by CED against Casserino. 1 (Doc. 1). CED counterclaimed for identical relief. (Doc. 9 at 4-6).
In its motion, Mid-Continent contends that it has no duty to indemnify Casserino. 2 The only issue raised in Mid-Continent's motion is whether there was an “occurrence” during the relevant policy period. According to Mid-Continent, it has no duty to indemnify Casserino because there was no “occurrence” during the policy period. Mid-Continent therefore requests a judgment as a matter of law on its indemnification claim. CED has cross-moved for essentially identical relief, contending, inter alia, that there was an “occurrence” during the policy period.
The Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1332.
The underlying litigation between CED and Casserino involves two residential building projects: the Water View Club apartment building in Orange County, Florida, and the Tierra Vista apartment building in Osceola County, Florida. In both projects, CED, as the general contractor, subcontracted with Casserino to perform building wrap, vinyl siding, roofing and certain accessories work. The Water View buildings were completed in July, 1998, and the Tierra Vista buildings were completed in December, 1998.
In later part of 2004, CED was notified by the owner of possible water intrusion in the Water View and Tierra Vista buildings. In January, 2005, CED inspected the buildings and discovered water damage. According to CED's expert, however, there were latent defects in the buildings that, upon a prudent engineering investigation, would have been discernable “about the time of the first measurable rains after construction was concluded in 1998.” (Doc. 36-1, ¶¶ 8 and 9). 4 It is undisputed that neither the owners of the buildings nor CED discovered any water damage until at least 2004.
On March 22, 2006, CED sued Casserino and other subcontractors in two separate state court actions, alleging, inter alia, that the water intrusion in the buildings was caused by Casserino's construction defects. 5 Those actions remain pending and judgment has not been entered on CED's claims against Casserino. Mid-Continent, however, has defended (and continues to defend) Casserino in both actions under a reservation of rights.
B. The CGL Polices
Mid-Continent issued four CGL polices to Casserino. Each policy was in effect for a year, and between August 30, 1998 through August 30, 2002 (the last effective date of the final policy), there were no lapses in coverage. The policies contained identical language and, in pertinent part, provided coverage for:
SECTION I-COVERAGES....
PROPERTY DAMAGE LIABILITY.
1. Insuring Agreement
a. We will pay those sums that the insured becomes legally obligated to pay as damages because of ... “property damage” to which this insurance applies....
b. This insurance applies to ... “property damage” only if: ...
(2) The ... “property damage” occurs during the policy period....
The policies contained the following exclusions:
2. Exclusions
This Insurance does not apply to: ...
j. Damage to Property
“Property damage” to: ...
(5) That particular part of real property on which you or any contractors or subcontractors working directly or indirectly on your behalf are performing operations, if the “property damage” arises out of those operations; or
(6) That particular part of any property that must be restored, repaired or replaced because “your work” was incorrectly performed on it....
Paragraphs ... (5) and (6) of this exclusion do not apply to liability assumed under a sidetrack agreement. 6
Paragraph (6) of this exclusion does not apply to “property damage” included in the “products-completed operations hazard”.
l. Damage to Your Work
“Property damage” to “your work” arising out of it or any part of it and included in the “products-completed operations hazard”.
This exclusion does not apply if the damaged work or the work out of which the damage arises was performed on your behalf by a subcontractor.
m. Damages to Impaired Property....
“Property damage” to “impaired property” or property that has not been physically injured, arising out of:
(1) A defect, deficiency, inadequacy or dangerous condition in ... “your work”; or
(2) A delay or failure by you or anyone acting on your behalf to perform a contract or agreement in accordance with its terms.
This exclusion does not apply to the loss of use of other property arising out of sudden and accidental physical injury to ... “your work” after it has been put to its intended use.
Finally, the policies contained the following definitions:
SECTION V-DEFINITIONS....
7. “Impaired property” means tangible property, other than ... “your work”, that cannot be used or is less useful because:
a. It incorporates ... “your work” that is known or thought to be defective, deficient, inadequate or dangerous; or
b. You have failed to fulfill the terms of a contract or agreement.
12. “Occurrence” means an accident, including continuous or repeated exposure to substantially the same general harmful conditions.
14. “Products-completed operations hazard:”
a. Includes all ... “property damage” occurring away from premises you own or rent and arising out of ... “your work”....
15. “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 of use shall be deemed to occur at the time of the “occurrence” that caused it.
19. “Your work” means:
a. Work or operations performed by you or on your behalf; and
b. Materials, parts or equipment furnished in connection with such work or operations.
“Your work” includes:
a. Warranties or representations made at any time with respect to the fitness, quality, durability, performance or use of “your work”; and
b. The providing of or failure to provide warnings or instructions.
A party is entitled to summary judgment when it can show that there is no genuine issue as to any material fact. Fed. R. Civ. P. 56(c); Beal v. Paramount Pictures Corp., 20 F.3d 454, 458 (11th Cir.1994). Which facts are material depends on the substantive law applicable to the case.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The moving party bears the burden of showing that no genuine issue of material fact exists. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir.1991); Watson v. Adecco Employment Servs., Inc., 252 F.Supp.2d 1347, 1351-52 (M.D.Fla.2003).
When a party moving for summary judgment points out an absence of evidence on a dispositive issue for which the non-moving party bears the burden of proof at trial, the non-moving party must “go beyond the pleadings and by [its] own affidavits, or by the depositions, answers to interrogatories, and admissions on file, designate specific facts showing that there is a genuine issue for trial.” Celotex Corp., 477 U.S. at 324-25, 106 S.Ct. 2548 (internal quotations and citations omitted). Thereafter, summary judgment is mandated against the non-moving party who fails to make a showing sufficient to establish a genuine issue of fact for trial. Id. at 322, 324-25, 106 S.Ct. 2548; Watson, 252 F.Supp.2d at 1352. The party opposing a motion for summary judgment must rely on more than conclusory statements or allegations unsupported by facts. Evers v. Gen. Motors Corp., 770 F.2d 984, 986 (11th Cir.1985) () (citations omitted); Broadway v. City of Montgomery, Ala., 530 F.2d 657, 660 (5th Cir.1976).
In determining whether the moving party has satisfied its burden, the Court considers all inferences drawn from the underlying facts in a light most favorable to the party opposing the motion, and resolves all reasonable doubts against the moving party. Anderson, 477 U.S. at 255, 106 S.Ct. 2505. The Court is not, however, required to accept all of the nonmovant's factual characterizations and legal arguments. Beal, 20 F.3d at 458-59.
In Florida, an insurer's duty to defend is distinct from, and broader than, the duty to indemnify. Lime Tree Vill. Cmty. Club Ass'n, Inc. v. State Farm Gen. Ins. Co., 980 F.2d 1402, 1405 (11th Cir.1993) (citing Baron Oil Co. v. Nationwide Mut. Fire Ins. Co., 470...
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