Nationwide Prop. & Cas. Ins. Co. v. Chism
| Decision Date | 07 July 2017 |
| Docket Number | Case No. 2:16-cv-738-TMP |
| Parties | NATIONWIDE PROPERTY AND CASUALTY INSURANCE COMPANY, Plaintiff/Counter-defendant; v. JEFFREY L. CHISM, Defendant/ Counterclaimant. |
| Court | U.S. District Court — Northern District of Alabama |
This action was brought pursuant to 28 U.S.C. § 2201, which provides that a federal court "may declare the rights and other legal relations" of the parties. This declaratory judgment action was filed by plaintiff Nationwide Property and Casualty Insurance Company ("Nationwide"), seeking a declaration that the insurer owes no uninsured/underinsured motorist coverage ("UM/UIM") to defendant Jeffrey L. Chism. This matter is before the court on the court's sua sponte motion for summary judgment. (Doc. 22). The court notified the parties that it appeared that an express exclusion in the policy at issue demonstrated that, as a matter of law, no UIM coverage was provided to Chism. (Doc. 22, p. 12). The parties have fully briefed the issue. The defendant filed a brief in opposition to the court's notice regarding summary adjudication (Doc. 27), supported by exhibits. Plaintiff filed a reply, and evidence in support of the reply. (Docs. 30, 31). Defendant filed a supplemental response (Doc. 37), and the plaintiff filed a sur-reply (Doc. 38), to which the defendant filed a response. (Doc. 39). The parties have consented to the exercise of final dispositive jurisdiction by the undersigned magistrate judge pursuant to 28 U.S.C. § 636(c).
Under Federal Rule of Civil Procedure 56(c), summary judgment is proper "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(c). The party asking for summary judgment "always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of 'the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,' which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (quoting Fed. R. Civ. P. 56(c)). The movant can meet this burden by presenting evidence showing there is no dispute of material fact, or by showing that the nonmoving party has failed to present evidence in support of some element of its case on which it bears the ultimate burden of proof. Celotex,477 U.S. at 322-23. There is no requirement, however, "that the moving party support its motion with affidavits or other similar materials negating the opponent's claim." Id. at 323.
Once the moving party has met his burden, Rule 56(e) "requires the nonmoving party to go beyond the pleadings and by her own affidavits, or by the 'depositions, answers to interrogatories, and admissions of file,' designate 'specific facts showing that there is a genuine issue for trial.'" Id. at 324 (quoting Fed. R. Civ. P. 56(e)). The nonmoving party need not present evidence in a form necessary for admission at trial; however, he may not merely rest on his pleadings. Celotex, 477 U.S. at 324. "[T]he plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Id. at 322.
After the plaintiff has properly responded to a proper motion for summary judgment, the court must grant the motion if there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). The substantive law will identify which facts are material and which are irrelevant. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A disputeis genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. at 248. "[T]he judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Id. at 249. His guide is the same standard necessary to direct a verdict: "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Id. at 251-52; see also Bill Johnson's Restaurants, Inc. v. N.L.R.B., 461 U.S. 731, 745 n.11 (1983). However, the nonmoving party "must do more than show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). If the evidence is merely colorable, or is not significantly probative, summary judgment may be granted. Anderson, 477 U.S. at 249 (citations omitted); accord Spence v. Zimmerman, 873 F.2d 256 (11th Cir. 1989). Furthermore, the court must "view the evidence presented through the prism of the substantive evidentiary burden," so there must be sufficient evidence on which the jury could reasonably find for the plaintiff. Anderson, 477 U.S. at 254; Cottle v. Storer Communication, Inc., 849 F.2d 570, 575 (11th Cir. 1988). Nevertheless, credibility determinations, the weighing of evidence, and the drawing of inferences from the facts are the function of the jury, and therefore the evidence of the non-movant is to be believed and alljustifiable inferences are to be drawn in his favor. Anderson, 477 U.S. at 255. The non-movant need not be given the benefit of every inference but only of every reasonable inference. Brown v. City of Clewiston, 848 F.2d 1534, 1540 n. 12 (11th Cir. 1988).
Viewing the evidence provided by both parties in the light most favorable to the defendant, Chism,1 the following facts are relevant for purposes of the motion for summary judgment.
Nationwide filed this action seeking declaratory relief, requesting that the court declare the parties' rights and liabilities pursuant to a policy of automobile insurance, Policy No. 77 01 C 408074, that was issued to Omiku Chism, the defendant's mother. The policy covered three vehicles: a 2005 Chevrolet Silverado, a 2004 Mercedes Benz S1500, and a 2009 Nissan Maxima, and included $25,000/$50,000 in coverage for uninsured or underinsured motorists. The policy covered a period from April 30, 2015, until October 30, 2015.
On October 13, 2015, during the coverage period, the defendant was involved in an automobile accident while driving a 2003 GMC Sierra 3500 owned by hisfather, Jeffrey C. Chism. The 2003 GM Sierra was insured by Progressive Insurance Company, which is not a party to this action. The GM Sierra was not covered by the Nationwide policy owned by Omiku Chism. (Doc. 27, p. 3). As a result of the accident, the defendant was injured and incurred medical expenses of more than $100,000. The driver of the car that struck the defendant was insured by Alfa Insurance Company, which paid its policy limits of $25,000 to the defendant on December 16, 2015. It is undisputed that, absent some exclusion, the Nationwide contract would include coverage for the defendant as a resident relative of the named insured.
The declarations pages of the policy expressly excluded Jeffrey L. Chism "from all coverages and all vehicles on the policy." (Doc. 1-1). On page 2 of 4 of the declarations pages, the following appears:
See Doc. 1, p. 15 of 54 (bolding as in original). All but the words, "Jeffery L. Chism," appear to be a standard printed part of page 2 of the declarations pages.
Attached to the policy was Endorsement 3000, titled "Voiding Automobile Insurance While A Certain Person Is Operating Car," which stated that "[w]ith this endorsement, the coverages provided in this policy are not in effect while: [BLANK] is/are operating any motor vehicle to which the policy applies." The endorsement was not filled in, however, as neither the name of any excluded driver nor the policy number are referenced in the endorsement. (Doc. 27-6, p. 3 of 11; Doc. 1, p. 50 of 54).
Policyholder Omiku Chism did not reject UM/UIM coverage on the policy at issue.2 Initial briefing included no dispute over whether the policy expressly excluded coverage for the defendant. There also is no dispute that Omiku Chism intended to exclude her son from coverage, or that Jeffery L. Chism understood that he was excluded from coverage under his mother's policy. (Doc. 31-1 p. 20, Depo. of Jeffery L. Chism). She expressly stated that she wanted to exclude Jeffery from coverage, and Jeffery was aware of her decision to exclude him. Inthe defendant's supplemental response, however, the defendant asserts that the exclusion cannot be considered part of the contract at issue because, at neither the time the contract was entered nor at the time the accident occurred, it had not been submitted to and approved by the Alabama Department of Insurance ("DOI"), as required by Alabama Code § 27-14-8.
Defendant Chism has offered the affidavit of James Williamson, a Rate Analyst III with the Alabama Department of Insurance. He testified that Nationwide submitted to the Department one page of its multi-page declaration page form for approval on October 27, 2011. The page containing the exclusion language quoted above was not submitted, or at least there is no evidence it was submitted, according to Williamson. See Doc. 37-3. Williamson concluded that 3 Id. Although Nationwide filed an opposition and motion to strike Chism's...
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