Nova Cas. Co. v. Waserstein

Decision Date24 March 2006
Docket NumberNo. 04-20755 CIV JORDAN.,04-20755 CIV JORDAN.
Citation424 F.Supp.2d 1325
CourtU.S. District Court — Southern District of Florida
PartiesNOVA CASUALTY COMPANY Plaintiff v. Richard WASERSTEIN, et al. Defendants.

Wayne T. Gill, Esq., Walton Lantaff, West Palm Beach, FL, for Plaintiff.

Jacob J. Givner, Esq., Bay Harbor Islands, Robert J. McKee, Krupnick Campbell Malone Roselli, et al., Fort Lauderdale, for Defendants.

ORDER ON MOTION AND CROSS-MOTION FOR SUMMARY JUDGMENT

JORDAN, District Judge.

Nova Casualty Company moves for summary judgment on Count I of its second amended complaint for declaratory relief, and Richard Waserstein's and 1108 Concourse, L.C.'s ("1108") affirmative defenses. Mr. Waserstein and 1108 filed a cross-motion for summary judgment on Count I, and oppose Nova's motion for summary judgment only as to their affirmative defense of promissory estoppel. For the following reasons, Nova's motion for summary judgment [D.E. 78] is GRANTED IN PART. It is GRANTED as to Count I, and DENIED as to the affirmative defense of promissory estoppel. Mr. Waserstein's and 1108's cross-motion for summary judgment [D.E. 87] is DENIED.

Nova also moves for summary judgment on 1108's and Mr. Waserstein's affirmative defenses of failure to state a claim and lack of subject matter jurisdiction. 1108 and Mr. Waserstein do not oppose Nova's motion in this regard. Therefore, Nova's motion for summary judgment on the affirmative defenses of failure to state a claim and lack of subject-matter jurisdiction [D.E. 78] is GRANTED.

The only other count in Nova's complaint, Count II, seeks a declaration that it has no duty to indemnify Mr. Waserstein in connection with the battery claim in the underlying state court suit. Nova concedes that Count II is moot because the battery claim against Mr. Waserstein was dismissed in the underlying state court suit. See Nova's Motion for Summary Judgment ("Sum. J. Mot.") at 2. I interpret this as a voluntary dismissal of Count II in Nova's second amended complaint, see Rule 41(a)(2), and thus, Count II is DISMISSED WITHOUT PREJUDICE.

I. FACTS

On summary judgment, the facts must be read in the light most favorable to the non-moving parties, Mr. Waserstein and 1108. See Hilburn v. Murata Electronics North America, Inc., 181 F.3d 1220, 1225 (11th Cir.1999). With that standard in mind, the facts are as follows.

A. THE UNDERLYING STATE COURT SUIT AND POLLUTION EXCLUSION CLAUSE

1108 owns an office building located in Miami, Florida, and Mr. Waserstein is a managing member of 1108. See Deposition of Richard Waserstein ("Waserstein Depo.") [D.E. 96] at 4-5; Affidavit of Richard Waserstein in Opposition to Nova's Motion for Summary Judgment ("Waserstein Aff.") [D.E. 84] at ¶ 1. Eight plaintiffs filed suit in Florida circuit court against Mr. Waserstein, 1108, two parties that did construction, repair, and maintenance work in the building, and Bank of America Corp., a tenant in the building. See Second Amended Complaint of Marlene Barnett in Marlene Barnett v. Trammel Crow Servs., Inc., et. al., Case No. 03-14301 CA 20 (Fla. 11th Jud. Cir.) ("St.Ct.Compl.") at ¶¶ 3-12, att'd as Ex. 1 to Sum. J. Mot. Each of the eight plaintiffs were employees of Bank of America, and are the other defendants in this declaratory judgment action.

The underlying complaints contain identical allegations and negligence claims against 1108 and Mr. Waserstein.1 The complaints allege that, due to the negligence of 1108 and Mr. Waserstein, the eight plaintiffs in the underlying suit were physically injured by exposure to the following while working for Bank of America inside the building:

"expos[ure] to harmful chemicals and living organisms" (Id. at ¶ 13);

"hazardous particles and chemicals" (Id. at ¶¶ 38, 39, 40, 41 d, 46, 47, 48, 49 d);

"hazardous particles and chemical toxicants" (Id. at ¶¶ 41 b, 49 b);

"dangerous chemicals, particulates and microbial populations" (Id. at ¶¶ 40, 48);

"indoor allergens" (Id. at ¶¶ 42 d, 50 d);

and

"airborne and microbial contaminants"

(Id. at ¶¶ 42 b, c, d, 50 b, c, d).

The complaints also allege claims for battery against 1108 and Mr. Waserstein, but the state court has dismissed them. See Sum. J. Mot. at 2.

Nova issued a general commercial liability insurance policy to 1108. Count I of Nova's complaint seeks a declaration that Nova has no duty to defend or indemnify 1108 or Mr. Waserstein in the underlying suit because the pollution exclusion clause in the policy excludes coverage for the causes alleged in the underlying suit. The policy has a coverage provision which sets out Nova's duty to defend and indemnify:

1. Insuring Agreement

a. We will pay those sums that the insured becomes legally obligated to pay as damages because of "bodily injury" or "property damage" to which this insurance applies. We will have the right and duty to defend the insured against any "suit" seeking those damages. However, we will have no duty to defend the insured against any "suit" seeking damages for "bodily injury" or "property damage" to which this insurance does not apply.

Commercial General Liability Coverage Form at 1, att'd as Comp. Ex. 9 to Sum. J. Mot. A subsequent provision, commonly referred to as an "absolute pollution exclusion clause," limits Nova's duty to defend and indemnify:

This insurance does not apply to:

f. Pollution

(1) "Bodily injury" or "property damage" which would not have occurred in whole or in part but for the actual, alleged or threatened discharge, dispersal, seepage, migration, release, or escape of "pollutants" at any time.

Total Pollution Exclusion Endorsement at 1, att'd as Comp. Ex. 9 to Sum. J. Mot. The policy also defines "pollutants":

15. "Pollutants" mean any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals, and waste. Waste includes materials to be recycled, reconditioned, or reclaimed.

Commercial General Liability Coverage Form at 12.

B. REPRESENTATIONS RELATING TO THE ESTOPPEL DEFENSE

Some time before he purchased the office building on January 28, 2000, Mr. Waserstein called Combined Underwriters of Miami, Inc., and inquired as to the availability of an insurance policy that would provide "full coverage" to the office building. See Waserstein Depo. at 5-9. He specified that both he and Bank of America planned to do renovations in the building, and that he did not want any problems relating to the renovation to arise. See id. at 9-12. Combined promised Mr. Waserstein that it would provide him with a policy where "everything [he] needed it to cover, it was covered." See id. at 12. The building was purchased on January 28, 2000. See id. at 10-11.

Combined helped Mr. Waserstein obtain an insurance policy to cover the period from January 28, 2000 to January 28, 2001. See id. at 6-7. The insurer for this first period was either Underwriters at Lloyd's, London, or Nova. See id.; Waserstein Aff. at ¶ 7; Deposition of Georgina Lopez ("Lopez Depo.") [D.E. 98] at 10-13. This policy was renewed for the period of January 28, 2001 to January 28, 2002. See Waserstein Depo. at 7, 15; Lopez Depo. at 12-13. Another policy was issued for the period of January 28, 2002, to January 28, 2003. That policy was then renewed for the period of January 28, 2003 to January 28, 2004. See Waserstein Depo. at 20; Lopez Depo. at 15, 38. There is no dispute that the policy covering the third period, and its renewal, were issued by Nova. See Waserstein Depo. at 20; Lopez Depo. at 15, 38.

At some time during the third period (January 28, 2002 to January 28, 2003), while the building was insured by Nova, Mr. Waserstein contacted Combined again to inquire as to the scope of coverage. See Waserstein Depo. at 16; Mr. Waserstein's Responses to Nova's Interrogatories ("Waserstein Ans. to Interogs.") at ¶ 9 a, att'd Ex. 24 to Sum. J. Mot; 1108's Responses to Nova's Interrogatories ("1108 Ans. to Interogs.") at ¶ 9 a, att'd Ex. 22 to Sum. J. Mot. Mr. Waserstein reiterated that both he and Bank of America were planning on doing renovations and construction in the building, and that he needed full or complete coverage. See id. He specifically asked whether he needed to purchase additional coverage for the office building. See id. Combined's representative reassured him that he did not need any additional coverage and that he would be fully covered. See id. at 23, 25. But for Combined's representations to him, Mr. Waserstein would not have allowed the construction and renovation to begin. See Waserstein Aff. at ¶ 15; Waserstein Ans. to Interogs. at ¶ 9 g; 1108 Ans. to Interogs. at ¶ 9 g. After speaking with Combined's representative, Mr. Waserstein allowed the renovation to start, and it then began some time later in 2002. See Waserstein Depo. at 16, 25-26; Waserstein Ans. to Interogs. at ¶ 9 a, f; 1108 Ans.-to Interogs. at ¶ 9 a, f. The plaintiffs in the underlying suit allege injuries arising from the renovation. See St. Ct. Compl. at ¶ 7.

I do not resolve the factual dispute over whether Lloyd's or Nova was the insurer during the first two periods (January 28, 2000 to January 28, 2002) because this fact is not material to the estoppel defense. Mr. Waserstein's and 1108's estoppel defense can survive summary judgment even if the first policy, and its subsequent renewal, were issued by Lloyd's, rather than Nova. I recognize that the evidence Mr. Waserstein presents on when Combined's representative made the second representation, and when renovations commenced, is on shaky ground. During his deposition, Mr. Waserstein testified:

Mr. Gill: What was the first time that any of that construction work commenced?

Mr. Waserstein: I don't recall the exact date.

Mr. Gill: Do you know the year?

Mr. Waserstein: 2001, I believe, but I don't really know.

. . . . .

Mr. Gill: Did you have any conversations or communications of any kind with Combined...

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