Ripley v. Brethren Mut. Ins. Co.

• Decision Date: 25 November 2014
• Docket Number: Civil Action No. 14–4763.
• Citation: 69 F.Supp.3d 503
• Court: U.S. District Court — Eastern District of Pennsylvania
• Parties: Carroll RIPLEY, Jr. and Carolyn Ripley v. BRETHREN MUTUAL INSURANCE CO.

69 F.Supp.3d 503

Carroll RIPLEY, Jr. and Carolyn Ripley

v.BRETHREN MUTUAL INSURANCE CO.

Civil Action No. 14–4763.

United States District Court, E.D. Pennsylvania.

Signed Nov. 25, 2014.

Mark J. Hill, Mark J. Hill & Associates PC, Philadelphia, PA, for Carroll Ripley, Jr. and Carolyn Ripley.

Martin A. Durkin, Durkin Law Offices P.C., Philadelphia, PA, for Brethren Mutual Insurance Co.

MEMORANDUM

DALZELL, District Judge.

In the summer of 2012, Michael Ripley and two acquaintances stole antiques worth more than $50,000 from his grandparents Carroll Ripley, Jr. and Carolyn Ripley's house. At issue is whether Michael was at that time a member of his grandparents' household, which would trigger a policy exclusion in their insurance policy precluding recovery from defendant Brethren Mutual Insurance Co. (“Brethren Mutual”) for the theft.

Before us are plaintiffs' motion for partial summary judgment seeking a judicial declaration that Michael Ripley was not an “insured” for purposes of the policy exclusion and Brethren Mutual's motion for summary judgment. For the reasons set forth below, we will grant plaintiffs' motion and deny Brethren Mutual's motion.

I. Factual And Procedural Background

The undisputed facts are that on May 12, 2012 Brethren Mutual issued Farm Policy No. F880010255 05 to Carroll Ripley, Jr. and Carolyn Ripley (collectively, “the Ripleys”) to cover their residence in Ivyland, Pennsylvania, which includes a 15 ½-room house, a six-room carriage house, and four horse barns (one of which is attached to a horse-riding arena) on a thirty-acre working horse farm. Pl. SOF at ¶¶ 6, 7. On July 30, 2012 a theft of personal property—antiques Carolyn Ripley had collected—occurred at the residence. Def. SOF at ¶ 4; Pl. SOF at ¶ 9. The plaintiffs filed a claim to recover under their insurance policy, Def. SOF at ¶ 4, and Brethren Mutual hired Michael H. McIntyre of MHM Risk Management, Inc. to investigate and evaluate the claim. Id. at ¶ 5. McIntyre visited the premises on August 16, 2012. Id. at ¶ 6. During the inspection, Carolyn Ripley advised McIntyre that her grandson lived on the premises and had admitted his involvement in the theft to her. Id. at ¶¶ 7, 8; Pl. SOF at ¶ 24.

On August 21, 2012, McIntyre issued a letter on behalf of Brethren Mutual denying coverage by reference to a policy provision that stated:

We will not pay for loss or damage arising out of any act an “insured” commits or conspires to commit with the intent to cause a loss.

In the event of such a loss, no “insured” is entitled to coverage, even “insureds” who did not commit or conspire to commit the act causing the loss.

Def. SOF at ¶ 12; Pl. SOF at ¶ 25 and Ex. E.

The policy defines “insured” as follows:

“Insured” means you and, If you are an individual, the following members of your household:

a. Your relatives;....

Pl. SOF, Ex D. at 6; see also Def. SOF at ¶ 13.

Plaintiffs offer the following additional facts. Michael Ripley, then 22 years old, lived at the Ripley residence as a boarder since December of 2009. Pl. SOF ¶¶ 11, 14. He paid a reduced rent of $25 per week and bartered work by caring for the horses in exchange for a room, as his mother had done between 1993 and 1996. Id. at ¶¶ 15, 16. Michael Ripley did not sign a Room Rental Agreement, as the Ripleys require other boarders to do, nor did he pay the security deposit they required of other boarders because (1) he was familiar with the house rules and did not need to sign an acknowledgment thereto; (2) he intended to stay longer than the minimum twelve-week stay the Ripleys otherwise required; (3) he was already known to his grandparents; and (4) his arrangement provided for barter for services. Id. at ¶¶ 17, 18.

The plaintiffs further state that from the time he moved in until he was evicted on August 2, 2012, id. at Ex. C ¶ 24, Michael Ripley provided his own food and ate his meals separately from the Ripleys. Id. at ¶ 20. He had access to the residence's appliances and the kitchen as other boarders did, but did not have permission to otherwise use any of the Ripleys' other property—such as their car.Id. He did not have access to the living or dining rooms, his grandmother's office, or any bedroom but his own. Id. He paid for his cell phone and health insurance, and when he could not afford health insurance, he went without. He was not covered under the Ripleys' health insurance plan. Id.; see also Ex. C. Michael, like other boarders, was not permitted to bring anyone into the Ripley residence. Id., Ex. C at ¶ 22.

After he lost a part-time job in the summer of 2012 and ceased working reliably on the farm, the plaintiffs state that his grandmother gave him three weeks' notice to leave. Id. at ¶ 21. Carolyn Ripley discovered the theft of antique objects and furniture when she returned home on August 1, 2012. Id. at ¶ 23. Michael confessed to her that he participated in the theft by letting two men into the house in her absence. Id. She evicted him the following day. Id.

For its part, defendant Brethren Mutual offers the following additional facts. The insurer states that Carolyn Ripley never advised investigator McIntyre while they were inspecting the premises together that her grandson was a boarder or tenant. Def. SOF at ¶ 15. Brethren Mutual points to Carolyn Ripley's repeated references to her familial relationship to Michael. For example, in a handwritten letter supplementing her police report, she stated “Michael thinks of me as his mother, because I raised him.” Id. at ¶ 16. Brethren Mutual also relies on another handwritten letter to the detective, in which she recounted that upon first discovering the theft, she was

sobbing, saying to Michael with [a friend] present, ‘I've given you my life. I paid all your fines. I kept you from getting two felonies. I lived for you. No one in the world has ever meant as much to me as you. I would have died for you!’

Id. at ¶ 17, see also Def. SOF, Ex. C.

On July 9, 2014, the Ripleys filed suit in the Court of Common Pleas of Philadelphia County for breach of contract and bad faith. Their complaint alleges more than $50,000 in damages from the theft¹ and also seeks interest, attorney's fees and punitive damages under the Pennsylvania Bad Faith statute, 42 Pa.C.S.A. § 8371. On August 14, 2014, Brethren Mutual removed to this Court. Thereafter, the parties filed the instant motions.

II. Legal Standard

Summary judgment is appropriate if there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). A party moving for summary judgment bears the burden of proving no genuine issue of material fact exists. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 n. 10, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). To that end, the movant must inform the district court of the basis for its argument by “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, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Where the movant is the defendant or the party that does not have the burden of proof on the underlying claim, it “has no obligation to produce evidence negating its opponent's case,” National State Bank v. Federal Reserve Bank of New York, 979 F.2d 1579, 1582 (3d Cir.1992). The movant need only point to the lack of evidence supporting the non-movant's claim. Id.

It is well-established that Rule 56 obliges the nonmoving party “to go beyond the pleadings and by her 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, 477 U.S. at 324, 106 S.Ct. 2548 ; see also Fed.R.Civ.P. 56(c). The nonmoving party must identify specific facts and affirmative evidence that contradict those offered by the moving party.

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256–57, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

The reviewing court should view the facts in the light most favorable to the non-moving party and draw all reasonable inferences in that party's favor. Scheidemantle v. Slippery Rock Univ. State Sys. of Higher Educ., 470 F.3d 535, 538 (3d Cir.2006). A factual dispute is “genuine” if it turns on “evidence on which the jury could reasonably find for the plaintiff.” Anderson, 477 U.S. at 252, 106 S.Ct. 2505. A fact is “material” if it “might affect the outcome of the suit under the governing law.” Id. at 248, 106 S.Ct. 2505. That is, “only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude” summary judgment. Boyle v. County of Allegheny Pennsylvania, 139 F.3d 386, 393 (3d Cir.1998) (quoting Anderson, 477 U.S. at 248, 106 S.Ct. 2505 ).

[T]he plain language of Rule 56 [ ] mandates the entry of summary judgment ... 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.

Celotex, 477 U.S. at 322, 106 S.Ct. 2548.

When both parties move for summary judgment, our task is no different. As our Court of Appeals has cautioned,

Cross-motions are no more than a claim by each side that it alone is entitled to summary judgment, and the making of such inherently contradictory claims does not constitute an agreement that if one is rejected the other is necessarily justified or that the losing party waives judicial consideration and determination whether genuine issues of material fact exist. If any such issue exists it must be disposed of by a plenary trial and not on summary judgment.

Rains v. Cascade Industries, Inc., 402 F.2d 241, 245 (3d Cir.1968). Cross-motions must be considered separately and should not be interpreted necessarily to mean that judgment should be entered on either one of them. Each party,...