Royer v. Usaa Cas. Ins. Co., No. 3:09–CV–112.

CourtUnited States District Courts. 7th Circuit. United States District Court of Northern District of Indiana
Writing for the CourtRUDY LOZANO, District Judge.
Citation781 F.Supp.2d 767
PartiesBrian ROYER, et al., Plaintiffs,v.USAA CASUALTY INSURANCE COMPANY, Defendant.
Decision Date11 March 2011
Docket NumberNo. 3:09–CV–112.

781 F.Supp.2d 767

Brian ROYER, et al., Plaintiffs,
v.
USAA CASUALTY INSURANCE COMPANY, Defendant.

No. 3:09–CV–112.

United States District Court, N.D. Indiana, South Bend Division.

March 11, 2011.


[781 F.Supp.2d 769]

Edward R. Ruiz, Morris & Ruiz PC, Plymouth, IN, Timothy W. Woods, J. Thomas Vetne, Jones Obenchain LLP, South Bend, IN, for Plaintiffs.Anna M. Mallon, Dennis F. Cantrell, Cantrell Strenski & Mehringer LLP, Indianapolis, IN, for Defendant.
OPINION AND ORDER
RUDY LOZANO, District Judge.

This matter is before the Court on: (1) Plaintiff's Motion for Partial Summary Judgment, filed on November 18, 2010; and (2) Defendant's Motion for Summary Judgment, filed on December 16, 2010. For the reasons set forth below Plaintiff's Motion for Partial Summary Judgment is DENIED and Defendant's Motion for Summary Judgment is GRANTED. This case is DISMISSED and the Clerk is ORDERED to enter judgment in favor of Defendant and close this case.

BACKGROUND

On February 13, 2007, a fire burned down Brian and Stephanie Royer's home in Plymouth, Indiana. The Royers then filed a claim with their insurer, USAA Casualty Insurance Company (“USAA CIC”), to cover the losses of the fire. USAA CIC suspected fraud and ultimately denied the claim. Twenty-four months after the fire, the Royers filed suit alleging breach of contract under the Homeowner's Policy and bad-faith claims handling. At issue is whether the insurance policy's one-year limitations period makes the Royers' claim untimely.

The parties have filed their respective motions for summary judgment, each stating that there is no genuine issue of material fact and that they are entitled to judgment as a matter of law.

DISCUSSIONSummary Judgment Standard

The standards that generally govern summary judgment motions are familiar. Pursuant to Rule 56(c) of the Federal Rules of Civil Procedure, summary judgment is proper only if it is demonstrated that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. See Nebraska v. Wyoming, 507 U.S. 584, 590, 113 S.Ct. 1689, 123 L.Ed.2d 317 (1993); Celotex Corp. v. Catrett, 477 U.S. 317, 322–23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). In other words, the record must reveal that no reasonable jury could find for the nonmovant. Karazanos v. Navistar Int'l Transp. Corp., 948 F.2d 332, 335 (7th Cir.1991); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). In deciding a motion for summary judgment, a court must view all facts in the light most favorable to the nonmovant. Anderson, 477 U.S. at 255, 106 S.Ct. 2505; NUCOR Corp. v. Aceros Y Maquilas de Occidente, 28 F.3d 572, 583 (7th Cir.1994).

The burden is upon the movant to identify those portions of “the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits,” if any, that the movant believes demonstrate an absence of a genuine issue of material fact. Celotex, 477 U.S. at 323, 106 S.Ct. 2548. Once the movant has met this burden, the nonmovant may not rest upon mere allegations but “must set forth specific facts showing that there is a genuine issue for trial.” Fed.R.Civ.P. 56(e); Becker v. Tenenbaum–Hill Assocs., Inc., 914 F.2d 107, 110 (7th Cir.1990); Schroeder v. Lufthansa German Airlines, 875 F.2d 613, 620 (7th Cir.1989). “Whether a fact is material depends on the substantive law underlying a particular claim and ‘only disputes over facts that might affect the outcome of the suit under governing law will properly preclude the entry of summary judgment.’ ” Walter v. Fiorenzo, 840 F.2d 427, 434 (7th Cir.1988) (citing

[781 F.Supp.2d 770]

Anderson, 477 U.S. at 248, 106 S.Ct. 2505).

“[A] party who bears the burden of proof on a particular issue may not rest on its pleading, but must affirmatively demonstrate, by specific factual allegations, that there is a genuine issue of material fact which requires trial.” Beard v. Whitley County REMC, 840 F.2d 405, 410 (7th Cir.1988) (emphasis in original); see also Hickey v. A.E. Staley Mfg., 995 F.2d 1385, 1391 (7th Cir.1993). Therefore, if a party fails to establish the existence of an essential element on which the party bears the burden of proof at trial, summary judgment will be appropriate.

Interpretation of a written contract, including a contract of insurance, typically presents a question of law suitable for resolution on motions for summary judgment. Erie Ins. Group v. Alliance Environmental, Inc., 921 F.Supp. 537, 539 (S.D.Ind.1996). “When the question presented is whether an insurance policy provides liability coverage for a particular claim or lawsuit, the central material facts are ordinarily the terms of the written contract and the contents of the plaintiff's allegations in the underlying litigation.” Id. ( citations omitted). Here, the facts are largely undisputed; instead, it is the legal conclusions to be drawn from the terms of the insurance contract as applied to the underlying lawsuit that is at issue.

Facts

The Royers' home, located at 109 Baker Street, Plymouth, Indiana, was damaged by fire on February 13, 2007. (Royer Aff. p. 1). The home was insured with a Homeowner's Policy (“Policy”) issued by USAA CIC. (Cmplt. Ex. A). The effective date of the Policy was April 1, 2006 through April 1, 2007. (CIC Motion, Ex. 1). The Policy included a one year limitations period, which provided:

SECTION I—CONDITIONS

7. Suit Against Us. No action can be brought against us unless you have:

a. given us notice of the loss,

b. complied with all other provisions, and

c. started the action within one year after the date of the loss.

(Cmplt. Ex. A).

Soon after the fire, the Royers made a claim under the Policy to USAA CIC for the fire damage. (Royer Aff. p. 1). Two insurance adjusters were assigned the fire; one handled the dwelling and the other handled the contents. (Royer Aff. p. 1). While the claim was pending, the adjusters gave the Royers a $10,000 advance to take care of the family's immediate needs. (Royer Aff. p. 1).

USAA CIC had the fire investigated. USAA CIC suspected fraud early into the investigation, with preliminary indications that two separate and unrelated fires were the cause of the damage. (Royer Aff. p. 2; Ex. B). USAA CIC sent a reservation of rights letter to the Royers on March 2, 2007, which indicated the Policy might not provide coverage and reserving the right to deny the Royers claim pending an investigation. (Royer Aff. p. 2; Ex. A). USA CIC denied the Royers' claim under the Policy in a letter sent on October 31, 2007. (Royer Aff. p. 2; Ex. B).

USAA CIC then sent the Royers a letter on December 21, 2007 canceling the Policy effective January 25, 2008. (Royer Aff. p. 2; Ex. C). In the letter, USAA CIC stated:

This is legal notice that we will cancel homeowners policy CIC 01444 89 67 90A effective 12:01 a.m. on January 25, 2008.

The reason for cancellation is shown below:

Our reason for this action is the substantial change in the risk insured against, as indicated by the circumstances of the

[781 F.Supp.2d 771]

loss of February 13, 2007. Specifically, our investigation found that you had intentionally caused the fire damage to your home.

* * *

This notice supersedes any policy or declaration you received previously. We will not provide coverage after 12:01 a.m. on January 25, 2008.

(Royer Aff. Ex. C).

On February 12, 2009, almost two years to the day after the fire, the Royers filed a complaint suing USAA CIC for breach of the Policy and bad-faith claims handling. (DE # 45, p. 3; DE # 48, p. 3).

USAA CIC claims that the Royers filed this claim outside the one year period set out in the Policy. The Royers claim that the one year period is not controlling for three reasons. First, the Royers argue that the one year provision is ambiguous and, therefore, not enforceable against them. Second, the Royers argue that USAA CIC waived its right to enforce the one year provision because the December 21, 2007, letter superseded the Policy. And, third, the Royers contend that the newly enacted Indiana statute, Indiana Code section 27–1–13–17, prohibits the enforcement of the one year period contained in the Policy.

The Suit Limitation Provision is Not Ambiguous

The Royers assert that the suit limitation provision contained in the Policy is...

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4 practice notes
  • McClain v. Madison Nat'l Life Ins. Co., No. 3:11-CV-377
    • United States
    • United States District Courts. 7th Circuit. United States District Court of Northern District of Indiana
    • September 4, 2014
    ...Progressive Ins. Co., Jnc. v. Bullock, 841 N.E. 2d 238, 240 (Ind. Ct. App. 2006). See also Royer v. USAA Casualty Jnsurance Company, 781 F.Supp.2d 767, 770 (N.D. Ind. 2011)("Interpretation of a written contract, including a contract of insurance, typically presents a question of law su......
  • Westfield Ins. Co. v. Orthopedic & Sports Med. Ctr. of N. Ind., Inc., NO. 3:14–CV–1548
    • United States
    • United States District Courts. 7th Circuit. United States District Court of Northern District of Indiana
    • March 28, 2017
    ...typically presents a question of law suitable for resolution on motions for summary judgment." Royer v. USAA Cas. Ins. Co., 781 F.Supp.2d 767, 770 (N.D. Ind. 2011) (citation omitted). "When the question presented is whether an insurance policy provides liability coverage for a par......
  • Legend's Creek Homeowners Ass'n, Inc. v. Travelers Indem. Co. of Am., Case No. 1:18-cv-02782-TWP-MPB
    • United States
    • United States District Courts. 7th Circuit. United States District Court (Southern District of Indiana)
    • October 6, 2020
    ...it failed to comply with the terms of the Coverage Form. The provision is similar to one considered in Royer v. USAA Cas. Ins. Co. , 781 F.Supp.2d 767, 770 (N.D. Ind. 2011). The suit limitation provision in that case read:7. Suits Against Us. No action can be brought against us unless you h......
  • Allstate Ins. Co. v. Mccolly Realtors, Inc., NO. 2:16–cv–00142
    • United States
    • United States District Courts. 7th Circuit. United States District Court of Northern District of Indiana
    • October 31, 2017
    ...typically presents a question of law suitable for resolution on motions for summary judgment." Royer v. USAA Cas. Ins. Co., 781 F.Supp.2d 767, 770 (N.D. Ind. 2011) (citation omitted). "When the question presented is whether an insurance policy provides liability coverage for a par......
4 cases
  • McClain v. Madison Nat'l Life Ins. Co., No. 3:11-CV-377
    • United States
    • United States District Courts. 7th Circuit. United States District Court of Northern District of Indiana
    • September 4, 2014
    ...Progressive Ins. Co., Jnc. v. Bullock, 841 N.E. 2d 238, 240 (Ind. Ct. App. 2006). See also Royer v. USAA Casualty Jnsurance Company, 781 F.Supp.2d 767, 770 (N.D. Ind. 2011)("Interpretation of a written contract, including a contract of insurance, typically presents a question of law suitabl......
  • Westfield Ins. Co. v. Orthopedic & Sports Med. Ctr. of N. Ind., Inc., NO. 3:14–CV–1548
    • United States
    • United States District Courts. 7th Circuit. United States District Court of Northern District of Indiana
    • March 28, 2017
    ...insurance, typically presents a question of law suitable for resolution on motions for summary judgment." Royer v. USAA Cas. Ins. Co., 781 F.Supp.2d 767, 770 (N.D. Ind. 2011) (citation omitted). "When the question presented is whether an insurance policy provides liability coverage for a pa......
  • Legend's Creek Homeowners Ass'n, Inc. v. Travelers Indem. Co. of Am., Case No. 1:18-cv-02782-TWP-MPB
    • United States
    • United States District Courts. 7th Circuit. United States District Court (Southern District of Indiana)
    • October 6, 2020
    ...it failed to comply with the terms of the Coverage Form. The provision is similar to one considered in Royer v. USAA Cas. Ins. Co. , 781 F.Supp.2d 767, 770 (N.D. Ind. 2011). The suit limitation provision in that case read:7. Suits Against Us. No action can be brought against us unless you h......
  • Allstate Ins. Co. v. Mccolly Realtors, Inc., NO. 2:16–cv–00142
    • United States
    • United States District Courts. 7th Circuit. United States District Court of Northern District of Indiana
    • October 31, 2017
    ...insurance, typically presents a question of law suitable for resolution on motions for summary judgment." Royer v. USAA Cas. Ins. Co., 781 F.Supp.2d 767, 770 (N.D. Ind. 2011) (citation omitted). "When the question presented is whether an insurance policy provides liability coverage for a pa......

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