RSBI Aerospace, Inc. v. Affiliated FM Ins. Co.

Citation49 F.3d 399
Decision Date28 February 1995
Docket NumberNo. 94-2706,94-2706
PartiesRSBI AEROSPACE, INC., Appellant, v. AFFILIATED FM INSURANCE COMPANY, Appellee.
CourtUnited States Courts of Appeals. United States Court of Appeals (8th Circuit)

Marilyn Gussman, Kansas City, MO, argued (Thomas J. Cox, on the brief), for appellant.

Terrence R. Joy, Kansas City, MO, argued (William A. Webster and Patrick M. Reidy, on the brief), for appellee.

Before HANSEN, Circuit Judge, FLOYD R. GIBSON, Senior Circuit Judge, and WILL, * Senior District Judge.

WILL, Senior District Judge.

RSBI Aerospace, Inc. ("RSBI") brought this breach of insurance contract action against Affiliated FM Insurance Company ("Affiliated") after Affiliated denied RSBI's claim for lost inventory resulting from a fire at its office and warehouse. Affiliated brought a counterclaim against RSBI, alleging fraudulent misrepresentation, and then moved for summary judgment on both claims, arguing that the fire loss at issue was caused by an employee of the insured and therefore recovery was precluded by the terms of the policy. The district court granted the motion for summary judgment on RSBI's claims, but denied the motion for summary judgment on Affiliated's counterclaims. RSBI timely appealed the district court's order. We affirm.

BACKGROUND

On November 2, 1991, a fire occurred at RSBI's warehouse and offices, which resulted in a loss of most of RSBI's inventory. Neither party disputes that the fire was set intentionally. RSBI filed a claim of loss with its insurer, Affiliated, for the lost inventory. Affiliated denied the claim on the basis that RSBI misrepresented proof of losses and was involved with the setting of the fire. RSBI then brought this suit for breach of insurance contract and Affiliated filed a counterclaim seeking expenses incurred in the investigation and defense of this action.

Affiliated filed a motion for summary judgment on both RSBI's claims and its counterclaims. Affiliated contended that the fire In opposition to the motion for summary judgment, Barber and Mize filed affidavits which contradicted their own earlier sworn statements and stated that Tamburello was terminated as an employee on September 30, 1991. RSBI also cited deposition testimony of their witness, Robert Purinton, an accountant retained to support the claim, in which he made reference to a notation in Tamburello's personnel file that indicates that he was terminated on September 30, 1991. Mr. Purinton also testified that, according to RSBI's records, after September 30, 1991, Tamburello was no longer on the payroll. RSBI also submitted Tamburello's personnel records, which contained the notation that Tamburello was terminated from employment in September 1991.

was set by one of RSBI's employees, Guy Tamburello, and the policy contained a clause which excluded from coverage loss caused by any employee of the insured. In support of its motion, Affiliated submitted numerous discovery responses, most of them consisting of sworn statements or deposition testimony of RSBI's President, Ross Barber, and Secretary, Denise Mize, in which Barber and Mize stated that Tamburello was an employee at the time of the fire and continued to be employed until approximately January 1992. Affiliated also submitted the guilty plea of Guy Tamburello, in which he admitted to setting the fire, and the sworn statement of Guy Tamburello, in which he once again admitted setting the fire and confirmed that he was employed by RSBI at the time of the fire.

Although RSBI contended that its officers' affidavits and the other evidence demonstrated a genuine issue of material fact, the district court held otherwise. The court first concluded that the clause excluding coverage for acts of employees was enforceable under Missouri law, and thus the issue of whether Tamburello was an employee was material to this case. The court then noted that the affidavits filed by Barber and Mize completely contradicted their previous sworn testimony, and thus under this circuit's decision in Camfield Tires, Inc. v. Michelin Tire Corp., 719 F.2d 1361 (8th Cir.1983), these contradictory affidavits, without evidence of some type of confusion on the part of the affiants with respect to their previous testimony, did not create a dispute of fact which would preclude summary judgment. In particular, the court noted that in their affidavits Barber and Mize did not explain why the statements contained in the affidavits were contrary to the prior depositions and other sworn testimony.

Finally, the court concluded that Tamburello's personnel records and Purinton's deposition testimony did not create an issue of fact because, in light of the overwhelming evidence supporting Affiliated's assertion that Tamburello was an employee at the time of the fire, no reasonable jury could have concluded that Tamburello was not an employee of RSBI on November 2, 1991. The court then granted summary judgment on RSBI's claims, but denied the motion for summary judgment on Affiliated's counterclaims. RSBI filed this timely appeal.

DISCUSSION

On appeal, we review a grant of summary judgment de novo, applying the same standard as the district court. Egan v. Wells Fargo Alarm Services, 23 F.3d 1444, 1446 (8th Cir.), cert. denied, --- U.S. ----, 115 S.Ct. 319, 130 L.Ed.2d 280 (1994). Summary judgment is proper when the movant establishes that there are no genuine issues of material fact and, therefore, the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 2509, 91 L.Ed.2d 202 (1986). As the district court noted, a genuine issue of material fact exists if: (1) there is a dispute of fact; (2) the disputed fact is material to the outcome of the case; and (3) the dispute is genuine, that is, a reasonable jury could return a verdict for either party. The moving party has the burden of proving that these requirements have been met. Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970). When considering a motion for summary judgment, a court should construe all evidence in favor of the non-moving party. Anderson, 477 U.S. at 255, 106 S.Ct. at 2513. However, if the evidence submitted by the non-moving party is The district court correctly concluded that the issue of whether Tamburello was an employee was material. The applicable exclusionary clause in the insurance policy stated:

merely colorable or is not significantly probative, summary judgment may be granted. Id. at 249-50, 106 S.Ct. at 2510-11.

This policy does not insure against loss or damage caused by or resulting from any of the following regardless of any other cause or event which contributes concurrently or in any sequence to the loss unless such coverage is specifically endorsed to this Policy:

(a) Any dishonest act committed alone or in collusion with others, (1) by the Insured or any associate, officer or employee thereof whether or not such acts are committed during regular business hours....

Thus, under the plain terms of the insurance policy, RSBI could not recover insurance proceeds for any dishonest acts committed by its employees. While Missouri common law would not have prevented coverage for acts committed by employees unless the corporation had assented to the acts, we agree with the district court and the cases upon which it relied that because coverage for such acts is specifically included in the insurance policy, Missouri common law is inapplicable in this case. See, e.g., State Farm Fire and Cas. Ins. Co. v. Kane, 715 F.Supp. 1558, 1561-62 (S.D.Fla.1989); Minnesota Bond v. St. Paul Mercury Ins. Co., 300 Or. 85, 706 P.2d 942, 943 (1985).

RSBI also contends that the exclusionary language contained in the policy should not be applied in this case because the term "employee" is ambiguous and therefore should be construed in their favor. However, RSBI did not present this argument to the district court. "It is old and well-settled law that issues not raised in the trial court cannot be considered by this court as a basis for reversal." Gregory v. Honeywell, Inc., 835 F.2d 181, 184 (8th Cir.1987). Even if we were to consider the merits of RSBI's argument, however, it would fail because although the term "employee" may be ambiguous in certain situations,...

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