S. Pilot Ins. Co. v. CECS, Inc.
| Decision Date | 25 January 2013 |
| Docket Number | Civil Action No. 1:11–CV–03863–AT. |
| Citation | 15 F.Supp.3d 1284 |
| Parties | SOUTHERN PILOT INSURANCE CO., Plaintiff, v. CECS, INC., Jason Chatham, Louis Duckwall, Adriana Duckwall, and Robert Miller, as surviving spouse of Trisha Miller and as the administrator/executor of the estate of Trisha Miller, Defendants, v. Michael Dillon and Little and Smith, Inc., Third–Party Defendants. |
| Court | U.S. District Court — Northern District of Georgia |
Adam Charles Joffe, R. Tyler Bryant, Robert Malcolm Darroch, Stephanie F. Glickauf, Goodman McGuffey Lindsey & Johnson, Atlanta, GA, for Plaintiff.
James Glenn Richardson, Talley Richardson & Cable, P.A., Dallas, GA, Lawrence J. LoRusso, Rebecca L. Sample, LoRusso Law Firm, P.C., Jennifer Suzanne Ivey, Linley Jones, Linley Jones, P.C., Atlanta, GA, for Defendants.
Brenton Sewell Bean, Christine L. Mast, Hawkins Parnell Thackston & Young, LLP, Atlanta, GA, for Third–Party Defendants.
This is a declaratory judgment action. On September 6, 2011, Defendant Jason Chatham was driving a dump truck owned by Defendant CECS, Inc. (“CECS”) when he and Defendants Louis Duckwall and Trisha Miller were involved in a motor vehicle accident. Trisha Miller died and Louis Duckwall was injured. CECS identified the dump truck as a scheduled vehicle on a Southern Pilot Business Auto Policy (“Policy”). However, Plaintiff Southern Pilot Insurance Company (“Southern Pilot”) filed this instant action seeking a declaration that, because it properly cancelled the subject policy, it was not in force at the time of the accident.
In addition to filing an answer and counterclaim (Doc. 14), Defendants CECS, Inc. (“CECS”) and Jason Chatham (the “CECS Defendants”) filed a Third–Party Complaint against insurance agents Michael Dillon and Little and Smith Inc. (“Little & Smith”). Among other claims, the CECS Defendants assert that Dillon and Little & Smith breached a fiduciary duty by not acting in a timely manner to ensure that CECS had sufficient liability insurance coverage.
This matter is before the Court on the CECS Defendants' Motion for Partial Summary Judgment [Doc. 38] and Dillon and Little & Smith's Motion to Dismiss, or in the Alternative, Motion to Strike the Third–Party Complaint [Doc. 52].1 The Court begins by considering the CECS Defendants' Motion for Partial Summary Judgment.
Summary judgment must be granted if the record shows “that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). A factual issue is genuine if there is sufficient evidence for a reasonable jury to return a verdict in favor of the nonmoving party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A factual issue is material if resolving the factual issue might change the suit's outcome under the governing law. Id. The motion should be granted only if no rational fact finder could return a verdict in favor of the non-moving party. Id. at 249, 106 S.Ct. 2505.
When ruling on the motion, the Court must view all the evidence in the record in the light most favorable to the non-moving party and resolve all factual disputes in the non-moving party's favor. See Reeves v. Sanderson Plumbing Products, Inc., 530 U.S. 133, 150, 120 S.Ct. 2097, 147 L.Ed.2d 105 (2000). The moving party need not positively disprove the opponent's case; rather, the moving party must establish the lack of evidentiary support for the non-moving party's position. See Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). If the moving party meets this initial burden, in order to survive summary judgment, the non-moving party must then present competent evidence beyond the pleadings to show that there is a genuine issue for trial. Id. at 324–26, 106 S.Ct. 2548. The essential question is “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.” Anderson, 477 U.S. at 251–52, 106 S.Ct. 2505.
Keeping in mind that when deciding a motion for summary judgment, the Court must view the evidence and all factual inferences in the light most favorable to the party opposing the motion, the Court provides the factual background below. See Optimum Techs., Inc. v. Henkel Consumer Adhesives, Inc., 496 F.3d 1231, 1241 (11th Cir.2007) (). This summary statement does not represent actual findings of fact. Instead, the Court has provided the statement simply to place the Court's legal analysis in the context of this particular case or controversy.
Southern Pilot issued a policy of commercial automobile insurance to CECS. 2 The policy period was from March 1, 2011 to March 1, 2012. (Doc. 38–3 Ex. A at 1.)
In August of 2011, Southern Pilot/General Casualty3 sent to CECS a document entitled “Notice of Intent to Cancel” (“Notice of Intent”). (Doc. 44 ¶ 5; Doc. 38–3 Ex. B at 1–2.) This Notice of Intent was dated August 8, 2011. (Doc. 44 ¶ 5; Doc. 38–3 Ex. B.) CECS received this on August 17, 2011. (Id.; Doc. 38–3 Ex. B.) This Notice of Intent stated as follows:
Along with the Notice of Intent, Southern Pilot contends that it sent CECS a notice of cancellation (“Notice of Cancellation”), also dated August 8, 2011. (Doc. 60–1 at 8–10 (Ex. J).) The Notice of Cancellation showed the “EFFECTIVE DATE OF NOTICE” as August 23, 2011. (Id. at 9.) In a section entitled “Cancellation,” the document stated, “You are hereby notified in accordance with the terms and conditions of the above mentioned policy, and in accordance with law, that your insurance will cease at and from the hour and date mentioned above.” (Id.) Finally, the Notice of Cancellation indicated that the reason for cancellation was “Nonpayment of premium.” (Id.)
The CECS Defendants appear to dispute that they received the Notice of Cancellation. Indeed, the circumstances surrounding the Notice of Cancellation are peculiar. Southern Pilot contends that it sent this Notice in the same envelope as the Notice of Intent to Cancel. (Pl.'s Supplemental Resp. Opp'n Defs.' Mot. Summ. J. (Doc. 60) at 4; Gragg Aff. (Doc. 60–1) ¶ 4.) However, when Southern Pilot initiated this action in November of 2011, Southern Pilot relied only on the Notice of Intent. (Compl. (Doc. 1) Ex. G.) It was not until Southern Pilot filed a supplemental response to the CECS Defendants' motion for partial summary judgment on May 18, 2012 (Doc. 60)4 that Southern Pilot presented the Notice of Cancellation to the Court and asserted that it sent the Notice of Cancellation to CECS. Unsurprisingly, the CECS Defendants question how it is that Southern Pilot did not know of this Notice of Cancellation when it filed suit in November of 2011 or when it responded to their motion for partial summary judgment. (See Defs.' Supplemental Resp. Pl.'s Supplemental Resp. Opp'n Defs.' Mot. Summ. J. (Doc. 69) at 4–7.) Thus, there is a genuine issue of fact as to whether Southern Pilot actually sent the Notice of Cancellation to CECS.
There is no dispute, however, regarding the remaining material facts. Southern Pilot sent CECS a letter entitled “Cancellation Memo,” dated August 23, 2011. (Doc. 44 ¶ 7.) On August 24, 2011, a day after the purported cancellation, CECS transmitted an electronic check for premium payment to General Casualty. (Doc. 44 ¶ 6.) The amount of this check was removed from the CECS account on August 26, 2011. (Id.)
On September 6, 2011, while operating a dump truck owned by CECS, Defendant Jason Chatham was involved in a motor vehicle collision. (Doc. 38–3 ¶ 6.) Shortly thereafter, on November 9, 2011, Southern Pilot filed this instant action seeking a declaration that the subject policy was not in force at the time of the accident. (Doc. 1.)
The issue on summary judgment is narrow: whether Southern Pilot sent sufficient notice to CECS that its policy would cancel on August 23, 2011. The parties do not address, and thus the Court does not consider, any of the CECS Defendants' other arguments to support their contention that, regardless of the sufficiency of the Notices, the policy was in force at the time of the accident. The CECS Defendants' only contention here is that the Notice of Intent to Cancel it received failed to satisfy Georgia law regarding the sufficiency of notices of cancellation.
O.C.G.A. § 33–24–44 provides that, in order to cancel an insurance policy for failure of the named insured to pay its premiums on time, an insurer must provide written notice at least 10 days prior to the effective date of cancellation. O.C.G.A. § 33–24–44(d). The written notice must state “the time when the cancellation will be effective.” O.C.G.A. § 33–24–44(b). This statute does not dictate a particular form of the notice. See id.; see also Reynolds v. Infinity Gen. Ins. Co., 287 Ga. 86, 694 S.E.2d 337, 341 (2010). However, under Georgia law, the cancellation notice is effective only if it “positively and unequivocally state[s] that the cancellation is taking place.” Reynolds, 694 S.E.2d at 341. “The mere...
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