Strope-Robinson v. State Farm Fire & Cas. Co.
| Decision Date | 20 December 2019 |
| Docket Number | Civil No. 18-2454 (DWF/LIB) |
| Citation | 429 F.Supp.3d 634 |
| Parties | Dawn STROPE-ROBINSON, Plaintiff, v. STATE FARM FIRE AND CASUALTY COMPANY, Defendant. |
| Court | U.S. District Court — District of Minnesota |
Richard A. Dahl, Esq., Prebich Law Office, counsel for Plaintiff.
Joseph A. Lulic, Esq., Brownson Norby, PLLC, counsel for Defendant.
This matter is before the Court on cross motions for summary judgment brought by Plaintiffs Dawn Strope-Robinson ("Strope-Robinson") and the Estate of David Clair Strope (the "Estate") (together, "Plaintiffs") (Doc. No. [39] ) and Defendant State Farm Fire and Casualty Company ("State Farm") (Doc. No. [34] ). For the reasons set forth below, the Court grants State Farm's motion and denies Plaintiffs' motion.
The following facts of this case are undisputed. David Strope ("Strope") was the owner of a house and parcel of land (the "Property") located in Orr, Minnesota.1 On August 10, 2017, Strope, who was dying of leukemia, executed a transfer on death deed ("TODD") conveying the Property to his niece, plaintiff Dawn Strope-Robinson ("Strope-Robinson"), upon his death. (Am. Compl. ¶ 9; Doc. No. 37 ("Lulic Aff."), Ex. 4 ("Strope TODD") at 3-4.) The Strope TODD was recorded on August 11, 2017. (Am. Compl. ¶ 9.) Strope died soon thereafter, on August 14, 2017.2 (Lulic Aff., Ex. 1 ("Certificate of Death").)
Before his death, Strope married, then divorced, Denise Lehti ("Lehti"). (Am. Compl. ¶ 11.) On or about August 20, 2017, Lehti intentionally burned down the house located on the Property, destroying the home and the personal property inside.3 (Id. ¶¶ 11-12, 21.)
Strope was a named insured on a homeowner's insurance policy issued by State Farm which was in effect from June 3, 2017 to June 3, 2018 and covered fire loss and damage to the Property. Strope paid a premium of $1,580.00 for the year, an amount that State Farm charged based in part on "information from consumer reports" State Farm used to determine the insurance risk, such as Strope's number of adverse public records and credit accounts carrying a balance, as well as the coverages and limitations he chose and the "likelihood of future claims." (Policy at 5-7.) This rate also reflected discounts State Farm gave based on Strope's history as a customer. (Id. at 5, 11.)
The Policy defines those who are "insured" as the named insured and residents of the household who are relatives of the named insured or persons who are under age 21 and in the care of the named insured or covered resident relatives. (Id. at 17.) Section II, "Your Liability," states that "[i]f any person shown in the Declarations or the spouse, if a resident of the same household, dies," State Farm insures "the legal representative of the deceased ... with respect to the premises and property of the deceased covered under this policy at the time of death." (Id. at 36.) The same subsection goes on to reiterate that "insured" includes household members who are insured and reside in the premises at the time of the named insured's death or who have "proper temporary custody" of the covered property until a legal representative is appointed. (Id. ) Section I of the Policy, entitled "Your Property," states that "[e]ven if more than one person has an insurable interest in the property covered, [State Farm] shall not be liable ... to the insured for an amount greater than the insured's interest." (Id. at 29.) The Policy also provides that assignment "shall not be valid unless [State Farm] gives [its] written consent." (Id. at 36.) The insured may cancel the Policy at any time by notifying State Farm in writing of the date cancellation is to take effect, but State Farm may waive the written notice requirement by confirming the date and time of cancellation in a writing to the insured. (Id. at 35.) The Policy states that when it is cancelled, "the premium for the period from the date of cancellation to the expiration date will be refunded" according to State Farm's rules for such cancellation, which "may be less than a full pro rata refund." (Id. at 36.)
Strope-Robinson was appointed Special Administrator of the Estate on October 24, 2017 and the Estate's Personal Representative on September 17, 2018. (Am. Compl. ¶19.) Following its investigation of the fire, State Farm denied timely filed claims by Strope-Robinson for coverage of loss to the dwelling on the Property as well as for loss of use for the fair rental value of the house. (Id. ¶ 22; Dahl Aff. 3, Ex. L ("Denial Letter") at 21.) State Farm stated that because the Strope TODD transferred title of the dwelling to Strope-Robinson before the fire occurred, meaning that she was the owner of the Property, so "there was no named insured with an interest in the dwelling." (Denial Letter at 21.) State Farm accepted the Estate's claim for the loss of personal property in the fire and enclosed a check payable to the Estate for $27,713.28, the covered amount. (Id. at 21-22; Am. Compl. ¶¶ 20-21.)
Strope-Robinson commenced this action against State Farm in state court on August 16, 2018. (Doc. No. 1.) State Farm removed the action to the District of Minnesota on August 22, 2018, pursuant to the Court's jurisdiction under 28 U.S.C. § 1332. (Id. ¶ 5.) Strope-Robinson, and in the alternative, the Estate, assert a claim against State Farm under the Minnesota Uniform Declaratory Judgment Act, Minn. Stat. § 555.01, et seq. and pursuant to Minnesota state law governing insurance companies, seeking a declaratory judgment that State Farm has a duty to provide coverage based upon "contract, equity, or statute" and awarding damages for the loss to the Property. (Am. Compl. at 5, 7.) Strope-Robinson contends that Strope had a reasonable expectation that after his death, the Estate "and/or his successor in interest" would have insurance coverage under the Policy for "a reasonable period of time." (Id. ¶ 24.) Strope-Robinson argues that she "did not have the benefits of ownership" under Minnesota law until after August 28, 2017, when she filed documents required to clear the title, and until that point, State Farm should have either considered her to be the successor in interest to the Policy for the house "as much as [the Estate] was the successor [to the Policy] for the purposes of the personal property claim" or, in the alternative, considered the Estate to be a successor in interest to the Policy for both the house and personal property. (Id. ¶¶ 25-26.)
Strope-Robinson further contends that State Farm is estopped from denying coverage to her or the Estate because State Farm did not return the unused premium for the period through June 3, 2018 or notify Strope-Robinson or the Estate that it was terminating the Policy, which led them to rely upon the Policy "to their detriment."4 (Id. ¶¶ 27-28.)
State Farm counters that it denied the claims for loss to the structure on the Property based on the fact that Strope-Robinson was not an insured on the Policy and, because the title for the Property transferred to her before the fire, the Estate had no insurable interest in it for State Farm to insure. (Doc. No. 36 ("Def. Mem.") at 1.) State Farm also argues that Strope-Robinson misconstrues the purpose and operation of a TODD under Minnesota law. (Def. Mem. at 2.) Further, State Farm argues that the Policy is a contract for the parties, not the subject property, and that State Farm never entered an agreement to provide coverage for Strope-Robinson, meaning that State Farm is under no obligation to pay for damages to her property. (Id. )
Summary judgment is proper if there are no disputed issues of material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). The Court must view the evidence and the inferences that may be reasonably drawn from the evidence in the light most favorable to the nonmoving party. Weitz Co. v. Lloyd's of London , 574 F.3d 885, 892 (8th Cir. 2009). However, as the Supreme Court has stated, "[s]ummary judgment procedure is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed ‘to secure the just, speedy and inexpensive determination of every action.’ " Celotex Corp. v. Catrett , 477 U.S. 317, 327, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) (quoting Fed. R. Civ. P. 1 ).
This Court will consider the cross-motions drawing inferences against each movant as warranted. See, e.g., Wermager v. Cormorant Twp. Bd. , 716 F.2d 1211, 1214 (8th Cir. 1983). The moving party bears the burden of showing that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. Enter. Bank v. Magna Bank of Missouri , 92 F.3d 743, 747 (8th Cir. 1996). The nonmoving party must demonstrate the existence of specific facts in the record that create a genuine issue for trial. Krenik v. Cty. of Le Sueur , 47 F.3d 953, 957 (8th Cir. 1995). A party opposing a properly supported motion for summary judgment "may not rest upon the mere allegations or denials of his pleading, but ... must set forth specific facts showing that there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).
Because this case is before the Court based on diversity jurisdiction, Minnesota's substantive law controls the analysis. Kozlov v. Associated Wholesale Grocers, Inc. , 818 F.3d 380, 388 (8th Cir. 2016) ; Babinski v. Am. Family Ins. Grp. , 569 F.3d 349, 351–52 (8th Cir. 2009). With respect to Minnesota state law, a district court is bound by the decisions of the Minnesota Supreme Court. Qwest Corp. v. City of Des Moines, Iowa , 896 F.3d 843, 845 (8th Cir. 2018).
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