Szczeklik v. Markel Int'l Ins. Co., Case No. 8:12–CV–970–T–27TGW.

• Decision Date: 30 April 2013
• Docket Number: Case No. 8:12–CV–970–T–27TGW.
• Citation: 942 F.Supp.2d 1254
• Parties: George SZCZEKLIK and Marta Szczeklik, as Assignees of Neubert Aero Corp., Plaintiffs, v. MARKEL INTERNATIONAL INSURANCE COMPANY, LIMITED, Defendant.
• Court: U.S. District Court — Middle District of Florida

942 F.Supp.2d 1254

George SZCZEKLIK and Marta Szczeklik, as Assignees of Neubert Aero Corp., Plaintiffs,
v.
MARKEL INTERNATIONAL INSURANCE COMPANY, LIMITED, Defendant.

Case No. 8:12–CV–970–T–27TGW.

United States District Court,
M.D. Florida,
Tampa division.

April 30, 2013.

[942 F.Supp.2d 1256]

Lee Delton Gunn, IV, Scott A. Arthur, Gunn Law Group, PA, Tampa, FL, for Plaintiffs.

John R. Catizone, Michael K. McCaffrey, Litchfield Cavo, LLP, Ft. Lauderdale, FL, for Defendant.

ORDER
JAMES D. WHITTEMORE, District Judge.

BEFORE THE COURT are Defendant's Motion for Summary Judgment (Dkt. 12) and Plaintiffs' Motion for Summary Judgment (Dkt. 15). Because the undisputed evidence reveals that Markel International Insurance Company, Limited (“Markel”) wrongfully refused to defend and indemnify Neubert Aero Corp. (“Neubert”) in connection with certain underlying litigation brought by George Szczeklik and Marta Szczeklik (the “Plaintiffs”), Plaintiffs are entitled to summary judgment as a matter of law.

Introduction

The issue in this case is whether Markel had a duty to defend and indemnify Neubert

[942 F.Supp.2d 1257]

in connection with a personal injury action brought against Neubert by Plaintiffs in Pinellas County Circuit Court. Plaintiffs, as assignees of Neubert's rights under the insurance policy, assert that no genuine issues of material fact exist and that they are entitled to judgment as a matter of law. Markel responds that the undisputed facts demonstrate that it had no duty to defend and indemnify Neubert under various insurance policy provisions and, therefore, it is entitled to summary judgment.

Factual and Procedural Background

Neubert was an authorized Dealer/Distributor of “Runway Continuous Friction Measuring Equipment (CFME, Mu–Meter Mk6 Airports)” manufactured by Douglas Equipment Limited and approved by the Federal Aviation Administration for testing and compiling runway friction measurements ( i.e.,“Mu–Meters”). See, e.g., Deposition of Ronald Hopkins (Dkt. 14–1, Dkt. 14–3), pp. 24–28, 103–04. Neubert was also involved in the supply of parts, equipment, and service related to Mu–Meters in the United States. See, e.g., Deposition of Ronald Hopkins (Dkt. 14–3), pp. 103.¹

On or about September 21, 2004, Neubert requested that Safe Start, Inc. (“Safe Start”) mount a tire onto a rim that Neubert brought to Safe–Start in connection with the assembly of a Mu–Meter (or a spare wheel to be supplied in connection with an existing Mu–Meter). See, e.g., Deposition of Ronald Hopkins (Dkt. 14–1), pp. 28–30.² The rim was a “split” rim—meaning that it was actually composed of two rims that were bolted together. Neubert supplied the tire, rim, bolts, nuts, and other materials necessary to mount the tire (the “Wheel Assembly”). The completed Wheel Assembly was intended to be returned to Neubert for distribution in the normal course of Neubert's business. See, e.g., Deposition of Lynette Smith (Dkt. 14–4), pp. 9–10. ³ Safe Start declined to assemble the rim, asserting that they required certain “torque” or other specifications

[942 F.Supp.2d 1258]

for assembly as to which Safe Start lacked sufficient knowledge. Safe Start requested that Neubert assemble the rim itself and then return the assembled rim to Safe Start for mounting of the tire.

On or about September 22, 2004, Neubert returned to Safe Start with the rims bolted together and again requested that Safe Start mount the tire onto the rim. George Szczeklik, an employee of Safe Start, was assigned the task of mounting the tire onto the rim supplied by Neubert. While Mr. Szczeklik was inflating a tire on the rim, the two halves of the “split” rim explosively separated causing serious injury to Mr. Szczeklik.

The Underlying Litigation

On or about October 19, 2007, Plaintiffs filed a Complaint against Neubert asserting claims for negligence and loss of consortium. The Complaint alleged that Neubert breached its duty of care to Mr. Szczeklik by furnishing Safe Start with a Wheel Assembly that contained bolts which were inadequate for the purpose of mounting the tire onto the rim. See Complaint (Dkt. 2–3), ¶ 10.

On or about September 19, 2008, Plaintiffs filed a Second Amended Complaint against Neubert, Douglas Equipment Ltd., and Watts Industrial Tyres PLC. The Second Amended Complaint clarified the factual basis for the negligence claim against Neubert. Specifically, Plaintiffs alleged that Neubert breached its duty of care to George Szczeklik by providing him with a negligently assembled rim and by failing to warn him of dangers associated with mounting the tire onto the rim at issue. See Second Amended Complaint (Dkt. 2–3), ¶¶ 16–17.

The Insurance Policy and Denial of Coverage

Markel insured Neubert under a Commercial General Liability Policy (Certificate No. GLSC3154) for the period of February 27, 2004, through February 27, 2005 (the “Policy”).⁴ After being placed on notice of the Plaintiffs' claims against Neubert, Markel refused to defend or indemnify Neubert contending that certain amendatory endorsements to the Policy excluded coverage. The Policy contained three endorsements relied on by Markel in denying coverage:

Exclusion—Productions—Completed Operations Hazard: “This insurance does not apply to ‘bodily injury’ or ‘property damage’ included within the ‘products—completed operations hazard.’ ”

* * * * * *

Limitation of Coverage to Designated Premises or Project: “This insurance applies only to ‘bodily injury,’ ‘advertising injury,’ and medical expenses arising out of ... the ownership, maintenance or use of the premises shown in the [Declarations] and operations necessary or incidental to those premises ... or [t]he project shown in the schedule.”

* * * * * *

Classification Limitation: “This insurance applies only to locations and operations described on the Declarations page or Extension of Declarations of this policy. If any operation(s) or location(s) are not described, they are not covered hereunder.” ⁵

[942 F.Supp.2d 1259]

The Settlement Between Neubert and Plaintiffs

After Markel denied coverage and refused to defend Neubert in the underlying litigation, Neubert and Plaintiffs entered into a Joint Stipulation and Agreement (Dkt. 13–1) whereby they agreed to a stipulated judgment in the amount of $375,000. As part of the settlement, Neubert also assigned its rights under the Policy to Plaintiffs with respect to the events giving rise to Plaintiffs' claims. Final Judgment was entered in favor of Plaintiffs on December 7, 2011 (Dkt. 13–1).

The Pending Litigation

Plaintiffs, as assignees of Neubert, commenced this action by filing a single count Complaint against Markel alleging that Markel breached the Policy by failing to defend and indemnify Neubert in the underlying litigation. See Complaint (Dkt. 2). Plaintiffs seek damages in the amount of $375,500 ( i.e., the Final Judgment in the underlying litigation) together with interest, costs, and attorney's fees.

Standard on Summary Judgment

Summary judgment is proper if, following discovery, the pleadings, depositions, answers to interrogatories, affidavits and admissions on file show 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. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Fed.R.Civ.P. 56(c). “An issue of fact is ‘material’ if, under the applicable substantive law, it might affect the outcome of the case.” Hickson Corp. v. N. Crossarm Co., 357 F.3d 1256, 1259–60 (11th Cir.2004). “An issue of fact is ‘genuine’ if the record taken as a whole could lead a rational trier of fact to find for the nonmoving party.” Id. at 1260. All the evidence and factual inferences reasonably drawn from the evidence must be viewed in the light most favorable to the nonmoving party. Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970); Jackson v. BellSouth Telecomms., 372 F.3d 1250, 1280 (11th Cir.2004).

Once a party properly makes a summary judgment motion by demonstrating the absence of a genuine issue of material fact, the nonmoving party must go beyond the pleadings through the use of affidavits, depositions, answers to interrogatories and admissions on file, and designate specific facts showing that there is a genuine issue for trial. Celotex, 477 U.S. at 323–24, 106 S.Ct. 2548. The evidence must be significantly probative to support the claims. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

The Court will not weigh the evidence or make findings of fact. Anderson, 477 U.S. at 249, 106 S.Ct. 2505;Morrison v. Amway Corp., 323 F.3d 920, 924 (11th Cir.2003). Rather, the Court's role is limited to deciding whether there is sufficient evidence upon which a reasonable jury could find for the nonmoving party. Id.

Florida Law Relating to the Interpretation of Insurance Policies

The interpretation of an insurance contract is a question of law. See Graber v. Clarendon Nat'l Ins. Co., 819 So.2d 840, 842 (Fla. 4th DCA 2002). The policy must be read as a whole, and every provision must be accorded its full meaning and operative effect. Excelsior Ins. Co. v. Pomona Park Bar & Package Store, 369 So.2d 938, 941 (Fla.1979) (noting that every provision in a contract should be given meaning and effect and apparent inconsistencies reconciled if possible); see also

[942 F.Supp.2d 1260]

Dahl–Eimers v. Mutual of Omaha Life Ins. Co., 986 F.2d 1379, 1381 (11th Cir.1993).

“[A] court cannot rewrite an insurance contract to extend coverage beyond what is clearly set forth in the contractual language.” Florida Residential Prop. & Cas. Joint Underwriting Ass'n v. Kron, 721 So.2d 825, 826 (Fla. 3d DCA 1998). It is well-settled that insurance contracts are to be construed in accordance with the plain language of the policy, with any ambiguity interpreted liberally in favor the insured and against the insurer. Auto–Owners Ins. Co. v. Anderson, 756 So.2d 29, 34...