Trophy Tracks v. Massachusetts Bay Ins.
| Decision Date | 17 March 2009 |
| Docket Number | No. COA08-733.,COA08-733. |
| Citation | 673 S.E.2d 787 |
| Parties | TROPHY TRACKS, INC., Plaintiff, v. MASSACHUSETTS BAY INSURANCE COMPANY, Hanover Insurance Company, Lancaster McAden, Willis Smith Company, The Insurance Center and Mike McAden, Defendants. |
| Court | North Carolina Court of Appeals |
Hopf & Higley, P.A., by Donald S. Higley, II, Greenville, for plaintiff-appellee.
Hedrick, Gardner, Kincheloe & Garofalo, L.L.P., by Reid Russell, Raleigh, for Massachusetts Bay Insurance Company and Hanover Insurance. Company, defendant-appellants.
Manning, Fulton & Skinner, P.A., by Michael T. Medford and William S. Cherry, III, Raleigh, for Lancaster McAden, Willis Smith Company, The Insurance Center and Mike McAden, defendant-appellees.
Defendants, Massachusetts Bay Insurance Company and Hanover Insurance Company (collectively "insurance companies"), appeal from partial summary judgment order entered in favor of plaintiff on the issue of insurance coverage. For reasons discussed herein, we reverse.
Kenneth Weeks, Michele Weeks, Edward Weeks, and Carolyn Weeks are stockholders of Weeks Seed Company ("Weeks Seed"), which was incorporated in 1990 for the purpose of selling seeds wholesale. In 2003, Kenneth Weeks, Michele Weeks, Kinsey Weeks, and Tori Weeks became shareholders of Trophy Tracks, Inc. ("plaintiff"), which was incorporated for the purpose of selling larger boxes of seed to attract deer for hunting purposes. Both companies shared a facility, owned by Weeks Seed, located at 2103 Chestnut Street in Greenville, NC ("Greenville facility"). The two companies shared management and employees. The employees of Weeks Seed also performed services for plaintiff including sales, seed storage, and shipping. Shortly after its incorporation, plaintiff leased a second facility located at 2501-C Ten Ten Road in Apex ("Apex facility") for which it sought insurance. In September 2003, plaintiff purchased a business owners' insurance policy ("the policy") through defendant Lancaster McAden, an independent insurance agency. The policy, issued by defendant Massachusetts Bay Insurance Company, was effective from 12 September 2003 through 12 September 2004.
On 24 December 2003, a fire occurred at the Greenville facility and destroyed approximately $70,000.00 worth of plaintiff's property. On 30 April 2004, defendant Hanover Insurance Company, an affiliate of defendant Massachusetts Bay Insurance Company, denied coverage for plaintiff's property, on the grounds that the policy only covered property located at the Apex facility. The policy provides:
A. Coverage
We will pay for direct physical loss of or damage to Covered Property at the premises described in the Declarations caused by or resulting from any Covered Cause of Loss.
1. Covered Property
Covered Property includes ... Business Personal Property[.]
(Emphasis added.)
The first page of the declarations provides:
In consideration of the premium, insurance is provided the Named Insured with respect to those premises described in the Schedule below and with respect to those coverages and kinds of property for which a specific Limit of Insurance is shown, subject to all of the terms of this policy including forms and endorsements made a part hereof:
LOCATION SCHEDULE
Described Premises:
NO. 1 2501-C TEN TEN ROAD, APEX, N.C. 27502
(Emphasis added.)
In August of 2006, plaintiff filed suit against the insurance companies, seeking to recover for its losses under the policy.1 On 28 September 2006, plaintiff filed a motion for partial summary judgment on the issue of whether the policy provides coverage for its personal property destroyed by the fire on 24 December 2003. The matter was heard at the 6 October 2006 term of Pitt County Superior Court. The trial court granted plaintiff's partial summary judgment motion on 23 January 2008.
The insurance companies argue that the trial court erred in granting plaintiff's motion for partial summary judgment and request that this Court remand the matter, pursuant to Rule 56(c), to the trial court to enter summary judgment against plaintiff.
Where a motion for summary judgment has been granted, the two critical questions on appeal are whether (1) there is a genuine issue of material fact, and (2) the moving party is entitled to judgment as a matter of law. North River Ins. Co. v. Young, 117 N.C.App. 663, 667, 453 S.E.2d 205, 208 (1995). We review an order granting summary judgment de novo. Diggs v. Novant Health, Inc., 177 N.C.App. 290, 294, 628 S.E.2d 851, 855 (2006), disc. review denied, 361 N.C. 426, 648 S.E.2d 209 (2007).
The insurance companies argue that the trial court erred in granting plaintiff partial summary judgment on the issue of insurance coverage. The insurance companies assert that neither the "Business Personal Property" provision nor the "Personal Property Off Premises" provision of the policy provides coverage for plaintiff's property at the Greenville facility. We agree.
The insurance companies contend that the "Business Personal Property" provision of the policy only provides coverage for plaintiff's property located at the Apex facility. The parties do not dispute that plaintiff's property destroyed in the fire is "Business Personal Property" or that the loss resulted from a "Covered Cause of Loss." The parties disagree whether or not plaintiff's property in Greenville constitutes "Covered Property at the premises described in the Declarations."
The insurance companies claim that the policy clearly does not insure the Greenville facility because only the Apex facility is listed as a "described premises." Plaintiff argues that the Greenville facility is a "Covered Property at the premises described in the Declarations" because its name and address appear in the declarations six times. On the top of each page of the declarations, the following is listed:
Named Insured and Address
TROPHY TRACKS, INC
2103 CHESTNUT STREET
GREENVILLE, NC 27834
We do not agree with plaintiff.
An insurance policy is a contract between two parties. Allstate Ins. Co. v. Shelby Mut. Ins. Co., 269 N.C. 341, 345, 152 S.E.2d 436, 440 (1967). "[I]t is the duty of the court to construe an insurance policy as it is written, not to rewrite it and thus make a new contract for the parties." Id. at 346, 152 S.E.2d at 440 (citations omitted).
"[A] contract of insurance should be given that construction which a reasonable person in the position of the insured would have understood it to mean[.]" Cowell v. Gaston County, ___ N.C.App. ___, ___, 660 S.E.2d 915, 918 (2008) quoting Grant v. Emmco Ins. Co., 295 N.C. 39, 43, 243 S.E.2d 894, 897 (1978), disc. review denied, ___ N.C. ___, 672 S.E.2d 687 (2009). "If there is uncertainty or ambiguity in the language of an insurance policy regarding whether certain provisions impose liability, the language should be resolved in the insured's favor." Eatman Leasing, Inc. v. Empire Fire & Marine Ins. Co., 145 N.C.App. 278, 281, 550 S.E.2d 271, 273 (2001), disc. review denied and cert. denied, 356 N.C. 298, 570 S.E.2d 503 (2002).
We do not find that the provision insures plaintiff's property in Greenville. The language in this provision specifically limits the insurance coverage to "those premises described in the Schedule below." Below that paragraph, in bold, is the heading, "LOCATION SCHEDULE." Directly under that heading, "Described Premises" is listed with the address of the Apex facility. We do not find that a reasonable person would understand the clause "premises described in the Schedule below" to include the address listed on the top of each page. (Emphasis added.) As a matter of law, the "Business Personal Property" provision does not provide coverage for plaintiff's property destroyed in the fire.
In an alternative argument, plaintiff asserts that its property in Greenville is partially insured under the "Off Premises" provision of the policy, which provides:
b. Personal Property Off Premises
You may extend the insurance that applies to Business Personal Property ... while temporarily at a premises you do not own, lease, or operate. ... The most we will pay for loss or damage under this Extension is $50,000 or the amount shown in the Additional Property Coverage Schedule.
We do not agree.
In their briefs, the parties primarily...
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