Weber v. Travelers Home & Maine Ins. Co.

• Decision Date: 13 July 2011
• Docket Number: Civ. No. 10–2142 (RHK/LIB).
• Citation: 801 F.Supp.2d 819
• Parties: Jeremy WEBER, Plaintiff, v. The TRAVELERS HOME AND MARINE INSURANCE CO., Defendants.
• Court: U.S. District Court — District of Minnesota

801 F.Supp.2d 819

Jeremy WEBER, Plaintiff,
v.
The TRAVELERS HOME AND MARINE INSURANCE CO., Defendants.

Civ. No. 10–2142 (RHK/LIB).

United States District Court, D. Minnesota.

July 13, 2011.

[801 F.Supp.2d 821]

John E. Mack, Mack & Daby, P.A., New London, MN, for Plaintiff.

Stacy E. Ertz, Daniel A. Haws, Kari L. Gunderman, Murnane Brandt, PA, St. Paul, MN, for Defendant.

MEMORANDUM OPINION AND ORDER RICHARD H. KYLE, District Judge.INTRODUCTION

This action arises out of a fire at Plaintiff Jeremy Weber's home on September 14, 2009. Weber filed a claim with his insurance company, Defendant Travelers Home and Marine Insurance Company (“Travelers”), which was denied. ¹ Weber then commenced this action, seeking to recover the policy proceeds. Presently pending before the Court are (i) Weber's Motion for Partial Summary Judgment and to Amend the Complaint and (ii) Travelers' Motion for Summary Judgment. For the reasons that follow, both Motions will be denied.

BACKGROUND

The events leading up to the fire are not well explicated in the parties' briefs, even though they are critical to a full understanding of the parties' arguments. Many of the facts set forth below, therefore, are taken from the October 15, 2009 Investigation Report of Deputy State Fire Marshal John Steinbach, who investigated the fire's cause. ( See 4/4/11 Mack Aff. Ex. E.) ²

Through a contract for deed, Weber purchased a house in Sauk Centre, Minnesota, in October 2008. The purchase agreement required him to make $700 monthly payments to the house's previous owners. He obtained a policy from Travelers insuring the house and its contents. Among other things, the policy excluded coverage for any loss “arising out of any act an ‘insured’ commits or conspires to commit with the intent to cause a loss.”

The policy imposed certain duties on Weber in the event of a loss, including cooperating with any investigation undertaken by Travelers, submitting a sworn proof of loss containing an inventory of damaged property, and sitting for an examination under oath. The policy also provided that “[n]o action can be brought against” Travelers if there were anything

[801 F.Supp.2d 822]

less than “full compliance with all of the terms” thereof.

In March 2009, Weber was laid off from his job, and he was unable to find other employment. Two months later, a fire in the house's kitchen, which Weber attributed to “bump[ing] a knob on the stove,” caused significant damage. He submitted a claim to Travelers, which paid him more than $52,000. He then set about repairing the damage. The interior of the house was largely gutted; most of the electrical supply was disconnected, and the house was stripped to the frame and contained no working appliances. During remodeling, Weber lived in a travel trailer parked in his backyard. The house was otherwise unoccupied.

According to Weber, on September 13, 2009, he was at his house until approximately 12:00 p.m. After boarding up some windows and locking the doors, he drove, with his traveler trailer in tow, to Mabel Murphy's, a restaurant and bar in Fergus Falls, Minnesota, approximately 65 miles away along Interstate 94. There, he watched a Vikings football game, after which he visited his brother and sister-in-law, who live near Fergus Falls. He then returned to Mabel Murphy's, where he drank heavily and sang karaoke. At approximately midnight he took his van to get gas and then returned to Mabel Murphy's' parking lot. He went into his trailer, “got sick,” and fell asleep.

Joanne McQuisten Moe, co-owner of Mabel Murphy's, recalls the events somewhat differently. She told Steinbach that she had known Weber for 12 years and, although she was working the bar during the Vikings game, she did not see him there. She recalled seeing him enter the bar at approximately 8:00 p.m., after which he drank and sang karaoke. He left at approximately 12:30 a.m. on September 14, 2009; when she closed Mabel Murphy's at 2:00 a.m. and left the premises, she saw Weber's travel trailer but did not see his van attached to it. She acknowledged, however, that she did not search for the van, which may have been parked in a nearby lot where patrons often parked on weekends.

At approximately 4:00 a.m. on September 14, 2009, neighbors reported a fire at Weber's house. Despite the efforts of the Sauk Centre Fire Department, the house was largely destroyed. The walls on its west side collapsed and its northwest quadrant was reduced to several feet of ash. The house's remaining sides were heavily damaged and in danger of collapsing. Simply put, the house was a total loss.

Weber, who learned of the fire via a call on his cell phone at approximately 5:00 a.m., submitted a claim to Travelers for the damage. The company, in turn, hired an independent investigator to analyze the origin and cause of the fire.³ It also asked Weber to submit within 60 days a form entitled “Sworn Statement in Proof of Loss,” listing all damages he claimed, all property destroyed, and similar information. It is clear from the record that Weber filled out and returned the form to Travelers, although neither party has submitted it to the Court.

Deputy State Fire Marshal Steinbach also undertook an investigation at the request of the Sauk Centre Fire Department. That investigation included an examination of the scene, interviews with neighbors, and a review of Weber's financial records. Those records revealed that Weber had maintained two checking accounts in 2009. The first account had been charged overdraft fees on several occasions and had monthly ending balances between five and ten dollars; it was closed in May 2009. The second account was

[801 F.Supp.2d 823]

opened in January 2009 and had a beginning balance of 11 cents; the balance fell to zero in March. In June, approximately $46,000 was deposited into the account, likely the proceeds of Travelers' payment for the first fire. Several large withdrawals followed, and by September 15, 2009, the day after the fire, the account's balance had dropped to just under $600.

Steinbach also interviewed Weber at the Sauk Centre Police Department; there, he denied having set the fire. He also denied having any financial problems and indicated that he was current on his bills.⁴ When Steinbach asked if he would be willing to take a polygraph examination, Weber refused. He then asked Steinbach whether he (Steinbach) was accusing him of having set the fire, and Steinbach answered in the affirmative. Weber then terminated the interview and said he wanted to consult an attorney.

Steinbach also conducted a criminal background check on Weber, which revealed a “lengthy criminal history,” including “felony level burglary and theft convictions” and an “extensive criminal driving record.” The nature and number of his prior convictions are not specified in the record.

Ultimately, Steinbach was unable to determine the fire's cause from the physical evidence. Nevertheless, he concluded in his October 15, 2009 report:

Based on my training and experience and the scene examination, it is my opinion the fire in this residential house, which was damaged by a previous fire, originated in the northwest quadrant of the residence's basement. Due to severe fire damage and building collapse, I was unable to determine an exact area of origin and/or definitive cause for the fire. However, it is my opinion this unoccupied residence damaged by a previous fire and undergoing extensive remodeling, including significant foundation work, was in all probability intentionally set on fire to destroy property and collect insurance monies. The property owner, who has owned the residence on a contract for deed for less than a year, has experienced two fires at the residence I consider to be in extremely poor condition, including a crumbling foundation. The unemployed property owner, who has felony level burglary convictions, maintains he's not involved with setting his house on fire and refuses to take a polygraph exam. I am closing this case and reserve the right to re-open it should newer information become available.

On November 10, 2009, Travelers wrote Weber and informed him that it would take his examination under oath regarding the fire on November 24, 2009, as permitted under the policy. Weber appeared with counsel and testified as requested; due to scheduling conflicts, however, the examination could not be completed on November 24. The parties agreed to continue it on January 18, 2010. In the interim, however, on January 7, 2010, Travelers wrote to Weber's counsel, advising him that it was

[r]ejecting the Sworn Statement [in] Proof of Loss as submitted by ... Weber on the following grounds: The proof of loss includes amounts for additional living expenses which have not been established as actually incurred; the amounts of personal property and the value of that property ha[ve] not been proven nor ha[ve] [they] been established as accurate; the amount claimed for the structure has not been proven or established; and Travelers' investigation

[801 F.Supp.2d 824]

into this loss and claim will not be complete until such time as Mr. Weber's examination under oath is completed and the investigation by the fire marshal for the State of Minnesota is also completed.

The letter further advised that Weber could “submit a revised Sworn Statement [in] Proof of Loss ... following the completion of [his] examination under oath.”

Weber's examination under oath was completed on January 18, 2010. At the conclusion, he indicated that he wanted to read and sign the transcript of the examination, but according to Travelers he never did so. There also exists no evidence that he submitted a revised Sworn Statement in Proof of Loss following the completion of his examination.

On April 24, 2010, Weber commenced the instant action in the Stearns County, Minnesota District Court, alleging that Travelers' failure to pay his claim constituted breach of contract. (Compl. ¶ VI.) He further alleged...