Westfield Ins. Co. v. Weaver Cooke Constr., LLC
Decision Date | 11 April 2019 |
Docket Number | No. 4:15–CV–00169–BR,4:15–CV–00169–BR |
Court | U.S. District Court — Eastern District of North Carolina |
Parties | WESTFIELD INSURANCE COMPANY, Plaintiff, v. WEAVER COOKE CONSTRUCTION, LLC, et al., Defendants. |
J. Mark Langdon, Wall Templeton & Haldrup, P.A., Raleigh, NC, for Plaintiff.
Sanford W. Thompson, IV, Sanford Thompson, PLLC, Michael T. Medford, Manning Fulton & Skinner, P.A., Raleigh, NC, for Defendant Weaver Cooke Construction, LLC.
James M. Dedman, IV, Gallivan, White & Boyd, P.A., Charlotte, NC, Jennifer E. Johnsen, Phillip E. Reeves, Gallivan, White & Boyd, P.A., Greenville, SC, for Defendant Zurich American Insurance Company.
Matthew A. Abee, Nelson Mullins Riley & Scarborough, LLC, Columbia, SC, Robert C. Calamari, Nelson Mullins Riley & Scarborough LLP, Myrtle Beach, SC, Terri L. Gardner, Nelson Mullins Riley & Scarborough, LLP, Raleigh, NC, for Defendant Selective Insurance Company of America.
Gregory C. York, York Williams Barringer Lewis & Briggs, LLP, Charlotte, NC, for Defendant Penn National Insurance Company.
This matter is before the court on three cross–motions for summary judgment: plaintiff Westfield Insurance Company ("Westfield") and defendant Zurich American Insurance Company's ("Zurich") motion (DE # 67); defendant Selective Insurance Company of America's ("Selective") motion (DE # 72); and defendant Weaver Cooke Construction, LLC's ("Weaver Cooke") motion (DE # 74). The parties have filed responses in opposition and replies. (DE ## 84, 86, 88, 90, 91, 94, 97–100.) The matter is now ripe for adjudication.
(3/1/17 Order, DE # 55, at 1–2.)
(Id. at 13; DD Plumbing Subcontract (DE # 71–22) Ex. 18 at 12.) Both Subcontracts required additional insured coverage "on a primary and non–contributing basis." (DD Plumbing Subcontract (DE # 71–22) Ex. 19 at 3; ECM Subcontract (DE # 71–21) Ex. 18 at 3.)
Following the filing of the Underlying Action by New Bern, on 14 March 2012 Weaver Cooke sent two letters, identical in substance, to DD Plumbing and ECM (the "First Tender Letter") tendering its defense of the Underlying Action and requesting that the letter be forwarded to the recipient's agent and/or insurance carrier. (Weaver Cooke Tender Letters (DE # 71–31) Ex. 28 at 2, 5.) On 12 September 2013, Westfield sent two subsequent identical letters to Selective and Penn National (the "Second Tender Letter") tendering the defense in the Underlying Action. (Selective App'x (DE # 80–4) at 1; Penn National Req. for Admis. and Am. Answers (DE # 71–23) Ex. 20 at 85.) Pursuant to the commercial liability policies, Selective and Penn National have defended DD Plumbing and ECM, respectively, in the Underlying Action under a reservation of rights. (Selective App'x (DE # 78–2) Ex. 1.1 at 15; Penn National Resp. Opp'n (DE # 84) at 2.) To date, neither Selective nor Penn National has defended Weaver Cooke as an additional insured.
(3/1/17 Order, DE # 55, at 2–3.)
On 1 March 2017, the court stayed this action on "[t]he issue of the insurers' duty to indemnify[,]" while "the issues of the insurer's duty to defend Weaver Cooke (including coverage as an additional insured) and Selective's and Penn National's handling of Weaver Cooke's claim" were allowed to proceed. (Id. at 6.) Following discovery on these issues, the parties filed the instant motions for summary judgment.
Summary judgment is appropriate when the record as a whole reveals no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a) ; Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The party seeking summary judgment initially must demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Once the moving party has met its burden, the nonmoving party may not rest on the allegations or denials in its pleading, Anderson, 477 U.S. at 248–49, 106 S.Ct. 2505, but "must come forward with specific facts showing that there is a genuine issue for trial," Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (emphasis and quotation omitted). A trial court reviewing a motion for summary judgment should determine whether a genuine issue of material fact exists. Anderson, 477 U.S. at 249, 106 S.Ct. 2505. In making this determination, the court must view the evidence and the inferences drawn therefrom in the light most favorable to the nonmoving party. Scott v. Harris, 550 U.S. 372, 378, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007). "When faced with cross-motions for summary judgment, the court must review each motion separately on its own merits to determine whether either of the parties deserves judgment as a matter of law." Rossignol v. Voorhaar, 316 F.3d 516, 523 (4th Cir. 2003) (internal quotation marks and citation omitted).
The parties' primary dispute is whether Selective and Penn National owe a duty to defend to Weaver Cooke in the Underlying Action as an additional insured provision under the policies issued to DD Plumbing and ECM. The parties also dispute whether Selective and Penn National violated the North Carolina Insurance Unfair Trade Practices Act ("IUTPA"), N.C. Gen. Stat. § 58–63–15, and the North Carolina Unfair and Deceptive Trade Practices Act ("UDTPA"), N.C. Gen. Stat. § 75–1 et. seq.
In response to Westfield and Zurich's motion for summary judgment, Selective contends that Westfield and Zurich "lack standing to assert additional insured rights under its insured's subcontract[ ]" because they are not third–party beneficiaries of either the construction contract or the DD Plumbing subcontract. (Selective Resp. Opp'n (DE # 91) at 9–10.)
In order to maintain an action in federal court, a plaintiff must show that they have standing under federal law. Miller v. Augusta Mut. Ins. Co., 157 [F. App'x] 632, 636 (4th Cir. 2005) (citing Phillips Petrol. Co. v. Shutts, 472 U.S. 797, 804 [105 S.Ct. 2965, 86 L.Ed.2d 628] (1985) ). Under 28 [U.S.C.] § 2201, "[i]n a case of actual controversy within its jurisdiction... any court of the United States... may declare the rights and other legal relations of any interested party seeking...
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