Opinion
HHDCV156062412S
10-16-2017
Anne Day et al. v. The Automobile Insurance Company of Hartford, Connecticut
UNPUBLISHED OPINION
MEMORANDUM OF DECISION RE DEFENDANT'S MOTION FOR SUMMARY JUDGMENT (#111.00)
Ingrid L. Moll, Judge, Superior Court.
Before the court is the motion for summary judgment dated January 17, 2017 (motion), filed by the defendant, The Automobile Insurance Company of Hartford, Connecticut (defendant) (#111.00). Based on the parties' submissions and the arguments of counsel, the court grants the motion.
BACKGROUND
The plaintiffs, Anne Day and Spencer Reiss, are the named insureds under a homeowners' insurance policy issued by the defendant to cover their residential property at 5 Upper Road, Lakeville, Connecticut, during the policy period of May 1, 2013 to May 1, 2014 (policy). On October 28, 2013, a fire occurred at the plaintiffs' home, which resulted in significant damage to both their dwelling and personal property. Thereafter, the plaintiffs submitted a claim to the defendant under the policy. All premiums were paid in full, and the parties agree that the policy was in effect at the time of the fire. Following an investigation, the defendant paid the plaintiffs $564,526 for the loss of their dwelling (under Coverage A) and $395,168.20 for the loss of their personal property (under Coverage C).
A dispute arose between the parties as to the amount paid by the defendant for the loss of their personal property under Coverage C. Specifically, while the defendant paid the plaintiffs $395,168.20 under Coverage C, the plaintiffs maintain that the defendant miscalculated that amount, which in their view should have been $592,752.30.
On or about September 22, 2015, the plaintiffs filed a one-count complaint seeking a declaration that the Coverage C limit is $592,752.30. On November 12, 2015, the defendant filed its answer. On January 17, 2017, the defendant filed the instant motion, an accompanying memorandum, and the affidavit of Timothy Swabowicz, a general adjuster for the defendant. (#111.00.) On March 20, 2017, the plaintiffs filed a memorandum in opposition and the affidavit of Spencer Reiss. (#113.00.) On April 17, 2017, the defendant filed its reply memorandum. (#114.00.) The court heard oral argument on June 19, 2017. Additional facts are set forth below as necessary.
SUMMARY JUDGMENT STANDARD
" The motion for summary judgment is designed to eliminate the delay and expense of litigating an issue when there is no real issue to be tried." Wilson v. New Haven, 213 Conn. 277, 279, 567 A.2d 829 (1989). Practice Book § 17-49 provides that summary judgment " shall be rendered forthwith if the pleadings, affidavits and any other proof submitted 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." " In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party . . . The party seeking summary judgment has the burden of showing the absence of any genuine issue of material facts which, under applicable principles of substantive law, entitle him to a judgment as a matter of law . . . and the party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact." (Internal quotation marks omitted.) Liberty Mutual Ins. Co. v. Lone Star Industries, Inc., 290 Conn. 767, 787, 967 A.2d 1 (2009). " It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue. Mere assertions of fact . . . are insufficient to establish the existence of a material fact and, therefore, cannot refute evidence properly presented to the court in support of a motion for summary judgment." (Internal quotation marks omitted.) Home Ins. Co. v. Aetna Life & Casualty Co., 235 Conn. 185, 202, 663 A.2d 1001 (1995). " A party may not . . . rely on mere speculation or conjecture as to the true nature of the facts to overcome a motion for summary judgment." (Internal quotation marks omitted.) Buell Industries, Inc. v. Greater New York Mutual Ins. Co., 259 Conn. 527, 558, 791 A.2d 489 (2002).
ANALYSIS
Because the sole issue in dispute in this case involves the interpretation of the plaintiffs' policy vis-a-vis the calculation of Coverage C relating to the loss of their personal property, the court begins its analysis with the general principles that govern the interpretation of insurance policies. " An insurance policy is to be interpreted by the same general rules that govern the construction of any written contract and enforced in accordance with the real intent of the parties as expressed in the language employed in the policy . . . The policy words must be accorded their natural and ordinary meaning . . . Under well established rules of construction, any ambiguity in the terms of an insurance policy must be construed in favor of the insured because the insurance company drafted the policy . . . This rule of construction may not be applied, however, unless the policy terms are indeed ambiguous . . .
" A contract is ambiguous if the intent of the parties is not clear and certain from the language of the contract itself . . . The contract must be viewed in its entirety, with each provision read in light of the other provisions . . . and every provision must be given effect if it is possible to do so . . . If the language of the contract is susceptible to more than one reasonable interpretation, the contract is ambiguous . . . The fact that the parties interpret the terms of a contract differently, however, does not render those terms ambiguous . . . Rather, whether a contract is ambiguous is a question of law for the court . . ." (Citations omitted; internal quotation marks omitted.) Enviro Express, Inc. v. AIU Ins. Co., 279 Conn. 194, 199-200, 901 A.2d 666 (2006).
The court turns therefore to the policy language at issue. Because Coverage A is used in the calculation of Coverage C, which is the disputed coverage in the present case, the court begins with the provisions underlying the calculation of Coverage A, relating to the dwelling. The declarations page provides that the limit of liability for Coverage A (" Dwelling") is $554,000. That limit is increased by the " inflation protection coverage" provision, which provides:
15. Inflation Protection Coverage
a . During the term of this policy, we will increase the limit of liability for Coverage A monthly at the rate of 1/12 of the annual residential building cost percentage change factors as determined by our cost calculation method which is based on a nationally recognized construction cost index.
b . The limit of liability shown on the Declarations Page for Coverage A will be revised yearly at each renewal to reflect any changes in building costs during the policy period as determined in paragraph 1 above. Any adjustment in premium resulting from this change will be made on the basis of rates in use by us at the time the change is made. You have the right to refuse this change prior to the renewal date by contacting your agent or us.(Emphasis in original.) Following the plaintiffs' submission of a claim, the defendant calculated the limit of liability for Coverage A to be $564,526.00, taking into account an inflation factor of 3.8%--prorated to 1.9% because the fire occurred in the middle of the policy period. That was the amount paid to the plaintiffs under Coverage A.
The court now turns to the provisions controlling Coverage C. The declarations page of the policy indicates that the limit of liability for Coverage C (" Personal Property") is $387,800. That limit is modified by the " Value Added Package" endorsement, which provides in part: " The Coverage C limit shown on the Declarations is increased to 70% of COVERAGE A--DWELLING ." (Emphasis in original.) Because the defendant calculated the Coverage A limit to be $564,526.00, as explained above, the defendant calculated Coverage C to be $395,168.20 (i.e., 70% of $564,526.00). That is the amount the defendant paid to the plaintiffs for the loss of their personal property under Coverage C.
The parties disagree as to the defendant's calculation of Coverage C. Although the defendants maintain that it properly applied the policy language in its calculation of Coverage C, the plaintiffs assert that the defendant failed to take into account the " Additional Replacement Cost Protection" (ARCP) condition contained within the Value Added Package endorsement. The ARCP condition provides in relevant part:
(Applies only when loss to dwelling building exceeds the Coverage A Limit of Liability shown in the Declarations.)
To the extent that coverage is provided, we agree to provide an additional amount of insurance in accordance with the following provisions:
***
b . If there is a loss to the dwelling building that exceeds the Coverage A limit of liability shown in the Declarations, for the purpose of settling that loss only:
(1) We will provide an additional amount of insurance, up to 25% of the Coverage A limit of liability; . . .(Emphasis in original.) A separate endorsement, entitled " Additional Replacement Cost Protection--Increased amount, " provides in pertinent part:
Paragraph B.1 . of the ADDITIONAL REPLACEMENT COST PROTECTION endorsement attached to your policy is deleted and replaced by the following:
1. We will provide an additional amount of insurance, up to 50% of the Coverage A limit of liability; . . .(Emphasis in original.)
The plaintiffs contend that this provision increases the Coverage A limit of liability to $846,789, by adding 50% of $564,526.00 to that latter amount. The plaintiffs argue that, because the Coverage A limit is increased to $846,789, the Coverage C limit of liability is $592,752 (i.e., 70% of $846,789). The defendant argues that the ARCP provision cited above does not increase the Coverage A limit of liability, but rather " provide[s] an additional amount of insurance, " as the provision states. Moreover, the defendant contends that, by the express terms of the ARCP provision, such " additional amount of insurance" applies only " [i]f there is a loss to the dwelling building that exceeds the Coverage A limit of liability shown in the Declarations, for the purpose of settling that loss only ." (Emphasis added.) The defendant argues that the clause " for the purpose of settling that loss only" would be rendered meaningless if the additional amount of insurance pursuant to the ARCP provision were added to the Coverage A limit of liability for purposes of calculating Coverage C. The court agrees with the defendant's construction of the policy.
The ARCP condition provides " an additional amount of insurance" when calculating the amount of insurance if there is " a loss to the dwelling building that exceeds the Coverage A limit of liability shown in the Declarations, " and " for the purpose of settling that loss only." The only reasonable construction of " that loss" is the loss described earlier in the provision, i.e., " a loss to the dwelling building." If the additional amount of insurance available pursuant to the ARCP provision is added to the Coverage A limit of liability for all purposes (including the calculation of Coverage C), the language " for the purpose of settling that loss only" would be rendered meaningless, a result not permitted by traditional principles of contract interpretation when a reasonable construction can avoid such result. See City of Groton v. Yankee Gas Servs. Co., 224 Conn. 675, 689 n.13, 620 A.2d 771 (1993). There is no language to suggest that the additional amount of insurance should be included to increase the Coverage C limit of liability. In short, the court finds that the language of the policy is plain and unambiguous.
The plaintiffs seek to create or demonstrate an ambiguity in the policy by relying on a " Sworn Statement in Proof of Loss and Subrogation Agreement, " which the defendant prepared and presented to the plaintiffs in February 2014, approximately four months after the fire loss. The plaintiffs take the position that in such document, the defendant temporarily took the same position that they currently posit. The court finds, however, that the adjuster's after-the-fact construction of the policy is irrelevant to the court's determination as to whether the policy is ambiguous, which is a question of law. Enviro Express, Inc., 279 Conn. at 200. Moreover, the fact that the parties currently interpret the provisions of the policy differently does not render those provisions ambiguous. Id.
In sum, the court finds the policy to be clear and unambiguous and that the defendant properly calculated the Coverage C limit of liability.
CONCLUSION
Based on the foregoing, the court grants the defendant's motion for summary judgment. (#111.00.) Judgment shall enter in favor of the defendant on count one.