North American Elite Insurance Company v. Victory Fire Protection, Inc.

RESPONSE in Opposition to Motion for Summary Judgment of SimplexGrinnell

E.D. Pa.July 27, 2018

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF PENNSYLVANIA NORTH AMERICAN ELITE INSURANCE COMPANY, Plaintiff, vs. VICTORY FIRE PROTECTION, INC. Defendant/Third Party Plaintiff vs. PENN BUILDERS, INC., SIMPLEXGRINNELL LP n/k/a JOHNSON CONTROLS FIRE PROTECTION, LP and ANCHOR FIRE PROTECTION COMPANY Third Party Defendants No.: 2:17-cv-03554-WB NORTH AMERICAN ELITE INSURANCE COMPANY AS SUBROGEE OF PENN FOUNDATION, INC. Fourth Party Plaintiff vs. PENN BUILDERS, INC., SIMPLEXGRINNELL LP n/k/a JOHNSON CONTROLS FIRE PROTECTION, LP and ANCHOR FIRE PROTECTION COMPANY Fourth Party Defendants ORDER AND NOW this _______ day of ______________, 2018, upon consideration of defendant/third party defendant, SimplexGrinnell, LP n/k/a Johnson Controls Fire Protection, LP’s Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 1 of 13 Motion for Summary Judgment, Defendant/Third Party Plaintiff, Victory Fire Protection, Inc.’s response thereto, it is hereby ORDERED and DECREED that said Motion is DENIED. _________________________________ WENDY J. BEETLESTONE, J. UNITED STATES DISTRICT JUDGE Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 2 of 13 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF PENNSYLVANIA NORTH AMERICAN ELITE INSURANCE COMPANY, Plaintiff, vs. VICTORY FIRE PROTECTION, INC. Defendant/Third Party Plaintiff vs. PENN BUILDERS, INC., SIMPLEXGRINNELL LP n/k/a JOHNSON CONTROLS FIRE PROTECTION, LP and ANCHOR FIRE PROTECTION COMPANY Third Party Defendants No.: 2:17-cv-03554-WB DEFENDANT, VICTORY FIRE PROTECTION, INC.'S ANSWER TO SIMPLEXGRINNELL’S MOTION FOR SUMMARY JUDGMENT NORTH AMERICAN ELITE INSURANCE COMPANY AS SUBROGEE OF PENN FOUNDATION, INC. Fourth Party Plaintiff vs. PENN BUILDERS, INC., SIMPLEXGRINNELL LP n/k/a JOHNSON CONTROLS FIRE PROTECTION, LP and ANCHOR FIRE PROTECTION COMPANY Fourth Party Defendants ANSWER OF DEFENDANT/THIRD PARTY PLAINTIFF, VICTORY FIRE PROTECTION, INC. TO DEFENDANT/THIRD PARTY DEFENDANT SIMPLEXGRINNELL LP n/k/a JOHNSON CONTROLS FIRE PROTECTION LP’S MOTION FOR SUMMARY JUDGMENT Pursuant to Federal Rule of Civil Procedure 56 and E.D. Pa. L.R. 7.1, Defendant/Third Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 3 of 13 Party Plaintiff, Victory Fire Protection, Inc. (“Victory”) hereby filed its Answer to Defendant/Third Party Defendant, SimplexGrinnell n/k/a Johnson Controls Fire Protection, L.P.’s (“SimplexGrinnell”) Motion for Summary Judgment and respectfully requests this Honorable Court deny said Motion. Victory’s Brief in opposition to SimplexGrinnell’s Motion is being filed along with this Motion in accordance with E.D. Pa. L.R. 7.1. Respectfully submitted, By: /s/ Franklin C. Love Franklin C. Love, Esq. fclove@zarwin.com ZARWIN, BAUM, DeVITO, KAPLAN, SCHAER & TODDY, P.C. 1818 Market Street, 13th Floor Philadelphia, PA 19103 Phone: 215.569.2800 Fax: 267.765.9674 Attorney for Defendant, Victory Fire Protection, Inc. Dated: July 27, 2018 Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 4 of 13 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF PENNSYLVANIA NORTH AMERICAN ELITE INSURANCE COMPANY, Plaintiff, vs. VICTORY FIRE PROTECTION, INC. Defendant/Third Party Plaintiff vs. PENN BUILDERS, INC., SIMPLEXGRINNELL LP n/k/a JOHNSON CONTROLS FIRE PROTECTION, LP and ANCHOR FIRE PROTECTION COMPANY Third Party Defendants No.: 2:17-cv-03554-WB DEFENDANT, VICTORY FIRE PROTECTION, INC.'S BRIEF IN SUPPORT OF ANSWER TO SIMPLEXGRINNELL’S MOTION FOR SUMMARY JUDGMENT NORTH AMERICAN ELITE INSURANCE COMPANY AS SUBROGEE OF PENN FOUNDATION, INC. Fourth Party Plaintiff vs. PENN BUILDERS, INC., SIMPLEXGRINNELL LP n/k/a JOHNSON CONTROLS FIRE PROTECTION, LP and ANCHOR FIRE PROTECTION COMPANY Fourth Party Defendants Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 5 of 13 BRIEF OF DEFENDANT/THIRD PARTY PLAINTIFF, VICTORY FIRE PROTECTION, INC. IN OPPOSITION TO DEFENDANT/THIRD PARTY DEFENDANT SIMPLEXGRINNELL LP n/k/a JOHNSON CONTROLS FIRE PROTECTION LP’S MOTION FOR SUMMARY JUDGMENT I. MATTER BEFORE THE COURT The matter before this Honorable Court is Defendant/Third Party Defendant SimplexGrinnell n/k/a Johnson Controls Fire Protection, LP’s (hereinafter “SimplexGrinnell”) Motion for Summary Judgment. Defendant/Third Party Plaintiff Victory Fire Protection, Inc. (hereinafter “Victory”) respectfully requests this Honorable Court deny SimplexGrinnell’s Motion as such Motion is premature in light of the fact that written discovery is continuing, no depositions have been taken, and the discovery deadline in this matter is August 20, 2018 and expert reports are not due until September 17, 2018. Further, SimplexGrinnell’s arguments with respect to the dismissal of Victory’s claims are erroneous. II. QUESTIONS PRESENTED 1. Question Presented: Whether SimplexGrinnell’s Motion for Summary Judgment should be granted where such Motion is premature as written discovery is continuing, no depositions have been taken, the discovery deadline in this matter is August 20, 2018 with expert reports due September 17, 2018? Suggested Answer: No. Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 6 of 13 2. Question Presented: Whether SimplexGrinnell’s Motion should be granted where Victory has properly asserted negligence and contribution claims against SimplexGrinnell which are not dependent upon Plaintiff NAEIC having a direct claim against SimplexGrinnell and are not barred by the gist of the action doctrine as such claims are premised upon SimplexGrinnell’s negligent conduct, not an alleged breach of contract? Suggested Answer: No. III. FACTUAL BACKGROUND On August 4, 2017, plaintiff, North American Elite Insurance Company (“NAEIC”) commenced this action by way of complaint filed against Victory. According to the complaint, NAEIC issued a policy of insurance to Penn Foundation, Inc. (“Penn Foundation”) which, at all times relevant hereto, insured the real and personal property of Penn Foundation, Inc. located at the Penn Villa facility, 807 Lawn Avenue, Sellersville, Pennsylvania, 18960 (hereinafter “the subject property”). The Complaint asserts that, at all times material hereto, Victory supplied, constructed, fabricated, assembled, and installed the fire protection system at the subject property. The Complaint further asserts, on January 5, 2016, a piping connection for the fire protection system at the subject property froze and broke. According to the Complaint, the pipe connection which froze and broke was a water filled tee connection for the dry fire protection system piping within the unheated attic at the subject property. According to the Complaint, the failure of the pipe connection at the subject property on January 5th, 2016 was caused by the actions and inactions of Victory and its employees acting on its behalf as a result of improper performance of its work, specifically regarding placement of signage relative to the dry sprinkler system. According to the complaint, Penn Foundation, Inc. incurred damages in the amount of not less Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 7 of 13 than $373,651.20 as a result of the incident. Victory filed its answer to NAEIC’s complaint on September 6, 2017. On November 21, 2017, Victory filed a Motion for Leave to File a Third Party Complaint against SimplexGrinnell, Penn Builders, Inc., and Anchor Fire Protection Company which was granted on November 22, 2017. With leave of Court, Victory filed its Third-Party Complaint on November 27, 2017. Victory’s Third Party Complaint alleges that Third Party Defendant SimplexGrinnell LP n/k/a Johnson Controls Fire Protection (“SimplexGrinnell”) maintained and inspected the subject dry sprinkler system and their independent acts and omissions were the proximate cause of any loss suffered by Penn Foundation. Victory’s Third Party Complaint sets forth specific allegations of negligence against SimplexGrinnell. See Joint Appendix Exhibit B, Joinder Complaint, Count II. SimplexGrinnell filed the subject Motion for Summary Judgment on July 6, 2018. The discovery deadline is this matter is August 20, 2018 and defense experts’ reports are not due until September 17, 2018. At that point in the litigation, not a single deposition has been taken. It is simply premature for any party to file a Motion for Summary Judgment as the record is woefully deficient and this Honorable Court should dismiss SimplexGrinnell’s motion on this basis alone. IV. LEGAL ARGUMENT SimplexGrinnell’s Motion should be denied as it also fails to establish that there is no material issue of fact and that it is entitled to a matter of law, as discussed herein.1 1 The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law. F.R.C.P. 56. Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 8 of 13 a. Victory’s Claims Survive Even if NAEIC Does Not Have a Direct Claim Against SimplexGrinnell. Victory’s Joinder Complaint alleges that SimplexGrinnell is liable over to Victory as a result of SimplexGrinnell’s negligence conduct and the damage sustained by Penn Foundation is the direct and proximate result of such conduct on the part of SimplexGrinnell. As such, Victory’s claim against SimplexGrinnell survives even if NAEIC does not have a direct claim against SimplexGrinnell as SimplexGrinnell can be held liable over to Victory on Victory’s negligence claim regardless of whether Penn Foundation and/or NAEIC can assert a direct claim against SimplexGrinnell. A plaintiff may have no direct claim or right of recovery against an additional defendant in various situations. One example is where the statute of limitations on a plaintiff’s underlying tort claim has run prior to a third party being joined by an originally named defendant on theories of contribution and/or indemnification. Third party claims under such scenario are routinely permitted. SimplexGrinnell’s attempt to argue that if Plaintiff cannot assert a direct claim against SimplexGrinnell, Victory is precluded from asserting claims against it is patently erroneous and it cites no applicable case law which would establish such a bar to Victory’s claims. As such, SimplexGrinnell’s Motion for Summary Judgment should be denied. b. Victory’s Claim is Not Barred by the Gist of the Action Doctrine. The claims asserted against SimplexGrinnell are negligence/contribution claims, not a breach of contract claim. Victory’s Joinder Complaint alleges specific allegations of negligent conduct, including allegations of gross negligence and code violations, against SimplexGrinnell without reference to any contractual obligations or breach thereof. See Joint Appendix Exhibit B, Joinder Complaint, Count II. Victory does not claim that SimplexGrinnell Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 9 of 13 did not perform its contractual duty of conducting an inspection and testing. Instead, Victory claims that SimplexGrinnell negligently performed such inspections and testing which caused the alleged damage to Penn Foundation, if any. Pennsylvania law does not permit a contract to bar claims for grossly negligent conduct or conduct in violation of code as a matter of public policy. See Tayar v. Camelback Ski Corp., Inc., 616 Pa. 385, 399, 47 A.3d 1190, 1199 (2012). Thus, as a jury could find that SimplexGrinnell’s conduct was grossly negligent and/or in violation of code, Victory’s claims against SimplexGrinnell are not barred by the gist of the action doctrine and should not be dismissed at this early juncture in light of the fact that discovery is ongoing and in its infancy. SimplexGrinnell’s Motion for Summary Judgment argues that such claims are barred by the gist of the action doctrine as Victory’s claims are “if anything, a breach of contract claim.” However, SimplexGrinnell’s Motion is devoid of any assertion that it had a contract with Victory. In fact, SimplexGrinnell does not have any contract with Victory relevant to the dispute involved in this matter. Despite the lack of a contract between Victory and SimplexGrinnell, SimplexGrinnell’s Motion for Summary Judgment attempts to argue that Victory was limited to bringing a breach of contract action, rather than a negligence action for SimplexGrinnell’s negligent conduct in causing Penn Foundation’s alleged damages, if any. As previously discussed, the claims asserted against SimplexGrinnell are negligence/contribution claims, not a breach of contract claim and are supported by specific allegations of negligent conduct without reference to a contractual obligation or breach thereof. As the claims asserted by Victory against SimplexGrinnell are negligence/contribution claims not premised upon a contract between the parties (no such contract existing), such claims are not barred by the gist of the action doctrine. Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 10 of 13 c. SimplexGrinnell’s Motion is Premature. SimplexGrinnell’s Motion is premature in light of the fact that written discovery is continuing, no depositions have been taken, and the discovery deadline in this matter is August 20, 2018 with defense expert reports coming due on September 17, 2018. See Joint Appendix Exhibit K. Victory’s claims against SimplexGrinnell should not be dismissed at this early stage of the litigation before it is even determined what caused the alleged water damage and before the parties are given the opportunity to conduct discovery regarding whether negligence on the part of SimplexGrinnell caused or contributed thereto. V. CONCLUSION For all the foregoing reasons, Defendant/Third Party Plaintiff Victory Fire Protection, Inc., requests this Honorable Court deny SimplexGrinnell’s Motion for Summary Judgment as such Motion is premature in light of the fact that written discovery is continuing, no depositions have been taken, and the discovery deadline in this matter is August 20, 2018 and defense expert reports are not due until September 17, 2018. Further, SimplexGrinnell’s arguments with respect to the dismissal of Victory’s claims are erroneous. Respectfully submitted, By: /s/ Franklin C. Love Franklin C. Love, Esq. fclove@zarwin.com ZARWIN, BAUM, DeVITO, KAPLAN, SCHAER & TODDY, P.C. 1818 Market Street, 13th Floor Philadelphia, PA 19103 Phone: 215.569.2800 Fax: 267.765.9674 Attorney for Defendant, Victory Fire Protection, Inc. Dated: July 27, 2018 Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 11 of 13 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF PENNSYLVANIA NORTH AMERICAN ELITE INSURANCE COMPANY, Plaintiff, vs. VICTORY FIRE PROTECTION, INC. Defendant/Third Party Plaintiff vs. PENN BUILDERS, INC., SIMPLEXGRINNELL LP n/k/a JOHNSON CONTROLS FIRE PROTECTION, LP and ANCHOR FIRE PROTECTION COMPANY Third Party Defendants No.: 2:17-cv-03554-WB NORTH AMERICAN ELITE INSURANCE COMPANY AS SUBROGEE OF PENN FOUNDATION, INC. Fourth Party Plaintiff vs. PENN BUILDERS, INC., SIMPLEXGRINNELL LP n/k/a JOHNSON CONTROLS FIRE PROTECTION, LP and ANCHOR FIRE PROTECTION COMPANY Fourth Party Defendants CERTIFICATE OF SERVICE The undersigned hereby certifies that on the date written below, a true and correct copy of the foregoing Answer of Defendant/Third Party Plaintiff, Victory Fire Protection, Inc. to Defendant/Third Party Defendant SimplexGrinnell LP n/k/a Johnson Controls Fire Protection Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 12 of 13 LP’s Motion for Summary Judgment and Memorandum of Law in Support thereof, was served upon all counsel of record via the United States District Court for the Eastern District of Pennsylvania’s Electronic Civil Filing System. ZARWIN, BAUM, DeVITO, KAPLAN, SCHAER & TODDY, P.C. By: /s/ Franklin C. Love Franklin C. Love, Esq. fclove@zarwin.com ZARWIN, BAUM, DeVITO, KAPLAN, SCHAER & TODDY, P.C. 1818 Market Street, 13th Floor Philadelphia, PA 19103 Phone: 215.569.2800 Fax: 267.765.9674 Attorney for Defendant, Victory Fire Protection, Inc. Dated: July 27, 2018 Case 2:17-cv-03554-WB Document 70 Filed 07/27/18 Page 13 of 13