Diamond State Insurance v. Re
Diamond State Insurance v. Re
Opinion of the Court
ORDER
Before the Court is Plaintiff Diamond State Insurance Company’s Motion for Summary Judgment. (Doc. 41.) Defendant Andrea Re did not file a response. For the following reasons, Plaintiffs motion is GRANTED. The Clerk of Court is DIRECTED to enter judgment in favor of Plaintiff and close this case.
BACKGROUND
This case stems from a dispute concerning the scope of coverage provided by two insurance policies issued by Plaintiff. Defendant Andrea Re is a licensed real estate broker and the sole principal of Re Realty.
Sometime in 1996, Lavinia Strickland, whose real estate agent license was affiliated with Defendant’s broker license, operated Re Realty Property Management Division (“RRPMD”), which engaged in the business of managing rental properties. (Doc. 41, Attach. 1 at 3-4.) Ms. Strickland was the sole owner of RRPMD, which was a separate business entity from Re Realty. (Id. at 4.) While in operation, RRPMD maintained separate bank accounts to hold funds paid by tenants of properties managed by RRPMD. (Id.) Defendant never received or reviewed any bank statements for the RRPMD accounts. (Id.)
Also in late 2008, Ms. Garrigus informed Defendant that there were some discrepancies concerning the RRPMD accounts. (Doc. 41, Attach. 1 at 4.) In April 2009, RRR closed its doors, ceasing business operations. (Id at 5.) Around this time, Ms. Garrigus informed Defendant that there was insufficient money in RRR’s security deposit and rental trust accounts to pay for all of its outstanding liabilities. (Id) All told, approximately $170,000 was missing from the trust accounts due to Mses. Strickland and Garrigus unlawfully converting or misappropriating the funds for their private uses. (Id) Several individuals and entities sued Defendant for the return of deposits and rental funds, with Plaintiff defending Defendant under a reservation of rights. (Id at 6.)
According to Plaintiff, Defendant submitted applications for insurance in May 2007 and April 2008. (Id) In these applications, Defendant stated that Re Realty had a staff member with thirteen years experience managing properties and that Defendant was engaged in the business of providing property management services, specifically RRPMD. (Id at 6-7.) However, Plaintiff was never informed that RRPMD was a separate entity over which Defendant had no control. (Id at 7.) According to Plaintiff, it would have declined to issue the subject insurance policy if it had been aware that Defendant exercised no control over the separate business entities involved in property management. (Id)
On October 15, 2009, Plaintiff filed a complaint with this Court. (Doc. 1.) With the consent of Defendant (Doc. 14), Plaintiff filed an amended complaint on January 8, 2010.
ANALYSIS
I. SUMMARY JUDGMENT STANDARD
According to Fed.R.Civ.P. 56(a), “[a] party may move for summary judgment, identifying each claim or defense-or the part of each claim of defense-on which summary judgment is sought.” Such a
Summary judgment is appropriate when the nonmovant “fails to make a showing sufficient to establish the existence of an element essential to that party’s case, and on which that party will bear the burden of proof at trial.” Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The substantive law governing the action determines whether an element is essential. DeLong Equip. Co. v. Wash. Mills Abrasive Co., 887 F.2d 1499, 1505 (11th Cir. 1989).
As the Supreme Court explained:
[A] party seeking summary judgment always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact.
Celotex, 477 U.S. at 323, 106 S.Ct. 2548. The burden then shifts to the nonmovant to establish, by going beyond the pleadings, that there is a genuine issue as to facts that are material to the nonmovant’s ease. Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991).
The Court must review the evidence and all reasonable factual inferences arising from it in the light most favorable to the nonmovant. Matsushita, 475 U.S. at 587-88, 106 S.Ct. 1348. However, the nonmoving party “must do more than simply show that there is some metaphysical doubt as to the material facts.” Id. at 586, 106 S.Ct. 1348. A mere “scintilla” of evidence, or simply conclusory allegations, will not suffice. See, e.g., Tidwell v. Carter Prods., 135 F.3d 1422, 1425 (11th Cir. 1998). Nevertheless, where a reasonable fact finder may “draw more than one inference from the facts, and that inference creates a genuine issue of material fact, then the Court should refuse to grant summary judgment.” Barfield v. Brierton, 883 F.2d 923, 933-34 (11th Cir. 1989).
Even though a motion requesting summary judgment is unopposed, it may only be granted when appropriate — there must be an evidentiary showing that the moving party is entitled to judgment as a matter of law. United States v. One Piece of Real Property Located at 5800 SW 74th Ave., Miami Fla., 363 F.3d 1099, 1101 (11th Cir. 2004). To this end, a district court cannot simply accept the factual statements in the unopposed motion as true, “but must ensure that the motion itself is supported by evidentiary materials.” Id. It is only when the court concludes that the moving party’s factual statements find evidentiary support in the record that the court may grant an unopposed request for summary judgment. See id.
II. PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT
In its Motion for Summary Judgment, Plaintiff contends that Defendant is not entitled to coverage under the policy pursuant to O.C.G.A. § 33-24-7(b)(2). (Doc. 41, Attach. 1 at 8-10.) Under that provision, misrepresentations or incorrect
In support of its motion, Plaintiff has submitted the affidavit of one of their underwriters — Margaret Robinson. (Doc. 41, Ex. 13.) In the affidavit, Ms. Robinson stated that, from an underwriting perspective, [tjhere is a substantial difference between a policyholder actively operating, supervising and controlling its own property management business and a policyholder who is not engaged in the business of property management. (Id. ¶ 15.) According to Ms. Robinson, “[t]his changes the nature, extent and character of the risks being insured against.” (Id.) In addition, she states that if Plaintiff, as a prudent insurer, knew that Defendant was not in control of the property management operations, then it would have either not offered Defendant the policy in question or modified it to exclude claims arising from property management services. (Id. ¶ 16.)
After reviewing the record, this Court must conclude that Plaintiff is entitled to summary judgment. Based on the lack of any opposition offered by Defendant,
CONCLUSION
For the foregoing reasons, Plaintiffs Motion for Summary Judgment is GRANTED. The Clerk of Court is DIRECTED to enter the appropriate judgment in favor of Plaintiff and to close this case.
SO ORDERED.
. Because Defendant did not respond to Plaintiff's motion, the Court accepts as true Plaintiff's factual statements for the purpose of ruling on its motion. See S.D.L.R. 7.5 ("Failure to respond within the applicable time period shall indicate that there is no opposition to a motion."); Id. 56.1 ("All material facts set forth in the statement [of material facts] required to be served by the moving party will be deemed to be admitted unless controverted by a statement served by the opposing party.”).
. Oddly, even though she answered the first complaint, Defendant failed to answer the amended complaint. Of course, this would entitle Plaintiff to a default judgment. Surprisingly, however, Plaintiff never requested that type of relief.
. The Court notes that it would not have been difficult for Defendant to create a genuine issue of material fact with respect to this contention. By not offering any response, however, the Court must accept the truth of Plaintiff’s factual assertion, which is supported by evidence in the record.
. Because the Court finds that Plaintiff is entitled to summary judgment based on O.C.G.A. § 33-24-7(b)(2), it need not address the remainder of Plaintiff's arguments.
Reference
- Full Case Name
- DIAMOND STATE INSURANCE CO. v. Andrea RE, d/b/a Re Realty
- Status
- Published