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Bierman Family Farm LLC v. United Farm Family Insurance Co.

United States District Court, D. Maryland

November 29, 2017



          A. David Copperthite, United States Magistrate Judge

         Plaintiff. Bierman Family Farm, LLC/King Mulch/King Farms, moves this Court for summary judgment in favor of Plaintiff and against Defendant United Farm Family Insurance Company ("Defendant") ("Plaintiffs Motion'*) (ECF No. 40). Plaintiff seeks a ruling from the Court that Defendant pay the remaining half of its insurance policy's limit of liability. Defendant filed an opposition to Plaintiffs Motion and cross-motion for summary judgment in favor of Defendant and against Plaintiff ("Defendant's Cross-Motion) (ECF No. 43).

         After considering the motions and responses thereto (ECF Nos. 44-45), the Court finds that no hearing is necessary. See Loc.R. 105.6 (D.Md. 2016). In addition, having reviewed the pleadings of record and all competent and admissible evidence submitted by the parties, the Court finds that there is a genuine issue of material fact as to the claims asserted. Accordingly, the Court will DENY Plaintiffs Motion (ECF No. 40) and DENY Defendant's Cross-Motion (ECF No. 43).


         This lawsuit arises out of Defendant's partial denial of Plaintiffs insurance claim for the alleged damage to a storage building on the property located at 33819 Market Street, Pokomoke City, Maryland 21851 ("the Property"). On or about October 13. 2015, Plaintiff and Defendant executed an insurance contract (Policy No. 1913G1126) ("the Policy") to provide coverage on the Property for the time period from November 17, 2015 through November 17, 2016. ECF No. 40-2. The Policy lists fire as one of the "PERILS INSURED AGAINST." The Policy includes a "VACANCY and UNOCCUPANCY Clause" (the "Vacancy and Unoccupancy Clause"), which states, in pertinent part:

If a RESIDENCE or BUILDING[1]'' covered under this policy is VACANT[2] or UNOCCUPIED[3] beyond a period of sixty (60) consecutive days, the applicable Limit of Liability for the RESIDENCE or BUILDING and the contents contained therein will be automatically reduced by 50%. BUILDINGS which are in a seasonal state of VACANCY or UNOCCUPANCY due to normal practices of FARMING[4] operations are not considered VACANT or UNOCCUPIED.

Id. at 29. The Policy provides for a maximum coverage of $200, 000 for the storage building located on the Property. Id. at 8. In addition to the maximum coverage amount, the Policy provides for up to 5% of the $200, 000, or $ 10.000. for debris removal. Id. at 53.

         At the Property, Plaintiff provided King Pallet, Inc. with a place to store, maintain, and stage pallets used in the farming industry. ECF No. 43-3 at 2. Accordingly, any pallets at the Property during the sixty days preceding April 10, 2016 belonged to and were used in the business of King Pallet. Inc. Id. at 3.

         On April 10, 2016, the Property sustained a fire loss. ECF No. 40-7 at 17-18. Plaintiff made a claim with Defendant for the resulting property damage by way of Claim Number 19-G-3A9171, claiming costs in excess of the $200, 000 policy limit for replacement of the Property as well as estimates in excess of $10, 000 for debris removal. See ECF No. 40-2 at 3. After an inspection and evaluation of the Property, a claims representative for Defendant determined that the building was a total loss and was unoccupied. ECF No. 40-7 at 18-19. Therefore, on April 18, 2016, relying on the first sentence of the Vacancy and Unoccupancy Clause contained in the Policy, Defendant partially denied Plaintiffs claim, paying $105, 000, or one half of the total coverage for damages plus 5% for debris removal at the Property. ECF No. 40-3 at 2.

         Procedural Background

         On January 3, 2017, Plaintiff filed suit in the Circuit Court for Harford County against Defendant alleging a single count of breach of contract for failure to fully pay the amount due under the Policy. ECF No. 2 ("the Complaint").[5] Specifically, Plaintiff alleged that Defendant "improperly applied a 50% vacancy penalty, even though the storage building was not vacant under the definitions of the policy." Id. at 3. The Complaint sought $220, 000 in damages with interests and costs for the alleged breach.[6] Id. at 6.

         On September 22, 2017, Plaintiff filed Plaintiffs Motion (ECF No. 40) seeking summary judgment against Defendant for imposing a fifty percent reduction in the amount of Plaintiffs recoverable policy benefits based on Defendant's allegedly incorrect conclusion that an insured building was vacant at the time of the fire loss.[7] On October 11, 2017, Defendant filed Defendant's Cross-Motion (ECF No. 43) seeking summary judgment in its favor. Plaintiff filed a reply and opposition (ECF No. 44) on October 27, 2017, and Defendant filed a reply (ECF No. 45) on November 8, 2017. This matter is now fully briefed and the Court has reviewed each party's cross-motion for summary judgment. For the foregoing reasons and pursuant to Federal Rule of Civil Procedure 56(d). Plaintiffs Motion (ECF No. 40) is denied and Defendant's Cross-Motion (ECF No. 43) is denied.

         Standard of Review

         Pursuant to Rule 56, a movant is entitled to summary judgment where the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact. Fed.R.Civ.P. 56(a); see Celolex Corp. v. Catrett,477 U.S. 317, 322-23 (1986). The Supreme Court has clarified that not every factual dispute will defeat a motion for summary judgment but rather, there must be a genuine issue of material fact. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-248 (1986) ("[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." (emphases in original)). An issue of fact is material if, under the substantive law of the case, resolution of the ...

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