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United National Insurance Co. v. Peninsula Roofing Company, Inc.

United States District Court, D. Maryland

March 30, 2018



          George L. Russell, III United States District Judge

         THIS MATTER is before the Court on Defendant Peninsula Roofing Company, Inc.'s (“Peninsula”) Motion for Summary Judgment (ECF No. 12). The Motion is ripe for disposition, and no hearing is necessary. See Local Rule 105.6 (D.Md. 2016). For the reasons outlined below, the Court will grant the Motion.

         I. BACKGROUND[2]

         Pelican Beach Condominium Association (“Pelican Beach”), Plaintiff United National Insurance Company's (“United National”) insured, entered into a contract (the “Contract”) with Peninsula to replace the roof on its condominium building located at 13908 Wight Street, Ocean City, Maryland (the “Work”).[3] (Compl. ¶ 4, ECF No. 1). The Contract consists, in relevant part, of two boilerplate American Institute of Architects (“AIA”) documents: Document A101™-2007 “Standard Form Agreement Between Owner and Contractor where the basis of payment is a Stipulated Sum” (“A101”), (Def.'s Mem. Supp. Mot. Summ. J. [“Def.'s Mot.”] Ex. 5 [“A101”], ECF No. 12-5); and Document A201™-2007 “General Conditions of the Contract for Construction” (“A201”), (Def.'s Mot. Ex. 6 [“A201”], ECF No. 12-6).

         The Contract contains four provisions relevant to this case. First, the “Waivers of Subrogation” provision (the “Waiver”), A201 § 11.3.7 provides, in pertinent part: “The Owner and Contractor waive all rights against [ ] each other . . . for damages caused by fire . . . to the extent covered by property insurance obtained pursuant to Paragraph 11.3 or other property insurance applicable to the Work . . . .” (A201 § 11.3.7).[4] Second, A201 § 11.3.1 provides, in relevant part, that “the Owner shall purchase and maintain . . . property insurance written on a builder's risk ‘all-risk' or equivalent policy form.” (Id. § 11.3.1). Third, § further provides that “[p]roperty insurance shall be on ‘all risk' or equivalent policy form and shall include, without limitation, insurance against the perils of fire.” (Id. § Finally, § 11.3.5 states: “If during the Project construction period the Owner insures properties, real or personal or both, at or adjacent to the site by property insurance under policies separate from those insuring the Project . . ., the Owner shall waive all rights in accordance with the terms of Section 11.3.7 for damages caused by fire or other causes of loss covered by this separate property insurance.” (Id. § 11.3.5).

         Prior to and during construction, Pelican Beach maintained a commercial property insurance policy through United National. (Joint Stip. of Facts ¶ 5). Pelican Beach did not obtain a freestanding builder's risk or all-risk policy. (See id.).

         Around September 8, 2015, Peninsula began replacing the roof at Pelican Beach. (Compl. ¶ 7). On January 13, 2016, while Peninsula was working on the roof, a fire broke out in the back of a Peninsula truck that was parked in a parking structure underneath the condominium. (Joint Stip. of Facts ¶¶ 1-4). The source of the fire was a generator located in the back of the truck that supplied electricity to the tools Peninsula was using on the roof. (Id. ¶¶ 3-4). The fire caused more than $3, 000, 000.00 in property damage, which United National either “paid, or expects to pay.” (Id. ¶ 7).

         On October 25, 2016, United National, as Pelican Beach's subrogee, sued Peninsula. (ECF No. 1). The two-count Complaint alleges negligence and breach of contract. (Compl. ¶¶ 20-37). United National seeks to recover the approximately $3, 000, 000.00 in fire damages. (Id. at 5, 7). On April 24, 2017, Peninsula filed a Motion for Summary Judgment. (ECF No. 12). On June 26, 2017, United National filed an Opposition. (ECF No. 19). Peninsula filed a Reply on July 13, 2017. (ECF No. 20).


         A. Standard of Review

          In reviewing a motion for summary judgment, the Court views the facts in a light most favorable to the nonmovant, drawing all justifiable inferences in that party's favor. Ricci v. DeStefano, 557 U.S. 557, 586 (2009); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986) (citing Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59 (1970)). Summary judgment is proper when the movant demonstrates, through “particular parts of materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations . . . admissions, interrogatory answers, or other materials, ” that “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a), (c)(1)(A). Significantly, a party must be able to present the materials it cites in “a form that would be admissible in evidence, ” Fed.R.Civ.P. 56(c)(2), and supporting affidavits and declarations “must be made on personal knowledge” and “set out facts that would be admissible in evidence, ” Fed.R.Civ.P. 56(c)(4).

         Once a motion for summary judgment is properly made and supported, the burden shifts to the nonmovant to identify evidence showing there is genuine dispute of material fact. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986). The nonmovant cannot create a genuine dispute of material fact “through mere speculation or the building of one inference upon another.” Beale v. Hardy, 769 F.2d 213, 214 (4th Cir. 1985) (citation omitted).

         A “material fact” is one that might affect the outcome of a party's case. Anderson, 477 U.S. at 248; see also JKC Holding Co. v. Wash. Sports Ventures, Inc., 264 F.3d 459, 465 (4th Cir. 2001) (citing Hooven-Lewis v. Caldera, 249 F.3d 259, 265 (4th Cir. 2001)). Whether a fact is considered to be “material” is determined by the substantive law, and “[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment.” Anderson, 477 U.S. at 248; accord Hooven-Lewis, 249 F.3d at 265. A “genuine” dispute concerning a “material” fact arises when the evidence is sufficient to allow a reasonable jury to return a verdict in the nonmoving party's favor. Anderson, 477 U.S. at 248. If the nonmovant has failed to make a sufficient showing on an essential element of her case where she has the burden of proof, “there can be ‘no genuine [dispute] as to any material fact, ' since a complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial.” Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986).

         B. ...

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