Douglas et al v. Renola Equity Fund II, LLC et al, No. 2:2013cv06192 - Document 117 (E.D. La. 2015)
Court Description: ORDER AND REASONS - the Court GRANTS defendant's motion 106 for summary judgment. Plaintiffs' claims against Imperial Fire under policy number F220028644 are DISMISSED WITH PREJUDICE.. Signed by Chief Judge Sarah S. Vance on 9/18/15. (jjs)
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Douglas et al v. Renola Equity Fund II, LLC et al Doc. 117 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA STEVE B. DOUGLAS, ET AL. CIVIL ACTION NO: 13-6192 VERSUS RENOLA EQUITY FUND, II, LLC, ET AL. SECTION: R(2) ORD ER AN D REASON S Defendant Im perial Fire and Casualty Insurance Com pany ("Im perial Fire") m oves for sum m ary judgm ent on plaintiffs' bad faith insurance practices claim s under La. R.S. §§ 22:1892 and 22:1973 in relation to policy num ber F220 0 28644. The Court grants the m otion because plaintiffs have failed to provide the Court with any evidence dem onstrating that they have a valid, underlying insurance claim against Im perial Fire. I. BACKGROU N D Plaintiffs are form er owners and tenants of condom inium s located at 217 Plantation Drive in Chalm ette, Louisiana. Plaintiffs allege that following Hurricane Isaac's landfall in August of 20 12, they suffered various injuries and dam age as a result of exposure to toxic m old. Plaintiffs further allege that, because of the toxic m old and other unrepaired dam age caused by Hurricane Isaac, St. Bernard Parish officials declared the property uninhabitable and ordered plaintiffs to vacate their hom es. Plaintiffs brought this suit against several defendants asserting different theories of liability against each defendant. At issue here are Dockets.Justia.com plaintiffs' claim s against Im perial Fire for bad faith insurance practices under La. R.S. §§ 22:1892 and 22:1973.1 Im perial Fire provided flood insurance coverage for the property at 217 Plantation Drive under a General Property Form Standard Flood Insurance Policy ("SFIP"), num ber F220 0 28644. Renola Equity, II, LLC ("Renola") is the only entity listed as a nam ed insured on the policy.2 In addition, Scott Holm es, Vice President of Claim s for a com pany that services Im perial Fire's SFIP policies, provided an affidavit stating that "Im perial Fire does not have any record of Renola Equity Fund II, LLC or any of the Plaintiffs reporting a flood loss claim caused by flooding associated with Hurricane Isaac that occurred on or about August 29, 20 12."3 Holm es further states that Im perial Fire was served with this lawsuit on or about Septem ber 24, 20 13 and that "[s]ervice of this lawsuit was Im perial Fire's first notice of the August 29, 20 12 Hurricane Isaac flood loss claim ."4 Im perial Fire now m oves for sum m ary judgm ent, arguing that plaintiffs have failed to dem onstrate the privity of contract required for a valid insurance claim . Im perial Fire further argues that even if privity existed, plaintiffs' claims should still be dism issed because plaintiffs failed to provide tim ely notice of the flood loss claim and did not tim ely subm it a signed and sworn Proof of Loss in support of the am ount claim ed, as required by the term s of the SFIP.5 Plaintiffs do not oppose the m otion. 1 R. Doc. 2-2 at 16. 2 R. Doc. 10 6-2 at 1. 3 R. Doc. 10 6-3 at 3. 4 Id. 5 R. Doc. 10 6-1. 2 II. LEGAL STAN D ARD Sum m ary judgm ent is warranted when "the m ovant shows that there is no genuine dispute as to any m aterial fact and the m ovant is entitled to judgm ent as a m atter of law." Fed. R. Civ. P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322– 23 (1986); Little v. Liquid Air Corp., 37 F.3d 10 69, 10 75 (5th Cir. 1994). When assessing whether a dispute as to any m aterial fact exists, the Court considers "all of the evidence in the record but refrain[s] from m aking credibility determ inations or weighing the evidence." Delta & Pine Land Co. v. Nationw ide Agribusiness Ins. Co., 530 F.3d 395, 398– 99 (5th Cir. 20 0 8). All reasonable inferences are drawn in favor of the nonm oving party, but "unsupported allegations or affidavits setting forth 'ultim ate or conclusory facts and conclusions of law' are insufficient to either support or defeat a m otion for sum m ary judgm ent." Galindo v . Precision Am . Corp., 754 F.2d 1212, 1216 (5th Cir. 1985); see also Little, 37 F.3d at 10 75. If the dispositive issue is one on which the m oving party will bear the burden of proof at trial, the m oving party "m ust com e forward with evidence which would 'entitle it to a directed verdict if the evidence went uncontroverted at trial.'" Int'l Shortstop, Inc. v. Rally 's, Inc., 939 F.2d 1257, 1264– 65 (5th Cir. 1991). The nonm oving party can then defeat the m otion by either countering with evidence sufficient to dem onstrate the existence of a genuine dispute of m aterial fact, or "showing that the m oving party's evidence is so sheer that it m ay not persuade the reasonable fact-finder to return a verdict in favor of the m oving party." Id. at 1265. If the dispositive issue is one on which the nonm oving party will bear the burden of proof at trial, the m oving party m ay satisfy its burden by m erely pointing out that the evidence in the record is insufficient with respect to an essential elem ent of the nonm oving 3 party's claim . See Celotex, 477 U.S. at 325. The burden then shifts to the nonm oving party, who m ust, by subm itting or referring to evidence, set out specific facts showing that a genuine issue exists. See id. at 324. The nonm ovant m ay not rest upon the pleadings, but m ust identify specific facts that establish a genuine issue for trial. See, e.g., id.; Little, 37 F.3d at 10 75 ("Rule 56 'm andates the entry of sum m ary judgm ent, after adequate tim e for discovery and upon m otion, against a party who fails to m ake a showing sufficient to establish the existence of an elem ent essential to that party's case, and on which that party will bear the burden of proof at trial.'" (quoting Celotex, 477 U.S. at 322)). III. D ISCU SSION La. R.S. §§ 22:1892 and 22:1973 provide penalties to insureds and policy beneficiaries if an insurer acts in bad faith when adjusting a claim m ade under an insurance policy.6 To recover statutory penalties under these provisions, a plaintiff "m ust first have a valid, underlying, substantive claim upon which insurance coverage is based." Matthew s v. Allstate, 731 F. Supp. 2d 552, 566 (E.D. La. 20 10 ). In other words, the "penalties in these statutes do not stand alone; they do not provide a cause of action against an insurer absent a valid, underlying insurance claim ." Clausen v. Fidelity and Deposit Co. of Md., 660 So. 2d 83, 85-86 (La. App. 1 Cir. 1995). See also Bay le v. Allstate, 615 F.3d 350 , 363 (5th Cir. 6 La. R.S. § 22:1892 provides for penalties if an insurer fails to m ake a paym ent or written settlem ent offer "within thirty days after receipt of satisfactory proof of loss of that claim . . . when such failure is found to be arbitrary, capricious, or without probable cause . . . ." La. R.S. § 22:1973 provides for penalties if an insurer fails to "adjust claim s fairly and prom ptly and to m ake a reasonable effort to settle claim s with the insured or the claim ant, or both." 4 20 10 ) ("Breach of contract is a condition precedent to recovery for the breach of the duty of good faith."). Plaintiffs have failed to establish a genuine issue of m aterial fact as to whether they have a valid, underlying insurance claim against Im perial Fire under the policy at issue. As an initial m atter, the insurance contract nam es Renola, the owner of the building at issue, as the sole nam ed insured under policy num ber F220 0 28644. See Herbert v. Hill, 855 So. 2d 768, 772 (La. App. 2 Cir. 20 0 3) (holding that tenants cannot bring bad faith adjustm ent practices claim under landlord's insurance policy). Because the policy does not provide third party liability or property coverage, plaintiffs have no valid insurance claim against Im perial Fire. See Randall v. Lloy d's Underw riter's at London, 60 2 So. 2d 790 , 791 (La. App. 4 Cir. 1992) ("It is a well-accepted principle in Louisiana jurisprudence that, absent a contrary statutory provision, actions ex contractu cannot be m aintained against a party by an individual who is not party thereto."); Saunders v. Nat'l Flood Ins. Program , No. CIV.A. 13-5613, 20 14 WL 3161459, at *2 (E.D. La. J uly 8, 20 14) (holding that insured had no claim for breach of insurance contract when there was no privity of contract between insurer and insured). Moreover, even if plaintiffs could bring a claim under Renola's insurance policy, Im perial Fire provided an affidavit of a claim s adjustor stating that Im perial Fire never received a claim from any of the plaintiffs in this case under the policy at issue. Plaintiffs offer no evidence to rebut this assertion. Im perial Fire cannot be liable to plaintiffs for bad faith adjustm ent practices when plaintiffs never filed claim s for Im perial Fire to adjust. Thus, absent evidence of an underlying insurance claim , plaintiffs' bad faith insurance practices claim s under policy num ber F220 0 28644 fail as a m atter of law. See Chet 5 Morrison Contractors, LLC v. Onebeacon Am . Ins. Co., Civ. A. No. 14-1958, 20 15 WL 1221616, at *6 (E.D. La. Mar. 17, 20 15) ("Because [plaintiff] has no underlying claim against [defendants], its claim s under La. Rev. Stat. §§ 22:1892 and 22:1973 fail as a m atter of law."). IV. CON CLU SION For the reasons stated above, the Court GRANTS defendant's m otion for sum m ary judgm ent. Plaintiffs' claim s against Im perial Fire under policy num ber F220 0 28644 are DISMISSED WITH PREJ UDICE. New Orleans, Louisiana, this 18th day of Septem ber, 20 15. ___ _____________________________ SARAH S. VANCE UNITED STATES DISTRICT J UDGE 6
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