Opinion
07-CV-637166
07-11-2013
RESCO HOLDINGS L.L.C., et al. Plaintiffs, v. AIU INSURANCE COMPANY, et al., Defendants.
OPINION AND ORDER GRANTING PLAINTIFFS' MOTION FOR SUMMARY JUDGMENT ON THE DUTY TO DEFEND
This matter is before the Court on the issue of the duty to defend. The Plaintiffs Rust International Inc. and Rust Engineering & Construction Inc. (collectively "Rust Companies") have filed their Motion for Partial Summary Judgment on Issues of Duty to Defend against defendants Travelers Casualty and Surety Company ("Travelers"); Hartford Accident & Indemnity Company ("Hartford"); and Employers Insurance of Wausau ("Wausau"), as successor to Employers Mutual Liability Insurance Company of Wisconsin (collectively "Defendants") on the following policies: (i) Aetna Casualty & Surety Company, policy number 06 GL 1487 SCA, policy period 7/1/82-7/1/83; (ii) Hartford Accident & Indemnity Company, policy number CBP-62080, policy period 12/31/52-12/31/53; and (iii) Employers Mutual Liability Insurance Company of Wisconsin, policy number 2223 00 029062, policy period 12/31/62-12/31/63.
Plaintiffs are seeking summary judgment that all Defendants breached their duty to defend the Plaintiffs in cases within their policies ' coverage. Specifically, the Plaintiffs allege Defendant Hrutford breached its duty to defend the Plaintiffs in Donald Schussler v. Allied Signal, Inc., et al. including Treco Construction Services, Inc., Case No. C-48- AB-2009-22, Northampton County Court of Common Pleas, Pennsylvania, and Charles Hockenbeny v A.O. Smith Corporation, et al., including Treco Construction Services, Case No. CV-09-705040, Cuyahoga County Court of Common Pleas. Defendant Wausau breached its duty to defend the Plaintiffs in Willie Mae Purvis. et al . v. A. W. Chesterton Company, et al., including Rust Engineering & Construction, Inc., Case No. 08-32672. Montgomery County Court of Common Pleas. Pennsylvania. and Donna Morris Fox. et al. v. A. W Chesterton Company. et al. including Rust Engineering & Construction. Inc., Case No. 08-32665. Montgomery County Court of Common Pleas. Pennsylvania. And. Defendant Travelers breached its duty to defend the Plaintiffs in Herbert H. Huggins v. Adience. Inc. f/k/a BMI. et al. including Treco Construction Services f/k/a The Rust Engineering Co., Case No. CV-09-684277. Cuyahoga County Common Pleas. Ohio. and Mildrew W. Philfer v. A. W Chesterton Company. et al. including Rust Engineering & Construction. Inc. Case No. 09-03449. Montgomery County Court of Common Pleas. Pennsylvania. All of the aforementioned cases are seeking damages from the Plaintiffs for alleged asbestos-related bodily injuries incurred during the time the Plaintiffs were insured by the respective Defendants.
The Schussler Complaint is seeking damages for allegedly .. suffer[ing] asbestos-related bodily injury, including mesothelioma, as a result of exposure to asbestos dust and fibers during the period of 1947 through 1982." (Schussler Cmpt. at ~8-9). The Hockenberry Complaint is seeking damages for allegedly "suffer[ing] bodily injury as a result of exposure to asbestos dust and fibers during the period of 1952 through 1997." (Hockenberry Cmpt. at W2-3). The Purvis Complaint is seeking damages for allegedly "suffer[ing] bodily injury, including lung cancer and death, as a result of exposure to asbestos during 1952 through 1997." (Purvis Cmpt. at W4-7). The Fox Complaint is seeking damages for allegedly "suffer[ing] bodily injury, including lung cancer and death, as a result of exposure to asbestos during 1952 through 1997." (Purvis Cmpt at in['4-7). The Fox Complaint is seeking damages for allegedly "sufier[ing] bodily injury, including lung cancer and death, as a result of exposure to asbestos during 1960 through 2002." (Fox Cmpt. at ¶¶4-7). The Huggins Complaint is seeking damages for allegedly "suffer[ing] bodily injury, including asbestosis and asbestos-related lung cancer, as a result of inhaling asbestos dust and fibers during the period 1948 through 1985." (Huggins Cmpt. at ¶¶3-6). The Phifer Complaint is seeking damages for allegedly "suffer[ing] bodily injury, including lung cancer and death, as a result of inhaling asbestos dust and fibers during the period 1965 through 1985. (Phifer Cmpt. at ¶¶4-7).
Additionally, the Plaintiffs are seeking summary judgment for reimbursement from the respective Defendants for costs incurred in defending these cases. The Plaintiffs are also seeking a declaratory judgment with respect to the Defendants' duty to defend similar lawsuits seeking damages caused by asbestos-related bodily injury that are alleged to have occurred during each of the respective Defendants' policy period.
This case concerns a request for money damages and declaratory relief arising out of a dispute over the obligations of the Rust Companies' primary, umbrella, and excess liability insurers' duty to defend and indemnify the Rust Companies against liability for asbestos bodily injury claims covered under commercial comprehensive liability insurance policies purchased by the Rust Companies from 1940 through 1988. Amended Complaint, ¶1-2. The Plaintiffs have been named as defendants in various actions alleging bodily injury caused by exposure to asbestos in locations where the Rust Companies engaged in the business of, inter alia, construction, construction management, plant operations and maintenance services, including the installation and repair of furnaces and other structures alleged to incorporate asbestos-containing materials. Id. at ¶ 52. The underlying asbestos claims comprise a multitude of lawsuits involving, to date, thousands of claimants in 18 different states including Ohio. To date, of the 35, 000 claims filed nearly 25, 000, or approximately two-thirds of all the underlying asbestos claims, have been brought in Ohio and at least 15, 000 such claims are currently pending in Ohio. Id. at ¶ 54.
This Court found in a prior ruling, among other things, that: asbestos-related claims against the Plaintiffs were within the Plaintiffs' policies with Hartford, Wausau, and Travelers; Ohio law applies; each triggered policy is liable for all sums that Rust Companies are obligated to pay in connection with the underlying claims; and Rust Companies may select among any of the triggered policies to defend or indemnify it form the underlying claims. The remaining issue left is whether the Defendants breached their duty to defend on six asbestos-related claims, and a declaration seeking to hold it liable for damages for asbestos-related bodily injury alleged in underlying claims.
I. LEGAL STANDARD
Summary judgment is appropriate when, "(1) no genuine issue as to any material fact remains to be litigated; (2) the moving party is entitled to judgment as a matter of law; and (3) it appears from the evidence that reasonable minds can come to but one conclusion, and viewing such evidence most strongly in favor of the party against whom the motion for summary judgment is made, that conclusion is adverse to the party whom the motion for summary judgment is made." State ex rel. Parsons v. Fleming (1994), 68 Ohio St.3d 509, 511.
The moving party "bears the initial burden of informing the trial court of the basis for the motion, and identifying those portions of the record that demonstrate the absence of a genuine issue of material fact on the essential elements of the non-moving party's claims." Drescher v. Burt (1996), 75 Ohio St.3d 280, 293. Once the moving party meets its initial burden, the nonmoving party must produce evidence on any issue that the party bears the burden of production at trial. Wing v. Anchor Media, Ltd. Of Texas, (1991), 59 Ohio St.3d 108, 111.
II. ANAYLSIS
A. Defendants Have Breached Their Duty to Defend the Plaintiffs.
The duty to defend is a question of law for this Court. In its prior opinion, this Court granted Plaintiffs' Motion for Summary Judgment on Trigger and Scope Issues and found that Ohio law was applicable. Therefore, this Court will use Ohio's legal principles applicable to an insurance carrier's initial duty to defend.
In Ohio, the duty to defend is determined by comparing the allegation of the complaints in the underlying actions to the terms of the policies. City of Willoughby Hills v. Cincinnati Ins. Co., 9 Ohio St.3d 177, 179-80 (1984). If the allegations of the complaint are arguably or potentially within the coverage, even if such allegations are eventually found to be false, fraudulent, and groundless or not within the indemnity obligations, the carrier is nevertheless bound to defend. Sanderson v. Ohio Edison Co., 69 Ohio St.3d 582 (Syllabus¶ 1)(1994). Any doubts must be resolved in favor of the insured both as to the allegations and the interpretation of any ambiguities in the policy. See The Glidden Company v Lumbermens Mutual Casualty Company, et al, Cuyahoga County, C.P. No. 02 CV 409039 (May 8, 2002). Even if multiple counts are asserted in the allegations assert both covered and non-covered activities, the carrier must defend the entire action. See id
Once the duty to defend is triggered, the insurer is obligated to pay "all sums" incurred by the insured, not just a pro rata share. Goodyear Tire & Rubber Co. v Aetna Casualty and Surety Co., 95 Ohio St 3d 512 (2002). If the underlying claim should trigger multiple policies, the insurer is permitted to select any one triggered policy from which to receive full relief up to the policy limits. See id
The Court finds that the allegations of the complaints in the identified actions generally bring the claims within the scope of the Plaintiffs' policy with the Defendants in that they assert bodily injury arising from occurrences covered by the policies. The Court finds that the Defendants presently have and had a duty to defend the underlying actions on behalf of Rust Companies. Therefore, Defendants' failure to fully defend the Plaintiffs in these identified actions resulted in a breach, and the Plaintiffs are permitted to obtain reimbursement for the costs incurred to date in defending against those claims.
The only argument remaining that was raised by the Defendants and not disposed of with this Court's prior ruling is whether the declaratory relief requested by the Plaintiffs would amount to an improper advisory declaration.
B. The Declaratory Judgment Plaintiffs' Seek is Not an Advisory Opinion.
Defendants Travelers and Wausau argue that the Plaintiffs are seeking an improper advisory opinion. Namely, the Defendants argue that the Plaintiffs failed to present the controlling complaints from any similar lawsuits in order for this court to undertake a duty to defend analysis. Without these complaints, the Defendants argue it is impossible for the Court to undertake a duty to defend analysis.
A declaration of an insurer's duty to defend may be properly decided as a summary judgment matter. Cincinnati Ins. Co. v Robert Setterlin & Sons (Ct. App. Franklin Cty. Sept. 27, 2007), No. 07AP-47, 2007 Ohio 5094, ¶ 5. In Preferred Risk Ins. Co. v. Gill, 30 Ohio St.3d 108, 111, 507 N.E. 2d. 1118 (1984), the court found that it could not be "disputed that the General Assembly intended declaratory judgment action to be available „to [any] person interested' under a written contract of any nature for purposes of establishes rights and duties there under." Id. "The purpose of a declaratory judgment action is to dispose of uncertain or disputed obligations quickly and conclusively, and to achieve that end, the declaratory judgment statutes are to be construed liberally." Mid-American Fire & Casualty Company, et al, v Heasley, 113 Ohio St. 3d. 133, 863 N.E.2d 142 (2007) (citing R.C. § 2721.01 et seq.).
In the present case, the Plaintiffs are seeking a declaration of their rights and Defendants' duties under the terms of their contracts in order to streamline litigation rather than addressing these same issues separately. As such, a declaration of the Plaintiffs' rights under their contract with the Defendants is appropriate and not advisory. A declaration will establish the parties' rights under the terms of the contract, and will avoid redundancy. This Court, having already found that asbestos-related claims are within Plaintiffs' coverage, now GRANTS the Plaintiffs' Partial Motion Summary Judgment on Issues of the Defendants' Duty to Defend, and declares that the Defendants have a duty to defend the Plaintiffs' in underlying asbestos-related claims that are alleged to have occurred during the time in which the Defendants' insured the Plaintiffs.
III. CONCLUSION
After full consideration of the Plaintiffs' Motion for Partial Summary Judgment, the Defendants' Briefs in Opposition, and the Plaintiffs' Responses, as well as having considered all the evidence and having construed the evidence most strongly in favor of the non-moving party, the Court finds that reasonable minds can come to but one conclusion, i.e., that there are no genuine issues of material fact, and that the Plaintiffs are entitled to judgment as a matter of law.
Consistent with the following Opinion this Court GRANTS the Plaintiffs' Partial Motion for Summary Judgment on the Duty to Defend and declares as follows:
1.Defendant Hartford breached its duty to defend the Plaintiffs in Donald Schussler v Allied Signal, Inc., et al. including Treco Construction Services, Inc., case No. C-48-AB-2009-22, Northampton County Court of Common Pleas, Pennsylvania, and Charles Hockenbeny v A.O. Smith Corporation, et al., including Treco Construction Services, Case No. CV-Q9-705040, Cuyahoga County Court of Common Pleas, Ohio, and the Plaintiffs are entitled to reimbursement from Hartford for costs incurred defending these actions;
2. Defendant Wausau breached its duty to defend the Plaintiffs in Willie Mae Purvis, et al., v. A. W. Chesterton Company, et al., including Rust Engineering & Construction Inc. Case No. 08-32672. Montgomety County Court of Common Pleas. Pennsylvania. and Donna Morris Fox. et al.. v. A. W. Chesterton Company, et al., including Rust Engineering & Construction. Inc. Case No. 08-32665. Monteomerv County Court of Common Pleas. Pennsylvania, and the Plaintiffs are entitled to reimbursement from Wausau for costs incurred defending these actions;
3. Defendant Travelers breached its duty to defend the Plaintiff in Herbert H. Huggins v. Adience, Inc. f/k/a BMI, et al., including Treco Construction Services f/k/a The Rust Engineering Co. Case No. CV-09-684277. Cuyahoga County Common Pleas. Ohio, and Mildrew W. Philfer v. A. W. Chesterton Company et al., including Rust Engineering & Construction Inc., Case No. 09-03449. Montgomery County Court of Common Pleas. Pennsylvania, and the Plaintiffs are entitled to reimbursement from Travelers for costs incurred defending these actions;
4. Defendant Travelers has a duty to defend the Plaintiffs in any underlying claims that seek to hold Rust Companies liable for damages resulting from asbestos-related bodily injury that allegedly occurred during July 1, 1982 to July 1, 1983;
5. Defendant Wausau has a duty to defend the Plaintiffs in any underlying claims that seek to hold Rust Companies liable for damages resultmg fiom asbestos-related bodily injury that allegedly occurred during December 31. 1962 to December 31. 1963; and
6. Defendant Hartford has a duty to defend the Plaintiffs in any underlying claims that seek to hold Rust Companies liable for damages resulting from asbestos-related bodily injury that allegedly occurred during December 31. 1952 to December 31. 1953.
IT IS SO ORDERED, this the __ day of February. 2012.