Great Lakes Reinsurance (UK) PLC v. Vasquez , 341 F. App'x 515 ( 2009 )

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________ FILED
U.S. COURT OF APPEALS
No. 08-14386 ELEVENTH CIRCUIT
AUGUST 10, 2009
Non-Argument Calendar
THOMAS K. KAHN
________________________
CLERK
D. C. Docket No. 06-21206-CV-SH
GREAT LAKES REINSURANCE (UK) PLC,
Plaintiff-Counter
Defendant-Appellant,
versus
CLARA VASQUEZ,
Defendant-Counter
Claimant-Appellee.
________________________
Appeal from the United States District Court
for the Southern District of Florida
_________________________
(August 10, 2009)
Before TJOFLAT, EDMONDSON and PRYOR, Circuit Judges.
PER CURIAM:
Plaintiff-Appellant Great Lakes Reinsurance (UK) PLC (“Great Lakes”)
appeals the grant of summary judgment in favor of the insured, Defendant-
Appellee Clara Vasquez (“Insured”) and the denial of Great Lakes’ cross-motion
for summary judgment. Reversible error has been shown; we reverse the judgment
below.
The facts are undisputed. On 27 March 2006, Great Lakes issued a policy of
marine insurance on Insured’s vessel, the Tropic Delight, in a coverage amount of
$290,000. Total premium paid amounted to $8505. Approximately two weeks
later, Insured’s son (listed as an additional operator on the insurance application)
took the Tropic Delight from it’s secure yard, placed it on a trailer and hitched it to
his truck with the intention of transporting the boat to a launch site approximately
20 miles from where the boat was stored. En route to the launch site, Insured’s son
parked his truck -- with the Tropic Delight on the trailer hitched to his truck -- in a
parking lot while he picked up some supplies at a Publix supermarket. The truck --
with the attached trailer and the Tropic Delight -- was stolen from the Publix
parking lot. The truck towing the trailer was later recovered and showed signs of
forced entry; neither the Tropic Delight nor the trailer was ever found. Insured
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filed a claim for the loss under it’s insurance policy with Great Lakes; Great Lakes
denied coverage.
At issue are the exclusions to coverage contained in the policy. The policy
provides:
Exclusions to Coverage A
Unless specifically agreed by us in writing and additional
premium charged the following losses and or damages (whether
incurred directly or indirectly) are not covered by this insuring
agreement:
a) Damage sustained by scheduled vessel whilst being transported
over land (whether by trailer or other method of conveyance approved
by us in writing), more than 100 miles from the normal place of
storage, as disclosed within your application form.
...
i) Theft of the scheduled vessel’s equipment whilst afloat
unless there is visible evidence of forcible entry onto the
scheduled vessel and removal of the same, made by tools,
explosives, electricity or chemicals.
...
k) Theft of the scheduled vessel and or its equipment
whilst on a trailer/boatlift/hoist/ dry storage rack unless
the scheduled vessel is situate in a locked and fenced
enclosure or marina and there is visible evidence of
forcible entry and or removal made by tools, explosives,
electricity or chemicals.
...
m) Damage to the scheduled vessel or tender caused by
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theft, and or attempted theft....
Great Lakes denied coverage of the theft of the Insured’s vessel and filed a
declaratory judgment action asking the court to rule that no coverage was provided
for the theft.
The district court read the exclusions to coverage as independent of each
other; the court read exclusion (a) to cover the vessel in transport and exclusion (k)
to cover the vessel in storage. The district court saw ambiguity in exclusion (a)’s
exclusion of the vessel “whilst being transported over land.” Because exclusion (a)
was ambiguous about its applicability to a vessel making a temporary stop for
supplies between its place of storage and its ultimate destination, the district court
resolved the ambiguity in favor of coverage.
The parties each cite to New York law. Under New York law whether a
contract is ambiguous is a legal question for the court to determine. See Alexander
& Alexander Services, Inc. v. These Certain Underwriters at Lloyd’s, London,
England, 136 F.3d 82, 86 (2d Cir. 1998) (applying New York law). We review the
grant of summary judgment de novo. Id. If an ambiguity is found in an insurance
policy, doubt about the existence of coverage should be resolved in favor of the
insured and against the insurance carrier. See Lavanant v. General Acc. Ins. Co. of
America, 595 N.E.2d 819, 822 (N.Y. 1992). But “[t]he language of a contract is
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not made amiguous simply because the parties urge different interpretations. Nor
does ambiguity exist where one party’s view strains the contract language beyond
its reasonable and ordinary meaning.” Seiden Associates, Inc. v. ANC Holdings,
Inc., 959 F.2d 425, 428 (2d Cir. 1992) (applying New York law) (internal
quotation and citation omitted).
The district court discerned ambiguity in the phrase “whilst being
transported over land” contained in exclusion (a). The district court found it
arguable that the phrase included a temporary stop such as that made by the
Insured’s son. And then the district court reasoned that differences between
exclusions (k) and (a) suggested that the “provisions governing transport and
storage are distinct from one another, for the purposes not only of exclusion from
coverage, but for coverage of the insured vessel itself.”
This construction -- which divines coverage from an exclusion -- ignores the
plain meaning of the terms employed. Exclusion (a) applies to exclude damage
sustained by the subject vessel; by its plain and ordinary terms exclusion (a) has no
application to theft of the vessel. The insurance policy does contain three
exclusions pertaining to theft: exclusion (k) addresses theft of the vessel and its
equipment “whilst on a trailer...;” exclusion (i) addresses theft of the vessel’s
equipment “whilst afloat;” and exclusion (m) addresses damage to the vessel
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caused by theft. That the vessel was stolen “whilst on a trailer” and that the vessel
was not “situate in a locked and fenced enclosure or marina” are undisputed.
Insurance coverage for the theft of the Tropic Delight was excluded by the plain
and ordinary meaning of exclusion (k).
As the New York Court of Appeals has said:
It is axiomatic that a contract is to be interpreted so as to give
effect to the intention of the parties as expressed in the unequivocal
language employed. Obviously, before the rules governing the
construction of ambiguous contracts are triggered, the court must first
find ambiguity in the policy. ... This court may not make or vary the
contract of insurance to accomplish its notions of abstract justice or
moral obligation, since equitable considerations will not allow an
extension of the coverage beyond its fair intent and meaning in order
to do raw equity and to obviate objections which might have been
foreseen and guarded against.
Breed v. Insurance Co. of North America, 385 N.E.2d 1280, 1282-83 (NY 1978)
(internal quotations and citations omitted).
We accept that this insurance contract -- a non-standardized manuscript
policy drafted in the United Kingdom -- is not drafted in a style typically
employed by United States-based insurers. But that the style is different -- or
even awkward -- is not to say that the terms are ambiguous. See Sirius Insurance
Co. (UK) Ltd. v. Collins, 16 F.3d 34, 38 (2d Cir. 1994) (although policy issued by
UK-based insurer was “poorly drafted and contain[ed] odd provisions of
questionable value,” no ambiguity found that would require construing contract
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against insurer). Exclusion (k) excludes from coverage unambiguously a vessel
“whilst on a trailer/boatlift/hoist/ dry storage rack unless the scheduled vessel is
situate in a locked and fenced enclosure.”* Because the Tropic Delight was on a
trailer and was not situate in a locked and fenced enclosure at the time of the theft,
the policy plainly excludes this loss from coverage. Summary judgment in favor
of Great Lakes was due to be granted.
We REVERSE the grant of summary judgment in favor of Insured; we
REVERSE the denial of summary judgment in favor of Great Lakes. The case is
REMANDED for judgment to be entered in favor of Great Lakes.
*
Insured also suggests that exclusion (k)’s reference to a vessel “whilst on a
trailer/boatlift/hoist/ dry storage rack” can be read to address only vessels situated on types of
dry storage racks, and, according to Insured, the Tropic Delight was not on a dry storage rack at
the time of the theft. We think this tortured construction fails to give full meaning to each of the
terms of exclusion (k).
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