Abe Developments LLC v. Auto-Owners Insurance Company, et al.

• Court: District Court, D. Arizona
• Decided: October 20, 2025
• Docket: 2:25-cv-02792
• Status: Unknown

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA

9 Abe Developments LLC, No. CV-25-02792-PHX-KML

10 Plaintiff, ORDER

11 v.

12 Auto-Owners Insurance Company, et al.,

13 Defendants. 14 15 Plaintiff Abe Developments LLC leased to non-parties a piece of real property that 16 included a “habitable dwelling.” (Doc. 1-1 at 5.) After the non-parties demolished the 17 dwelling, Abe submitted an insurance claim to defendant Auto-Owners Insurance 18 Company. The claim was denied, and Abe filed this suit in state court against its insurance 19 agent, defendant TAG-RH Agency, Inc., and Auto-Owners. After the case was removed to 20 federal court, Auto-Owners filed a motion to dismiss. (Doc. 18.) Abe did not file an 21 opposition. 22 Local Rule of Civil Procedure 7.2(i) provides that failure to file a response to a 23 motion “may be deemed a consent to the . . . granting of the motion and the Court may 24 dispose of the motion summarily.” Under this rule, the court construes Abe’s failure to 25 respond to the motion to dismiss as a consent to the granting of that motion. But the same 26 result is reached by examining the merits and therefore leave to amend is not appropriate. 27 The insurance policy attached to the motion to dismiss and incorporated by 28 reference into the complaint establishes that non-party Alvin Yono was the only named 1 insured on a policy covering the real property in Scottsdale. (Doc. 19-1 at 9, 14.) In 2 September 2023, non-parties “tore down, razed and destroyed the entire Dwelling” on the 3 property. (Doc. 1-1 at 9.) For unknown reasons Abe, not Yono, submitted an insurance 4 claim to Auto-Owners in early 2024. That claim was denied. (Doc. 1-1 at 9-10.) Abe then 5 filed this suit alleging six claims against Auto-Owners: breach of contract, breach of the 6 duty of good faith and fair dealing, bad faith denial of insurance claim, fraudulent 7 misrepresentation, constructive fraud, and unjust enrichment. (Doc. 1-1 at 18-3.) Abe also 8 alleged a single claim of negligence against TAG-RH Agency. (Doc. 1-1 at 31-32.) There 9 is no evidence Abe served TAG-RH Agency and TAG-RH Agency has not appeared. 10 Auto-Owners’s central argument in seeking dismissal is that Abe is not an insured 11 under the policy and has no basis to complain that Auto-Owners denied its claim. In 12 general, Arizona law does not allow a non-insured to sue an insurer for breach of contract 13 or for breach of the covenant of good faith and fair dealing. Fobes v. Blue Cross & Blue 14 Shield of Ariz., Inc., 861 P.2d 692, 695 (Ariz. Ct. App. 1993). Because Abe did not oppose 15 the motion to dismiss and no exception to that general rule obviously applies, those two 16 claims must be dismissed without leave to amend. Auto-Owners argues the four remaining 17 claims also fail because they are “based on an alleged ‘contract’ between [Abe] and Auto- 18 Owners” and there is no such contract. (Doc. 18 at 4.) With no contrary argument from 19 Abe, the absence of a valid contract between Abe and Auto-Owners is fatal to the other 20 four claims. Those claims are dismissed without leave to amend. 21 Abe filed its original complaint in March 2025 but has not filed proof of service for 22 TAG-RH Agency. (Doc. 1-1 at 3.) Abe must file proof of service of TAG-RH Agency and 23 failure to do so will result in the dismissal of Abe’s claims against TAG-RH Agency. 24 IT IS ORDERED the Motion to Dismiss (Doc. 18) is GRANTED. All claims 25 against Auto-Owners Insurance Company are DISMISSED WITHOUT LEAVE TO 26 AMEND. 27 / 28 / 1 IT IS FURTHER ORDERED no later than October 24, 2025, plaintiff shall file 2|| proof of service for defendant TAG-RH Agency Inc. The Clerk of Court shall enter a 3 || judgment of dismissal with prejudice in the event no proof of service for TAG-RH Agency 4|| is filed by that date. 5 Dated this 17th day of October, 2025. 6

Honorable Krissa M. Lanham 9 United States District Judge 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

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