UNITED STATES DISTRICT COURT
DISTRICT OF NEW HAMPSHIRE
Cam-Sam Real Estate Holding, LLC, Plaintiff Case No. 18-cv-433-SM v. Opinion No. 2018 DNH 253
Merchants Mutual Insurance Company and Hartford Fire Insurance Company, Defendants
Sentinel Insurance Company, Ltd. a/k/a Hartford Fire Insurance Company, Counter Claimant and Third Party Plaintiff
v.
Cam-Sam Real Estate Holding, LLC, Counter Defendant,
and
D La Pooch Hotel, LLC, n/k/a D La Pooch Resort, LLC, and Lindsey Todt, Third Party Defendants
Cam-Sam Real Estate Holding, LLC, Third Party Plaintiff
Mourer-Foster, Inc. and John T. Foster, Third Party Defendants
O R D E R
In this insurance dispute, Cam-Sam Real Estate Holding,
LLC, asserts claims of negligence and negligent
1 misrepresentation against third party defendants, Mourer-Foster,
Inc., and John T. Foster (collectively, “Foster”). Foster has
moved to dismiss Cam-Sam’s claims against it. Cam-Sam objects.
Background
Cam-Sam is the owner of a commercial building and property
located at 21 Londonderry Turnpike, in Hooksett, New Hampshire.
Cam-Sam rented Unit 1 of the building to D La Pooch Hotel, LLC,
for a term of five years. The lease between Cam-Sam and D La
Pooch required that D La Pooch obtain “comprehensive liability
insurance on the Leased Premises” carried “in the name of and
for the benefit of Tenant and Landlord,” and written on “an
occurrence” basis. Docket No. 15, ¶ 10. The lease further
mandated the following with respect to coverage: at least
$1,000,000 “in case of death or injury to one person;”
$1,000,000 “in case of death or injury to more than one person
in the same occurrence;” and $250,000 “in case of loss,
destruction or damage to property.” Docket No. 15, ¶ 10.
Consistent with those obligations, D La Pooch provided Cam-
Sam with a Certificate of Liability Insurance prepared by its
insurance agent, Foster. The Certificate relates to the
following insurance policies: a Commercial General Liability/Pet
Groomer’s Professional Liability policy, identified as number
81SBAPP8836 (the “Policy”); a Workers Compensation and
2 Employers’ Liability policy; and an Animal Bailee/Business
Personal Property policy. All policies are issued by Hartford
Fire Insurance 1 (“Hartford”). The Certificate identifies Cam-Sam
as “an additional insured with regards to general liability,” as
well as coverage limits, including a coverage limit of
$1,000,000 under the Commercial General Liability policy for
“damage to rented premises ([each] occurrence).” Id. at ¶¶ 8-9.
The Certificate further indicates that, should any of the
policies be cancelled prior to their expiration date, “notice
will be delivered in accordance with the policy provisions.”
Id. at ¶ 12. Cam-Sam alleges that it relied upon the
Certificate when deciding to lease Unit 1 to D La Pooch. Id. at
¶ 14.
Following the termination of D La Pooch’s tenancy, Cam-Sam
discovered significant damage to the premises, and subsequently
filed suit against D La Pooch. Cam-Sam also initiated this
declaratory judgment action against its own insurer, Merchants
Mutual, and Hartford. In response, Hartford moved for
declaratory judgment against Cam-Sam determining that it was not
entitled to coverage. According to Cam-Sam, Hartford has
alleged that Cam-Sam is not an additional insured under the
1 According to Hartford, it has been improperly named in this action, and “Sentinel Insurance Company, Limited” is the insurer issuing the relevant policies.
3 policies issued to D La Pooch, and that there is no coverage
under Hartford’s policies for “damage to rented premises.”
Based on Hartford’s position, Cam-Sam brought claims
against Foster. Cam-Sam alleges that, to the extent Hartford is
correct, Foster is liable for preparing and delivering an
inaccurate Certificate that misrepresented the policies. Cam-
Sam further alleges that it “was an intended and named
beneficiary” of the Certificate (id. at ¶ 20), and Foster acted
negligently when it prepared and sent the Certificate.
Legal Standard
When ruling on a motion to dismiss under Fed. R. Civ. P.
12(b)(6), the court must “accept as true all well-pleaded facts
set out in the complaint and indulge all reasonable inferences
in favor of the pleader.” SEC v. Tambone, 597 F.3d 436, 441
(1st Cir. 2010). Although the complaint need only contain “a
short and plain statement of the claim showing that the pleader
is entitled to relief,” Fed. R. Civ. P. 8(a)(2), it must allege
each of the essential elements of a viable cause of action and
“contain sufficient factual matter, accepted as true, to state a
claim to relief that is plausible on its face,” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (citation and internal
punctuation omitted).
4 In other words, “a plaintiff’s obligation to provide the
‘grounds’ of his ‘entitlement to relief’ requires more than
labels and conclusions, and a formulaic recitation of the
elements of a cause of action will not do.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007). Instead, the facts alleged
in the complaint must, if credited as true, be sufficient to
“nudge[] [plaintiff’s] claims across the line from conceivable
to plausible.” Id. at 570. If, however, the “factual
allegations in the complaint are too meager, vague, or
conclusory to remove the possibility of relief from the realm of
mere conjecture, the complaint is open to dismissal.” Tambone,
597 F.3d at 442.
Generally, a court must decide a motion to dismiss
exclusively upon the allegations set forth in the complaint and
the documents specifically attached, or convert the motion into
one for summary judgment. See Fed. R. Civ. P. 12(2). However,
when “a complaint's factual allegations are expressly linked to
— and admittedly dependent upon — a document (the authenticity
of which is not challenged), that document effectively merges
into the pleadings and the trial court can review it in deciding
a motion to dismiss under Rule 12(b)(6).” Beddall v. State St.
Bank & Trust Co., 137 F.3d 12, 17 (1st Cir. 1998).
5 Discussion
Turning first to Cam-Sam’s allegations against Foster
relating to its status as an “additional insured” under the
referenced policies, it should be noted that Cam-Sam incorrectly
characterizes the position taken by Hartford. Hartford does not
generally allege, as Cam-Sam contends, that Cam-Sam is not an
“additional insured.” Hartford, instead, alleges that Cam-Sam
is not an “additional insured” under the Special Property
Coverage Form. That position is fully consistent with the terms
of the Certificate, which represents that Cam-Sam is an
“additional insured with regards to general liability.” Doc.
No. 15-1 (emphasis added).
Free access — add to your briefcase to read the full text and ask questions with AI
UNITED STATES DISTRICT COURT
DISTRICT OF NEW HAMPSHIRE
Cam-Sam Real Estate Holding, LLC, Plaintiff Case No. 18-cv-433-SM v. Opinion No. 2018 DNH 253
Merchants Mutual Insurance Company and Hartford Fire Insurance Company, Defendants
Sentinel Insurance Company, Ltd. a/k/a Hartford Fire Insurance Company, Counter Claimant and Third Party Plaintiff
v.
Cam-Sam Real Estate Holding, LLC, Counter Defendant,
and
D La Pooch Hotel, LLC, n/k/a D La Pooch Resort, LLC, and Lindsey Todt, Third Party Defendants
Cam-Sam Real Estate Holding, LLC, Third Party Plaintiff
Mourer-Foster, Inc. and John T. Foster, Third Party Defendants
O R D E R
In this insurance dispute, Cam-Sam Real Estate Holding,
LLC, asserts claims of negligence and negligent
1 misrepresentation against third party defendants, Mourer-Foster,
Inc., and John T. Foster (collectively, “Foster”). Foster has
moved to dismiss Cam-Sam’s claims against it. Cam-Sam objects.
Background
Cam-Sam is the owner of a commercial building and property
located at 21 Londonderry Turnpike, in Hooksett, New Hampshire.
Cam-Sam rented Unit 1 of the building to D La Pooch Hotel, LLC,
for a term of five years. The lease between Cam-Sam and D La
Pooch required that D La Pooch obtain “comprehensive liability
insurance on the Leased Premises” carried “in the name of and
for the benefit of Tenant and Landlord,” and written on “an
occurrence” basis. Docket No. 15, ¶ 10. The lease further
mandated the following with respect to coverage: at least
$1,000,000 “in case of death or injury to one person;”
$1,000,000 “in case of death or injury to more than one person
in the same occurrence;” and $250,000 “in case of loss,
destruction or damage to property.” Docket No. 15, ¶ 10.
Consistent with those obligations, D La Pooch provided Cam-
Sam with a Certificate of Liability Insurance prepared by its
insurance agent, Foster. The Certificate relates to the
following insurance policies: a Commercial General Liability/Pet
Groomer’s Professional Liability policy, identified as number
81SBAPP8836 (the “Policy”); a Workers Compensation and
2 Employers’ Liability policy; and an Animal Bailee/Business
Personal Property policy. All policies are issued by Hartford
Fire Insurance 1 (“Hartford”). The Certificate identifies Cam-Sam
as “an additional insured with regards to general liability,” as
well as coverage limits, including a coverage limit of
$1,000,000 under the Commercial General Liability policy for
“damage to rented premises ([each] occurrence).” Id. at ¶¶ 8-9.
The Certificate further indicates that, should any of the
policies be cancelled prior to their expiration date, “notice
will be delivered in accordance with the policy provisions.”
Id. at ¶ 12. Cam-Sam alleges that it relied upon the
Certificate when deciding to lease Unit 1 to D La Pooch. Id. at
¶ 14.
Following the termination of D La Pooch’s tenancy, Cam-Sam
discovered significant damage to the premises, and subsequently
filed suit against D La Pooch. Cam-Sam also initiated this
declaratory judgment action against its own insurer, Merchants
Mutual, and Hartford. In response, Hartford moved for
declaratory judgment against Cam-Sam determining that it was not
entitled to coverage. According to Cam-Sam, Hartford has
alleged that Cam-Sam is not an additional insured under the
1 According to Hartford, it has been improperly named in this action, and “Sentinel Insurance Company, Limited” is the insurer issuing the relevant policies.
3 policies issued to D La Pooch, and that there is no coverage
under Hartford’s policies for “damage to rented premises.”
Based on Hartford’s position, Cam-Sam brought claims
against Foster. Cam-Sam alleges that, to the extent Hartford is
correct, Foster is liable for preparing and delivering an
inaccurate Certificate that misrepresented the policies. Cam-
Sam further alleges that it “was an intended and named
beneficiary” of the Certificate (id. at ¶ 20), and Foster acted
negligently when it prepared and sent the Certificate.
Legal Standard
When ruling on a motion to dismiss under Fed. R. Civ. P.
12(b)(6), the court must “accept as true all well-pleaded facts
set out in the complaint and indulge all reasonable inferences
in favor of the pleader.” SEC v. Tambone, 597 F.3d 436, 441
(1st Cir. 2010). Although the complaint need only contain “a
short and plain statement of the claim showing that the pleader
is entitled to relief,” Fed. R. Civ. P. 8(a)(2), it must allege
each of the essential elements of a viable cause of action and
“contain sufficient factual matter, accepted as true, to state a
claim to relief that is plausible on its face,” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (citation and internal
punctuation omitted).
4 In other words, “a plaintiff’s obligation to provide the
‘grounds’ of his ‘entitlement to relief’ requires more than
labels and conclusions, and a formulaic recitation of the
elements of a cause of action will not do.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007). Instead, the facts alleged
in the complaint must, if credited as true, be sufficient to
“nudge[] [plaintiff’s] claims across the line from conceivable
to plausible.” Id. at 570. If, however, the “factual
allegations in the complaint are too meager, vague, or
conclusory to remove the possibility of relief from the realm of
mere conjecture, the complaint is open to dismissal.” Tambone,
597 F.3d at 442.
Generally, a court must decide a motion to dismiss
exclusively upon the allegations set forth in the complaint and
the documents specifically attached, or convert the motion into
one for summary judgment. See Fed. R. Civ. P. 12(2). However,
when “a complaint's factual allegations are expressly linked to
— and admittedly dependent upon — a document (the authenticity
of which is not challenged), that document effectively merges
into the pleadings and the trial court can review it in deciding
a motion to dismiss under Rule 12(b)(6).” Beddall v. State St.
Bank & Trust Co., 137 F.3d 12, 17 (1st Cir. 1998).
5 Discussion
Turning first to Cam-Sam’s allegations against Foster
relating to its status as an “additional insured” under the
referenced policies, it should be noted that Cam-Sam incorrectly
characterizes the position taken by Hartford. Hartford does not
generally allege, as Cam-Sam contends, that Cam-Sam is not an
“additional insured.” Hartford, instead, alleges that Cam-Sam
is not an “additional insured” under the Special Property
Coverage Form. That position is fully consistent with the terms
of the Certificate, which represents that Cam-Sam is an
“additional insured with regards to general liability.” Doc.
No. 15-1 (emphasis added). The Special Property Coverage Form
is not mentioned. Id. And, Hartford’s Commercial General
Liability Policy reflects Cam-Sam’s additional insured status,
as noted in the Certificate. The Policy states that “[a]ny
person or organization from whom [the insured] lease[s] land or
premises” is an additional insured under the Policy. Document
No. 10-1, p. 66-67. Therefore, to the extent that Cam-Sam’s
claims are based on that misunderstanding, the claims are
subject to dismissal (because the Certificate plainly does not
misrepresent Cam-Sam’s “additional insured” status).
As for Cam-Sam’s claims against Foster that relate to the
Certificate’s attestation of coverage for real property damage
6 under the general liability policy, those claims are subject to
dismissal as well. The Certificate discloses that the
Commercial General Liability Policy, under which Cam-Sam is an
additional insured, provides coverage for “damage to rented
premises ([each] occurrence)” up to $1,000,000. Doc. No. 15-1.
And, the Policy plainly recites that it provides $1,000,000 in
coverage for “Damages to Premises Rented to You.” Document No.
10-1, at 14.
Whether the Policy covers the property damage at issue here
is a separate question. The Certificate reflects the Policy’s
limitations, providing: “the insurance afforded by the policies
described herein is subject to the terms, exclusions and
conditions of such policies.” Document No. 15-1. Accordingly,
it cannot be said that the Certificate inaccurately reflects the
coverage procured by D La Pooch. The Certificate describes the
coverage in terms of the Policy provisions, which are what they
are. Therefore, Cam-Sam’s claims fail for the simple reason
that the Certificate is not, as Cam-Sam alleges, inaccurate or
misleading.
Cam-Sam also notes that Foster’s motion must be denied
because, at this stage, the Court must accept the allegations in
its complaint as true. In its complaint, Cam-Sam seems to
contend that the Certificate must be inaccurate if Hartford is
7 able to prove its claims. And, Cam-Sam says, because Foster’s
arguments in support of its motion to dismiss necessarily rely
on the allegations in Cam-Sam’s complaint being false, the
motion to dismiss must be denied at this stage of the
litigation.
Cam-Sam actually seems to be objecting to Foster’s reliance
on the language of the Certificate and Hartford’s Policy – that
is, on matters outside the complaint itself. But, Foster’s
reliance on both documents is entirely proper: both documents
were included with the pleadings and referenced throughout, and
are central to the claims. See Alternative Energy, Inc. v. St.
Paul Fire & Marine Ins. Co., 267 F.3d 30, 34 (1st Cir. 2001)
(”Under First Circuit precedent, when a complaint's factual
allegations are expressly linked to — and admittedly dependent
upon — a document (the authenticity of which is not challenged),
then the court can review it upon a motion to dismiss.”)
(internal quotations omitted). See also Trans-Spec Truck Serv.
v. Caterpillar Inc., 524 F.3d 315, 321 (1st Cir. 2008)
(providing that exhibits “attached to the complaint are properly
considered part of the pleading ‘for all purposes,’ including
Rule 12(b)(6)” and that when “a complaint's factual allegations
are expressly linked to — and admittedly dependent upon — a
document (the authenticity of which is not challenged), that
document effectively merges into the pleadings and the trial
8 court can review it in deciding a motion to dismiss under Rule
12(b)(6).”).
Cam-Sam’s claims against Foster must be dismissed because
the complaint does not plausibly allege that the Certificate
misrepresents either the Policy or Cam-Sam’s status as an
additional insured. A plain reading of the Certificate and the
Policy makes clear that the Certificate accurately reports the
existence of coverage, coverage types, and limits of coverage
under the Hartford policy issued to D La Pooch, and that Cam-Sam
is an additional insured for general liability claims. “When a
complaint annexes and incorporates by reference a written
instrument, any inconsistencies between the complaint and the
instrument must be resolved in favor of the latter.” Arruda v.
Sears, Roebuck & Co., 310 F.3d 13, 18 (1st Cir. 2002) (citations
omitted). See also Yacubian v. United States, 750 F.3d 100, 108
(1st Cir. 2014) (“[I]t is a well-settled rule that when a
written instrument contradicts allegations in the complaint to
which it is attached, the exhibit trumps the allegations.”)
(citation omitted).
9 Conclusion
For the foregoing reasons, and for those given in
defendant’s memorandum in support of its motion, defendant’s
motion to dismiss (document no. 22) is GRANTED.
SO ORDERED.
____________________________ Steven J. McAuliffe United States District Judge
December 17, 2018
cc: David W. Rayment, Esq. Jeffrey Christensen, Esq. Doreen F. Connor, Esq. Michele Carlucci Sears, Esq. Laura Nicole Carlier, Esq. Richard E. Heifetz, Esq.