KOL B'SEDER, Inc. v. Certain Underwriters at Lloyd's of London Subscribing to Certificate No. 154766 Under Contract No. B0621MASRSWV15BND

CourtCourt of Appeals for the Eleventh Circuit
DecidedMarch 12, 2019
Docket18-10447
StatusUnpublished

This text of KOL B'SEDER, Inc. v. Certain Underwriters at Lloyd's of London Subscribing to Certificate No. 154766 Under Contract No. B0621MASRSWV15BND (KOL B'SEDER, Inc. v. Certain Underwriters at Lloyd's of London Subscribing to Certificate No. 154766 Under Contract No. B0621MASRSWV15BND) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eleventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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KOL B'SEDER, Inc. v. Certain Underwriters at Lloyd's of London Subscribing to Certificate No. 154766 Under Contract No. B0621MASRSWV15BND, (11th Cir. 2019).

Opinion

Case: 18-10447 Date Filed: 03/12/2019 Page: 1 of 20

[DO NOT PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT ________________________

No. 18-10447 Non-Argument Calendar ________________________

D.C. Docket No. 1:16-cv-22237-MGC

KOL B’SEDER, INC., A Florida Corporation,

Plaintiff - Counter Defendant - Appellant,

versus

CERTAIN UNDERWRITERS AT LLOYD’S OF LONDON SUBSCRIBING TO CERTIFICATE NO. 154766 UNDER CONTRACT NO. B0621MASRSWV15BND,

Defendant - Appellee,

GLASS-TECH CORP., A Florida Corporation,

Defendant - Counter Claimant - Appellee. Case: 18-10447 Date Filed: 03/12/2019 Page: 2 of 20

________________________

Appeal from the United States District Court for the Southern District of Florida ________________________

(March 12, 2019)

Before MARCUS, ROSENBAUM and JILL PRYOR, Circuit Judges.

PER CURIAM:

The owner of a yacht that partially submerged while at a boatyard for repairs

sued its insurer and the boatyard; the boatyard countersued after the yacht owner

refused to reimburse it for rescuing and storing the yacht. The district court

granted summary judgment to the insurer and the boatyard, and the yacht owner

appealed. After careful review, we affirm.

I. FACTUAL AND PROCEDURAL BACKGROUND

Kol B’Seder, Inc. is a limited liability company that owns a yacht called the

Sababa. Kol B’Seder’s sole managing member is Noreen Sablotsky. At all times

relevant to this lawsuit, Kol B’Seder insured the Sababa against accidental losses

through a policy with Certain Underwriters at Lloyd’s of London (“Underwriters”).

During the eight years leading up to the submersion incident that gave rise to

this case, the Sababa suffered engine troubles that required years to fix and

underwent major repairs to its rudder and hull. In the two years preceding the

submersion, the Sababa continued experiencing problems, even during short trips,

2 Case: 18-10447 Date Filed: 03/12/2019 Page: 3 of 20

and needed repairs and sometimes replacements for its anchor winch, generator,

batteries, bilge pumps, sun pads, vinyl, and isinglass. One to two months before

the submersion, it is possible that the Sababa touched bottom in what is known as

a “grounding.” Doc. 53-1 at 64. 1 Sablotsky thought at the time that the Sababa’s

propellers had only kicked up some mud and that the yacht was undamaged.

While preparing to take the Sababa on a longer trip, Sablotsky decided to

sail it to Glass-Tech Corp.’s boatyard on a Friday for it to be hauled out of the

water for repairs. Before bringing the boat in, Sablotsky sent a text message to

Glass-Tech’s owner asking if she could drop the yacht off that day. The owner

texted back, “Yes. That’s fine. I may not be able to haul till Monday. But it will

at least be here and so we can haul it Monday. So bring it over when u can.” Doc.

71-1 at 1. Sablotsky understood when she sailed the Sababa to Glass-Tech’s

boatyard on Friday that it was possible Glass-Tech would not haul the Sababa out

of the water until Monday.

Upon the Sababa’s arrival at Glass-Tech’s boatyard, Sablotsky did not

inform Glass-Tech that the boat had not received bottom maintenance in more than

three years. Sablotsky also did not ask anyone at Glass-Tech to plug the vessel

into shore power, nor did she plug it in herself.

1 “Doc. #” refers to the numbered entries on the district court’s docket.

3 Case: 18-10447 Date Filed: 03/12/2019 Page: 4 of 20

Glass-Tech did not haul the Sababa out of the water that Friday. Two days

later, on Sunday, a Glass-Tech employee discovered that the vessel had become

partially submerged. After informing Sablotsky, Glass-Tech hauled the Sababa

out of the water and took measures to preserve the vessel. Sablotsky never paid

Glass-Tech for the work it performed on the Sababa or for the costs of continuing

to store the vessel when no arrangements were made to pick it up.

After learning of the Sababa’s submersion, Kol B’Seder filed an insurance

claim with its insurer, Underwriters. Under the terms of the insurance policy,

Underwriters was obligated to cover damages resulting from accidents. But the

policy excluded from its coverage damage resulting from “[w]ear and tear, gradual

deterioration, osmosis, wet or dry rot, corrosion,” “defects in design,” and “[a]ny

claims caused by or arising out of . . . lack of repair of [the Sababa] caused by the

lack of reasonable care and due diligence in the . . . maintenance of [the Sababa].”

Doc. 51-2 at 3-4.

Kol B’Seder contends that the Sababa submerged as a result of the

grounding that possibly occurred one to two months earlier and that the loss

therefore comes within the policy’s coverage for accidents. Underwriters decided

the loss did not qualify for accident coverage, however, and denied Kol B’Seder’s

claim. According to the report of the surveyor Underwriters hired to examine the

Sababa, it was “possible” that a grounding had occurred, resulting in fracturing to

4 Case: 18-10447 Date Filed: 03/12/2019 Page: 5 of 20

the starboard rudder log tabbing that could have caused salt water infiltration into

the laminates and water pressure that pulled the rudder log backwards. Doc. 68-6

at 8. Yet the surveyor also noted that the yacht suffered from design and

installation defects in the external rudder logs, as well as extensive deterioration

and water damage in the external rudder, rudder log, fastener, plumbing, transom,

and engine—all of which he identified as causes of the submersion. In addition,

the surveyor explained that battery-powered bilge pumps previously removed

water that infiltrated the engine space, but that the failure to plug the vessel into

shore power meant that the pump batteries died, allowing water to flood the vessel.

Relying on the surveyor’s report, Underwriters concluded that the submersion

resulted from design and installation defects along with Sablotsky’s failure to do

preventive maintenance, causes that fell within the policy’s exclusions.

Kol B’Seder sued Underwriters for breach of contract and Glass-Tech for

breach of contract, breach of warranty of workmanlike performance, and

negligence. Glass-Tech counterclaimed for negligence and breach of contract.

Underwriters moved for summary judgment on Kol B’Seder’s single claim against

it. Glass-Tech moved for summary judgment on Kol B’Seder’s three claims

against it and on its counterclaim for breach of contract. The district court granted

both motions and denied Kol B’Seder’s motion for reconsideration. Kol B’Seder

timely appealed.

5 Case: 18-10447 Date Filed: 03/12/2019 Page: 6 of 20

II. STANDARDS OF REVIEW

We review de novo the district court’s grant of summary judgment. Brown

v. Crawford, 906 F.2d 667, 669 (11th Cir. 1990). Summary judgment is

appropriate if “there is no genuine dispute as to any material fact and the movant is

entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). “The moving party

bears the initial burden to show . . . that there are no genuine issues of material fact

that should be decided at trial.” Clark v.

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KOL B'SEDER, Inc. v. Certain Underwriters at Lloyd's of London Subscribing to Certificate No. 154766 Under Contract No. B0621MASRSWV15BND, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kol-bseder-inc-v-certain-underwriters-at-lloyds-of-london-subscribing-ca11-2019.