UNPUBLISHED
UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT
No. 18-1386
STEWART ENGINEERING, INC.,
Plaintiff - Appellant,
v.
CONTINENTAL CASUALTY COMPANY; SKANSKA USA BUILDING, INC.,
Defendants - Appellees,
and
ZURICH AMERICAN INSURANCE COMPANY; CLARK NEXSEN, INC.,
Defendants.
Appeal from the United States District Court for the Eastern District of North Carolina, at Raleigh. James C. Dever III, District Judge. (5:15-cv-00377-D)
Submitted: October 31, 2018 Decided: November 7, 2018
Before WILKINSON, KING, and AGEE, Circuit Judges.
Affirmed by unpublished per curiam opinion.
Stephen P. Safran, SAFRAN LAW OFFICES, Raleigh, North Carolina, for Appellant. Richard A. Simpson, Leland H. Jones IV, Ashley E. Eiler, WILEY REIN LLP, Washington, D.C., for Appellee Continental Casualty Company.
Unpublished opinions are not binding precedent in this circuit.
2 PER CURIAM:
Stewart Engineering, Inc. (“Stewart”), appeals the district court’s order granting
summary judgment in favor of Continental Casualty Company (“Continental”) and
holding that, as a matter of law, Continental has no further obligation to defend or
indemnify Stewart against several claims that arose out of the collapse of two pedestrian
bridges designed by Stewart. We affirm.
“We review a district court’s decision to grant summary judgment de novo,
applying the same legal standards as the district court, and viewing all facts and
reasonable inferences therefrom in the light most favorable to the nonmoving party.”
Carter v. Fleming, 879 F.3d 132, 139 (4th Cir. 2018). Summary judgment is appropriate
“if the movant shows that 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). “[T]he
pertinent inquiry is whether there are any genuine factual issues that properly can be
resolved only by a finder of fact because they may reasonably be resolved in favor of
either party.” Variety Stores, Inc. v. Wal-Mart Stores, Inc., 888 F.3d 651, 659 (4th Cir.
2018) (internal quotation marks omitted).
Stewart purchased a Professional Liability and Pollution Incident Insurance Policy
(“policy”) from Continental that obligated Continental to defend and indemnify Stewart
against claims arising from Stewart’s wrongful acts, with Continental’s liability limited to
3 $3,000,000 per claim and $5,000,000 for the policy term. 1 The policy also provided that
Continental would consider all related claims to be a single claim subject to the
$3,000,000 limit and defined “related claims” as “all claims . . . during any policy year
arising out of . . . a single wrongful act; [or] . . . multiple wrongful acts that are logically
or causally connected by any common fact, situation, event, transaction, advice, or
decision.” J.A. 104. 2 Under the policy, Continental was not obligated to defend or
indemnify Stewart after reaching the limit of liability for any claim or set of related
claims.
In February 2013, Stewart contracted to furnish structural engineering designs for
two new pedestrian bridges (“Bridge 1” and “Bridge 2”) on the campus of Wake
Technical Community College. Construction of the bridges began in October 2014, and,
on November 13, 2014, Bridge 1 collapsed, killing one construction worker and injuring
four others. Bridge 2 collapsed less than 24 hours later, causing no injuries or fatalities.
Stewart settled, and Continental defended and indemnified Stewart against several claims
arising out of the collapse of Bridge 1. Stewart does not contest that Continental
indemnified Stewart up to the $3,000,000 single claim limit. Rather, the parties dispute
whether several pending claims arising out of the collapse of Bridge 2 are related—as
defined by the policy—to the Bridge 1 claims and thus whether Continental must
1 Continental does not contest that the claims at issue in this case occurred within the policy term. 2 “J.A.” refers to the joint appendix filed by the parties on appeal.
4 continue to defend and indemnify Stewart up to the $5,000,000 policy term limit. 3 The
district court concluded that the Bridge 2 claims were related to the Bridge 1 claims
under the plain language of the policy. The court therefore held that Continental has no
further obligation to defend or indemnify Stewart against those claims.
Federal subject matter jurisdiction in this case rests on diversity, see 28 U.S.C.
§ 1332 (2012), and the parties do not dispute that North Carolina law applies. “Pursuant
to North Carolina law, the interpretation of an insurance policy is a question of law” for
the court. State Auto Prop. & Cas. Ins. Co. v. Travelers Indem. Co. of Am., 343 F.3d 249,
254 (4th Cir. 2003). An insurance policy is a contract, and “[a]s with all contracts, the
object of construing an insurance policy is to arrive at the insurance coverage intended by
the parties when the policy was issued.” Harleysville Mut. Ins. Co. v. Buzz Off Insect
Shield, L.L.C., 692 S.E.2d 605, 612 (N.C. 2010) (internal quotation marks omitted).
“When the policy language is clear and unambiguous, a court is required to enforce the
policy as written. Terms defined in insurance policies are applied to all clauses of the
insurance contract, while undefined terms are construed in accordance with their ordinary
meaning.” Cont’l Cas. Co. v. Amerisure Ins. Co., 886 F.3d 366, 371 (4th Cir. 2018)
(citation omitted).
We agree with the district court that the claims arising out of the collapse of
Bridge 2 are related to the claims arising out of the collapse of Bridge 1 under the plain
and unambiguous language of the policy. Stewart points to several ways in which the
3 The underlying claims alleged that Stewart negligently designed the bridges.
5 collapse of Bridge 1 was distinct from the collapse of Bridge 2 and asserts that the two
bridge collapses caused different sets of injuries. However, as the district court noted,
claims are related under the policy if they arise out of wrongful acts that are logically or
casually connected by any common fact. The alleged wrongful acts out of which the
Bridge 1 and Bridge 2 claims arose are logically connected by multiple common facts:
Stewart executed a single contract for the design of both bridges, the same Project
Manager and Project Engineer worked on the design of both bridges, and, crucially, the
same design flaw caused the collapse of both bridges. Moreover, a miscommunication
between the Project Manager and the Project Engineer responsible for both bridges led to
Stewart’s failure to detect and correct the common design flaw. 4 Because the Bridge 2
claims are related to the Bridge 1 claims, and because Continental has already
indemnified Stewart up to the $3,000,000 limit on related claims, the district court
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UNPUBLISHED
UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT
No. 18-1386
STEWART ENGINEERING, INC.,
Plaintiff - Appellant,
v.
CONTINENTAL CASUALTY COMPANY; SKANSKA USA BUILDING, INC.,
Defendants - Appellees,
and
ZURICH AMERICAN INSURANCE COMPANY; CLARK NEXSEN, INC.,
Defendants.
Appeal from the United States District Court for the Eastern District of North Carolina, at Raleigh. James C. Dever III, District Judge. (5:15-cv-00377-D)
Submitted: October 31, 2018 Decided: November 7, 2018
Before WILKINSON, KING, and AGEE, Circuit Judges.
Affirmed by unpublished per curiam opinion.
Stephen P. Safran, SAFRAN LAW OFFICES, Raleigh, North Carolina, for Appellant. Richard A. Simpson, Leland H. Jones IV, Ashley E. Eiler, WILEY REIN LLP, Washington, D.C., for Appellee Continental Casualty Company.
Unpublished opinions are not binding precedent in this circuit.
2 PER CURIAM:
Stewart Engineering, Inc. (“Stewart”), appeals the district court’s order granting
summary judgment in favor of Continental Casualty Company (“Continental”) and
holding that, as a matter of law, Continental has no further obligation to defend or
indemnify Stewart against several claims that arose out of the collapse of two pedestrian
bridges designed by Stewart. We affirm.
“We review a district court’s decision to grant summary judgment de novo,
applying the same legal standards as the district court, and viewing all facts and
reasonable inferences therefrom in the light most favorable to the nonmoving party.”
Carter v. Fleming, 879 F.3d 132, 139 (4th Cir. 2018). Summary judgment is appropriate
“if the movant shows that 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). “[T]he
pertinent inquiry is whether there are any genuine factual issues that properly can be
resolved only by a finder of fact because they may reasonably be resolved in favor of
either party.” Variety Stores, Inc. v. Wal-Mart Stores, Inc., 888 F.3d 651, 659 (4th Cir.
2018) (internal quotation marks omitted).
Stewart purchased a Professional Liability and Pollution Incident Insurance Policy
(“policy”) from Continental that obligated Continental to defend and indemnify Stewart
against claims arising from Stewart’s wrongful acts, with Continental’s liability limited to
3 $3,000,000 per claim and $5,000,000 for the policy term. 1 The policy also provided that
Continental would consider all related claims to be a single claim subject to the
$3,000,000 limit and defined “related claims” as “all claims . . . during any policy year
arising out of . . . a single wrongful act; [or] . . . multiple wrongful acts that are logically
or causally connected by any common fact, situation, event, transaction, advice, or
decision.” J.A. 104. 2 Under the policy, Continental was not obligated to defend or
indemnify Stewart after reaching the limit of liability for any claim or set of related
claims.
In February 2013, Stewart contracted to furnish structural engineering designs for
two new pedestrian bridges (“Bridge 1” and “Bridge 2”) on the campus of Wake
Technical Community College. Construction of the bridges began in October 2014, and,
on November 13, 2014, Bridge 1 collapsed, killing one construction worker and injuring
four others. Bridge 2 collapsed less than 24 hours later, causing no injuries or fatalities.
Stewart settled, and Continental defended and indemnified Stewart against several claims
arising out of the collapse of Bridge 1. Stewart does not contest that Continental
indemnified Stewart up to the $3,000,000 single claim limit. Rather, the parties dispute
whether several pending claims arising out of the collapse of Bridge 2 are related—as
defined by the policy—to the Bridge 1 claims and thus whether Continental must
1 Continental does not contest that the claims at issue in this case occurred within the policy term. 2 “J.A.” refers to the joint appendix filed by the parties on appeal.
4 continue to defend and indemnify Stewart up to the $5,000,000 policy term limit. 3 The
district court concluded that the Bridge 2 claims were related to the Bridge 1 claims
under the plain language of the policy. The court therefore held that Continental has no
further obligation to defend or indemnify Stewart against those claims.
Federal subject matter jurisdiction in this case rests on diversity, see 28 U.S.C.
§ 1332 (2012), and the parties do not dispute that North Carolina law applies. “Pursuant
to North Carolina law, the interpretation of an insurance policy is a question of law” for
the court. State Auto Prop. & Cas. Ins. Co. v. Travelers Indem. Co. of Am., 343 F.3d 249,
254 (4th Cir. 2003). An insurance policy is a contract, and “[a]s with all contracts, the
object of construing an insurance policy is to arrive at the insurance coverage intended by
the parties when the policy was issued.” Harleysville Mut. Ins. Co. v. Buzz Off Insect
Shield, L.L.C., 692 S.E.2d 605, 612 (N.C. 2010) (internal quotation marks omitted).
“When the policy language is clear and unambiguous, a court is required to enforce the
policy as written. Terms defined in insurance policies are applied to all clauses of the
insurance contract, while undefined terms are construed in accordance with their ordinary
meaning.” Cont’l Cas. Co. v. Amerisure Ins. Co., 886 F.3d 366, 371 (4th Cir. 2018)
(citation omitted).
We agree with the district court that the claims arising out of the collapse of
Bridge 2 are related to the claims arising out of the collapse of Bridge 1 under the plain
and unambiguous language of the policy. Stewart points to several ways in which the
3 The underlying claims alleged that Stewart negligently designed the bridges.
5 collapse of Bridge 1 was distinct from the collapse of Bridge 2 and asserts that the two
bridge collapses caused different sets of injuries. However, as the district court noted,
claims are related under the policy if they arise out of wrongful acts that are logically or
casually connected by any common fact. The alleged wrongful acts out of which the
Bridge 1 and Bridge 2 claims arose are logically connected by multiple common facts:
Stewart executed a single contract for the design of both bridges, the same Project
Manager and Project Engineer worked on the design of both bridges, and, crucially, the
same design flaw caused the collapse of both bridges. Moreover, a miscommunication
between the Project Manager and the Project Engineer responsible for both bridges led to
Stewart’s failure to detect and correct the common design flaw. 4 Because the Bridge 2
claims are related to the Bridge 1 claims, and because Continental has already
indemnified Stewart up to the $3,000,000 limit on related claims, the district court
correctly declared that Continental has no further obligation to defend or indemnify
Stewart against the Bridge 2 claims. 5
4 Contrary to Stewart’s contention, the district court did not err by considering the existence of a single contract for both bridges as one of the common facts logically connecting the alleged wrongful acts, and the district court did not hold that the existence of a single contract standing alone would constitute a sufficient logical connection between the claims. Stewart’s argument that the district court was required to consider whether Stewart’s wrongful acts were in fact the proximate causes of the bridge collapses also finds no support in either the policy at issue or the applicable precedents. 5 Because we affirm the district court’s determination that the wrongful acts are logically connected, we need not address the question of whether the acts are causally connected.
6 Stewart also contends that the district court erred in considering evidence extrinsic
to the claims themselves in determining that the Bridge 2 claims were related to the
Bridge 1 claims. Because Stewart did not make this argument to the district court, we
decline to address it on appeal. See In re Under Seal, 749 F.3d 276, 285 (4th Cir. 2014)
(“[A]bsent exceptional circumstances, we do not consider issues raised for the first time
on appeal.” (ellipsis and internal quotation marks omitted)).
We therefore affirm the district court’s judgment. We dispense with oral
argument because the facts and legal contentions are adequately presented in the
materials before this court and argument would not aid the decisional process.
AFFIRMED