Stowell v. Farmers Insurance Exchange

• Court: Superior Court of Maine
• Decided: November 22, 2005
• Docket: CUMcv-04-478
• Status: Unpublished

Opinion

STATE OF MAINE SUPERIOR COURT CUMBERLAND, ss.

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I-: -7.- 23 CIVIL ACTION DOCKET NO. CV-04-478 p*.~ 1 \ AL,, I 7/;,4, / ,-<* 'l / I-

RAND N. STOWELL

Plaintiff .. ~ . p-p-p------

ORDER ON DEFENDANT'S MOTION FOR SUMMARY FARMERS INSURANCE JUDGMENT EXCHANGE

Defendant

Before the court is Defendant Farmers Insurance Exchange's

("Defendant") motion for summary judgment on Plaintiff Rand N. Stowell's

("Plaintiff") complaint.

UNDISPUTED FACTS

On June 3, 2003, Plaintiff was served with a complaint from four

individuals claiming monetary damages against two companies owned by

Plaintiff, and against Plaintiff in h s individual capacity. This complaint alleges

that Plaintiff's companies hired the individuals in mid-2002 at various stated

salaries, and failed to pay these salaries during the periods of their employment,

which lasted anywhere from five to eight months.

The basis of the claims against Plaintiff in his individual capacity are, (1)a

claim for injunctive relief to prevent Plaintiff from using or transferring one of

the individual's claimed patent rights; (2) a claim for monetary damages for

Plaintiff's alleged fraudulent conduct in (i) promising to pay the individuals their

salaries in the near future and (ii) promising to personally pay the individuals

their salaries if they continued to work for his companies; and (3) a claim for monetary damages based on promissory estoppel, alleging that Plaintiff

personally promised that he would pay the individuals their weekly salaries if

they would continue to work for h s companies.

On July 27, 2004, Plaintiff commenced this action against Defendant, - -- --. -- daIm+ngt t - Defendznt has a-du ty t&m-b-PkainMf irtthe- abovedescribed

suit. Plaintiff has a homeowners policy with Defendant with an effective date of

07 / 01/ 02 to 07101 / 03, and an umbrella policy covering both this homeowners

policy as well as an auto insurance policy.' The umbrella policy has an effective

date of 12101103 to 12101104. Under Coverage E of the homeowners policy,

Plaintiff is covered by Defendant for personal liability for damages because of

"bodily injury" or "property damage" caused by an "occurrence" to which the

coverage applies. "Occurrence" is defined in the policy as an accident, including

continuous or repeated exposure to substantially the same general harmful

conditions, which results, during the policy period, in "bodily injury" or

"property damage." "Bodily injury" and "property damage," in turn, are

defined as bodily harm, sickness or disease, including required care, loss of

services and death that results; and physical injury to, destruction of, or loss of

use of tangible property. The homeowners policy also excludes personal liability

coverage for "bodily injury" or "property damage" arising out of or in

connection with a "business" engaged in by the insured. The policy states that

this exclusion applies to but is not limited to an act or omission regardless of its

nature or circumstance, a service or duty rendered, promised, owed, or implied

to be provided because of the nature of the "business."

The only two policies on file with the court are the homeowners policy and the umbrella policy, though it appears from the umbrella policy that it covers an auto insurance policy also issued to Plaintiff through Defendant. DISCUSSION

Summary judgment is proper when the citations to the record found in

the parties Rule 56(h) statements demonstrate that no genuine issue of material

fact has been generated and that a party is entitled to a judgment as a matter of -

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An insurer's duty to defend its insured presents a question of law that the court

determines by comparing the allegations in the underlying complaint with the

provisions of the insurance policy. Baywood Corp. v. Maine Bonding t 3 Casualty

Co., 628 A.2d 1029, 1030 (Me. 1993). The insured is entitled to a defense if there

exists any legal or factual basis that could be developed at trial that would

obligate the insurer to pay under the policy. Id. The duty to defend does not

encompass alleged hazards not withn the scope of the policy. Id.

The allegations in the underlying complaint and the terms of Plaintiff's

homeowner's policy with Defendant, which was the only policy in effect at the

time Plaintiff's alleged liability arose, establish as a matter of law that Plaintiff's

alleged liability is not within the scope of the policy. See id. The allegations in

the underlying complaint allege neither "bodily injury" nor "property damage"

as contemplated by the homeowners policy under the personal liability coverage.

See id. Additionally, the allegations of liability arose out of business engaged in

by the Plaintiff, coverage for which is specifically excluded by the policy. See id.

Accordingly, Defendant owes no duty to defend Plaintiff in the underlying suit

and summary judgment in favor of Defendant is proper.

The entry is:

Defendant's motion for summary judgment is GRANTED. ~4 day of Dated at Portland, Maine this 3 ,2005.

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Robert E. Crowley Justice, Superior court ' COURTS i d County IX 287 e 041 12-0287

JAMES POLIQUIN ESQ 'by NORMAN HANSON & DETROY '- 0 PO BOX 4600 PORTLAND ME 04112-4600

COURTS nd County ox 287 le 041 12-0287

JEFFREY EDWARDS ESQ p/4' P R E T I FLAHERTY BELIVEAU PA&>OS & HALEY PO BOX 9546 PORTLAND ME 04112-9546