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Brown v. Economy Premier Assurance Co.

United States District Court, W.D. North Carolina, Asheville Division

February 5, 2019

JUDITH BROWN, Plaintiff,
v.
ECONOMY PREMIER ASSURANCE COMPANY, Defendant.

          ORDER

          MAX O. COGBURN, UNITED STATES DISTRICT JUDGE.

         THIS MATTER is before the Court on defendant's Motion for Summary Judgment (#40), plaintiff's Response, and defendant's Reply.[1] For the reasons that follow, the Court determines that defendant is entitled to the summary judgment it seeks.

         FINDINGS AND CONCLUSIONS

         I. Background

         This is an action for breach of a contract of fire insurance. Amended Complaint (#13) Exhibit A (“A.C. Ex. A”). The policy at issue provided coverage for accidental property loss for plaintiff's home located on Allison Watts Road in Franklin, North Carolina. Id. at ¶ 4. Plaintiff describes the premises as a permanently constructed home and a single wide mobile home adjacent to the permanent dwelling, served by one utility meter. Id. at ¶¶ 5-6.

         Between 2014 and 2016, the permanent home was undergoing repairs due to water damage in 2014. Plaintiff contends that she was at the permanent home almost every day during the period of repair, id. at ¶ 9, but that she moved a small portion of her daily personal clothing and cleaning supplies to the mobile home and sometimes slept overnight in the mobile home when repairs were being done on the permanently constructed home, id. at ¶12, and occasionally stayed overnight with a friend in an RV park. Id. at ¶13. The permanent home -- which is the subject of this lawsuit -- was destroyed by fires on October 11 and 12, 2016. Id. at 18. She contends that at the time of the fires, she was admitted to a local hospital. Id.

         The only claim remaining is a claim for breach of the contract of insurance, which is Count 1 of the Amended Complaint.[2] Despite the contentions in the Complaint, the proffer of evidence shows that plaintiff did not reside in the fire-damaged home that was covered by the policy of insurance. Even worse for plaintiff, the evidence now undisputedly shows that plaintiff knowingly gave fire investigators a false statement in 2017, under oath, that at the time of the fires she was living in the home -- a statement which is contradicted by earlier recorded statements she made to fire investigators in 2016.

         While this Court agrees that an insurance company need not show that it acted in reliance on the false statements or was even taken in by them, it is obligated to show that the statements were material. At the conclusion of discovery, defendant has argued that it is entitled to summary judgment on this remaining claim because it has now shown that such knowingly false testimony was material to its investigation, voiding any coverage under the policy of insurance. This Court, having considered all the evidence before it and provided plaintiff with time for discovery on that and other issues, now agrees that plaintiff's knowingly false statement was indeed material to the investigation as the fact she misrepresented -- to wit, that she lived in the covered premises -- would be one reasonably expected to influence the decision of the defendant in its investigation of the claim or in paying the claim, regardless of the cause of the fires.

         II. Summary Judgment Standard

         Defendant contends that it is entitled to summary judgment. Rule 56(a), Federal Rules of Civil Procedure, provides:

A party may move for summary judgment, identifying each claim or defense - or the part of each claim or defense - on which summary judgment is sought. The court shall grant summary judgment 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. The court should state on the record the reasons for granting or denying the motion.

Fed.R.Civ.P. 56(a). The rule goes on to provide procedures for plaintiff to use in responding to a Motion for Summary Judgment:

(c) Procedures.
(1) Supporting Factual Positions. A party asserting that a fact cannot be or is genuinely disputed must support ...

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