United States District Court, W.D. North Carolina, Asheville Division
Cogburn Jr. United States District Judge
MATTER is before the Court on the following pending
motions. From plaintiff, there is the Motion for Partial
Summary Judgment (#29). From defendant, there is the Motion
for Summary Judgment (#30). Having considered each motion and
reviewed the pleadings, the Court enters the following Order.
Summary Judgment Standard
judgment shall be granted “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). A factual dispute is genuine “if
the evidence is such that a reasonable jury could return a
verdict for the nonmoving party.” Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A fact is
material only if it might affect the outcome of the suit
under governing law. Id.
movant has the “initial responsibility of informing the
district court of the basis for its motion, and identifying
those portions of the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the
affidavits, if any, which it believes demonstrate the absence
of a genuine issue of material fact.” Celotex Corp.
v. Catrett, 477 U.S. 317, 323 (1986) (citations
this initial burden is met, the burden shifts to the
nonmoving party. That party “must set forth specific
facts showing that there is a genuine issue for trial.”
Id. at 322 n.3. The nonmoving party may not rely
upon mere allegations or denials of allegations in his
pleadings to defeat a motion for summary judgment.
Id. at 324. Instead, that party must present
sufficient evidence from which “a reasonable jury could
return a verdict for the nonmoving party.”
Anderson, 477 U.S. at 248; accord Sylvia Dev.
Corp. v. Calvert Cnty., Md., 48 F.3d 810, 818 (4th Cir.
1995). When ruling on a summary judgment motion, a court must
view the evidence and any inferences from the evidence in the
light most favorable to the nonmoving party.
Anderson, 477 U.S. at 255. “‘Where the
record taken as a whole could not lead a rational trier of
fact to find for the nonmoving party, there is no genuine
issue for trial.'” Ricci v. DeStefano, 129
S.Ct. 2658, 2677 (2009) (quoting Matsushita v. Zenith
Radio Corp., 475 U.S. 574, 587 (1986)). Any question as
to the meaning of the language used in a policy is a question
of law for the court to resolve. Guyther v. Nationwide
Mut. Fire Ins., 109 N.C.App. 506, 512 (1993).
Plaintiff's Motion for Partial Summary Judgment
Church seeks partial summary judgment on its claims for
unfair and deceptive trade practices, unfair trade practices,
and bad faith. It claims Insurer denied Church's claim
without following up on its initial investigation, without
addressing all possible areas of coverage, and without
knowing the applicable law. Specifically, Church alleges
Insurer denied Church's claim without knowing North
Carolina law on concurrent causation or partial collapse.
argues Insurer violated the Unfair and Deceptive Trade
Practices Act ("UDTPA"), N.C. G.S. §§
75-1.1 et seq. by intentionally avoiding knowledge
of the law and making repeated misrepresentations about the
coverage based on an indifference to the law. Church
maintains Insurer is tasked with knowing the law applying to
its products and that Insurer wantonly denied claims and
unfairly processed claims based on an intentional disregard
for the law and a conscious disregard for insureds.
also claims Insurer has committed violations under N.C. G.S.
§§ 58-63-1 et seq., which provides the
state with means to regulate insurance and deal with unfair
and deceptive practices. Violations of N.C. G.S. §§
58-63-15(11) support a violation of the UDTPA. See Gray
v. North Carolina Ins. Underwriting Ass'n, 352 N.C.
61, 68-71 (2000). If Church can prove that Insurer acted in a
way that violated § 58-63-15(11), and that it suffered
an actual injury proximately caused by that violation, then
Church will be able to establish his UDTPA claim and thereby
may seek treble damages arising from the alleged UDTPA
violation. Guessford v. Pennsylvania Nat. Mut. Cas. Ins.
Co., 983 F.Supp.2d 652, 660 (M.D. N.C. 2013) (citing
Gray, 352 N.C. at 74-75).
Church argues it is entitled to summary judgment on its bad
faith claim because its insurance claim was valid and
Insurer's refusal to pay or if make a proper
investigation supports a finding of bad faith. In order to
recover punitive damages for the tort of an insurance
company's bad faith refusal to settle, plaintiffs must
prove: (1) a refusal to pay after recognition of a valid
claim; (2) bad faith; and (3) aggravating or outrageous
conduct. Guessford, 983 F.Supp. at 671- 72 (citing
Lovell v. Nationwide Mut. Ins. Co., 108 N.C.App.
416, 420 (1993), aff'd, 334 N.C. 682 (1993)). In
this context, bad faith means “not based on honest
disagreement or innocent mistake.” Lovell, 108
N.C.App. at 421. The third element, aggravating or outrageous
conduct, may be shown by “fraud, malice, gross
negligence, insult, rudeness, oppression, or wanton and
reckless disregard of plaintiff's rights.”
Id. at 422.
reasons stated at the January 4, 2019 hearing and in the
Insurer's Response, the Court finds Church has not met
its burden of showing show that there is no genuine issue as
to any material fact and that it is entitled to a judgment on
each of these claims as a matter of law. Fed.R.Civ.P. 56(c).
The Court will, therefore, deny plaintiff's Motion for
Partial Summary Judgment (#29).
Defendant's Motion for Summary Judgment
Insurer seeks summary judgment on all of Church's claims.
It argues Insurer is entitled to judgment on Church's
claim for breach of contract because Insurer's policy of
insurance does not provide coverage for Church's reported
damages and, as such, Insurer's denial was proper.
Insurer also argues it is entitled to judgment on
Church's claim for unfair and deceptive trade practices,
unfair claims settlement practices, bad faith, and punitive
damages because Insurer acted reasonably and in good faith in
investigating Church's claim and properly denying a claim
that was not covered by the terms and conditions of the
policy. Insurer claims Church has come forward with no
evidence that Insurer ...