2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 1 of 19 Pg ID 31 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION

Transcription

1 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 1 of 19 Pg ID 31 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION JOY TABERNACLE - THE NEW TESTAMENT CHURCH, Plaintiff, Case No. 2:13-cv Hon. Gershwin A. Drain v STATE FARM FIRE AND CASUALTY COMPANY, DEMAND FOR JURY TRIAL Defendant. JO ROBIN DAVIS (P31263) JO ROBIN DAVIS, PLLC Attorneys for the Plaintiff Northwestern Highway, Ste. 104 Farmington Hills, Michigan (248) ext. 254 CARY R. BERLIN (P64122) PAUL H. JOHNSON, JR. (P26871) Attorneys for Defendant Franklin Road, Suite 1400 Southfield, Michigan (248) ANSWER TO THE COMPLAINT The Defendant, State Farm Fire and Casualty Company ( State Farm ), through its attorneys, Patrick, Johnson & Mott, P.C., provides the following Answer to the Plaintiff s Complaint: COMMON ALLEGATIONS 1. Admitted. 2. Admitted. 3. Admitted. In further answer, the amount in controversy exceeds $75,000.01, as evidenced in State Farm s Notice of Removal (Docket No. 1). 4. State Farm admits the existence of the insurance policy, numbered 92-BC-D117-0, insuring the Plaintiff s interest, if any, in the property set forth and described in the policy, subject

2 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 2 of 19 Pg ID 32 to all the terms, conditions, exclusions and limitations set forth therein. In further answer, a copy of the subject policy is in the possession of both parties. 5. State Farm admits the existence of the insurance policy, numbered 92-BC-D117-0, insuring the Plaintiff's interest, if any, in the property set forth and described in the policy, subject to all the terms, conditions, exclusions and limitations set forth therein. 6. State Farm admits the existence of the insurance policy, numbered 92-BC-D117-0, insuring the Plaintiff's interest, if any, in the property set forth and described in the policy, subject to all the terms, conditions, exclusions and limitations set forth therein. 7. State Farm denies the allegations contained in Paragraph 7 of the Plaintiff s Complaint because the allegations are untrue and contain erroneous legal conclusions. 8. State Farm denies the allegations contained in Paragraph 8 of the Plaintiff s Complaint because the allegations are untrue and contain erroneous legal conclusions. 9. State Farm denies the allegations contained in Paragraph 9 of the Plaintiff s Complaint because the allegations are untrue and contain erroneous legal conclusions. 10. State Farm denies the allegations contained in Paragraph 10 of the Plaintiff s Complaint because the allegations are untrue and contain erroneous legal conclusions. 11. State Farm admits, only, that it has denied liability for the Plaintiff s claims for the reasons set forth in its Affirmative Defenses hereto. COUNT I BREACH OF CONTRACT 12. State Farm incorporates herein by reference thereto each of its answers to Paragraphs 1 through 11 of the Plaintiff s Complaint, the same as if those answers were fully set forth herein. 2

3 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 3 of 19 Pg ID State Farm admits, only, that its duties and responsibilities are set forth in the subject policy, as well as in the various applicable statutes and case law, which State Farm submits it has fully complied with. In further answer, State Farm avers that both parties have a duty to act fairly and in good faith when dealing with each other. 14. State Farm denies the allegations contained in Paragraph 14 of Count I of the Plaintiff s Complaint, including the allegations contained in Paragraphs 14(a) through 14(d), because the allegations are untrue and contain erroneous legal conclusions. 15. State Farm denies the allegations contained in Paragraph 15 of Count I of the Plaintiff s Complaint because the allegations are untrue and contain erroneous legal conclusions. WHEREFORE, the Defendant, State Farm Fire and Casualty Company, respectfully prays that this Honorable Court will dismiss this action against it with prejudice and award to State Farm its costs and attorney s fees so wrongfully incurred. COUNT II VIOLATIONS OF THE UNIFORM TRADE PRACTICES ACT 16. State Farm incorporates herein by reference thereto each of its answers to Paragraphs 1 through 15 of the Plaintiff s Complaint, the same as if those answers were fully set forth herein. 17. State Farm relies on the provisions of M.C.L , and avers that the statute, in its entirety, speaks for itself. 18. State Farm denies the allegations contained in Paragraph 18 of Count II of the Plaintiff s Complaint because the allegations are untrue and contain erroneous legal conclusions. 19. State Farm denies the allegations contained in Paragraph 19 of Count II of the Plaintiff s Complaint because the allegations are untrue and contain erroneous legal conclusions. In 3

4 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 4 of 19 Pg ID 34 further answer, State Farm relies on the provisions of M.C.L , and avers that the statute, in its entirety, speaks for itself. 20. State Farm denies the allegations contained in Paragraph 20 of Count II of the Plaintiff s Complaint because the allegations are untrue. 21. State Farm denies the allegations contained in Paragraph 21 of Count II of the Plaintiff s Complaint because the allegations are untrue and contain erroneous legal conclusions. WHEREFORE, the Defendant, State Farm Fire and Casualty Company, respectfully prays that this Honorable Court will dismiss this action against it with prejudice and award to State Farm its costs and attorney s fees so wrongfully incurred. Respectfully submitted, PATRICK, JOHNSON & MOTT, P.C. Date: April 16, 2013 s/ Cary R. Berlin Attorneys for Defendant Franklin Road, Suite 1400 Southfield, Michigan (248) cberlin@pjmpc.com P

5 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 5 of 19 Pg ID 35 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION JOY TABERNACLE - THE NEW TESTAMENT CHURCH, Plaintiff, Case No. 2:13-cv Hon. Gershwin A. Drain v STATE FARM FIRE AND CASUALTY COMPANY, Defendant. JO ROBIN DAVIS (P31263) JO ROBIN DAVIS, PLLC Attorneys for the Plaintiff Northwestern Highway, Ste. 104 Farmington Hills, Michigan (248) ext. 254 CARY R. BERLIN (P64122) PAUL H. JOHNSON, JR. (P26871) Attorneys for Defendant Franklin Road, Suite 1400 Southfield, Michigan (248) AFFIRMATIVE DEFENSES The Defendant, State Farm Fire and Casualty Company ( State Farm ), will insist in its defense and offer evidence in support of the following affirmative defenses: First Defense Failure to State Claims The following counts, claims and allegations set forth in the Plaintiff s Complaint fail, as a matter of law, to state valid claims upon which relief may be granted: a. Count I of the Plaintiff s Complaint which attempts to set forth claims for consequential damages; b. Count II of the Plaintiff s Complaint which attempts to set forth a claim that State Farm violated the Uniform Trade Practices Act, M.C.L ;

6 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 6 of 19 Pg ID 36 c. All claims that State Farm: pursued false defenses to Plaintiff's claims in an attempt to avoid, delay, or compromise Plaintiff's claims; conducted an investigation for the purpose of creating potential defenses rather than to fairly and honestly determine its liability to Plaintiff; agreed to indemnify Plaintiff and upon being apprised of the extensive scope of damage, rescinded its agreement to pay Plaintiff and wrongfully denied Plaintiff's claim; and abused its contractual relationship with the Plaintiff congregation; d. All claims that State Farm failed to specify what materials constituted a satisfactory proof of loss within 30 days of receiving Plaintiff s claim; and e. All claims for extra-contractual damages, including claims for costs and attorney s fees. Notice is hereby given of State Farm s intention to move for a dismissal of these counts, claims, and allegations before the commencement of trial pursuant to Fed. R. Civ. P. 12 and/or 56. Second Defense No Coverage for the Claimed Collapse The subject policy provides, in relevant part: SECTION I COVERED CAUSES OF LOSS We insure for accidental direct physical loss to Covered Property unless the loss is: 1. Excluded in SECTION I EXCLUSIONS; or 2. Limited in the Property Subject To Limitations provision. SECTION I EXCLUSIONS 2. We do not insure under any coverage for loss whether consisting of, or directly and immediately caused by, one or more of the following: 6

7 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 7 of 19 Pg ID 37 i. Collapse Collapse, except as provided under SECTION I EXTENSIONS OF COVERAGE. But if collapse results in a Covered Cause Of Loss, we will pay for the loss caused by that Covered Cause Of Loss. SECTION I - EXTENSIONS OF COVERAGE 4. Collapse a. With respect to buildings: (1) Collapse means an abrupt falling down or caving in of a building or any part of a building with the result that the building or part of the building cannot be occupied for its intended purpose; (2) A building or any part of a building that is in danger of falling down or caving in is not considered to be in a state of collapse; (3) A part of a building that is standing is not considered to be in a state of collapse even if it has separated from another part of the building; and (4) A building that is standing or any part of a building that is standing is not considered to be in a state of collapse even if it shows evidence of cracking, bulging, sagging, bending, leaning, settling, shrinkage or expansion. b. We will pay for accidental direct physical loss to 7

8 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 8 of 19 Pg ID 38 Covered Property, caused by collapse of a building or any part of a building that is insured under this coverage form or that contains Covered Property insured under this coverage form, if the collapse is caused by one or more of the following: (1) Any of the "specified causes of loss" or by breakage of building glass, all only as insured against in this coverage form; (2) Decay that is hidden from view, unless the presence of such decay is known to an insured prior to collapse; (3) Insect or vermin damage that is hidden from view, unless the presence of such damage is known to an insured prior to collapse; (4) Weight of people or personal property; (5) Weight of rain that collects on a roof; or (6) Use of defective material or methods in construction, remodeling or renovation if the collapse occurs during the course of the construction, remodeling or renovation. However, if the collapse occurs after construction, remodeling or renovation is complete and is cause in part by a cause of loss listed in Paragraphs (1) through (5), we will pay for the loss even if use of defective material or methods in construction, remodeling or renovation, contributes to the collapse. The criteria set forth in Paragraphs a.(1) through a.(4) do not limit the coverage otherwise provided under this Extension Of Coverage for the cause of loss listed 8

9 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 9 of 19 Pg ID 39 in Paragraphs (b).(1), b.(4), and b.(5). The Plaintiff s Complaint should be dismissed because the damages complained of are expressly excluded by the above-quoted collapse provision, and/or did not result from one of the above exceptions, entitling State Farm to judgment in its favor as a matter of law. Third Defense Latent Defect Exclusions The subject policy provides, in relevant part: SECTION I COVERED CAUSES OF LOSS We insure for accidental direct physical loss to Covered Property unless the loss is: 1. Excluded in SECTION I EXCLUSIONS; or 2. Limited in the Property Subject To Limitations provision. SECTION I EXCLUSIONS 2. We do not insure under any coverage for loss whether consisting of, or directly and immediately caused by, one or more of the following: l. Other Types Of Loss (1) Wear and tear; (2) Rust or other corrosion, decay, deterioration, hidden or latent defect or any quality in property that causes it to damage or destroy itself; (3) Smog; (4) Settling, cracking, shrinking or expansion; (5) Nesting or infestation, or discharge or release of waste products or secretions, by insects, birds, rodents or other animals; 9

10 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 10 of 19 Pg ID 40 (6) Mechanical breakdown, including rupture or bursting caused by centrifugal force; or (7) The following causes of loss to personal property: (a) (b) (c) Dampness or dryness of atmosphere; Changes in or extremes of temperature; or Marring or scratching. But if an excluded cause of loss that is listed in Paragraphs (1) through (7) above results in an accidental direct physical loss by any of the specified causes of loss or by building glass breakage, we will pay for the loss caused by that "specified cause of loss" or by building glass breakage. The Plaintiff s Complaint should be dismissed because the loss and/or damage complained of was caused in whole or in part by one or more of the above exclusions, including, but not limited to, wear and tear, settling, cracking, shrinking, expansion, deterioration, hidden or latent defect or any quality in property that causes it to damage or destroy itself, all of which are expressly excluded by the policy, entitling State Farm to judgment in its favor as a matter of law. The subject policy also provides: Fourth Defense Weather Exclusion SECTION I COVERED CAUSES OF LOSS We insure for accidental direct physical loss to Covered Property unless the loss is: 1. Excluded in SECTION I EXCLUSIONS; or 2. Limited in the Property Subject To Limitations provision. SECTION I EXCLUSIONS 10

11 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 11 of 19 Pg ID We do not insure under any coverage for any loss consisting of one or more of the items below. Further, we do not insure for loss described in Paragraphs 1. and 2. immediately above regardless of whether one or more of the following: (a) directly or indirectly cause, contribute to or aggravate the loss; or (b) occur before, at the same time, or after the loss or any other cause of the loss: a. Weather Conditions Weather conditions. But this exclusion only applies if weather conditions contribute in any way with a cause or event excluded in Paragraph 1. and 2. above to produce the loss. But if accidental direct physical loss results from items 3.a., 3.b., or 3.c., we will pay for that resulting loss unless the resulting loss is itself one of the losses not insured in SECTION I of this coverage form. The Plaintiff s Complaint should be dismissed because the claimed loss and/or damage was caused in whole or in part by one or more of the above weather conditions which contributed to the excluded cause of the claimed damages, entitling State Farm to judgment in its favor as a matter of law. Fifth Defense Faulty, Inadequate of Defective Work Exclusion The subject policy also provides: SECTION I COVERED CAUSES OF LOSS We insure for accidental direct physical loss to Covered Property unless the loss is: 1. Excluded in SECTION I EXCLUSIONS; or 2. Limited in the Property Subject To Limitations provision. SECTION I EXCLUSIONS 11

12 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 12 of 19 Pg ID We do not insure under any coverage for any loss consisting of one or more of the items below. Further, we do not insure for loss described in Paragraphs 1. and 2. immediately above regardless of whether one or more of the following: (a) directly or indirectly cause, contribute to or aggravate the loss; or (b) occur before, at the same time, or after the loss or any other cause of the loss: c. Work Faulty, inadequate or defective: (1) Planning, zoning, development, surveying, siting; (2) Design, specifications, workmanship, repair, construction, renovation, remodeling, grading, compaction; (3) Materials used in repair, construction, renovation or remodeling; or (4) Maintenance; of part or all of any property (including land, structures or improvement of any kind) on or off the described premises. But if accidental direct physical loss results from items 3.a., 3.b., or 3.c., we will pay for that resulting loss unless the resulting loss is itself one of the losses not insured in SECTION I of this coverage form. The Plaintiff s Complaint should be dismissed because the loss and/or damage complained of was caused in whole or in part by faulty, inadequate or defective workmanship, repair, renovation, remodeling, and/or faulty, inadequate or defective materials used in repair, renovation or remodeling; or faulty, inadequate or defective maintenance of the building, all of which are expressly excluded by the policy of insurance sued upon, entitling State Farm to judgment in its favor as a matter of law. 12

13 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 13 of 19 Pg ID 43 Sixth Defense Fungi, Virus or Bacteria Exclusion The subject policy provides, in relevant part: SECTION I COVERED CAUSES OF LOSS We insure for accidental direct physical loss to Covered Property unless the loss is: 1. Excluded in SECTION I EXCLUSIONS; or 2. Limited in the Property Subject To Limitations provision. SECTION I EXCLUSIONS 1. We do not insure, under any coverage for any loss which would not have occurred in the absence of one or more of the following excluded events. We do not Insure for such loss regardless of: (a) the cause of the excluded event; or (b) other causes of the loss; or (c) whether other causes acted concurrently or in any sequence with the excluded event to produce the loss; or (d) whether the event occurs suddenly or gradually, Involves isolated or widespread damage, arises from natural or external forces, or occurs as a result of any combination of these: j. Fungi, Virus Or Bacteria (1) Growth, proliferation, spread or presence of fungi" or wet or dry rot; or (2) Virus, bacteria or other microorganism that induces or is capable of inducing physical distress, illness or disease; and (3) We will also not pay for: (a) Any loss of use or delay in rebuilding, repairing or replacing covered p r o p e r t y, i n c l u d i n g a n y associated. cost or expense, due to interference at the described premises or location of the rebuilding, repair or replacement of that property, by "fungi", wet or dry rot, virus, bacteria 13

14 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 14 of 19 Pg ID 44 or other microorganism; (b) Any remediation of "fungi", wet or dry rot, virus, bacteria or other microorganism, including the cost or expense to: i. Remove the "fungi", wet or dry rot, virus, bacteria or 'other microorganism from Covered Property or to repair, restore or replace that property; ii. Tear out and replace any part of the building or other property as needed to gain access to the "fungi", wet or dry rot, virus, bacteria or other microorganism; or iii. Contain, treat, detoxify, neutralize or dispose of or in any way respond to or assess the effects of the "fungi", wet or dry rot, virus, bacteria or other microorganism; or (c) The cost of any testing or monitoring of air or property to confirm the type, absence, presence or level of "fungi", wet or dry rot, virus, bacteria or other microorganism, whether performed prior to, during or after removal, repair, restoration or replacement of Covered Property. This exclusion does not apply if "fungi", wet or dry rot, virus, bacteria or other microorganism results from an accidental direct physical loss caused by fire or lightning. The Plaintiff s Complaint should be dismissed to the extent that the losses and/or damages complained of were caused, in whole or in part, by fungi, virus or bacteria including, but not limited to, any remediation costs associated with the fungi, virus or bacteria, as well as the cost of any testing or monitoring of air related to the presence and/or absence of fungi, virus or bacteria. 14

15 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 15 of 19 Pg ID 45 Seventh Defense Actual Cash Value Limitation The subject policy, pursuant to Endorsement, also provides: SECTION I CONDITIONS 1. Property Loss Conditions e. Loss Payment In the event of loss covered by this policy: (1) At our option, we will either: (a) (b) (c) (d) Pay the value of lost or damaged property; Pay the cost of repairing or replacing the lost or damaged property; Take all or any part of the property at an agreed or appraised value; or Repair, rebuild or replace the property with other property of like kind and quality. We will determine e.(1)(a) in accordance with the applicable terms of Paragraph e.(4) below or any applicable provision which amends or supercedes the terms in Paragraph e.(4) below. (4) The value of property covered under Coverage A - Building will be determined at actual cash value as of the time of loss. We will not pay more for loss in any one occurrence than the smallest of: a. The Limit of Insurance under Section I - Property that applies to the lost or 15

16 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 16 of 19 Pg ID 46 damaged property; or b. The actual cash value of the lost or damaged property as of the time of loss. The Plaintiff s Complaint should be dismissed to the extent it seeks damages that are in excess of the actual cash value of the property at the time of the claimed damage. Eighth Defense Loss Deductible The Plaintiff s Complaint against State Farm should be dismissed to the extent that the Plaintiff s claims have not applied the $1, deductible in force under the policy at the time of the claimed December 15, 2012 event. Ninth Defense Insurable Interest and Limit of Liability The Plaintiff s Complaint should be dismissed to the extent that the Plaintiff claims amounts which are greater than its interest in the property insured under the policy and/or which are greater than the applicable limits of liability in force under the policy sued upon. Tenth Defense Failure to Mitigate The Plaintiff s Complaint should be dismissed to the extent that the Plaintiff has failed to mitigate any damages and/or losses, if any, sustained as a result of the events described in its Complaint. 16

17 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 17 of 19 Pg ID 47 Eleventh Defense Claim of Offset State Farm claims that the sums previously paid under the policy for the loss and/or damage complained of in the Plaintiff s Complaint, believed to be $10,215.32, as well as any other benefits of any kind received by the Plaintiff as the result of the loss and/or damage complained of in the Plaintiff s Complaint, as an offset to any damages which may be awarded to the Plaintiff in connection with the lawsuit and/or under the policy of insurance sued upon, or otherwise. Twelfth Defense Reservation of Rights State Farm reserves its right to add to, supplement, modify, change, or amend any and all of the Affirmative Defenses hereto as the facts and circumstances become known through discovery and/or further investigation. Respectfully submitted, PATRICK, JOHNSON & MOTT, P.C. Date: April 16, 2013 s/ Cary R. Berlin Attorneys for Defendant Franklin Road, Suite 1400 Southfield, Michigan (248) cberlin@pjmpc.com P

18 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 18 of 19 Pg ID 48 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION JOY TABERNACLE - THE NEW TESTAMENT CHURCH, Plaintiff, Case No. 2:13-cv Hon. Gershwin A. Drain v STATE FARM FIRE AND CASUALTY COMPANY, Defendant. JO ROBIN DAVIS (P31263) JO ROBIN DAVIS, PLLC Attorneys for the Plaintiff Northwestern Highway, Ste. 104 Farmington Hills, Michigan (248) ext. 254 CARY R. BERLIN (P64122) PAUL H. JOHNSON, JR. (P26871) Attorneys for Defendant Franklin Road, Suite 1400 Southfield, Michigan (248) JURY DEMAND The Defendant, State Farm Fire and Casualty Company, through its attorneys, Patrick, Johnson & Mott, P.C., hereby demands a trial by jury in the above-captioned litigation. Respectfully submitted, PATRICK, JOHNSON & MOTT, P.C. Date: April 16, 2013 s/ Cary R. Berlin Attorneys for Defendant Franklin Road, Suite 1400 Southfield, Michigan (248) cberlin@pjmpc.com P

19 2:13-cv GAD-MKM Doc # 3 Filed 04/16/13 Pg 19 of 19 Pg ID 49 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION JOY TABERNACLE - THE NEW TESTAMENT CHURCH, Plaintiff, Case No. 2:13-cv Hon. Gershwin A. Drain v STATE FARM FIRE AND CASUALTY COMPANY, Defendant. JO ROBIN DAVIS (P31263) JO ROBIN DAVIS, PLLC Attorneys for the Plaintiff Northwestern Highway, Ste. 104 Farmington Hills, Michigan (248) ext. 254 CARY R. BERLIN (P64122) PAUL H. JOHNSON, JR. (P26871) Attorneys for Defendant Franklin Road, Suite 1400 Southfield, Michigan (248) PROOF OF SERVICE I hereby certify that on April 16, 2013, my legal assistant, Laura Martinico, electronically filed State Farm s Answer to Complaint, Affirmative Defenses, Jury Demand and this Proof of Service with the Clerk of the court using the ECF system which will send notification of such filing to the following: JO ROBIN DAVIS (P31263) JO ROBIN DAVIS, P.L.L.C. Attorney for Plaintiff Northwestern Highway, Suite 104 Farmington Hills, Michigan s/cary R. Berlin PATRICK JOHNSON & MOTT Franklin Road, Suite 1400 Southfield, Michigan cberlin@pjmpc.com P64122