United States District Court, D. New Mexico
MEMORANDUM OPINION AND ORDER DENYING PLAINTIFF'S
PARTIAL MOTION FOR SUMMARY JUDGMENT AND GRANTING
DEFENDANT'S MOTION FOR SUMMARY JUDGMENT
MATTER is before the Court upon Plaintiff's Motion for
Partial Summary Judgment, filed October 3, 2018 (Doc. 34),
and Defendant's Motion for Summary Judgment, filed on
November 2, 2018 (Doc. 38). Having reviewed the parties'
pleadings and applicable law, the Court finds that
Plaintiff's motion is not well-taken and therefore, is
DENIED. The Court further finds that
Defendant's motion is well-taken and therefore, is
an insurance case about whether certain amounts claimed as
losses by HB Construction, Inc. (“Plaintiff”),
and denied by Travelers Property Casualty Company of America
(“Defendant”), fall within the scope of coverage.
Plaintiff contracted with Defendant to insure a luxury
condominium building it was constructing, the Carlisle. As
the building was nearing completion, David Hickman burned it
down and set a number of other buildings in Albuquerque on
fire. David Hickman was convicted and sentenced in this
district court for arson.
was reimbursed approximately $5, 772, 484.36. At issue is
$567, 828.00 in expenses claimed by Plaintiff but denied in
part by Travelers (the “denied amount”). Although
Defendant paid $100, 000 under the “soft cost”
coverage extension, it denied more than $400, 000. It
reasoned that the denied amounts either (1) were soft costs
exceeding the soft costs sublimit, or (2) did not fall under
the coverage provisions of the Builder's Risk policy
because they accrued before the fire. See Doc. 38-5,
p. 4 (“the majority of those costs were incurred prior
to the date of loss and thus those costs would be considered
as part of the original project budget.”)
parties cross-moved for summary judgment on the breach of
contract claim, focusing primarily on whether the denied
amounts fall under coverage provisions or are otherwise
excluded as soft costs. Defendant also moved for summary
judgment on the remaining claims, arguing that they must fail
as a matter of law if there was no breach of the policy.
motion for summary judgment may be granted only when
“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). Summary judgment is
appropriate if the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to
any material fact. Munoz v. St. Mary Kirwan Hosp.,
221 F.3d 1160, 1164 (10th Cir. 2000). When applying this
standard, the court examines the record and makes all
reasonable inferences in the light most favorable to the
non-moving party. Id. The movant bears the initial
burden of establishing that no genuine issue exists as to any
material fact. See Adickes v. S.H. Kress & Co.,
398 U.S. 144, 157 (1970). Where the record taken as a whole
could not lead a rational trier of fact to find for the
non-moving party, there is no genuine issue for trial.
Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 587 (1986) (quoting First Nat'l Bank of
Arizona v. Cities Serv. Co., 391 U.S. 253, 289 (1968)).
parties stipulated to the majority of the facts below.
Defendant also asserted additional facts, which Plaintiff did
issued Policy Number QT-66-3E977885-TIL-16 to Plaintiff with
policy period 11/18/2016 to 02/28/2017 (“the
Policy”). Plaintiff was the general contractor for a
condominium complex known as the Carlisle at 3600 Central
Boulevard SE, Albuquerque, New Mexico 87113. A fire occurred
at the Carlisle on November 23, 2016. Plaintiff submitted a
claim to Defendant for the loss on November 23, 2016. The
Policy's insuring agreement provides:
We will pay for direct physical loss of or damage to Covered
Property caused by or resulting from a Covered Cause of Loss.
Covered Property, as used in this Coverage Form, means the
following types of property you own or for which you are
legally liable, the value of which is included in the
estimated "total project value" shown in the
Materials, equipment, machinery, supplies and property of a
similar nature that will become a permanent part of the
project described in the Declarations during completion of
such project or that will be used or expended in the
completion of such project.
Completion of the project includes site preparation
(including demolition of existing buildings or structures),
fabrication, assembly, installation, erection, alteration,
renovation and similar construction activities.
Cofferdams, construction forms, cribbing, falsework,
hoarding, scaffolds, fencing, signs, office trailers (and
their "contents") and similar temporary buildings
or structures incidental to completion of the project
described in the Declarations.
Policy specifically excludes “soft costs” beyond
the Limits of Insurance shown on the Policy's Declaration
We will not pay for loss or damage caused by or resulting
from any of the following:
(1) Delay, loss of use, or loss of market;
(2) Loss of income, soft costs or extra
expenses except as specifically provided in this ...