Opinion ID: 2327368
Heading Depth: 1
Heading Rank: 5

Heading: The Hearing on Employers' Motion for Summary Judgment

Text: On August 4, 2009, a hearing on Employers' motion for summary judgment was held before a justice of the Superior Court. At the hearing, counsel for Employers noted that Arbella had begun to provide a defense to Viking Stone in the underlying civil action, and he stated that he would agree to limit his argument at the August 4 hearing to that portion of his motion that sought a determination with respect to count two of Employers' amended petition, which count requested a declaration that there was no coverage afforded to Viking Stone under Employers' policy. Counsel for Employers argued at the hearing that there had been only one occurrence that caused the Destremps' property damage rather than multiple occurrences. He asserted that it was undisputed that that one occurrence (which he characterized as continuous exposure of constant water leaking from Viking Stone) began before 2004, which was the year when Employers began to insure Viking Stone. Counsel for Employers noted that the evidence indicated that the flooding began sometime between 2001 and 2003, and he asserted that certainly there is no question that [Employers] has no duty [to indemnify or defend Viking Stone] because the events all occurred prior to 2004, whether in 2001, 2002, or in 2003. In response, counsel for Arbella asserted (1) that [t]here [was] absolutely no proof that the flooding was a single incident and (2) that there was no proof as to the cause of the flooding. He noted that the evidence in the case is scant, pointing out that there was no expert testimony with respect to the causation of the flooding. He further noted that the Destremps had stated in documents submitted to the court in the underlying civil action that the flooding had continued at least until 2008that is, until well after Employers came on the risk. He also pointed out that Mr. Mello denied in his deposition that Viking Stone had caused any water to flood onto the Destremps' property; he noted that Mr. Mello had further stated at his deposition that the property adjacent to the road where the Destremps alleged that water collected was not Viking Stone's property, but rather was the property of the Town of Tiverton. Counsel for Arbella contended that it was possible that the flood water could have been coming up from the ground; he contended that it would be necessary to have an expert to prove where it came from, how it got there, what caused it. With respect to Employers' duty to defend, counsel for Arbella asserted that, looking within the four corners of the complaint, the Destremps simply claim that the flooding starts after Viking began operating a quarry and [that] it's continued since then, but there's nothing further, and he argued that that allegation theoretically raises potential for coverage by both Arbella and [Employers]. He contended that, as a result, both insurers had a duty to defend until the issue of the underlying liability was resolved. Counsel for Arbella then urged the court to deny the motion for summary judgment as to the duty to defend because there existed an underlying factual dispute with respect to whether an occurrence causing the property damage took place during the period of Arbella's policy coverageor during the period of Employers' policy coverage. He argued that, if the hearing justice determined that there had been just one occurrence, she would be making a factual decision in spite of the fact that, upon reading the complaint in the underlying civil action, it is not evident whether this continuous flooding is one continuous act or whether there's a number of different acts   . He pointed to the fact that the complaint indicated that the flooding continued over a period of years, but did not reveal what the cause was or whether it was a single event or multiple events. In response, counsel for Employers argued that, based on the evidence in the underlying civil action, including the complaint, answers to interrogatories, and testimony from the injunction hearing, it was clear [that] damage occurred prior to 2004. Employers then asserted that that fact was all that was needed for the court to grant its motion for summary judgment. The hearing justice was not persuaded by Arbella's contention that there was not sufficient evidence to determine the cause of the flooding. She stated that that contention dealt with issues of fact with respect to the ultimate liability of Viking in the underlying civil action, implying that those issues were irrelevant to the issues before her. (Emphasis added.) In response, counsel for Arbella contended that the court was being asked [by Employers] to make a factual decision    to decide the flooding that occurred is a single action, and he asserted that there was not sufficient undisputed factual evidence for the court to make a determination as to that issue. The hearing justice disagreed, stating that [w]hat we know    is that [the flooding] happened sometime before 2004. Whether it was 2001, 2002, 2003, it started prior to 2004. The hearing justice observed that the language in the insurance policies defining occurrence as including continuous or repeated exposure was meant to assist insurers such that they would not have to pay claims for multiple occurrences when they were the result of exposure to the same condition. She then indicated that the definition of an occurrence contained in both policies constrained her to find that, because the occurrence was alleged by the Destremps to have started prior to 2004, it could not be anything but one occurrence under the definitions set forth in the insurers' liability policies. Further, with respect to the issue of the lack of expert testimony, the hearing justice stated that she could not take speculation as to what an expert may or may not ultimately say, and she stated that it was not the duty of Employers' counsel to provide an expert in a declaratory judgment action related to issues of coverage. The hearing justice went on to grant Employers' motion for summary judgment. In making her decision, she noted that she recognized that it was for the court to decide whether genuine issues of material fact were present, as opposed to making that determination. Thereafter, the hearing justice ruled as follows: Based on the language of the insurance policy, the specific definition of occurrence being the continuous or repeated exposure to substantially the same general harmful conditions, and based upon the manner in which the allegations are pled in the plaintiff's complaint and declaratory judgment complaint against Viking, I find that there are no genuine issues of material fact with regard to [Employers'] coverage. On August 21, 2009, an order entered stating: (1) that Employers has no duty to defend or indemnify Viking Stone in the case brought by the Destremps; (2) that there was an issue of fact as to whether or not Arbella Protection Insurance Company, Arbella Insurance Group has a duty to defend or indemnify Viking Stone in said matter; and (3) that Rule 54(b) certification [would be] made with respect to the court's declaration that Employers owes Viking Stone no duty to defend or indemnify with respect to the claims made against it. On the same day, judgment entered pursuant to Rule 54(b) of the Superior Court Rules of Civil Procedure in favor of Employers with respect to count two of the amended petition for declaratory relief. Arbella filed a timely notice of appeal. On appeal, Arbella argues, inter alia, that the Superior Court judgment should be reversed because genuine issues of material fact precluded the grant of summary judgment.