Court Opinion

ID: 9489517
Source: CourtListenerOpinion
Date Created: 2023-08-05 13:17:39.875833+00
Date Added: 2024-06-11T17:53:34.432575
License: Public Domain

TERENCE T. EVANS, Circuit Judge,
dissenting.
The Edward Gray Corporation filed this suit against National Union claiming it “incurred and personally paid” a quarter of a million dollars as a result of Union’s failure to defend it in litigation growing out of an accident at a power station in northern Indiana. The allegation was false. Edward Gray, it turned out, paid nothing. One of its other insurers, however, expended funds ($250,000 perhaps) to get Gray out of the power station litigation without a scratch. Because Gray personally suffered no damages, the district court gave Union a quick ticket out of the case when it granted summary judgment on a converted Rule 12 motion to dismiss. This action followed Gray’s initial filing of a motion seeking summary judgment in its favor.
I cannot join the majority’s conclusion that the district court improperly transformed Union’s motion to dismiss into one for summary judgment “without giving Edward Gray an opportunity to respond.” While it would have been wiser for Union to have called its request a motion for summary judgment rather than a motion to dismiss, I am satisfied that Gray had more than a reasonable opportunity to respond and get before the court its view of whether it suffered damages. The purpose of the “notice of intent to convert rule” is, as the majority notes, to prevent surprise. That a conversion occurred here was about as surprising as the Republican party’s decision last week to nominate Bob Dole as its ’96 presidential candidate. Gray knew what was happening, and the material it finally got together in support of its motion for reconsideration should have been filed right off the bat.
Furthermore, what Gray eventually submitted was, as Judge Kocoras noted, insufficient to defeat Union’s prayer for summary judgment. Discovery unmasked Gray’s claim that it “personally paid” $250,000 doing what Union, as its insurance carrier, was allegedly obligated to do. Why Gray tried to slip this one by on the inside comer is unclear, but it is now an admitted fact. Gray’s belated attempt to find some damages here through its “retrospectively rated premium” argument is, on these facts at this time, nothing but speculation. I would affirm the decision of the district court.