Court Opinion

ID: 3162742
Source: CourtListenerOpinion
Date Created: 2015-12-15 20:00:46.747151+00
Date Added: 2024-06-11T11:59:14.583850
License: Public Domain

UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                               No. 14-1787

BRAWNER BUILDERS, INC.,

                Plaintiff - Appellant,

           v.

NORTHERN ASSURANCE COMPANY OF AMERICA,

                Defendant - Appellee.

Appeal from the United States District Court for the District of
Maryland, at Baltimore.     Catherine C. Blake, Chief District
Judge. (1:13-cv-01042-CCB)

Argued:   September 16, 2015                 Decided:   December 15, 2015

Before MOTZ and WYNN, Circuit Judges, and DAVIS, Senior Circuit
Judge.

Affirmed by unpublished per curiam opinion.

ARGUED: Stephan Young Brennan, ILIFF, MEREDITH, WILDBERGER &
BRENNAN, P.C., Pasadena, Maryland, for Appellant.       Robert
Lawrence Ferguson, Jr., FERGUSON, SCHETELICH & BALLEW, P.A.,
Baltimore, Maryland, for Appellee.   ON BRIEF: Ann D. Ware,
FERGUSON, SCHETELICH & BALLEW, P.A., Baltimore, Maryland, for
Appellee.

Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

       Appellee Northern Assurance Company of America (“Northern”)

insured      Appellant       Brawner    Builders,        Inc.    (“Brawner”)        for

personal injury claims arising aboard Brawner’s insured vessels,

subject to an endorsement that listed six crew members to whom

the insurance policy applied.            Dino Kalandras was a Brawner crew

member who was not listed in that endorsement.                        He suffered an

injury aboard an insured vessel and sued Brawner.                          Asserting

that   the    insurance      policy    did    not    afford     coverage     for    the

Kalandras     claim,     Northern      declined     to   provide      a   defense   to

Brawner.     Brawner sued Northern for breach of contract, and the

district court granted Northern’s motion for summary judgment.

Brawner timely appealed, and we affirm.

                                         I.

                                         A.

       Northern,    a     Massachusetts        insurance        company,     insured

Brawner,     a   Maryland      construction         contracting       business,     for

bodily injuries sustained and medical expenses incurred aboard

Brawner’s insured vessels (the “Policy”).                   The Policy provided

for defense and indemnity coverage.                 Under the Policy, Northern

insured Brawner        for   “[c]osts     incurred . . .        for    investigation

and defense of claims.”          J.A. 140.        The indemnity portion of the

Policy covered claims, regardless of crew member status, for:

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      (1) Loss of life and bodily injury or illness; but
      excluding amounts paid under any compensation act.

      (2) Hospital, medical and other expenses necessarily
      and reasonably incurred with respect to loss of life,
      bodily injury to, or illness of, any person.

Id.    The    indemnity       portion        also    contained       crew-specific

provisions, which covered:

      (3) Crew member burial expense[s] not to exceed $1,000
      per person.

      (4) Repatriation expenses of crew member[s], excepting
      such as arise from the termination of any agreement in
      accordance with its terms, or the sale of the Vessel
      or other voluntary act of the Assured. . . .

Id.

      The dispute in this case centers on an endorsement attached

to    the    Policy    with     special        conditions      for     navigation,

passengers,    and    crew    members.         The   special     conditions   for

navigation and passengers stated the following:

      1.   Navigation
      It is a condition of this policy that the vessel shall
      be confined to: Chesapeake Bay and tributaries,
      Susquehanna and Potomac Rivers. In no event shall the
      vessel be navigated beyond the limits permitted by the
      United States Coast Guard.   If there is a failure to
      comply with this condition there is no coverage under
      this policy.

      2.   Passengers
      It is a condition of this Policy that the number of
      passengers on board the vessel shall not exceed the
      number of passengers permitted by the United States
      Coast Guard or other governmental authority, whichever
      is less.   If there is a failure to comply with this
      condition there is not coverage under this policy.

                                         3
J.A. 143.

      Of   particular      relevance      here    is    the   special   condition

regarding crew members (the “Crew Condition”), which provided as

follows:

      3.   Crew
      It is a condition of this Policy that the named crew
      members   covered  under   this  policy   [are] Robert
      Tormollan, Robert Baker, Jr., Francis Lauer, Robert W.
      Waldron, James F. Guess and Stephen Austin.

      However it is a condition of this policy that there
      shall not be more than two (2) crew members aboard the
      insured vessel at any one time.

      In the event additional crew is to be employed the
      assured shall give prior notice to this company and
      pay such additional premium as is required.     If the
      assured shall fail to give such prior notice and at
      the time of loss in respects to crew there are more
      crew employed, the insurance shall respond only in the
      proportion that the slated number of crew bears to the
      number on board at the time of the accident.

Id.

                                          B.

      On September 14, 2011, Kalandras was injured while removing

an    engine    cover     aboard   one     of    Brawner’s    insured   vessels.

Kalandras      was   a   Brawner   crew   member.       Brawner,   however,   had

inadvertently failed to inform Northern that Kalandras had been

working on insured vessels until the day of the incident.                      On

October 26, 2011, following an investigation, Northern denied

coverage for the claim because Kalandras was not one of the

named crew members under the Policy.                   Kalandras filed suit on
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December 19, 2011, against Brawner in the United States District

Court for the District of Maryland.                  Brawner defended the case,

and eventually settled the claim, at its own expense.

      On April 8, 2013, in the United States District Court for

the   District    of    Maryland,     Brawner        filed      this     suit     against

Northern, alleging two counts of breach of contract, arguing

that Northern breached its duties to defend and to indemnify

Brawner in the suit initiated by Kalandras.                       Northern filed a

motion for summary judgment.                    The district court, construing

Brawner’s memorandum in opposition as a cross-motion for summary

judgment,     denied     Brawner’s      cross-motion,           granted        Northern’s

motion,   and    entered     judgment       in    favor    of   Northern.         Brawner

Builders, Inc. v. N. Assurance Co. of Am., No. CCB-13-1042, 2014
WL 3421535, at *6 (July 9, 2014).                 Looking first at the language

of the Policy, the district court concluded that a reasonably

prudent     layperson    could    interpret          the     Policy      as     providing

coverage only for the crew members expressly listed in the Crew

Condition.      Next, the district court concluded that, “even if

the   court     were    to   assume     a       reasonable      person        could   also

interpret the Policy” to cover crew members not listed in the

Crew Condition, the extrinsic evidence demonstrated that crew

members were required to be listed in the Crew Condition to be

covered under the Policy.        Id. at *5.          Brawner timely appealed.

                                            5
                                           II.

     We review grants of summary judgment de novo.                          Am. Civil

Liberties   Union    v.    Mote,     423 F.3d 438,   442   (4th    Cir.   2005)

(citing Lone Star Steakhouse & Saloon, Inc. v. Alpha of Va.,

Inc., 43 F.3d 922, 928 (4th Cir. 1995)).                      Summary judgment is

appropriate when “there is no genuine issue as to any material

fact and . . . the moving party is entitled to judgment as a

matter of law.”      Id. (quoting Anderson v. Liberty Lobby, Inc.,

477 U.S. 242, 247 (1986)).

     When   reviewing       cross-motions            for   summary    judgment,     the

Court “must review each motion separately on its own merits to

determine whether either of the parties deserves judgment as a

matter of law.”      Rossignol v. Voorhaar, 316 F.3d 516, 523 (4th

Cir. 2003) (quoting Philip Morris Inc. v. Harshbarger, 122 F.3d
58, 62 n.4 (1st Cir. 1997)) (internal quotation marks omitted).

As the Court considers each individual motion, it must “resolve

all factual disputes and any competing, rational inferences in

the light most favorable to the party opposing that motion.”

Id. (quoting Wightman v. Springfield Terminal Ry. Co., 100 F.3d
228, 230 (1st Cir. 1996)) (internal quotation marks omitted).

                                       III.

     This   appeal        requires    us        to    interpret      the   Policy    to

determine its coverage in light of the Crew Condition.                        Brawner

                                            6
argues that the Policy is ambiguous and, as a result, should be

construed in favor of the insured.               We disagree.

       The parties agree that, in this diversity action, Maryland

law is controlling.           See Provident Bank of Md. v. Travelers

Prop.    Cas.    Corp.,   236 F.3d 138,   142    (4th    Cir.    2000).      In

Maryland, before a court may find a breach of a duty to defend

or indemnify, the insured must first establish that the claim is

potentially covered under the insurance contract.                         See Aetna

Cas. & Sur. Co. v. Cochran, 651 A.2d 859, 862 (Md. 1995).                          We

construe an insurance contract by examining its terms.                            Pac.

Indem. Co. v. Interstate Fire & Cas. Co., 488 A.2d 486, 488 (Md.

1985).      To    determine     the      parties’     intent,    we    construe    the

insurance contract as a whole and afford each word its ordinary

meaning.    Id.

       A word’s ordinary meaning is determined “by what meaning a

reasonably prudent layperson would attach to the term” and may

be deduced by consulting dictionaries.                 See id.    If a reasonably

prudent    layperson      would    attach      only    one     meaning,   then     the

contract is unambiguous, and we may construe it as a matter of

law.      Id. at 489.         If a reasonably prudent layperson could

attach more than one meaning, then the language is ambiguous,

and we may consider extrinsic evidence to resolve the ambiguity.

Id.

                                           7
       Here, we have no hesitation in concluding that the Policy

is   unambiguous       because    a     reasonably    prudent      layperson         would

construe it to have only one meaning — that the Policy covered

only the crew members listed in the Crew Condition.                            While the

Policy covered bodily injury and medical expenses, it specified

that such coverage was “[s]ubject to all exclusions and other

terms of this Policy.”            J.A. 140.         The Crew Condition was one

such “term.”         Not only was the Crew Condition “attached to and

made part of” the Policy, J.A. 143, but also, under Maryland

law, “the main insurance policy and an endorsement constitute a

single    insurance     contract,       and    an   effort   should       be    made    to

construe them harmoniously,” Prince George’s Cty. v. Local Gov’t

Ins. Trust, 879 A.2d 81, 88 (Md. 2005).                      The Crew Condition

therefore modified the Policy’s coverage for bodily injury and

medical expenses.

       To resolve the central issue before us, then, we examine

whether the Crew Condition modified the Policy to require crew

members   to    be    named.      We     conclude    that    it    did.        The    Crew

Condition provided that the listed individuals were “the named

crew    members      covered    under    this   policy.”          J.A.    143.        This

language plainly established that the Policy covered only those

named    crew   members.         Merriam-Webster      defines      “cover”       in    the

insurance       context    as      “afford[ing]       protection          against       or

                                           8
compensation       for.”              Cover,     Merriam-Webster            Dictionary,

http://www.merriam-webster.com/dictionary/cover                          (last        visited

Nov.     13,    2015).          Similarly,       Oxford       defines       “cover”         as

“protect[ing] against a liability, loss, or accident involving

financial        consequences.”                Cover,        Oxford       Dictionaries,

http://www.oxforddictionaries.com/us/definition/american_english

/cover (last visited Nov. 13, 2015).

       Giving     “cover”       its    ordinary       meaning       based        on     these

definitions,      we     determine     that     the     Policy     protected          Brawner

against liability for injuries to the crew members named in the

Crew Condition.          It follows that a reasonably prudent layperson

would construe the Crew Condition as having identified the crew

members covered by the Policy and that, because Kalandras was

not one of the crew members identified, the Policy did not cover

liability arising from his injuries.

       Brawner argues that a latent ambiguity lurks in the Policy

insofar    as    the     Crew   Condition       can     be   read     alongside        other

provisions of the Policy containing different language.                                    For

example, a provision of the Policy provided that Northern would

indemnify      Brawner    for    the    medical       expenses      of    “any    person,”

J.A.   140,     which,    arguably,      could    include      “any      member       of   the

crew.”    According to Brawner, other policy language is similarly

confounding:      the    Policy’s      bodily    injury      and    medical       expenses

                                           9
provisions,      for    example,       were     not   limited    to    crew    members,

whereas    the    provisions       for    burial      and    repatriation     expenses

were.      In    an    analogous       vein,    moreover,      the    special    policy

conditions       relating    to    navigation          and   passengers       expressly

stated that “there is no coverage under this policy” if Brawner

failed to comply with their terms, as did a separate provision

creating    a    general    condition          for    seaworthiness.       J.A.    143.

Thus, to construe the Crew Condition to limit coverage, as a

matter of law, only to the named crew members, Brawner argues,

would effectively render the language in those other provisions

superfluous.      We find this contention wholly unpersuasive.

     The mere fact that the Crew Condition contained no limiting

language or explicit disclaimers found elsewhere in the Policy

affords    us    no    warrant    to     construct      an   ambiguity    from    their

absence.        Our task is to construe the language of the Crew

Condition in accordance with the plain meaning evident as the

parties agreed to it, not to go in search of language in other

provisions of the Policy describing other coverages and other

risks.

     To be sure, the Policy provided for personal injury and

medical expenses coverage for “any person,” obviously a term

more expansive than “named crew member[s].”                     But this difference

in language does not aid Brawner because, under Maryland law, an

                                           10
endorsement controls, rather than the main policy, where the two

provisions conflict.              Local Gov’t Ins. Trust, 879 A.2d at 88.

As   the   Crew       Condition,     set      forth      in   an    endorsement    to    the

Policy, expressly limited coverage to “named crew members,” we

must read the Policy’s coverage as limited in the same way.

Under this reading, the Policy would still provide coverage for

“any person” injured on an insured vessel, but to the extent the

injured party is a crew member, the Crew Condition required the

crew member to be named.

      Our construction of the Policy is entirely harmonious with

the language in the conditions for navigation, passengers, and

seaworthiness.           The language in those conditions signals that

coverage would have been denied entirely if the conditions were

not met.         If the Crew Condition was not satisfied, however,

coverage        would    have    only    been      denied     for    any   unnamed      crew

member.         For     example,    a    single       occurrence      could     result   in

injuries to both a named crew member and an unnamed crew member.

In that instance, Brawner would only be denied coverage for the

unnamed crew member.

      Finally,         Brawner     argues     that     the    Crew    Condition       served

mainly     to    cap    the     number   of    crew      members     allowed    aboard    an

insured     vessel.           Brawner      relies        on   language     in   the     Crew

Condition,       and     similar    language        in    the      crew   warranty,     that

                                              11
stated that “there shall not be more than two (2) crew members

aboard the insured vessel at any one time.”    J.A. 143, 154.   If

an accident occurred with more than two crew members aboard,

then the Policy only covered “the proportion that the stated

number of crew bears to the number on board at the time of the

accident.”   Id.   Brawner has not shown, however, how a two-crew-

member limitation conflicts with the explicit requirement that

the two crew members be named in the Policy.

     Accordingly, we hold that the Policy unambiguously required

crew members to be named in the Crew Condition for coverage to

apply, and Northern is entitled to judgment as to the Kalandras

claim because he was not a named crew member at the time he

suffered his injury. *

                                IV.

     For the reasons set forth, the judgment of the district

court is

                                                         AFFIRMED.

     * Having concluded that the Crew Condition is unambiguous
and that Northern is entitled to judgment as a matter of law, we
need not examine the district court’s alternative ruling that,
even if the Policy were deemed ambiguous in some relevant
respect, undisputed facts based on extrinsic evidence would
yield the same result.

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