Court Opinion

ID: 2790569
Source: CourtListenerOpinion
Date Created: 2015-04-01 15:00:36.725471+00
Date Added: 2024-06-11T11:28:55.123778
License: Public Domain

14-2289-cv
     Safeco Insurance Co. of America v. Lawrence Brunoli, Inc., Lawrence Brunoli, Jr.

                                       UNITED STATES COURT OF APPEALS
                                           FOR THE SECOND CIRCUIT

                                                         SUMMARY ORDER

     Rulings by summary order do not have precedential effect. Citation to a summary
     order filed on or after January 1, 2007, is permitted and is governed by Federal
     Rule of Appellate Procedure 32.1 and this court’s Local Rule 32.1.1. When citing a
     summary order in a document filed with this court, a party must cite either the
     Federal Appendix or an electronic database (with the notation “summary order”). A
     party citing a summary order must serve a copy of it on any party not represented
     by counsel.

 1           At a stated term of the United States Court of Appeals for the Second Circuit, held
 2   at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New
 3   York, on the 1st day of April, two thousand fifteen.
 4
 5   PRESENT:
 6
 7            CHESTER J. STRAUB,
 8            ROBERT D. SACK,
 9            CHRISTOPHER F. DRONEY,
10                               Circuit Judges,
11   - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
12
13   SAFECO INSURANCE COMPANY OF AMERICA,
14
15                                   Plaintiff-Appellee,
16
17                        v.                                                              No. 14-2289-cv
18
19   LAWRENCE BRUNOLI, INC., LAWRENCE BRUNOLI, JR.,
20
21                                   Defendants-Appellants.
22
23   - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
24
25   FOR DEFENDANTS-APPELLANTS: Margaret Fogerty Rattigan, Murphy, Laudati,
26                              Kiel, Buttler & Rattigan, LLC, Farmington, CT;
27                              P. Jo Anne Burgh, Glastonbury, CT.
 1
 2   FOR PLAINTIFF-APPELLEE:                  Bradford R. Carver, Jonathan C. Burwood,
 3                                            Hinshaw & Culbertson LLP, Boston, MA.
 4
 5   Appeal from a judgment of the United States District Court for the District of
 6   Connecticut (Shea, J.).
 7
 8   UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND
 9   DECREED that the judgment of the District Court is AFFIRMED IN PART and
10   VACATED IN PART and the case is REMANDED.
11
12          Lawrence Brunoli, Inc. and Lawrence Brunoli, Jr. (collectively, “LBI”),
13   Defendants-Appellants, appeal from the district court’s grant of summary judgment in
14   favor of Plaintiff-Appellee Safeco Insurance Company of America (“Safeco”), awarding
15   Safeco $4,687,147.84 in collateral security. On appeal, LBI contends that it is not
16   required to post collateral where Safeco has not yet suffered any actual loss on a claim or
17   where Safeco faces allegedly meritless claims. We assume the parties’ familiarity with
18   the underlying facts, procedural history, and issues on appeal.

19          We “review[] a district court’s grant of summary judgment de novo, viewing the
20   facts in the light most favorable to the non-moving party and resolving all factual
21   ambiguities in its favor.” Singh v. City of New York, 524 F.3d 361, 366 (2d Cir. 2008).
22   Summary judgment is appropriate “when the contractual language on which the moving
23   party’s case rests is found to be wholly unambiguous and to convey a definite meaning.”
24   Topps Co. v. Cadbury Stani S.A.I.C., 526 F.3d 63, 68 (2d Cir. 2008).
25
26           Under Connecticut law, “[i]n situations where the parties have their agreement in
27   writing, their intention is to be determined from its language and not on the basis of any
28   intention either may have secretly entertained.” Sturman v. Socha, 463 A.2d 527, 532
29   (Conn. 1983) (internal quotation marks omitted).
30                  A contract is unambiguous when its language is clear and
31                  conveys a definite and precise intent. . . .The court will not
32                  torture words to impart ambiguity where ordinary meaning
33                  leaves no room for ambiguity. . . . Moreover, the mere fact
34                  that the parties advance different interpretations of the
35                  language in question does not necessitate a conclusion that
36                  the language is ambiguous.
37   Cruz v. Visual Perceptions, LLC, 84 A.3d 828, 834 (Conn. 2014)
38   (alterations in original) (internal quotation marks omitted).

                                                 2
 1          We conclude that the plain language of the General Agreement of Indemnity for
 2   Contractors (“GAI”) supports a broad interpretation of the collateral security provision.
 3   Under the terms of the parties’ agreement, collateral security is not limited to actual
 4   losses: “[LBI] will, if requested by [Safeco], either deposit collateral with [Safeco],
 5   acceptable to [Safeco], sufficient to cover all exposure under such bond or bonds, or
 6   make provisions acceptable to [Safeco] for the funding of the bonded obligation(s).” App.
 7   12, General Provisions ¶ 5. Moreover, the GAI’s broad language indicating that
 8   collateral security should “cover all exposure” should also be read in light of another
 9   provision requiring that the agreement “be liberally construed so as to protect, exonerate
10   and indemnify [Safeco].” Id., General Provisions ¶ 11. We have previously interpreted
11   the same contractual language to unambiguously require a contractor to provide a surety
12   with collateral to cover potential losses and expenses. See Safeco Ins. Co. of Am. v.
13   Hirani/MES, JV, 480 F. App’x 606, 608 (2d Cir. 2012) (summary order) (“Under the
14   plain, unambiguous language of the contracts, Defendants were required to provide
15   collateral security upon demand if Safeco became exposed to potential losses and
16   expenses under the surety bonds and, therefore, Safeco was entitled to partial summary
17   judgment as to its right to collateral security.”). The district court did not err in its
18   interpretation of the GAI.

19           At the time the district court decided the motion for summary judgment on
20   collateral security, two of the five underlying claims against Safeco had been resolved.
21   The district court’s judgment accordingly ordered that LBI provide collateral equal to the
22   amount of the remaining three claims. LBI did not subsequently argue in its submissions
23   opposing indemnification and requesting reconsideration of the value of the collateral
24   security that other claims had been resolved. Therefore, the collateral security judgment
25   properly included the amount claimed in the three remaining bond claims against LBI
26   and Safeco. Safeco acknowledges that all of the claims underlying this action, with the
27   exception of Suntech of Connecticut’s claim for $601,304.54, were resolved after the
28   district court ordered LBI to post $4,687,147.84 in collateral. It accordingly requests that
29   this Court either modify the district court’s judgment to reflect this change in
30   circumstances or vacate the district court’s judgment with respect to the amount of
31   collateral security it ordered LBI to pay. The district court will determine what claims
32   are still pending and award collateral security in the first instance. Cf. Korn v. Franchard
33   Corp., 456 F.2d 1206, 1208 (2d Cir. 1972) (“[W]here circumstances have changed
34   between the ruling below and the decision on appeal, the preferred posture is to remand
35   to give the district court an opportunity to pass on the changed circumstances.”).

36            Thus, we AFFIRM IN PART AND VACATE IN PART. We AFFIRM the
37   district court’s judgment to the extent the court ordered LBI to pay collateral security and
38   VACATE the district court’s judgment with respect to the amount of the collateral

                                                  3
1   security and REMAND to the district court to amend the judgment to recalculate the
2   amount of collateral security due to Safeco under the GAI in light of intervening
3   settlements.

4                                        FOR THE COURT:
5                                        Catherine O’Hagan Wolfe, Clerk of Court

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