Court Opinion

ID: 9960811
Source: CourtListenerOpinion
Date Created: 2024-04-17 14:00:52.322234+00
Date Added: 2024-06-11T08:19:54.404450
License: Public Domain

USCA11 Case: 23-11438    Document: 46-1     Date Filed: 04/17/2024   Page: 1 of 9

                                                  [DO NOT PUBLISH]
                                   In the
                United States Court of Appeals
                        For the Eleventh Circuit

                          ____________________

                                No. 23-11438
                          Non-Argument Calendar
                          ____________________

       MASSACHUSETTS BAY INSURANCE COMPANY,
                                                     Plaintiﬀ-Appellant,
       versus
       D.C.J.D. CORPORATION,
       d.b.a. Markey Insurance Group,
       MICHAEL BRANCH HENDERSON,

                                                  Defendants-Appellees.

                          ____________________

                 Appeal from the United States District Court
                    for the Northern District of Georgia
USCA11 Case: 23-11438     Document: 46-1     Date Filed: 04/17/2024    Page: 2 of 9

       2                     Opinion of the Court                 23-11438

                     D.C. Docket No. 1:21-cv-01002-VMC
                          ____________________

       Before NEWSOM, ABUDU, and ANDERSON, Circuit Judges.
       PER CURIAM:
               This case arises out of a contract dispute between Massachu-
       setts Bay Insurance Company (“MBIC” or “Appellant”) and
       D.C.D.J. Corporation, d/b/a Markey Insurance Group (“Markey”)
       and Michael Branch Henderson (collectively “Appellees”). Markey
       had entered into an agency agreement with MBIC that allowed it
       to sell commercial insurance policies on MBIC’s behalf. Hender-
       son was one of Markey’s employees.
              MBIC alleged a breach of the agency agreement when Hen-
       derson did not promptly notify MBIC of an insurance claim, thus
       prompting MBIC’s federal lawsuit against Markey and Henderson.
       MBIC now appeals the district court’s grant of summary judgment
       in favor of Markey and Henderson. After a thorough review of the
       record and the parties’ briefs, we conclude that the district court
       properly granted summary judgment in Markey and Henderson’s
       favor because MBIC failed to show Markey and Henderson caused
       the claim-related damages MBIC incurred. We, therefore, affirm.
       I.    FACTUAL AND PROCEDURAL BACKGROUND
             In 2017, MBIC issued a businessowners insurance policy to
       Formosa Enterprise, LLC (“Formosa”). Among other things, this
       businessowner’s policy protected Formosa against lawsuits based
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       23-11438               Opinion of the Court                         3

       on bodily injury that occurred from October 31, 2017, through Oc-
       tober 31, 2018.
               The policy contained two relevant notice provisions. The
       first provided: “[Formosa] must see to it that [MBIC is] notified as
       soon as practicable of an ‘occurrence’ or an offense which may re-
       sult in a claim.” The second provided: “If a claim is made or ‘suit’
       is brought against any insured, you must . . . [n]otify [MBIC] as
       soon as practicable.” Related to the second provision, the policy
       also required that the insured send “us” copies of any “demands,
       notices, summonses or legal papers received in connection with the
       claim or ‘suit’[.]” The policy listed Markey as the registered insur-
       ance agent for the policy.
              On June 30, 2018, Larry Douglas—an individual visiting a
       business Formosa owned—tripped on an object that was out of
       place on the floor and sustained severe spinal injuries from the fall.
       Five months later, Douglas and his wife sued Formosa for injuries
       arising out of the fall. Douglas ultimately died by suicide allegedly
       as “a direct result of the pain” from the fall.
              Formosa did not notify MBIC of the accident or the lawsuit
       despite the policy’s requirement that MBIC be “notified as soon as
       practicable of an ‘occurrence’ or an offense which may result in a
       claim.” Instead, Formosa contacted Henderson, an insurance
       agent with Markey. According to Henderson, he advised Formosa
       to report the claim directly to MBIC, but Formosa contended that
       Henderson said he would “take care of it.” Regardless of what was
       said between Henderson and Formosa, Formosa never responded
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       4                      Opinion of the Court                 23-11438

       to the lawsuit. A default judgment was entered against Formosa as
       to liability on February 4, 2019, and Henderson ultimately notified
       MBIC of the default judgment on September 30, 2019. After MBIC
       learned of the default judgment, MBIC accepted a time-limited,
       policy limits demand to settle the lawsuit against Formosa for
       $1,000,000.
              MBIC subsequently filed suit against Markey and Hender-
       son. It alleged that Markey and Henderson breached an agency
       agreement between MBIC and Markey by not promptly informing
       MBIC of the Douglases’ lawsuit. MBIC also brought a negligence
       claim, stating that it should have been notified of the incident and
       lawsuit earlier.
               Prior to the dispositive motions deadline, MBIC disclosed an
       expert, Wade Vandiver, and filed his expert report. In his report,
       Vandiver concluded that, because MBIC was unable to properly
       investigate the Douglases’ personal injury claims, it was unable to
       properly defend Formosa by developing available, meritorious de-
       fenses that “could have significantly impacted the claim’s value.”
       He determined that the settlement value of the claims “was not a
       foregone conclusion because liability defenses existed at the time
       the Douglases filed suit,” and the delayed report of the suit after
       default judgment had been entered and Douglas ending his life re-
       sulted in MBIC suffering significant adverse consequences. He be-
       lieved defenses were available to Formosa that “could have re-
       sulted in a complete defense verdict, if not significantly reduced the
       liability,” had the claims been appropriately reported.
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       23-11438               Opinion of the Court                         5

               Markey and Henderson also disclosed two experts, Thomas
       B. Ahart and Louis G. Fey, Jr. Relevant here, Fey’s expert report
       explained that, regardless of liability, the full value of the Doug-
       lases’ claims was in excess of $5 million. Fey came to this conclu-
       sion based on the fact that Douglas, an elderly man, incurred at
       least $355,000 in medical expenses and had an income of over
       $900,000. Additionally, his wife had a sizable claim for loss of sup-
       port and consortium. All this, in conjunction with the fact that
       Douglas committed suicide by handgun while visiting his wife at
       the hospital, would have meant that the Douglases had “an ex-
       tremely high level of jury appeal, making policy limits a foregone
       conclusion, regardless of liability.” Thus, to him, this case “was a
       policy limits case regardless of liability,” and any “alleged late re-
       porting of the claim did not impact” the outcome.
              After discovery closed, Markey and Henderson filed sepa-
       rate motions for summary judgment, and MBIC filed a partial mo-
       tion for summary judgment. In its motion, MBIC argued that
       Markey and Henderson breached their contractual duty to
       promptly report the claim and the breach resulted in damages—
       the $1,000,000 paid to the Douglases—because MBIC was pre-
       vented from an opportunity to investigate Douglas’s claim due to
       the 15-month delay in notice. Notably, MBIC did not refer to Van-
       diver or his expert report anywhere in its summary judgment brief-
       ing, nor did he attach the expert report as an exhibit for the court’s
       consideration.
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       6                       Opinion of the Court                   23-11438

              Markey and Henderson argued, in relevant part, that MBIC
       failed to establish causation, i.e., that MBIC’s liability was based
       solely on Markey’s alleged wrongdoing. In support of their con-
       tention, Markey and Henderson relied on Fey’s expert testimony.
               The district court granted Markey and Henderson’s motions
       for summary judgment as to both the breach of contract and neg-
       ligence claims. It explained that, under Georgia law, both of
       MBIC’s claims required MBIC to demonstrate causation—i.e.,
       proof of damages caused by Markey and Henderson. It then ruled
       that MBIC failed to establish causation because, as Fey’s expert re-
       port explained, the Douglases’ claims had an extremely high level
       of jury appeal, making it almost certain that MBIC would tender its
       full policy limits on the case. It further determined that MBIC
       failed to “point to any expert evidence or testimony” to rebut the
       expert testimony that Markey and Henderson introduced showing
       that a finding of liability was almost certain in this case. The district
       court declined to presume damages because there was no evidence
       of bad faith on Markey and Henderson’s part. MBIC’s appeal fol-
       lowed.
       II.    STANDARD OF REVIEW
              “We review de novo a district court’s grant of summary judg-
       ment.” Walker v. Life Ins. Co. of N. Am., 59 F.4th 1176, 1185 (11th
       Cir. 2023). In doing so, we construe all evidence and reasonable
       inferences in the light most favorable to the non-moving party. Id.
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       23-11438               Opinion of the Court                          7

       III.   DISCUSSION
              On appeal, MBIC argues that the district court erred when
       it denied its partial motion for summary judgment because the lan-
       guage in the policy requiring notice of any incident or claim “as
       soon as practicable” was clearly violated. MBIC also contends that
       the district court gave improper weight to Fey’s expert report on
       the issue of damages, and it ignored evidence that created a genu-
       ine dispute of material fact on the issue of damages.
              To succeed on a breach of contract claim in Georgia, a plain-
       tiff must show “(1) breach and the (2) resultant damages (3) to the
       party who has the right to complain about the contract being bro-
       ken.” McAlister v. Clifton, 873 S.E.2d 178, 183 (Ga. 2022) (internal
       quotation marks omitted). Similarly, to prove negligence in Geor-
       gia, a plaintiff must demonstrate: (1) a legal duty to conform to a
       standard of conduct; (2) breach of this standard; (3) a causal con-
       nection between the breach and the injury; and (4) damages as a
       result of the beach. Heston v. Lilly, 546 S.E.2d 816, 818 (Ga. Ct. App.
       2001).
              As an initial matter, we need not address MBIC’s contention
       that the district court erred in denying its motion for summary
       judgment based on both the breach of the policy and a breach of
       duty. This is because, regardless of the existence of a breach, for
       MBIC to prevail on both claims, MBIC had to prove that the dam-
       ages it incurred were a direct result of Markey and Henderson’s
       failure to comply with the notice provision in the contract- a bur-
       den it did not meet.
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       8                      Opinion of the Court                 23-11438

              MBIC argues it met its burden of proof and that the district
       court “ignored” Vandiver’s expert report in which he opined that
       “defenses were available to Formosa that could have resulted in a
       complete defense verdict, if not significantly reduced the liability
       to Formosa.” This characterization, however, is inaccurate.
              As noted above, MBIC never relied upon Vandiver’s expert
       report in its summary judgment briefings. The district court can-
       not err by failing to consider evidence upon which MBIC never
       once cited below. See Blue Cross & Blue Shield of Al. v. Weitz, 913
       F.2d 1544, 1550 (11th Cir. 1990) (“Presenting . . . arguments in op-
       position to a motion for summary judgment is the responsibility of
       the non-moving party, not the court . . . .”). Therefore, MBIC can-
       not raise this argument. See Access Now, Inc. v. Sw. Airlines Co., 385
       F.3d 1324, 1331 (11th Cir. 2004) (“If we were to regularly address
       questions—particularly fact-bound issues—that districts court
       never had a chance to examine, we would not only waste our re-
       sources, but also deviate from the essential nature, purpose, and
       competence of an appellate court.”).
              Even if MBIC had cited to the expert report in its summary
       judgment pleadings, this argument still fails. This evidence demon-
       strates, at most, that Markey and Henderson might have caused
       MBIC damages. According to Vandiver, “regarding liability, de-
       fenses were available to Formosa that could have resulted in a com-
       plete defense verdict.” It was also his expert opinion that the de-
       layed notice “could have significantly impacted the claim’s value.”
       He did not claim the defenses would have resulted in a defense
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       23-11438                Opinion of the Court                          9

       verdict as to liability or that these defenses would have impacted
       the claim’s value, and “[s]peculation does not create a genuine issue
       of fact.” See Cordoba v. Dillard’s, Inc., 419 F.3d 1169, 1181 (11th Cir.
       2005) (emphasis omitted). Therefore, the district court did not err
       in granting Markey and Henderson’s motion for summary judg-
       ment.
        IV.   CONCLUSION
               For the foregoing reasons, we AFFIRM the judgment of the
       district court.