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New Jersey Manufacturers Insurance Co. v. Hearth & Home Technologies

June 25, 2008

NEW JERSEY MANUFACTURERS INSURANCE COMPANY A/S/O DOUGLAS AND MAUREEN MERRITT, PLAINTIFFS,
v.
HEARTH & HOME TECHNOLOGIES, INC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Judge Caputo

MEMORANDUM

Presently before the Court are five (5) motions for summary judgment, filed by Defendants (1) CM Mechanical (Doc. 115), (2) Thiessen Plumbing and Heating (Doc. 118), (3) Hearth & Home Technologies, Inc., (Doc. 122), (4) Delfino Insulation Company, Inc. (Doc. 132), and (5) a joint motion by Regent Homes, Inc, Delfino Insulation Company, Inc., Hearth and Home Technologies, Inc., Thiessen Plumbing and Heating, and Combined Energy Services, Inc. (Doc. 124). Because Plaintiff has not opposed the motions for summary judgment of Hearth & Home, Delfino, or Thiessen and argues only that questions of material fact exist regarding the other Defendants; because Plaintiff bears some responsibility for the spoilation of evidence but did not act in bad faith; because Defendants are somewhat prejudiced by the spoilation of evidence; and because a question of material fact exists regarding the claim against CM Mechanical, these motions will be granted in part and denied in part. The Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 1332 and 1441.

BACKGROUND

I. Parties and Procedural Background

Plaintiff New Jersey Manufacturers Insurance Company ("N.J.M.") brings this action as subrogee of Douglas and Maureen Merritt ("the Merritts"). (Defs.' Joint Mot. for Summ. J., Doc. 124; Pl.'s Response to Defs.' Statement of Material Facts, Doc. 139 [hereinafter "Docs. 124 & 139"] ¶ 1.) This action arises out of a fire that occurred at the Merritts' home on November 27, 2005, approximately three (3) months after they took possession of the home. (Id. ¶ 2; Def. CM's Statement of Material Facts, Doc. 117 & Pl.'s Response to CM's Statement of Material Facts, Doc. 137, [hereinafter "Docs. 117 & 137"] ¶ 16.) Defendant Regent Homes, Inc. ("Regent") was the general contractor of the Merritts' newly constructed home, which contained a gas-fueled fireplace manufactured by Defendant Hearth & Home Technologies, Inc. ("H&H") and installed by Regent's contractor Defendant Delfino Insulation Company, Inc. ("Delfino"). (Docs. 124 & 139 ¶¶ 4-6.) Defendant CM Mechanical ("CM") was responsible for the installation of the gas supply throughout the Merritt residence, which was completed before August 2, 2005. (Docs. 117 & 137 ¶ 9.) Defendant Combined Energy Services Inc. ("CES") and Plaintiff agree that CES supplied propane gas to the Merritts' home and performed a leak test of the home's propane gas system. (Docs. 124 & 139 ¶ 7.) CM and Plaintiff agree that on August 4, 2005, the day after the excavation contractor, Del's Diggin, delivered and set the home's propane tank, CES's serviceman, Christopher Roberts, performed a final hookup and leak test of the propane gas system. (Docs. 117 & 137 ¶¶ 10-11.) On August 4, 2005, Mr. Roberts disconnected the fireplace and capped the line using a brass cap. (Id. ¶ 13.) A final inspection was performed August 11, 2005, resulting in the issuance of a Certificate of Occupancy by Dingman Township. (Id. ¶ 15.)

Additionally, Plaintiff's Second Amended Complaint (Doc. 77) alleges that Defendant ThiessenPlumbing and Heating ("Thiessen") supplied, installed, and connected gas pipes to gas fixtures, including the fireplace, and was responsible for installing a manifold with "homeruns" to each gas fixture, under contract with Regent, but Thiessen denies that it installed or connected any gas pipes to any fixtures, including the fireplace, and states that at no time did it install a manifold with "home runs" to any gas fixtures. (Thiessen's Statement of Material Facts, Doc. 120 ¶¶ 4-5.)

After Plaintiff N.J.M. brought this action in the Court of Common Pleas of Pike County, Pennsylvania, against H&H, Delfino, and Regent, H&H removed the case to this Court. (See Compl., Doc. 1-3; Doc. 1.) The Defendants filed various cross claims, and Delfino brought Theissen, CM, and CES into the case as third-party defendants. (See Docs. 17, 59, 60.) Plaintiff was twice granted leave to amend its complaint to add claims against these Defendants. (Docs. 25, 75.)

Plaintiff's Second Amended Complaint (Doc. 77) brings claims of Negligence (Count I), Strict Liability (Count II), and Breach of Warranty (Count III) against H&H; claims of Negligence (Count IV) and Breach of Warranty (Count V) against Delfino; claims of Negligence (Count VI), Breach of Contract (Count VII), and Breach of Warranty (Count VIII) against Regent; and claims of Negligence against Thiessen (Count IX), CM (Count X), and CES (Count XI). All Defendants except Regent filed answers to the Second Amended Complaint. (See Docs. 79, 82, 84, 89, 92.)

Defendant Delfino filed cross claims against all other Defendants (Doc. 79) and all Defendants except Regent filed answers to these cross claims (see Docs. 80, 83, 91, 95, 102). H&H filed cross claims against all other Defendants (Doc. 82) and all Defendants except Regent and CES filed answers thereto (see Docs. 85, 87, 104). Thiessen filed cross claims against all other Defendants (Doc. 84) and all Defendants except Regent filed answers thereto (see Docs. 86, 88, 96, 103). CM filed cross claims against all other Defendants (Doc. 89) and all Defendants except Regent filed answers (see Docs. 90, 91, 93, 98). And, CES filed cross claims against all other Defendants (Doc. 92), and all Defendants except Regent filed answers (see Docs. 94, 99, 101, 105).

II. Motions for Summary Judgment

Thiessen moves for summary judgment in its favor, arguing that it did not perform any work with regard to the fireplace. (Doc. 118.) H&H moves for summary judgment in its favor, arguing that there is no evidence that the fireplace itself had anything to do with the cause of the fire. (Doc. 122.) And Delfino moves for summary judgment arguing that the undisputed evidence establishes that Delfino did not install or connect the propane supply line that Plaintiff argues caused the fire. (Doc. 132.) Additionally, CM moves for summary judgment in its favor on the basis of spoilation of evidence and alternatively, on the basis that the record lacks evidence of CM's liability. (Doc. 115.) And finally, Defendants Regent, Delfino, H&H, Thiessen, and CES filed a joint motion for summary judgment, also based on spoilation of evidence. (Doc. 124).

The undisputed facts related to these motions are as follows: Plaintiff alleges that the fire originated in an area around the fireplace. (Docs. 124 & 139 ¶ 10.) Edward Good investigated the fire on behalf of Plaintiff and generated a report which is included as Exhibit A to Doc. 124. (Id. ¶¶ 11-12.) During Good's December 1, 2005 inspection, N.J.M.'s investigators had access to all of the fireplace's components, including the propane supply pipes which N.J.M. now maintains caused the fire. (Id. ¶ 13, 26.) Mr. Good testified that he instructed the contractor that N.J.M. retained to repair the home as follows: "don't let the fireplace go in the dumpster." (Id. ¶ 15.) Mr. Good conceded that he did not have discussions with the contractor about preserving the propane supply pipes or connections leading to the fireplace, and "assumed that [the contractor] would [not] have disconnected any piping that was already threaded into the fireplace, that would stay with the fireplace." (Id. ¶¶ 15-16.) Mr. Good admitted that no chain of custody existed with regard to the fireplace or any of the piping and component parts. (Id. ¶ 17.)

On April 4, 2006, Plaintiff N.J.M. arranged for its experts, Glen Frederick of National Forensic Consultants, Inc., and Louis Gahagan of Patrick J. McGinley Associates, Inc., to inspect the fireplace and its component parts, as they then existed, in the Merritts' garage. (Id. ¶ 18.) Glen Frederick notes that the supply piping and component parts, which N.J.M. claims were defective, had not been preserved for inspection or testing; he notes that when the retained supply piping was laid out in its installed configuration, "it was discovered that numerous pipe fittings, couplings, and nipples were not present" and concludes that "many supplied piping components were missing with no explanation as to their disposition." (Id. ¶ 19.) Mr. Frederick also states that "a contractor was retained to remove the mechanical components and gas piping associated with the fireplace and the hole in the east wall was sealed. All removed components and pipe were to be stored on site." (Id. ¶ 20.) Mark Fuller, Corporate Designee for H&H, but not an expert witness, also testified that he recalled noting that portions of the gas line piping, the gas valve, flex line, and connector to the control valve were missing. (Id. ¶¶ 28-29.)

Douglas Merritt testified that he saw every allegedly defective component part numerous times after the fire. (Id. ¶¶ 32-33.) And it is undisputed that the propane supply piping and component parts which N.J.M. maintains were defective or defectively installed disappeared while N.J.M. had custody or control of that evidence. (Id. ¶ 35.) But even N.J.M.'s experts never had the opportunity to examine these component parts before they came to be missing. (Id. ¶ 37.)

These motions are fully briefed and ripe for disposition.

LEGAL STANDARD

Summary judgment is appropriate if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." FED. R. CIV. P. 56(c). A fact is material if proof of its existence or nonexistence might affect the outcome of the suit under the applicable substantive law. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

Where there is no material fact in dispute, the moving party need only establish that it is entitled to judgment as a matter of law. Where, however, there is a disputed issue of material fact, summary judgment is appropriate only if the factual dispute is not a genuine one. See id. at 248. An issue of material fact is genuine if "a reasonable jury could return a verdict for the nonmoving party." Id.

Where there is a material fact in dispute, the moving party has the initial burden of proving that: (1) there is no genuine issue of material fact; and (2) the moving party is entitled to judgment as a matter of law. See CHARLES ALAN WRIGHT & ARTHURR. MILLER, FEDERALPRACTICE AND PROCEDURE: CIVIL 2D § 2727 (2d ed. 1983). The moving party may present its own evidence or, where the nonmoving party has the burden of proof, simply point out to the Court that "the nonmoving party has failed to make a sufficient showing of an essential element of her case." Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).

All doubts as to the existence of a genuine issue of material fact must be resolved against the moving party, and the entire record must be examined in the light most favorable to the nonmoving party. See White v. Westinghouse Elec. Co., 862 F.2d 56, 59 (3d Cir. 1988). Once the moving party has satisfied its initial burden, the burden shifts to the nonmoving party to either present affirmative evidence supporting its version of the material facts or to refute the moving party's contention that the facts entitle it to judgment as a matter of law. See Anderson, 477 U.S. at 256-57.

The Court need not accept mere conclusory allegations, whether they are made in the complaint or a sworn statement. Lujan v. Nat'l Wildlife Fed'n, 497 U.S. 871, 888 (1990). In deciding a motion for summary judgment, "the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Anderson, 477 U.S. at 249.

DISCUSSION

I. H&H, Delfino, and Thiessen's Motions

Plaintiff did not file briefs in opposition to the individual motions for summary judgment filed by Defendants Thiessen (Doc. 118), H&H (Doc. 122), and Delfino (Doc. 132). Plaintiff filed only its "Omnibus Brief in Support of its Opposition to the Motions for Summary Judgment Filed by CM Mechanical and Jointly by Defendants, Regent Homes, Inc., Delfino Insulation, Inc., Hearth & Home Technologies, Inc., Thiessen Plumbing & Heating, and Combined Energy Services, Inc." (Doc. 141). Within this brief, which addresses the motions based on the spoilation of evidence doctrine, Plaintiff also includes some arguments regarding the existence of genuine issues of material fact, but even to the extent that Plaintiff's Omnibus Brief may be taken to oppose the individual substantive motions for summary judgment, it argues only that "[t]here exist genuine issues of fact th[at] preclude the granting of summary judgmentin favor of CM Mechanical, Regent Homes, Inc. and Combined Energy Services, Inc. in this matter." (Doc. 141, at 16-18.) At no point does Plaintiff argue that questions of material fact exist that would preclude granting summary judgment in favor of H&H, Delfino, or Thiessen.

Indeed, after discovery, Plaintiff's theory of the cause of the fire is that "a gas leak was caused by improper installation and a failure to inspect this installation." (Doc. 141, at 8.) Specifically, Plaintiff's theory is that the gas leak resulted from improper installation of the propane supply pipe, rather than from any defect in the fireplace itself. This theory is based on the opinions of Plaintiff's experts: Glen Frederick opines that the "operation of the propane gas burner installed in the gas fireplace ignited errant propane gas from a piping defect resulting in the fire damage," and that "it is reasonable to believe that the defect to the propane supply pipe was a result of installation." (Docs. 124 & 139 ¶ 23.) Likewise, Plaintiff's other expert, Louis Gahagan, opines that the fire "was caused by a propane fuel leak below and to the left side of the fireplace ... and was caused by the improper installation of the piping to the unit." (Id. ¶ 24.) Plaintiff has not put forth evidence of alternate theories of the cause of the fire.

Notably, Plaintiff's allegations against H&H and Delfino do not relate to the connecting pipes whose improper installation Plaintiff now contends caused the fire but rather to the design and manufacture (H&H) and supply and installation (Delfino) of the gas-fueled fireplace itself. Indeed, in arguing that each of the Defendants was not prejudiced by the loss of the gas pipes and other materials previously connected to the fireplace, Plaintiff states that while its cause of action against H&H was based in products liability, Plaintiff concluded after discovery that "no evidence has been presented that indicates that a product defect nor manufacturing design was a cause of the fire." (Id. at 9.) Regarding Delfino, Plaintiff points out that Delfino's charges to its general contractor, Regent, "did not include the actual hook-up of the fireplace to the gas piping"and that while Delfino admitted to having performed the conversion of the fireplace from natural gas to propane, it also admitted "that it did not perform any connections from the black gas piping to the fireplace." (Id. at 14-15.) Moreover, Delfino points to evidence thatit installed the fireplace on or before May 11, 2005, before the gas lines or hookups that allegedly were the source of the fire had been installed. (See Dep. of Robert E. Tauss, former Vice President, Regent Homes, Jan. 11, 2008, Delfino's Ex. C, Doc. 129-2, at 45:9-25.)

Finally, with regard to Thiessen, Plaintiff states, again in the context of arguing that Thiessen was not prejudiced by the loss of evidence, that while "[t]his defendant was originally thought to have been responsible for laying down the gas piping" the evidence in record shows that it actually performed other work and "[n]o other party has produced any evidence that may have pointed to this defendant as being responsible for the connection of the fireplace to the gas line." (Doc. 141, at 14.)

Because neither Plaintiff nor any of the Defendants with cross claims against H&H, Delfino, and Thissen filed opposition briefs to these parties' individual motions for summary judgment, because Plaintiff concedes in its omnibus opposition brief that there is no evidence linking these Defendants to the piping it alleges was the source of the fire, and because its arguments that the existence of genuine issues of material fact preclude granting summary judgment are specifically addressed only to Defendants CM, Regent, and CES, I will grant the motions for summary judgment of Defendants H&H (Doc. 122), Delfino (Doc. 132), and Thiessen (Doc. 118). Accordingly, judgment will be granted in favor of H&H on Counts I, II, and III of Plaintiff's Second Amended Complaint (Doc. 77), as well as on all cross claims brought against H&H by the other Defendants. Judgment will be granted in favor of Delfino on Counts IV and V of Plaintiff's Second Amended Complaint ...


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