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151 First Side Associates, L.P. v. Peerless Insurance Co.

March 11, 2010

151 FIRST SIDE ASSOCIATES, L.P., AND ZAMBRANO CORPORATION, PLAINTIFFS,
v.
PEERLESS INSURANCE COMPANY, A CORPORATION, DEFENDANT.



The opinion of the court was delivered by: David Stewart Cercone United States District Judge

Electronic Filing

MEMORANDUM OPINION

I. INTRODUCTION

Plaintiff, 151 First Side Associates, L.P. ("First Side") filed a filed a complaint against Defendant, Peerless Insurance Company ("Peerless"), alleging claims of: (1) breach of contract; and, (2) bad faith on the part of an insurer pursuant to 42 PA. CONS. STAT. ANN. § 8371. Plaintiff, Zambrano Corporation ("Zambrano"), was permitted to intervene as plaintiff and filed a complaint against Peerless, also alleging breach of contract and bad faith. Peerless filed a motion for summary judgment, First Side and Zambrano (collectively "Plaintiffs") have filed a joint response and the motion is now before the Court.

Peerless filed a Concise Statement of Material Facts ("Peerless CSMF") in support of its motion for summary judgment. The Local Rules of the United States District Court for the Western District of Pennsylvania require that Plaintiffs file a responsive "concise statement which responds to each numbered paragraph in the moving party's Concise Statement of Material Facts by . . . admitting or denying whether each fact contained [therein] . . . is undisputed and/or material . . . setting forth the basis for the denial if any fact . . . is not admitted in its entirety (as to whether it is undisputed or material), with appropriate reference to the record . . ." See LR 56.1(C)(1)(a) & (b). Contrary to Rule 56.1, Plaintiffs instead filed a "Joint Concise Counter-Statement of Facts"("Pl. JCSF") which neither admits nor denies facts set forth in Peerless factual statement. Material facts set forth in a moving party's concise statement of material facts will be deemed admitted for the purpose of deciding the motion for summary judgment "unless specifically denied or otherwise controverted by a separate concise statement of the opposing party." See LR 56.1(E). Though it is not for the Court to sort through the entire record to determine whether stated facts are disputed, the Court will use its best efforts to reconcile the statements filed by the parties.

II. STATEMENT OF THE CASE

Peerless issued a Builder's Risk Insurance Policy to First Side for the construction residential condominiums in Pittsburgh, Pennsylvania (the "Project"). Peerless CSMF ¶ 1; Pl. JCSF ¶ 10. The policy was written to cover the specific construction project located at 151 Fort Pitt Boulevard in Pittsburgh. Peerless' CSMF ¶ 2. Zambrano, the general contractor on the Project and a partner in First Side, was included as an additional insured on the policy. Peerless' CSMF ¶ 3; Pl. JCSF ¶ 6.

On or about May 5, 2006, Zambrano entered into a subcontract with High Concrete Innovations ("High Concrete") to fabricate and erect precast concrete panels and balcony slabs for the project. Peerless' CSMF ¶ 4; Pl. JCSF ¶ 4. On or about October 25, 2006, a fire destroyed High Concrete's manufacturing facility in Lebanon, Pennsylvania. Peerless' CSMF ¶ 5; Pl. JCSF ¶ 13. The precast concrete panels awaiting delivery on the subcontract were destroyed, and High Concrete's manufacturing facility in Lebanon was unable to manufacture any more product for the project*fn1 . Peerless' CSMF ¶ 6; Pl. JCSF ¶ 15. High Concrete was not a named insured under the Builder's Risk policy. Peerless' CSMF ¶ 7.

First Side submitted a soft cost*fn2 claim under the policy in the amount of $10,593,093. Peerless' CSMF ¶ 11. Zambrano also submitted a claim to Peerless under the policy in the amount of $869,844.00 for extra expenses and overtime attributed to the loss of the fifty-five (55) concrete panels destroyed in the High Concrete fire. Peerless' CSMF ¶ 13. No claim was submitted to Peerless for the actual loss of the panels. Peerless' CSMF ¶ 12. Peerless denied the claims of both First Side and Zambrano. Peerless' CSMF ¶ 14..

III. LEGAL STANDARD FOR SUMMARY JUDGMENT

Pursuant to FED. R. CIV. P 56(c), summary judgment shall be granted when there are no genuine issues of material fact in dispute and the movant is entitled to judgment as a matter of law. To support denial of summary judgment, an issue of fact in dispute must be both genuine and material, i.e., one upon which a reasonable fact finder could base a verdict for the non-moving party and one which is essential to establishing the claim. Anderson v. Liberty Lobby, 477 U.S. 242, 248 (1986). When considering a motion for summary judgment, the court is not permitted to weigh the evidence or to make credibility determinations, but is limited to deciding whether there are any disputed issues and, if there are, whether they are both genuine and material. Id. The court's consideration of the facts must be in the light most favorable to the party opposing summary judgment and all reasonable inferences from the facts must be drawn in favor of that party as well. Whiteland Woods, L.P. v. Township of West Whiteland, 193 F.3d 177, 180 (3d Cir. 1999), Tigg Corp. v. Dow Corning Corp., 822 F.2d 358, 361 (3d Cir. 1987).

When the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). In the language of the Rule, the nonmoving party must come forward with "specific facts showing that there is a genuine issue for trial." FED. R. CIV. P 56(e). Further, the nonmoving party cannot rely on unsupported assertions, conclusory allegations, or mere suspicions in attempting to survive a summary judgment motion. Williams v. Borough of W. Chester, 891 F.2d 458, 460 (3d Cir.1989) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986)). The non-moving party must respond "by pointing to sufficient cognizable evidence to create material issues of fact concerning every element as to which the non-moving party will bear the burden of proof at trial." Simpson v. Kay Jewelers, Div. Of Sterling, Inc., 142 F. 3d 639, 643 n. 3 (3d Cir. 1998), quoting Fuentes v. Perskie, 32 F.3d 759, 762 n.1 (3d Cir. 1994). Moreover, the non-moving party cannot defeat a well supported motion for summary judgment by simply reasserting unsupported factual allegations contained in his pleadings. Williams v. Borough of West Chester, 891 F.2d 458, 460 (3d Cir. 1989).

IV. DISCUSSION

First Side and Zambrano contend that coverage exists under the policy for the losses claimed, Peerless breached of the contract for insurance, and acted in bad faith. Plaintiffs allege that the loss of the concrete panels at the High Concrete facility caused soft cost and extra expenses covered under the Soft Cost, Extra Expense and Rental Income Endorsement of the policy. Federal courts sitting in diversity must apply the substantive law of the forum state. Erie R.R. Co. v. ...


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