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Fred Dameshek and Johnette Dameshek v. Encompass Insurance Company of America

June 25, 2012


The opinion of the court was delivered by: (Chief Judge Kane)


Before the Court are Defendant/Third Party Plaintiff Encompass Insurance Company of America's motion for summary judgment (Doc. No. 26) and Third Party Defendant Alex R. Szeles, Inc.'s motion for summary judgment (Doc. No. 30). For the reasons that follow, the Court will grant Defendant Encompass's motion and deny Third Party Defendant Szeles's motion as moot.


Plaintiffs Fred Dameshek and Johnette Dameshek initiated this action by filing a complaint on January 5, 2011, regarding their homeowner's insurance policy. (Doc. No. 1.) On April 7, 2009, a fire occurred at Plaintiffs' residence. (Doc. No. 27 ¶ 1.) At the time, Plaintiffs' home was insured by an insurance policy issued by Defendant. (Id. ¶ 2.) The policy provided coverage for Additional Living Expenses ("ALE") to compensate the insured for living expenses above their normal expenses for the shortest time necessary to repair damage caused by a covered loss, or the shortest time required to settle elsewhere if the insured chose to relocate. (Doc. No. 1 ¶ 9.) In either case, the policy provided that the ALE were not to last for more than one year from the date of the fire, and Plaintiffs were informed of the one-year limitation. (Id.; Doc. No. 27 ¶¶ 8-9.)

Defendant assigned James Dunn to handle Plaintiffs' claim. (Doc. No. 27 ¶ 5.) It also assigned Peter Belden to handle Plaintiffs' ALE, and Joan Ellen Creed to handle Plaintiffs' contents claim. (Id. ¶ 6.) Plaintiffs selected Third Party Defendant Alex R. Szeles, Inc. as the general contractor for the repair of the fire damage to their home. (Id. ¶ 10.) Defendant was aware of Plaintiffs' selection, and negotiated with Szeles with respect to the work at Plaintiffs' home. Szeles also assisted Plaintiffs in obtaining alternate housing on Lyters Lane in Harrisburg, Pennsylvania within days of the fire. (Id. ¶ 11.) Defendant was not involved in securing these accommodations. (Id.)

After Plaintiffs selected Szeles as their contractor, there was a delay in obtaining an initial estimate for the restoration work; the delay was not attributable to Defendant. (Id. ¶ 17.) Mr. Dunn rejected Szeles's initial estimate of $630,000, and Szeles later agreed to do the restoration work for $490,000. (Id. ¶¶ 18-20.) Since the date of the loss, Szeles periodically stopped working on the project, and the repairs to the home took more than one year to complete. (Id. ¶¶ 21-22.)

Plaintiffs resided at the property on Lyters Lane from April 2009 through July 2009, until they moved to a property at the Terraces at Springford in Harrisburg from July 2009 until the end of June 2010. (Doc. No. 27 ¶¶ 12-13.) Before and after the one-year limitation for ALE payments, which expired in April 2010, Mr. Dunn advocated on Plaintiffs' behalf in efforts to resolve issues and disagreement with Szeles, and advocated for Szeles to pay Plaintiffs' additional living expenses beyond the one-year limit under the insurance policy. (Id. ¶ 24.) After the one-year limitation for ALE payments expired, Plaintiffs moved to a third property on Old Township Road. (Id. ¶ 13.) Plaintiffs learned of the availability of the Old Township Road property through Szeles. (Id. ¶ 14.) In an effort to encourage Szeles to provide Plaintiffs with free housing until the restoration was completed, Defendant advanced Szeles $100,000 of the money owed for the restoration work before it was completed. (Id. ¶ 25.) There is a dispute between Defendant and Szeles as to the extent to which Szeles agreed to provide Plaintiffs with free housing. Defendant asserts that Szeles agreed to provide Plaintiffs with free housing until the repair jobs were completed, whereas Szeles asserts that the agreement was limited to one month of rent-free housing. (See Doc. No. 40-1 at 32.) Plaintiffs allege that they moved to the Old Township Road property because Mr. Dunn informed them that Szeles would allow them to reside there rent-free until completion of the repair job. (Doc. No. 1 ¶ 17.)

Defendant has made nine expense reimbursements for ALE to Plaintiffs from April 7, 2009 through April 7, 2010. (Id. ¶ 23, 28.) Defendant has not paid Plaintiffs for their additional living expenses after April 7, 2010.

Plaintiffs initiated this action on January 5, 2011, alleging the following seven causes of action against Defendant: (1) breach of contract; (2) bad faith; (3) misrepresentation; (4) negligence; (5) deceit; (6) breach of covenant of good faith and fair dealing; and (7) unfair trade practices. (Doc. No. 1.) On March 21, 2011, Defendant filed an answer to the complaint and, on that same date, filed a third party complaint against Szeles, seeking contribution and indemnity from Szeles. (Doc. Nos. 6, 7.) On August 17, 2011, the Court granted in part Szeles's motion to dismiss, dismissing Defendant's indemnification claim against Szeles, but not dismissing Defendant's contribution claim against Szeles. (Doc. No. 22.)

On April 30, 2012, Defendant filed a motion for summary judgment. (Doc. No. 26.) That same day, Szeles filed a motion for summary judgment. (Doc. No. 30.)


Rule 56(a) of the Federal Rules of Civil Procedure provides that summary judgment is warranted "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). A factual dispute is material if it might affect the outcome of the suit under the applicable law, and it is genuine only if there is a sufficient evidentiary basis that would allow a reasonable fact finder to return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49 (1986). At summary judgment, the inquiry is whether the evidence presents a sufficient disagreement to require submission to the jury or whether it is so one-sided that one party must prevail as a matter of law. Id. at 251-52. In making this determination, the Court must "consider all evidence in the light most favorable to the party opposing the motion." A.W. v. Jersey City Pub. Sch., 486 F.3d 791, 794 (3d Cir. 2007).

The moving party has the initial burden of identifying evidence that it believes shows an absence of a genuine issue of material fact. Conoshenti v. Pub. Serv. Elec. & Gas Co., 364 F.3d 135, 145-46 (3d Cir. 2004). Once the moving party has shown that there is an absence of evidence to support the non-moving party's claims, "the non-moving party must rebut the motion with facts in the record and cannot rest solely on assertions made in the pleadings, legal memoranda, or oral argument." Berckeley Inv. Grp.. Ltd. v. Colkitt, 455 F.3d 195, 201 (3d Cir. 2006); accord Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). If the non-moving party "fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden at trial," summary judgment is warranted. Celotex, 477 U.S. at 322. With respect to the sufficiency of the evidence that the non-moving party must provide, a court should grant summary judgment where the non-movant's evidence is merely colorable, conclusory, or speculative. Anderson, 477 U.S. at 249-50. There must be more than a scintilla of evidence supporting the non-moving party and more than some metaphysical doubt as to the material facts. Id. at 252; see also Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). Further, a party may not defeat a motion for summary judgment with evidence that would not be admissible at trial. Pamintuan v. Nanticoke Mem'l Hosp., 192 F.3d 378, 387 (3d Cir. 1999).


Defendant moves for summary judgment on each of the seven counts alleged in Plaintiffs' complaint. (Doc. No. 26.) Defendant argues that Plaintiffs have not presented any evidence with which to establish any of their claims against it. The ...

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