United States District Court, M.D. Pennsylvania
VILLAGE HEIGHTS CONDOMINIUM ASSOCIATION, an unincorporated association, Plaintiff,
THE CINCINNATI INSURANCE CO., Defendant.
JOHN E. JONES III JUDGE.
before the Court are Cross-Motions for Summary Judgment filed
by the Plaintiff, Village Heights Condominium Association
(doc. 15), and the Defendant, the Cincinnati Insurance
Company (doc. 12). The Motions have been fully briefed (docs.
14, 17, 20, 21 and 23) and are thus ripe for our review. For
the reasons that follow, the Court will deny the
Defendant's Motion in full and grant the Plaintiffs
FACTUAL BACKGROUND & PROCEDURAL HISTORY
times relevant to the above-captioned action, the Plaintiff
Village Heights Condominium Association ("Plaintiff) was
the insured entity on a policy (the "Policy")
issued by the Defendant, Cincinnati Insurance Company
("Defendant"). (Doc. 16, ¶ 20; doc. 22, ¶
20). The Village Heights development is a gated community
comprised of fifty (50) units, including fifteen (15)
stand-alone homes, one (1) duplex, one (1) triplex, and
thirty (30) apartment units. (Doc. 1-2, ¶ 7; doc, 14, p.
Plaintiff is an association of unit owners that acts through
an executive board. (Doc. 14, p. 5). Plaintiff is generally
responsible for maintaining all common areas in the
development, including all external grounds, roofs, building
standard components, walls, ceilings and floors, stopping at
the interior surface of the same, at which point the unit
begins. (Doc. 1-2, ¶ 8; doc. 16, ¶ 10).
around December 2013, Mr. and Mrs. Herb Graves owned and
resided in Unit 205, a stand-alone villa within the Village
Heights development ("Unit 205" or "the
Unit"). (Doc. 1-2, ¶¶ 11-12). The same month,
Mr. and Mrs. Graves elected to move from Unit 205 into an
apartment unit and so entered into an agreement to sell Unit
205 to a third party. (Id.). Throughout the winter
of2013-14, Mr. and Mrs. Graves maintained the heat in Unit
205, and Mr. Graves inspected the interior of the Unit every
Friday to ensure that its systems and maintenance were
functioning properly. (Id., ¶ 13). However, the
parties agree that the Unit was predominantly empty,
"most" of the furniture having been sold at an
auction held in late 2013. (Doc. 16, ¶ 38; doc. 22,
¶ 38). Mr. and Mrs. Graves did continue to store several
trunks and a few items of furniture in the garage of the
Unit. (Doc. 16, ¶ 39; doc. 22, ¶ 39). They also kept
some wine in the wine cellar, which Mr. Graves occasionally
retrieved as needed. (Doc. 16, ¶¶ 39-40; doc. 22,
¶¶ 39-40). The parties dispute whether the
Graves' intermittently kept a car at the Unit. (Doc. 16,
¶ 36; doc. 22, ¶ 36).
summer of 2014, the pending sale of the Unit fell through.
(Doc. 1-2, ¶ 14). Mr. and Mrs. Graves continued to seek
another buyer through the winter of 2014-15, and the Unit was
shown on a regular basis. (Id., ¶ 14-16). Mr.
Graves continued to check the Unit every Friday
(id., ¶ 15); however the Complaint is silent
regarding whether Mr. and Mrs. Graves continued to keep the
heat on in the Unit throughout this time. (See generally,
about March 1, 2015, while Mr. and Mrs. Graves were on
vacation,  a pipe froze in the Unit, causing the pipe
to burst and resulting in significant water damage.
(Id., ¶ 18). When they returned from vacation,
the Graves' observed "ice hanging out" of the
Unit. (Doc. 16, ¶ 46; doc, 22, ¶ 46).
parties agree that Unit 205 is identified as "Location
11" on the Schedule of Locations attached to the
Commercial Property Coverage Part Declarations (the
"Declarations") forming a portion of the Policy.
(Doc. 16, ¶ 27; doc. 22, ¶ 27). Defendant states
that the policy "provides coverage for the 19 separate
buildings on Village Heights Drive, each of which are
separately listed in the Policy's Declarations."
(Doc. 14, pp. 7-8). Plaintiff argues that Defendant's
characterization misconstrues the nature of the coverage, and
that the buildings are not in fact listed separately in the
Declarations but are instead described as a single
"Blanket Building." (Doc. 20, p. 5).
the water damage occurred, Plaintiff filed a claim with
Defendant, believing some of the damage caused to be covered
under the Policy referenced above. (Doc 1-2, ¶ 19).
Specifically, Plaintiff anticipated that the common elements
of the Unit, including the drywall of the ceilings and walls
and the internal mechanical, electrical and HVAC components,
would be insured under the Policy. (Doc. 16, ¶64).
1, 2015, Defendant issued a declination of coverage letter to
Plaintiff. (Doc. 1-2, ¶ 20). Defendant cited the
"Vacancy Provision" of the Policy ("Vacancy
Provision") as the reason for refusing to cover the
damage caused by the burst pipe. (Id.; doc. 22,
¶ 48). The Vacancy Provision is reproduced as follows:
SECTION D. LOSS CONDITIONS
The following conditions apply in addition to the COMMON
POLICY CONDITIONS and the COMMERCIAL PROPERTY CONDITIONS.
a. Description of Terms
(1) As used in this Vacancy Condition, the term building and
the term vacant will have the meanings set forth in (1)(a)
and (0(b) below:
(a) When this Coverage Part is issued to a tenant, and with
respect to that tenant's interest in Covered Property,
building means the unit or suite rented or leased to the
tenant. Such building is vacant when it does not contain
enough business personal property to conduct customary
(b) When this Coverage Part is issued to the owner or general
lessee of a building, building means the entire building.
Such building is vacant unless at least 31% of its total
square footage is:
1) Rented to a lessee or sublessee and used by them to
conduct their customary operations; or 2) Used by the
building owner to conduct customary operations.
b. Vacancy Provisions If the building where
"loss" occurs has been vacant for more than 60
consecutive days before that "loss", we will:
(1) Not pay for any "loss" caused by any of the
following, even if they are Covered Causes of Loss:
(b) Sprinkler leakage, unless you have protected the system
(c) Building glass breakage;
(d) Water damage;
(e) Theft; ...