United States District Court, N.D. Alabama, Southern Division
RONALD SELLERS, as assignee of GARY GARDNER & GARY GARDNER BUILDERS, INC., Plaintiff,
NATIONWIDE MUTUAL FIRE INSURANCE COMPANY and STEVE DURHAM d/b/a S. DURHAM CONTRACTING, Defendants.
OWEN BOWDRE CHIEF UNITED STATES DISTRICT JUDGE
men make mistakes, [b]ut a good man yields when he knows his
course is wrong, [a]nd repairs the evil. The only crime is
pride.” The Antigone of Sophocles 70 (Dudley
Fitts & Robert Fitzgerald trans., Harcourt Brace
Publisher, 1946). While the court previously denied Defendant
Nationwide's motion in limine, the court is not too proud
to reconsider its ruling.
matter comes before the court on “Nationwide's
Motion to Reconsider.” (Doc. 77). Nationwide challenges
the court's denial without prejudice of its motion it
limine. (Doc. 70). Nationwide filed a motion in limine to
preclude Mr. Sellers, his counsel, and his witnesses from
presenting evidence regarding an issue previously litigated
in a declaratory judgment action. (Doc. 63). A jury trial was
held on September 10 and 11, 2018. The jury returned a
verdict in favor of Plaintiff Ronald Sellers as assignee of
Gary Gardner and Gary Gardner Builders, Inc. On September 19,
Nationwide submitted this motion to reconsider. (Doc. 77). On
September 24, Mr. Sellers responded in opposition to the
motion. (Doc. 78). The motion is now ripe for review. For the
reasons discussed below, the court will GRANT Defendant
Nationwide's motion to reconsider, but will DENY
Defendant Nationwide's motion in limine.
Sellers entered into a contract with Gary Gardner and Gary
Gardner Builders, Inc., for the construction of a home on
August 17, 2004. (Doc. 1-1 at 5). Mr. Gardner hired Steve
Durham, d/b/a Durham Contracting, as a subcontractor to
provide foundation work for the home. After Mr. Sellers moved
into the home, he discovered construction defects, some of
which involved work on the foundation.
insured Mr. Durham's subcontracting work. The insurance
policy provided coverage for damages to other property
resulting from Mr. Durham's faulty workmanship that first
manifested during the policy period, which ran from December
20, 2006 through December 20, 2007. (Doc. 60 at 3).
Sellers sued Mr. Gardner and Mr. Durham over the construction
defects on June 24, 2008 in the Circuit Court of Jefferson
County, Alabama. (Doc 1-1 at 5). Mr. Gardner filed
crossclaims against Mr. Durham in that action.
that case was pending, Mr. Durham filed for bankruptcy in the
U.S. Bankruptcy Court for the Northern District of Alabama in
July 2010. (Doc. 1-1 at 6). The bankruptcy court allowed Mr.
Sellers to pursue his claims against Mr. Durham, but limited
Mr. Sellers's recovery to Mr. Durham's available
insurance benefits. Mr. Gardner filed a motion in bankruptcy
court to pursue his claims against Mr. Durham by lifting the
bankruptcy stay, but the bankruptcy court never ruled on that
motion. The bankruptcy court discharged Mr. Durham from
bankruptcy on October 8, 2010.
pending state court action, Mr. Sellers and Mr. Gardner
entered into a settlement agreement on October 19, 2011. Mr.
Sellers released all claims against Mr. Gardner in exchange
for $100, 000 and the assignment of Mr. Gardner's
crossclaims against Mr. Durham. (Docs. 13-18, 13-19).
15, 2011, Nationwide filed for declaratory judgment in the
U.S. District Court for the Northern District of Alabama,
seeking a determination of its obligations to defend and
indemnify Mr. Durham regarding Mr. Seller's claims in the
pending state court action. (Doc. 63-1 at 3). Nationwide only
named Mr. Durham and Mr. Sellers as defendants in the
declaratory judgment action, not Mr. Gardner, who at that
time still had a crossclaim pending against Mr. Durham.
November 17, 2011, Mr. Sellers, as the assignee of Mr.
Gardner's claims, amended Mr. Gardner's earlier
crossclaims against Mr. Durham in the pending state court
action. (Doc. 77 at 21-29).
August 6, 2012, Magistrate Judge Greene entered his Report
& Recommendation in the declaratory judgment action.
(Doc. 63-1). Judge Greene recommended that the court grant
Nationwide's motion for a default judgment against Mr.
Durham and that the court grant Nationwide's motion for
summary judgment against Mr. Sellers. In granting the motion
for summary judgment against Mr. Sellers, Judge Greene found
that the workmanship damage first manifested before the
insurance policy period began. Judge Probst adopted Judge
Greene's Report & Recommendation. (Doc. 13-12).
Sellers and Mr. Durham entered into a consent judgment on
October 11, 2013. (Doc. 1-1 at 7). The consent judgment
entered into by Mr. Sellers and Mr. Durham provided for a
judgment of $250, 000 against Mr. Durham “for the
claims asserted by Ronald Sellers, individually and assignee
of Gary Gardner / Gardner Builders.” (Doc. 13-16 at 4).
The consent judgment limited recovery by Mr. Sellers,
individually and as Mr. Gardner's assignee, to any
insurance policy covering Mr. Durham, excluding recovery from
Mr. Durham personally.
October 3, 2013, Mr. Sellers, individually and as assignee of
Mr. Gardner, and Mr. Durham filed a joint motion for entry of
a consent judgment in the state court action. (Doc. 13-16).
On May 12, 2015, Mr. Sellers, solely as assignee of Mr.
Gardner, sued Nationwide in the Circuit Court of Jefferson
County, Alabama to collect the $250, 000 judgment entered
against Mr. Durham. (Doc. 1-1). Nationwide timely removed the
case to this court on June 8, 2015. (Doc. 1).