United States District Court, N.D. Alabama, Middle Division
ANNEMARIE CARNEY AXON, UNITED STATES DISTRICT JUDGE
matter comes before the court on a motion for summary
judgment filed by a set of parties that the court will refer
to as the Underwriters. (Doc. 237). The Underwriters are
Plaintiff Catlin Syndicated Limited (“Catlin”)
and Third Party Defendants Syndicate 1414 at Lloyd's,
Syndicate 5820 at Lloyd's, Syndicate 727 at Lloyd's,
and Syndicate 1861 at Lloyd's. (Doc. 237; see
also Doc. 188 at 15- 16).
background, Defendant Ramuji, LLC owned and operated a motel.
It had a mortgage on the property through Defendant Peoples
Independent Bank (“PIB”). PIB, in turn, obtained
a mortgage protection insurance policy through Intervenor
Great American Assurance Company (“Great
American”). The mortgage protection insurance policy
provided that if, in the event of any loss or damage to the
motel, PIB did not receive “acceptable hazard
insurance” from Ramuji, Great American would cover the
loss or damage. Although Ramuji had a commercial insurance
policy from the Underwriters covering the motel, the
commercial insurance policy did not list PIB as a beneficiary
until after a fire destroyed the motel. As a result, PIB made
a claim to Great American under the mortgage protection
insurance policy. Great American has issued a reservation of
rights letter but has not yet paid or denied the claim.
that backdrop, Catlin-one of the Underwriters-filed this
lawsuit against Ramuji and PIB, spawning a host of
counterclaims, third party claims, and crossclaims, including
Great American's third party claims as an intervenor.
Because Great American's obligation to pay PIB under its
mortgage protection insurance policy depends on whether the
Underwriters pay PIB under Ramuji's commercial insurance
policy, Great American requests a declaratory judgment that
(1) it need not cover PIB's claim because the
Underwriters must cover PIB's claim; (2) the Underwriters
are estopped from denying PIB's claim; and (3) the
Underwriters “are liable” to Great American.
(Doc. 93 at 9-10). The Underwriters have now moved for
summary judgment on those requests for declaratory judgment.
the court's earlier rulings preclude all of Great
American's claims against the Underwriters, the court
WILL GRANT the motion for summary judgment
and WILL ENTER SUMMARY JUDGMENT in favor of
the Underwriters and against Great American.
deciding a motion for summary judgment, the court
“draw[s] all inferences and review[s] all evidence in
the light most favorable to the non-moving party.”
Hamilton v. Southland Christian Sch., Inc., 680 F.3d
1316, 1318 (11th Cir. 2012) (quotation marks omitted).
owns a motel located in Boaz, Alabama. (See Doc. 237
at 4; Doc. 243 at 2). Ramuji obtained insurance on the
property through its insurance agent, Randy Jones &
Associates, and the agent's employee Jon Pair. (Doc.
127-1 at 9- 10, 97). Because of the type of insurance Ramuji
was seeking, Randy Jones & Associates had to work with
another insurance broker, which in turn contacted the
Underwriters' managing general agent, which issued a
commercial insurance policy to Ramuji. (Doc. 127-1 at 87,
100; Doc. 127-3 at 3, 14 Doc. 127-5 at 26- 27; Doc. 192-1 at
10; see also Doc. 237 at 5-6; Doc. 243 at 2). Great
American concedes that Randy Jones & Associates and Mr.
Pain were not agents of the Underwriters, but instead agents
of Ramuji. (See Doc. 2376 at 4-5 ¶¶ 2-3;
Doc. 243 at 2).
been the mortgagee of Ramuji's property since 2004 (doc.
46 at 27- 26), but the commercial insurance policy that
Ramuji obtained from the Underwriters did not list PIB as the
mortgagee of the property. (See Doc. 90-7 at 5-6;
Doc. 192-1 at 11). Meanwhile, PIB obtained mortgage
protection insurance from Great American, “insur[ing]
[PIB] against direct loss or damage to property in which [PIB
has] . . . a mortgagee interest” if “acceptable
hazard insurance has been cancelled or has not been received
from the mortgagor . . . .” (Doc. 93-1 at 3) (emphasis
omitted). “Acceptable hazard insurance” is
“insurance on the described location naming [PIB] as
mortgage holder and meeting [PIB's] requirements set
forth in the mortgage agreement.” (Id.)
(emphasis omitted). The policy also provides that “[i]f
the property is covered by [Ramuji's] acceptable hazard
insurance, this insurance shall not apply and shall not
contribute to the payment of any loss.” (Id.
at 11) (emphasis omitted). Finally, the policy provides that,
if Great American makes a payment to PIB, Great American may
require an assignment of PIB's rights of recovery, making
Great American PIB's subrogee. (Id. at 11).
fire on April 2, 2016, destroyed the motel, Ramuji made a
claim to the Underwriters under its commercial insurance
policy. (Doc. 144 at 15; see also Doc. 237 at 9;
Doc. 243 at 2). On April 25, 2016, through Randy Jones &
Associates, Ramuji asked to add PIB to the policy as a
mortgagee effective at the inception of the policy. (Doc.
127-5 at 13-15). The Underwriters' agent informed Ramuji
that it could not retroactively add PIB as a mortgagee, but
it added the bank by endorsement effective April 25, 2016.
(Id. at 14; see Doc. 90-7 at 60-61). The
Underwriters eventually denied Ramuji's fire loss claim.
(See Doc. 46 at 5).
to Great American's complaint, at some point PIB notified
Great American of the April 2 fire at the motel and made a
claim under the mortgage protection insurance policy. (Doc.
93 at 7 ¶ 19). Great American has issued a reservation
of rights letter stating that it will cover PIB's claim
only if the Underwriters' policy does not cover PIB.
(Id. at 8 ¶ 22).
Relevant Procedural History
filed this lawsuit, seeking in relevant part a declaratory
judgment that PIB does not have standing to present a claim
under Ramuji's insurance policy. (Doc. 1 at 10-11). Great
American moved to intervene because a determination about
PIB's coverage under the Underwriters' insurance
policy would dictate whether PIB is covered under Great
American's mortgage protection insurance policy. (Doc. ...