United States District Court, D. Idaho
MEMORANDUM DECISION AND ORDER
Lynn Winmill Chief Judge.
before the Court are Defendant Cincinnati Insurance
Company's Motion for Summary Judgment (Dkt. 33) and
Plaintiff Kim Peck's Motion for Leave to Amend to Add a
Claim for Punitive Damages (Dkt. 32). Having reviewed the
record in this case and considering the arguments of the
parties, the Court finds that oral argument is not needed.
The Court addresses each motion below.
an insurance case concerning a water loss event at a Boise,
Idaho hotel and condominium building (the
“Grove”). Ms. Peck owns a condominium unit at the
Grove, unit 1403 (“1403”). Complaint at ¶ 5,
Dkt. No. 1-1; Peck at 14; Peck EUO at 19, Dkt. 35- 1.
Plaintiff's unit 1403 is part of the Grove's
condominium homeowners association (“HOA”).
Complaint at ¶ 8, Dkt. No. 1-1.
Cincinnati Insurance Company (“Cincinnati”)
issued a property insurance policy (the “Grove
Policy”), number CAP 5219615, to the HOA and the hotel
(“Block 22”), effective March 31, 2012 through
March 31, 2013. Orgill Dec. at ¶ 9, Dkt. 38-1. The Grove
Policy provided, inter alia, property damage
coverage to Block 22, a hotel investment group, and the HOA
for a shared Boise, Idaho hotel and condominium building
(“the Grove”). On the HOA's part, the Grove
Policy covers the walls, floors, ceilings, fixtures and
affixed finishings of the Grove. H&R at 25-26; 35, Dkt. 35-5.
The Grove Policy does not cover the condominium unit
owners' personal property or alternative living expense
(“ALE”). H&R at 26, Dkt. 35-5. Pursuant to its
bylaws, the HOA receives any proceeds of the Grove Policy and
determines the amount of proceeds to apportion to units of
the HOA. Members of the HOA are bound by the HOA's
apportionment determinations. HOA at Ex. 6, Dkt.
issued policy number C01 0620671 to Plaintiff Kim Peck,
effective April 12, 2013 through April 12, 2014 (the
“Peck Policy”). Orgill Dec. at ¶ 10, Dkt.
38. The Peck Policy provides property and liability coverage
to unit 1403.
October 2012, a substantial quantity of water was discharged
from a fire sprinkler on the 15th floor at the Grove as a
result of a lit candle. Passmore at 30-31, Dkt. 36-1; Thomann
at 26, Dkt. 36-2; Korondi Dec. at ¶ 7, Dkt. 34-1. The
HOA and Block 22 submitted claims under the Grove Policy. HOA
at 8, Dkt. 35-3; Block 22 at 18-19, Dkt. 35-4. Ms. Peck
submitted claims under the Peck Policy. Peck EUO at 6-7, Dkt.
Block 22 Claim
22 submitted a claim to Cincinnati under the Grove Policy for
the loss. Block 22 at 18-19, Dkt. 35-4. Cincinnati paid $1,
753, 482.78 to Block 22 for this claim. Orgill Dec. at ¶
6, Dkt. 38. Block 22's President John Cunningham
testified that Block 22 was paid everything it had coming to
it from Cincinnati. Block 22 at 31-32, Dkt. 35-4. Block 22
testified that Cincinnati addressed its claim appropriately
and reasonably; that it had no complaints about
Cincinnati's response; that it received what it was
entitled to under the policy; that Cincinnati was diligent
and responsive and that it caused no delay. Block 22 at
34-35, Dkt. 35-4.
submitted a claim to Cincinnati under the Grove Policy for
the water loss. HOA at 8, Dkt. 35-3. Cincinnati paid $1, 573,
538.53 to the HOA for this claim. HOA at 10, Dkt. 35-3; HOA
at Ex. 2, Dkt. 35-3; Orgill Dec. at ¶ 7, Dkt. 38. Of
that amount, the HOA apportioned $96, 920.91 to 1403. HOA at
12, Dkt. 35-3; HOA at Ex. 2, Dkt. 35-3. Of that amount, $84,
937.44 has been paid to Ms. Peck. HOA at 12, Dkt. 35-3; HOA
at Ex. 2, Dkt. 35-3. The balance is being held by the HOA for
future work to be done at its expense in 1403. HOA at 12,
retained RestCon to provide consultation services as to the
health and safety concerns involved in remediation of the
Grove. HOA at 25-26, Dkt. 35-3. Restcon performed numerous
tests and inspections at the Grove, including several times
at 1403. Passmore at 82, Dkt. 36-1. RestCon then developed
reports with recommendations as to the scope of remedial
work. Passmore at 88, Dkt. 36-1; Thomann at 43-46, 56-59,
74-75, Dkt. 36-2. Aside from its final report, all
recommendations by RestCon were implemented by the
contractors. Cincinnati maintains that it never impeded
RestCon throughout the restoration process. Passmore at
88-90, 94-95, Dkt. 36-1; Thomann at 88-89, Dkt. 36-2.
Cincinnati paid all of RestCon's bills, and the HOA
testified that Cincinnati has paid all amounts submitted for
the loss. HOA at 44; 62-64, Dkt. 35-3.
Peck Personal 1403 Claim
Peck submitted a total of three claims under the Peck Policy.
Peck EUO at 6-7, Dkt. 35-1. One for 1403, and two concerning
her subsequent temporary housing (“Royal Plaza”
and “Reese Street”). Peck EUO at 6-7, Dkt. 35-1.
one week after the water loss, Ms. Peck moved out of 1403.
Peck EUO at 43, Dkt. 35-1. Ms. Peck then moved to a series of
temporary residences. Cincinnati paid Ms. Peck's
additional living expenses with respect to these locations
until the $80, 000 limit of liability for ALE coverage under
the Peck Policy was exhausted. Peck at 22, 25, 40, Dkt. 35-2;
Peck EUO at 65-66, Dkt. 35-1; Korondi at ¶ 20, Dkt. 34.
paid Ms. Peck for all sums claimed by her that it determined
to be a covered loss. Korondi Dec. at ¶ 10, Dkt. 34. Ms.
Peck has admitted that the actual damage to 1403 is being
paid by the Grove Policy, not the Peck Policy. Peck EUO at
40-41, Dkt. 35-1.
the development of this claim, both parties experienced delay
due to the complex nature of the claim and the acts of third
parties. Korondi Dec. at ¶ 11, Dkt. 34. For example,
beginning in January 2013, Peter Korondi, Cincinnati's
independent adjustor, made multiple requests of Belfor for
estimates of contents cleaning costs. Korondi Dec. at ¶
11, Dkt. 34. Belfor's estimate was an important part of
the process of determining those costs. Korondi Dec. at
¶ 11, Dkt. 34. Korondi then directed multiple follow-up
communications to Belfor over several months because the
estimate did not arrive. Korondi Dec. at ¶ 11, Dkt. 34.
Some of these communications were by telephone. Korondi Dec.
at ¶ 11, Dkt. 34. By email dated June 21, 2013 from
Belfor, Korondi was told that it had been instructed by Peck
not to communicate with him about this. Korondi Dec. at
¶ 11 and Ex. 1, Dkt. 34.
the development of this claim, Cincinnati experienced delay
related to Dr. Passmore's work. Korondi Dec. at ¶
13, Dkt. 34. Each of the many sampling events she conducted
required a cessation of work for the sampling to occur.
Korondi Dec. at ¶ 13, Dkt. 34. There would then be days
or weeks before sampling data returned from the laboratory.
Korondi Dec. at ¶ 13, Dkt. 34. ...