The opinion of the court was delivered by: Leslie G. Foschio United States Magistrate Judge
The parties to this action consented to proceed before the undersigned. The matter is presently before the court on Defendant's motions for summary judgment and to dismiss, filed March 9, 2005. (Doc. No. 15).
Plaintiff, Thomas F. Kenneth ("Plaintiff" or "Kenneth"), commenced this declaratory action on March 7, 2003 in New York Supreme Court, Niagara County, seeking declaratory judgment against Nationwide Mutual Fire Insurance Company ("Nationwide" or "Defendant") establishing Plaintiff's right to payment from Defendant under a homeowners insurance policy issued to Plaintiff and his then wife, Shelley Kenneth, for Plaintiff's property losses resulting from a fire at their residence at 800 Meadowbrook Drive, City of North Tonawanda, New York, on March 10, 2001. On July 9, 2003, Defendant removed the action based on diversity jurisdiction, and pleaded affirmative defenses including, inter alia, that Plaintiff caused the fire.
On March 9, 2005, Defendant filed the instant motion seeking summary judgment and dismissal of the Complaint, pursuant to Fed.R.Civ.P. 37 and 41(b) ("Rule 37" and "Rule 41") (Doc. No. 15) ("Defendant's motion"), along with the Affirmation of Scott D. Storm, Esq. (Doc. No. 15) ("Storm Affirmation"), a Memorandum of Law in Support of Defendant's Motion (Doc. No. 16) ("Defendant's Memorandum"), and a Statement of Facts (Doc. No. 17) ("Defendant's Statement of Facts") along with exhibits A - Z and AA - AG ("Defendant's Exh(s). __"). On March 22, 2005, Plaintiff filed the Affidavit of Mark D. Grossman, Esq. (Doc. No. 20) ("Grossman Affidavit") in Opposition to Defendant's Motion, a Memorandum of Law Opposing to Defendant's Motion to Dismiss (Doc. No. 21) ("Plaintiff's Memorandum"), and a Statement of Facts (Doc. No. 22) ("Plaintiff's Statement of Facts"). Defendant filed its Reply to Plaintiff's Response (Doc. No. 23) ("Defendant's Reply") on May 6, 2005. Oral argument was deemed unnecessary. Based on the following, Defendant's motion is DENIED.
On March 10, 2001, a single-family residence located at 800 Meadowbrook Drive, North Tonawanda, New York ("the residence" or "the house"), owned by Plaintiff and his wife, Shelley Kenneth, was damaged by a fire.
Defendant's Statement of Facts
¶¶ 2-3. Prior to the fire, on February 15, 2001, Shelley Kenneth informed the Plaintiff that she would seek a divorce. Defendant's Statement of Facts ¶ 5 (Defendant's Exh. B at 15).On March 10, 2001, Plaintiff telephoned his wife at the residence from a nearby payphone, approximately one-half mile from the house, at approximately 12:30 a.m., attempting to reconcile, but she did not answer the phone. Defendant's Statement of Facts ¶ 10. (Defendant's Exh. C at 54-56 and Defendant's Exh. B at 95-97). Plaintiff then drove to the residence, where Shelley refused to reconcile and asked him to leave. Defendant's Exhibit C at 56. Later that day, at approximately 8:31 p.m., Plaintiff again called the residence, but no one answered. Defendant's Fact Statement ¶ 10.
Mrs. Kenneth and her daughter were the first persons to discover the fire when they arrived at the residence in the evening at approximately 10:46 p.m. on March 10, 2001. Defendant's Statement of Facts ¶¶ 3, 11. At that time, Shelley Kenneth noticed that the living room light, which was connected to a timer, was off, however, she did not suspect that the residence had lost electric power because the automatic garage door worked and the garage light was on. Id. Before entering the house, Shelley Kenneth walked around its perimeter and noticed smoke coming from the rear of the residence, causing her to telephone 911. Id. (referring to Defendant's Exh. C at 61-63).
As of the filing of Defendant's motion, the cause of the fire at the residence remained "under investigation." Defendant's Statement of Facts ¶ 13. Nationwide's investigator determined that the fire started in a closet in the residence's basement under the staircase, and was not accidental. Id. The furnace, which was in close proximity to the location where the fire started, was ruled out as a source of the fire by the local utility company and an inspector retained by Nationwide. Id.
Plaintiff and his wife's homeowners insurance policy, issued by Nationwide ("the policy"), which was in effect on March 10, 2001, provided, as relevant, that to recover under the policy for property loss, an insured must submit a signed, sworn proof of loss identifying (1) the time and cause of loss; (2) the interest the claimant and others have in the property, including all liens on the property; (3) other insurance that may cover the loss; (4) changes in title or occupancy of the property; (5) all damaged real property and estimates for repair; (6) the quantity, description, actual cash value and amount of loss of damaged personal property, attaching any bills and receipts that support these estimates; (7) "receipts for additional living expenses and records supporting the fair rental value loss"; and (8) an affidavit or other evidence stating the amount and cause of any credit card and related losses, within 60 days of Nationwide's request for this information. Defendant's Exhibit G.
On May 18, 2001, Nationwide mailed to Plaintiff and Shelley Kenneth letters requesting the Kenneths to individually submit three signed, sworn proof of loss statements, "one each for their respective dwelling (Coverage A), personal property (Coverage C) and loss of use (Coverage D) claims." Defendant's Exh. I. The policy required the Kenneths to submit the forms no later than 60 days from the demand. Id. The letter, sent to Plaintiff by certified mail was received by Plaintiff on May 22, 2001. Id. In response to Nationwide's request, Shelley Kenneth timely submitted completed proof of loss forms for property loss and loss of use, which included documentation supporting the amounts claimed. Defendant's Statement of Facts ¶ 27. Nationwide subsequently paid Shelley Kenneth's claim "as an innocent co-insured" for $144,710. Id. ¶ 31. Nationwide's defenses include that Plaintiff misrepresented the cause of the fire at the residence and was himself involved in its cause. Defendant's Reply ¶ 9.
On June 12, 2001, according to Nationwide, Plaintiff personally delivered, to Nationwide's attorney's office, documents in support of his claim which were "charred, moldy and water-soaked" in garbage bags and buckets. Defendant's Statement of Facts ¶ 21, Defendant's Exh. H. Additionally, Plaintiff brought three proof of loss forms to the office with him which, according to Nationwide, were notarized, but otherwise completely blank.*fn2 Defendant's Fact Statement ¶ 21. Plaintiff verbally inquired why three separate proof of loss forms were necessary, and was advised by Nationwide representatives that the forms were for Plaintiff's personal property loss, Plaintiff's loss to the residence, and Plaintiff's loss of use of the residence, respectively. Defendant's Statement of Facts ¶ 21. Defendant's representatives further advised Plaintiff at that time to consider retaining legal counsel to assist him in completing the proof of loss forms and Plaintiff retained, on June 15, 2001, James H. Clayton as his attorney in this matter. Id. at ¶¶ 21-22. Shelley Kenneth's Proof of Loss forms were notarized on July 16, 2001 and, on July 17, 2001, Plaintiff personally delivered to Nationwide the proof of loss form related to his claim for damage to the residence and personal property losses, along with inventory sheets and various receipts. Id. at 24; Defendant's Motion, Exh. L ("Plaintiff's Proof of Loss Form"). As to the value of the residence, as requested by Question 6 on Plaintiff's Proof of Loss Form, Plaintiff included a handwritten note, "Refer to Shelley on total." Id. The number "13667.50" is written above Question No. 6, which requests Plaintiff to declare the actual cash value of the insured residence at the time of loss.Plaintiff's Proof of Loss Form. Plaintiff did not identify the amount of the whole loss and damage as requested by Question No. 7 on Plaintiff's Proof of Loss form, or the amount claimed under the applicable policy as requested by Question No. 9 on Plaintiff's Proof of Loss Form. Id. Plaintiff did not submit a proof of loss form for his loss of use of the residence under the policy, presumably because at that time Shelley had insisted that Plaintiff leave the residence while their expected divorce proceedings were pending. Id.
By letter dated August 8, 2001, Nationwide rejected Plaintiff's proof of loss submissions based on "a number of technical and substantive deficiencies in the completion of [the] forms," Defendant's Fact Statement ¶ 25 (referencing Defendant's Exh. M. - "Defendant's Denial of Coverage Letter dated August 8, 2001") ("Denial of Coverage Letter")). Specifically, Nationwide rejected Plaintiff's proof of loss submissions based on Plaintiff's failure to (i) submit separate and complete proof of loss forms for dwelling and personal property claims; (ii) state the policy's date of issuance and expiration; (iii) state adequately the amount of the policy at the time of loss; (iv) accurately respond to Question Nos. 5 and 6 requesting the total insurance coverage on the residence and its actual cash value at the time of the loss; and (v) respond to Question Nos. 7 and 9 on Plaintiff's Proof of Loss Form. Denial of Coverage Letter. In the Denial of Coverage Letter, Nationwide also reserved its rights under the policy, including the right to reject any loss of use claims submitted by the Plaintiff. Id.; Defendant's Fact Statement ¶ 26.Nevertheless, Nationwide included with the Denial of Coverage Letter two blank proof of loss forms for loss under Coverage A (dwelling) and Coverage C (personal property), permitting Plaintiff to submit these proofs of loss to Nationwide within 60 days of receiving the Denial of Coverage Letter. Defendant's Fact Statement ¶ 26. Plaintiff did not respond to this letter, id., but subsequently stated in his Response to Defendant's First Set of Interrogatories, served by Plaintiff on Nationwide on January 17, 2005, that Plaintiff would not submit a claim for loss of use of the residence. Defendant's Fact Statement ¶ 44; Defendant's Exh. AE ("Plaintiff's Response to Defendant's First Set of Interrogatories").
At the time of the fire, Plaintiff did not have a key to the residence, Plaintiff's Fact Statement ¶ 16, and judicial orders of protection against Plaintiff, effective April 4, 2001 through May 31, 2001, when the proof of loss forms were initially due, prohibited Plaintiff from communicating with or approaching Shelley Kenneth.*fn3 Defendant's Exh. D; Plaintiff's Fact Statement ¶ 32.
Plaintiff's examination under oath ("EUO"), in accordance with the policy, was conducted on August 12, 2001; and, thereafter, by letter dated December 17, 2001, Nationwide denied Plaintiff's claim based on (i) its determination that Plaintiff started the fire, (ii) Plaintiff's failure to submit the proof of loss forms to Nationwide within 60 days of receiving the Denial of Coverage Letter, and (iii) several other defenses Nationwide re-asserted in its amended answer to the Complaint. Defendant's Statement of Facts ¶ 28 (citing Defendant's Exhibits O & S). This action followed.
On April 16, 2004, Nationwide served Plaintiff with its First Set of Interrogatories, pursuant to Fed.R.Civ.P. 33(a), and a Demand for Production of Documents, pursuant to Fed.R.Civ. P. 34(a). Defendant's Fact Statement ¶ 33, Defendant's Exhs. T and U. Plaintiff failed to serve answers to Nationwide's interrogatories within the 30 day period required by Rule 34(a). On September 17, 2004, Nationwide served Plaintiff with its Second Set of Interrogatories and Request for Production of Documents. Defendant's Fact Statement ¶35; Defendant's Exh. V. By letter dated October 5, 2004, Nationwide notified Plaintiff that responses to Nationwide's discovery demands were overdue,*fn4 Defendant's Fact Statement ¶ 36, Defendant's Exh. X. Plaintiff also failed to timely serve answers to Nationwide's Second Set of Interrogatories or responses to Nationwide's Second Set of Document Requests. By letter dated November 2, 2004, Nationwide advised the court that Plaintiff had failed to respond to Defendant's discovery demands and was subject to sanctions in accordance with Fed.R.Civ.P. 37. Defendant's Fact Statement ¶ 37, Defendant's Exh. Y. By letter dated November 9, 2004, Nationwide requested Plaintiff's overdue discovery responses be served by November 12, 2004, "to avoid any unnecessary motion practice." Id. (referencing Defendant's Exh. Z)
By letter dated November 18, 2004, Plaintiff responded to Defendant's Second Set of Interrogatories and Request for Production of Documents. Defendant's Fact Statement ¶ 39 (referencing Defendant's Exh. AA). Thereafter, on November 30, 2004, Nationwide moved, pursuant to Fed.R.Civ.P. 33, 34 and 37(a), to compel Plaintiff's responses to Defendant's First Set of Interrogatories and Demand for Document Production. Defendant's Fact Statement ¶ 41 (referencing Defendant's Exh. AB). On January 5, 2005, following oral argument, the court granted Nationwide's motion to compel, directed Plaintiff to serve the overdue responses within 14 days, and awarded attorneys' fees to Nationwide in connection with the motion to compel. Doc. No. 13; Defendant's Fact Statement ¶ 43 (referencing Defendant's Exh. AD).
In accordance with the court's order, on January 17, 2005, Plaintiff served his responses to Defendant's First Set of Interrogatories and Demand for Production of Documents, Defendant's Fact Statement (referencing Defendant's Exhs. AE and AF, respectively), which included a statement that Plaintiff was unable to provide some of the information and documents Nationwide requested because Plaintiff was then incarcerated.*fn5 Id. ¶ 45 (referencing Defendant's Exh. AG). Plaintiff's answers to the interrogatories were not signed by Plaintiff as required by Fed.R.Civ.P. 33(b)(1) and (2). Id.
Nationwide moves for summary judgment based on Plaintiff's alleged failure to submit, as required under the policy, three signed, sworn proof of loss forms within 60 days of Nationwide's request for these forms. Defendant's Memorandum at 29. Alternatively, Nationwide moves, pursuant to Fed.R.Civ.P. 37 ("Rule 37") and Fed.R.Civ.P. 41(b) ("Rule 41(b)"), to dismiss the Complaint based on Plaintiff's alleged failure to comply with the court's orders, referred to by Nationwide as "discovery orders." Id. at 26. In opposition, Plaintiff argues that Plaintiff substantially complied with the provision of the policy requiring submission of proof of loss within 60 days of Nationwide's request and, in opposition to dismissal, that Plaintiff had complied with the court's orders. Plaintiff's Memorandum at 2, 8. Plaintiff maintains he should be allowed to submit further proof of loss information to Nationwide because, according to Plaintiff, Plaintiff timely submitted proof of loss to Nationwide which substantially complied with the policy conditions for payment by Nationwide of Plaintiff's share of the loss to the residence and all losses to his personal property. Id. at 11. Additionally, Plaintiff asserts Defendant's request for dismissal as a sanction be denied because Plaintiff complied with the court's scheduling order relating to pretrial discovery, and that his inability to respond more fully to Nationwide's discovery demands resulted from his incarceration and, therefore, did not constitute a willful or deliberate violation of the court's order. Id.
A. Defendant's Motion for Summary Judgment
Summary judgment will be granted pursuant to Fed.R.Civ.P. 56 when the moving party demonstrates that there are no genuine issues as to any material fact and that the moving party is entitled to judgment as a matter of law. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986); Rattner v. Netburn, 930 F.2d 204, 209 (2d Cir. 1991). The party moving for summary judgment bears the burden of establishing the nonexistence of a genuine issue of material fact and if there is any evidence in the record based upon any source from which a reasonable inference in the non-moving party's favor may be drawn, a moving party cannot obtain a summary judgment. Celotex, 477 U.S. at 322. Once a party moving for summary judgment has made a properly supported showing as to the absence of any genuine issue as to all material facts, the nonmoving party must, to defeat summary judgment, come forward with evidence that would be sufficient to support a jury verdict in its favor. Goenaga v. March of Dimes Birth Defects Foundation, 51 F.3d 14, 18 (2d Cir. 1995).
The function of a district court in considering a summary judgment motion is not to resolve disputed issues of fact, but to determine whether there is a genuine issue to be tried. Rattner, supra, at 209. In assessing the record, including any affidavits, exhibits, and other submissions, the court is required to resolve all ambiguities and to draw all factual inferences in favor of the nonmoving party. Anderson, supra, at 255; Rattner, supra, at 209. If the moving party meets its burden of demonstrating the absence of any genuine issue of material fact, the nonmoving party must come forward with "specific facts showing that there is a genuine issue for trial." Fed. R. Civ. P. 56(e). The nonmoving party may not rest upon unsubstantiated allegations, conclusory assertions or mere denials, but must set forth and establish specific facts showing that there is a genuine issue for trial. Fed. R. Civ. P. 56(e). A metaphysical or other hypothetical doubt concerning a material fact does not establish a genuine issue requiring trial. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 584 (1986).
1. Plaintiff's Noncompliance With Policy Requirements
Nationwide argues that Plaintiff failed to comply with the terms of the policy by not submitting to Nationwide timely, signed, sworn and fully completed proof of loss forms, Defendant's Memorandum at 29, and, as such, Plaintiff's failure to abide by the terms of the policy regarding such proof of loss requirements warrants summary judgment. Id. In opposition, Plaintiff maintains that he timely submitted the proof of loss statement to Nationwide, as required by the policy, and, although Nationwide deemed Plaintiff's Proof of Loss Statement to be deficient, such deficiency does not, upon the record, warrant summary judgment. Plaintiff's Memorandum at 11. Rather, according ...