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Durasevic v. Grange Insurance Co.

United States District Court, E.D. Michigan, Southern Division

July 9, 2018

Hana Durasevic, et al., Plaintiffs,
v.
Grange Insurance Company of Michigan, Defendant.

          ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT [#25] AND DENYING PLAINTIFFS' MOTION FOR PARTIAL SUMMARY JUDGMENT [#24].

          HON. GERSHWIN A. DRAIN JUDGE.

         I. Introduction

         Presently before the Court is Plaintiffs Hana Durasevic and Doka Durasevic's complaint against their insurance company, Grange Insurance Company of Michigan. Plaintiffs bring the present action alleging that Defendant is liable for insurance coverage for damage to their home. Plaintiffs filed a Motion for Partial Summary Judgment asserting Defendant's liability to provide them coverage. Defendant filed a Motion for Summary Judgment asserting that this Court should dismiss the entire action. For the reasons stated below, this Court will grant Defendant's Motion for Summary Judgment and deny Plaintiffs' Motion for Partial Summary Judgment.

         II. Factual Background

         This action arises from a dispute about insurance coverage for fire damage to Plaintiffs' home. On September 29, 2015, Plaintiffs submitted a claim to Defendant for fire damage to their house. Dkt. No. 25, pg. 4 (Pg. ID 310). Defendant issued $619, 029.98 to Plaintiffs to cover expenses from the fire damage, paying money for coverage identified as Dwelling, Contents, Additional Living Expenses, Dwelling Expenses, and Contents Expenses. Dkt. No. 25-2, pg. 2 (Pg. ID 341). Defendant paid for Plaintiffs' temporary housing after the September 29, 2015 fire. Dkt. No. 25, pg. 8 (Pg. ID 314).

         On April 29, 2016, a second fire occurred at Plaintiffs' original home, where the first fire occurred. Dkt. No. 25-2, pg. 2 (Pg. ID 341). At the time of the second fire, Plaintiffs still lived in temporary housing. Dkt. No. 25, pg. 8 (Pg. ID 314). Defendant paid $30, 548.14 for the April 29th fire, paying money for coverage identified as Additional Living Expenses and Dwelling Expenses. Id. Defendant retained Kevin G. Pike, a senior fire investigator, to investigate the origin of the second fire. Dkt. No. 25-3, pg. 2 (Pg. ID 344). Mr. Pike concluded that someone started the fire intentionally. Id. at pg. 21 (Pg. ID 363). Mr. Pike's investigation also found that there was no forced entry into the home. Dkt. No. 5-2, pg. 9 (Pg. ID 95). Defendant conducted an investigation and found that Niko Durasevic, Plaintiffs' son, was at the residence just a few hours before the fire. Id. Therefore, Defendant concluded that it was more likely than not that Niko Durasevic intentionally started the April 29, 2016 fire.[1] Id. As a part of Defendant's investigation, Defendant made repeated requests to Plaintiffs to produce financial records, phone records, and Facebook archives. Dkt. No. 5-2, pg. 8 Pg. ID 94). Plaintiff failed to produce the requested documentation and information so Defendant could properly investigate the claim. Id. Defendant also attempted to conduct examinations under oath (“EUOs”) with Plaintiffs and their family members living with them as part of its investigation. Id. Insured persons Niko and Samantha Durasevic failed to submit to EUOs. Id. Insured persons Doka, Hana, and Viktor Durasevic submitted to EUOs, but failed to sign their EUO transcripts. Id.

         On February 24, 2017, Defendant wrote Plaintiffs a letter stating why Plaintiffs' policy did not provide total coverage for their claim resulting from the April 29 fire. Dkt No. 5-2. The letter stated the following reasons for denying coverage: 1) Plaintiffs were vacant from the house for 60 days immediately preceding the fire; 2) some of the insured persons under the policy failed to provide sworn testimony at an EUO; 3) Plaintiffs failed to respond to repeated requests for documentation supporting the claim; 4) the evidence demonstrated that it was more likely than not that Niko Durasevic started the fire; and 5) Plaintiffs concealed Niko's involvement with the fire. Id. at pgs. 7-9 (Pg. ID 93-95).

         On May 15, 2017, Plaintiffs filed the present action in the Macomb County Circuit Court. Dkt. No. 1-4. On June 26, 2017, Defendant removed the action to this Court. Dkt. No. 1. Plaintiffs then filed their Motion for Partial Summary Judgment on April 26, 2018. Dkt. No. 24. In their Motion, Plaintiffs request that this Court strike several of Defendant's affirmative defenses and hold Defendant liable for coverage of the April 29, 2016 fire. Id. Defendant responded to the Motion on May 17, 2018. Dkt. No. 29. Plaintiffs replied on May 25, 2018. Dkt. No. 31. On April 26, 2018, Defendant filed its Motion for Summary Judgment. Dkt. No. 25. Defendant asserts that this Court should dismiss the entire action because Plaintiffs failed to comply with its policy conditions. Id. Plaintiffs responded to the Motion on May 17, 2018. Dkt. No. 28. Defendant replied on May 31, 2018. Dkt. No. 33.

         III. Legal Standard

         Federal Rule of Civil Procedure 56(c) governs summary judgment. The Rule states, “summary judgment shall be granted if ‘there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.'” Cehrs v. Ne. Ohio Alzheimer's Research Ctr., 155 F.3d 775, 779 (6th Cir. 1998). “All factual inferences ‘must be viewed in the light most favorable to the party opposing the motion.'” Id. (quoting Matsushita Elec. Indus., Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)). There is a genuine issue of material fact “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id. (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986)). Ultimately, the court evaluates “whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.” Anderson, 477 U.S. at 251-52.

         IV. Discussion

         A. Defendant's Motion for Summary Judgment

         Plaintiffs' and Defendant's Motions contain overlapping issues. This Court will address Defendant's Motion for Summary Judgment first. The Court will then apply its conclusions to Plaintiffs' Motion for Partial Summary Judgment to the extent they are applicable.

         Defendant asserts three reasons why this Court should grant summary judgment in its favor. First, Plaintiffs' insurance policy excludes coverage for damage resulting from intentionally set fires if the dwelling was vacant for the 60 days immediately preceding the fire. Dkt. No. 25, pg. 2 (Pg. ID 308). Second, Plaintiffs' policy requires insured persons to provide sworn testimony at an EUO; Niko and Samantha Durasevic are insured persons who failed to submit to EUOs. Id. Third, Plaintiffs' policy requires insured persons to cooperate with its investigation and produce documents, and Plaintiffs failed to produce requested documentation. Id.

         1. Argument One

         First, Defendant argues that it is entitled to summary judgment because Plaintiffs' insurance policy excludes coverage for loss or damage resulting from intentionally set fires if the dwelling was vacant for the sixty days immediately preceding the fire. Dkt. No. 25, pg. 2 (Pg. ID 308). Plaintiff contends that their home was not vacant because the definition of vacant means that a dwelling is lacking both animate and inanimate objects. Dkt. No. 24, pg. 4 (Pg. ID 183). Plaintiffs' home was not empty of inanimate objects at the time of the second fire. Id. Alternatively, Plaintiff argues that Defendant is estopped from asserting the vacancy exclusion because Defendant was paying Plaintiffs to live elsewhere and knew that Plaintiffs were not living at their home at the time of the fire. Dkt. No. 28, pg. 2 (Pg. ID 426).

         a. Vacancy

         Plaintiffs' insurance policy with Defendant states the following:

B ..... [W]e do not insure for loss . . . caused directly or indirectly by any of the following:
Exclusion B.4. is removed and replaced with the following:
4. Vandalism or malicious mischief, including intentionally set fires, if the dwelling has been vacant for more than 60 consecutive days immediately preceding the loss. A building ...

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