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QBE Ins. Corp. v. Creston Court Condo., Inc.

United States District Court, D. Oregon

November 1, 2014

QBE INSURANCE CORPORATION and COMMUNITY ASSOCIATION UNDERWRITERS OF AMERICA, INC., Plaintiffs,
v.
CRESTON COURT CONDOMINIUM, INC., and ASSOCIATION OF UNIT OWNERS OF CRESTON COURT CONDOMINIUM, INC., Defendants

Decided Date: September 23, 2014.

Page 1138

For QBE Insurance Corporation, a Pennsylvania corporation, Community Association Underwriters of America, Inc., a Delaware corporation, Plaintiffs: Blair E. McCrory, Brian R. Talcott, Donald E Templeton, LEAD ATTORNEYS, Dunn Carney Allen Higgins & Tongue, LLP, Portland, OR.

For Creston Court Condominium, Inc., an Oregon corporation, Defendant: Christopher T. Carson, LEAD ATTORNEY, Kilmer Voorhees & Laurick, PC, Portland, OR.

For Association of Unit Owners of Creston Court Condominium, Inc., an Oregon non-profit corporation, Defendant: James Lee Guse, LEAD ATTORNEY, Barker Martin, P.S., Portland, OR.

Page 1139

ORDER

MARCO A. HERNANDEZ, United States District Judge.

Magistrate Judge Papak issued a Findings and Recommendation (#48) on September 23, 2014, in which he recommends that this Court deny Plaintiffs' motion for summary judgment and grant Defendants' cross-motions for summary judgment. The matter is now before me pursuant to 28 U.S.C. § 636(b)(1)(B) and Federal Rule of Civil Procedure 72(b).

Because no objections to the Magistrate Judge's Findings and Recommendation were timely filed, I am relieved of my obligation to review the record de novo. United States v. Reyna-Tapia, 328 F.3d 1114, 1121 (9th Cir. 2003) (en banc); see also United States v. Bernhardt, 840 F.2d 1441, 1444 (9th Cir. 1988) ( de novo review required only for portions of Magistrate Judge's report to which objections have been made). Having reviewed the legal principles de novo, I find no error.

CONCLUSION

The Court ADOPTS Magistrate Judge Papak's Findings & Recommendation [48]. Accordingly, Plaintiffs' motion for summary judgment [16] is denied; Defendant Association's cross-motion for summary judgment [23] and Defendant Creston Court's cross-motion for summary judgment [26] are granted.

IT IS SO ORDERED.

FINDINGS AND RECOMMENDATION

Honorable Paul Papak, United States Magistrate Judge.

Plaintiffs QBE Insurance Corporation (" QBE" ) and Community Association Underwriters of America, Inc. (" CAU" ) (collectively, " plaintiffs" ) filed this action against Creston Court Condominium, Inc. (" Creston Court" ) and the Association of Unit Owners of Creston Court Condominium, Inc. (" the Association" ), seeking a declaration that plaintiffs have no duty to defend Creston Court in an underlying lawsuit that the Association filed in the Circuit Court for the County of Multnomah. Now before the court are plaintiffs' motion for summary judgment (#16), the Association's cross-motion for summary

Page 1140

judgment (#23), and Creston Court's cross-motion for summary judgment (#26). For the reasons set forth below, plaintiffs' motion for summary judgment should be denied and the Association's cross-motion for summary judgment and Creston Court's cross-motion for summary judgment should be granted.

FACTUAL BACKGROUND

I. Parties

Plaintiff QBE is a corporation that underwrites insurance policies. Decl. of Marianne Heineman (" Heineman Decl." ), #18, ¶ 2. Plaintiff CAU serves as the managing general agent of QBE. Id. Defendant Creston Court is an Oregon corporation that, as set forth below, " designed, developed, renovated, and managed the conversion" of an apartment building into the Creston Court Condominium (" the Condominium" ), an Oregon condominium organized under Oregon Revised Statute (" ORS" ) Section 100.405. Ex. 1, Second Decl. of James Guse (" Second Guse Decl." ), #40-1, at 2-4. Creston Court was the developer and declarant of the Condominium.[1] See id. Defendant the Association acts as the governing body of the Condominium. Id. at 2.

II. Insurance Policies

Beginning on December 27, 2006, plaintiffs insured " Creston Court Condominium" under a general-liability policy. Ex. 1, Decl. of James Guse (" Guse Decl." ), #22-1, at 1; Heineman Decl., #18, ¶ 2; Ex. 1, Heineman Decl., #18-1, at 1-62. This policy was effective from December 27, 2006, to December 27, 2007. Ex. 1, Guse Decl., #22-1, at 1; Heineman Decl., #18, ¶ 2. Subsequent policies provided coverage from December 27, 2007, to December 27, 2013. Heineman Decl., #18, ¶ 2. The subsequent policies contained nearly identical coverage, terms, limits, and exclusions[2] as the first policy but listed the insured as the " Association of Unit Owners of Creston Court Condominium" rather than " Creston Court Condominium." Id.

Attached to each policy was the " Condominium Association Insurance Policy" form. Id. ¶ 3; Ex. 1, Heineman Decl., #18-1, at 1-62. The Condominium Association Insurance Policy provides, in relevant part:

Throughout this policy the words " you" and " your" refer to the Named Insured shown in the " Declarations."

. . .

We will have the right and duty to defend the insured against any claim or " suit" seeking damages payable under VII. GENERAL LIABILITY COVERAGES SECTION. . . . We will have no duty to defend the insured against any " suit" seeking damages for " bodily injury," " property damage," " personal injury," or " advertising injury" to which this insurance does not apply.

. . .

With respect to VII.A. " BODILY INJURY" AND " PROPERTY DAMAGE," VII.B " PERSONAL INJURY" AND

Page 1141

" ADVERTISING INJURY" and VIII. GENERAL LIABILITY MEDICAL PAYMENTS SECTION each of the following is an insured:

1. You.

. . .

4. Any person, other than your " employee," or any organization while acting as your real estate manager.

5. Your individual unit owners, but only for liability arising out of the ownership, maintenance or repair of that portion of the premises which is not reserved for that unit owner's exclusive use or occupancy.

However, the insurance afforded with respect to the developer in the developer's capacity as a unit owner does not apply to liability for acts or omissions as a developer.

Ex. 1, Heineman Decl., #18-1, at 4, 24, 30 (emphasis omitted). The Condominium Association Insurance Policy also includes certain exclusions, including an exclusion for " [p]roperty you own, rent or occupy or which is owned, rented or occupied by another but which you ...


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