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Kirk v. Mutual of Enumclaw Insurance

United States District Court, D. Oregon

July 31, 2019

KENNETH KIRK, an individual Plaintiff,
v.
MUTUAL OF ENUMCLAW INSURANCE, Defendant.

          OPINION AND ORDER

          Michael McShane, United States District Judge.

         Plaintiff Kenneth Kirk brings this breach of contract action against his homeowner's insurance company, Mutual of Enumclaw Insurance (MOE). Pending before the Court are cross motions for summary judgment. Kirk argues that MOE wrongfully failed to pay his claim following the theft of Kirk's personal property. MOE argues Kirk's claim is barred under the theft exclusion of the policy because Kirk's ex-wife, who committed the theft, is named as an insured on the policy. Because the theft exclusion precludes coverage for theft committed by an insured, MOE's motion for summary judgment, ECF No. 15, is GRANTED.

         BACKGROUND

         MOE insured Kirk under a homeowner's insurance policy (“the policy”). When Kirk filed the claim on February 14, 2018, the policy was in full force and effect. The policy listed Kenneth Kirk and his then-wife Joli Kirk as “insured” parties on the declarations page of the policy, and both remained listed on the policy on the date that Kirk filed his insurance claim. Events leading up to the dispute at issue are as follows[1]:

Date

Event

Nov. 19, 2017

Kirk's then wife made a domestic abuse allegation and received a no-contact order, effectively excluding Kirk from entering within a mile of the home or the property contained therein.

Dec. 13, 2017

Kirk filed a petition for dissolution of marriage.

Feb. 6, 2018

Lane Co. Circuit Court entered judgment on petition for dissolution of marriage and granted Kirk the residence and all personal property located therein.

Feb. 14, 2018

Lane Co. Sheriff executed a writ of assistance, returning possession of the premises to Kirk. Kirk then filed his insurance claim.

On or about Apr. 5, 2018

Kirk filed a motion to show cause in Lane Co. Circuit Court against his now ex-wife for theft of property.

May 30, 2018

Kirk received a default judgment against his ex-wife for property theft in the amount of $81, 800.

Nov. 16, 2018

After receiving Kirk's claim for stolen property, MOE stated that any reimbursement would be limited to property not listed in the default judgment against Kirk's ex-wife.

Nov. 19, 2018

MOE issues payment to Kirk for $5, 986.90.

         MOE ultimately paid Kirk $5, 986.90 on his claim for $67, 765.79. Stipulation ¶¶ 11, 13. MOE declined to pay for any items included in the default judgment based on its interpretation that Joli Kirk was a named insured on the policy when the theft occurred. Stipulation ¶ 12, ECF No. 11. Instead, Defendant reimbursed only those items reported stolen that were excluded from the list at Lane County Circuit Court's show cause hearing. Id. The outstanding amount MOE refused to pay totals $59, 278.89.[2] Stipulation ¶ 14, ECF No. 11. Kirk filed this action for breach of contract. Kirk and MOE each filed cross-motions for summary judgment.

         STANDARDS

         The court must grant summary judgment if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). An issue is “genuine” if a reasonable jury could return a verdict in favor of the non-moving party. Rivera v. Phillip Morris, Inc., 395 F.3d 1142, 1146 (9th Cir. 2005) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). A fact is “material” if it could affect the outcome of the case. Id. The court reviews evidence and draws inferences in the light most favorable to the non-moving party. Miller v. Glenn Miller Prods., Inc., 454 F.3d 975, 988 (9th Cir. 2006) (quoting Hunt v. Cromartie, 526 U.S. 541, 552 (1999)). When the moving party has met its burden, the non-moving party must present “specific facts showing that there is a genuine issue for trial.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (quoting Fed.R.Civ.P. 56(e)).

         DISCUSSION

         This case turns on the interpretation of an insurance policy. Therefore, I must ascertain the intention of the parties to the policy. Hoffman Constr. Co. of Alaska v. Fred S. James & Co. of Oregon, 313 Or. 464, 469 (1992). I first turn to the language of the policy. Id. (citing ORS 742.016 (except in cases not relevant here, “every contract of insurance shall be construed according to the terms and conditions of the policy.”)). If the terms and conditions of the policy are ambiguous following a plain meaning review, the court considers the terms and conditions in the particular context used and then, if necessary, in the context of the policy as a whole. Id. at 470. If any ambiguity remains-meaning if two or more plausible interpretations of the term remain-the court resolves the ambiguity against the drafter and in favor of the insured. Id. Courts examine the policy language from the perspective of the ordinary purchaser of insurance. N. Pac. Ins. Co., v. Am. Mfrs. Mut. Ins. Co., 200 Or.App. 473, 478 (2005).

         The policy at issue states that MOE insures against several named perils and outlines the conditions and exclusions for coverage against those perils. The named peril at issue here is the theft provision, the pertinent parts of which appear below:

Coverage C - Personal Property
We insure for direct physical loss to the property described in Coverage C caused by the following perils, unless the loss is excluded below, or unless the loss is excluded in Section I - Exclusions.
9. Theft, including attempted theft and loss of property from a known place when it is likely that the ...

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