Pepin v. Allstate Insurance Co.

Pepin v. Allstate Insurance Co. (2003-037); 176 Vt. 307; 848 A.2d 269

2003-037

[Filed 27-Feb-2004]


       NOTICE:  This opinion is subject to motions for reargument under
  V.R.A.P. 40 as well as formal revision before publication in the Vermont
  Reports.  Readers are requested to notify the Reporter of Decisions,
  Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
  any errors in order that corrections may be made before this opinion goes
  to press.


                                 2004 VT 18

                                No. 2003-037


  Ronald L. Pepin	                         Supreme Court

                                                 On Appeal from
       v.	                                 Chittenden Superior Court


  Allstate Insurance Company	                 September Term, 2003


  Matthew I. Katz, J.

  Stephen S. Blodgett and Jason J. Sawyer of Blodgett, Watts & Volk, P.C.,
    Burlington, for Plaintiff-Appellant.

  Patricia S. Orr and Cassandra S. Edson of Unsworth Powell Barra Orr &
    Bredice, PLC, Essex Junction, for Defendant-Appellee.


  PRESENT:  Amestoy, C.J., Dooley, Johnson and Skoglund, JJ., and Allen, C.J.
            (Ret.), Specially Assigned


       ¶  1.  ALLEN, C.J. (Ret.), Specially Assigned.    Plaintiff Ronald
  L. Pepin appeals from the trial court's summary judgment dismissal of his
  complaint against defendant Allstate Insurance Company.  Plaintiff argues
  that the trial court erred in dismissing his complaint because he
  established a prima facie case that the removal of personal property from
  his home by a court-appointed master constituted "theft" covered by his
  homeowner's insurance policy.  We affirm.
   
       ¶  2.  In March 1998, pursuant to divorce proceedings, plaintiff and
  his wife were ordered to sell two homes that they owned in South
  Burlington.  Given the animosity between the parties, the court appointed a
  master to carry out the responsibilities set out in its order.  The court
  stated that, in the event that the parties were "unable to agree upon the
  process for sale of the dwellings, the real estate agent, etc., the Master
  shall make all decisions necessary to implement" its order. 


       ¶  3.  In October 1999, the court appointed the master as plaintiff's
  representative and agent because of plaintiff's limited availability to
  sign documents necessary to accept offers and complete closings on the
  properties in a timely manner.  Specifically, the court authorized the
  master to 

    act in the name, place and stead of [plaintiff], to sign his name
    and in his name execute, acknowledge and deliver any and all
    instruments, documents, or other writings, and to do, perform and
    otherwise transact any and all transactions on his behalf, which
    are necessary or advisable to accomplish the sale or transfer of
    the land and buildings, and personal property therein if any,
    located [in South Burlington], so that any purchaser shall receive
    full title in fee simple free and clear of all liens and
    encumbrances.

       ¶  4.  In connection with anticipated closings in October and
  November 1999, the master repeatedly asked plaintiff to remove his personal
  property from one of the homes.  Plaintiff removed some of his property,
  but he did not remove all of it.  The closings did not occur.  In
  anticipation of a December 17, 1999 closing, the master asked plaintiff to
  remove his remaining belongings by December 8.  On December 14, after
  plaintiff failed to comply with her request, the master hired a company to
  remove and dispose of plaintiff's remaining property.  Plaintiff discovered
  that his property was missing and filed a police report on December 15.  In
  the report, plaintiff stated his belief that the realtor had removed
  personal property worth $2000 from his basement without his permission. 
  Plaintiff indicated that he would contact the realtor to ascertain the
  status of his belongings and contact police if any other information was
  needed. 
   
       ¶  5.  The house was eventually sold in May 2000.  In a letter to
  the master, plaintiff's attorney indicated that plaintiff was filing a
  claim for lost property with his insurance carrier, and needed the master
  to substantiate that property had been removed from his home.  Plaintiff's
  attorney also informed the master that 

    [b]ecause there are a number of claims and offsets for payment of
    expenses (including [plaintiff's] claim that his property should
    have been retained rather than dumped), I will be requesting the
    Court to hold the net proceeds from the sale of the properties,
    that is after all expenses of closing are paid, for a final
    accounting.  

  Notwithstanding the concerns expressed in this letter, plaintiff agreed to
  the master's final distribution of funds from the sale of the marital
  properties, including the allocation of expenses.  The master's report did
  not account for the personal property that had been removed from
  plaintiff's home, and plaintiff raised no issue with respect to this
  property.  The family court accepted the recommendation in the master's
  report, and plaintiff did not appeal this decision. 

       ¶  6.  In July 2000, plaintiff submitted a claim to defendant Allstate
  Insurance Company seeking $62,801.88 in reimbursement for the property
  removed by the master.  Plaintiff's homeowner's policy covered his property
  against "[t]heft, or attempted theft, including disappearance of property
  from a known place when it is likely that a theft had occurred."  Defendant
  denied coverage, explaining that plaintiff's loss could not be considered a
  theft loss because the removal of the property had been completed under a
  court order. 
   
       ¶  7.  Plaintiff then filed a declaratory judgment action against
  defendant, seeking insurance coverage, injunctive relief, and damages.  The
  trial court granted summary judgment for defendant after concluding that
  there were no material facts at issue and plaintiff had failed to make out
  a prima facie case that his belongings were the object of theft.  The court
  found that "theft" meant "stolen," which the law defines as "the unlicensed
  apportation [sic] of personal property with the intent to permanently
  deprive the owner thereof."  The court concluded that plaintiff failed to
  show that his property had been the object of "theft" because the master
  had been authorized to arrange for the removal of the property, and
  plaintiff was estopped from challenging her authority because he had not
  appealed the family court decision.  The court explained that "[w]ithout
  some showing, both factual and legal, that the Master was without authority
  to remove the property from the building, and then had a duty to preserve
  what had been removed, we cannot conclude that this property was the object
  of theft, by the Master or tradesmen in her employ."  The court therefore
  granted summary judgment for defendant.  Plaintiff appealed.     

       ¶  8.  We review a grant of summary judgment using the same standard
  as the trial court.  Richart v. Jackson, 171 Vt. 94, 97, 758 A.2d 319, 321
  (2000).  Summary judgment is appropriate when, taking all allegations made
  by the nonmoving party as true, there are no genuine issues of material
  fact and the movant is entitled to judgment as a matter of law.  Id.;
  V.R.C.P. 56(c).  "Where the moving party does not bear the burden of
  persuasion at trial, it may satisfy its burden of production by showing the
  court that there is an absence of evidence in the record to support the
  nonmoving party's case."  Ross v. Times Mirror, Inc., 164 Vt. 13, 18, 665 A.2d 580, 583 (1995).  If the moving party satisfies this requirement,
  "[t]he burden then shifts to the nonmoving party to persuade the court that
  there is a triable issue of fact."  Id. 
   
       ¶  9.  Plaintiff first asserts that summary judgment was inappropriate
  because the term "theft" should be broadly construed to include the
  master's removal and disposal of his property without his permission.  More
  specifically, he argues that: (1) a question of fact remains whether the
  master acted outside of her delegated authority in removing and disposing
  of his property; (2) the term "theft" is ambiguous, and any question
  regarding the breadth of the term should be resolved against defendant; (3)
  he did not need to prove a theft per se under the terms of the policy, but
  only the likelihood that a theft occurred, and there are outstanding
  factual questions surrounding the resolution of this question; and (4) the
  law supports a broad interpretation of the term "theft."  

       ¶  10.  We must construe an insurance policy "according to its terms
  and the evident intent of the parties as expressed in the policy language." 
  City of Burlington v. Nat'l Union Fire Ins. Co., 163 Vt. 124, 127, 655 A.2d 719, 721 (1994).  In this case, plaintiff's homeowner's policy provides
  coverage for losses sustained by "[t]heft, or attempted theft, including
  disappearance of property from a known place when it is likely that a theft
  has occurred."  The term "theft" is not defined, and we therefore presume
  the parties relied on the word's ordinary meaning.  Landry v. Dairyland
  Ins. Co., 166 Vt. 634, 635, 701 A.2d 1035, 1036 (1997) (mem.); City of
  Burlington, 163 Vt. at 127-28, 655 A.2d  at 721 (we give disputed terms
  "their plain, ordinary and popular meaning").  As discussed below, we
  conclude that to be entitled to coverage under the "theft" provision in his
  homeowner's insurance policy, plaintiff needed to show that his property
  was taken by the master or her agents with the intent to steal.  Plaintiff
  has not presented any evidence that would justify such a conclusion, and
  therefore, summary judgment was properly granted for defendant.  

       ¶  11.   First, our case law does not support plaintiff's suggested
  interpretation of the term theft.  We have previously construed the term
  theft in the context of an insurance policy to require a showing that the
  taking of property was accompanied by an intent to steal.  See Rainville v.
  Farm Bureau Mut. Auto. Ins. Co., 117 Vt. 37, 39, 83 A.2d 599, 600 (1951);
  Allen v. Berkshire Mut. Fire Ins. Co., 105 Vt. 471, 476-77, 168 A. 698, 700
  (1933). 
   
       ¶  12.  In Rainville, plaintiff sought coverage under the "theft"
  provision in his automobile insurance policy after his son took his car
  without permission and wrecked it.  We concluded that plaintiff was not
  entitled to coverage because he had not shown that his son took the car
  with the intent to steal it, nor had he demonstrated other facts that would
  show that a "theft" had occurred.  Rainville, 117 Vt. at 40, 83 A.2d  at
  600.  We stated, without deciding, that if plaintiff could show that his
  son had taken the car 

    with a view only to a temporary user, intending, however, to keep
    it for an unreasonable time; or intending to use it in a reckless,
    wanton or injurious manner; or intending to leave it to mere
    chance whether the owner ever recovered it or not, such taking
    would be, both in common sense and in law, a theft within the
    meaning of [plaintiff's insurance] policy.

  Id. at 39-40, 83 A.2d  at 600.  Absent evidence that any of these
  alternatives existed, or that the taking had been with the intent to steal,
  we concluded that "[t]he facts as disclosed do not add up to a theft,
  either in law or in ordinary speech."  Id. at 40, 83 A.2d  at 600.  

       ¶  13.  In reaching our conclusion in Rainville, we recognized that a
  majority of states require a taking with the intent to steal to recover
  under a theft provision in an automobile insurance policy.  We rejected the
  argument that the term theft, synonymous with larceny, was broad enough to
  include use without the owner's consent, even in the absence of an intent
  to steal.  Id. at 38, 83 A.2d  at 599.  We explained that under Vermont law,
  the crime originally called theft, now called larceny, "has always required
  a taking animo furandi, that is to say with the intent to steal."  Id. at
  39, 83 A.2d  at 600. 
   
       ¶  14.  In Allen, we concluded that the term "theft" within an
  automobile insurance policy included what, at law, would be considered
  embezzlement.  Allen, 105 Vt. 471, 477, 168 A. 698, 700.  In that case,
  plaintiff sought coverage after he let a prospective purchaser take his car
  on a trial basis and the individual absconded with the vehicle.  The
  insurance company argued that "theft" meant larceny, and there had been no
  larceny because the bailee's possession had been lawfully obtained and his
  felonious intent had been formed after he received the vehicle.  We
  rejected this argument, explaining that "theft" was a wider term than
  "larceny," and it included other forms of wrongful deprivation of property. 
  Id.  We explained that "larceny by a bailee or fiduciary would be theft
  within the policy, though at common law it would be classified under the
  heading of embezzlement."  Id. (quoting Van Vechten v. American Eagle Fire
  Ins. Co., 146 N.E. 432, 433 (N.Y. 1925)).  We found it clear from the
  findings that the taking of plaintiff's automobile had been animo furandi,
  and therefore there had been a theft within the meaning of the policy.  Id.

       ¶  15.  Plaintiff relies on Katze v. Randolph & Scott Mut. Fire Ins.
  Co., 330 N.W.2d 232, rev'd on other grounds, 341 N.W.2d 689 (Wis. 1984), to
  support his assertion that the term theft should be broadly construed.  In
  Katze, the court concluded that plaintiff had suffered a loss due to
  "theft" within the meaning of an insurance policy when he received a
  worthless check as payment for cattle.  The court found the term theft,
  which was defined in the policy as "any act of stealing," included theft by
  fraud.  Id. at 236.  The court explained that the buyer's successful scheme
  to defraud plaintiff of his property fit within the general meaning of the
  term "theft."  Importantly, in Katze, it was undisputed that at all
  material times the purchaser intended to appropriate plaintiff's cattle
  without paying for them.  Id. 

       ¶  16.  These cases do not support plaintiff's assertion that the term
  "theft" should be construed to cover the acts at issue here.  In all of
  these cases, the court considered whether there had been an intent to steal
  in reaching its conclusion.  Plaintiff's reliance on language in  Rainville
  where we suggested alternative ways in which a plaintiff could show theft,
  is equally unavailing.  As dicta, this passage is not binding authority. 
  In any event, the suggested alternatives presume an initial wrongful taking
  with the intent to permanently deprive the owner of his property, which is
  absent in this case. 
   
       ¶  17.  Our construction of the term theft is consistent with
  dictionary definitions of the term and with the legal definition of larceny
  in Vermont.  See Abraham v. Ins. Co. of N. Am., 117 Vt. 75, 80, 84 A.2d 670, 673 (1951) ("When a pivotal word is not defined either in the policy
  or the application it is permissible for the court to take judicial notice
  of its meaning as given in standard works, such as dictionaries."). 
  Webster's New International Dictionary defines theft as "the act of
  stealing; specif:  the felonious taking and removing of personal property
  with intent to deprive the rightful owner of it."  Webster's New
  International Dictionary 2369 (3d ed. 2002).  Black's Law Dictionary
  defines theft as "[t]he felonious taking and removing of another's personal
  property with the intent of depriving the true owner of it; larceny." 
  Black's Law Dictionary 1486 (7th ed. 1999).

       ¶  18.  In a similar vein, the crime of larceny in Vermont, previously
  called theft, "specifically requires an intent to steal at the very moment
  the property in question is taken into possession by the defendant."  State
  v. Hanson, 141 Vt. 228, 232, 446 A.2d 372, 374 (1982).  We have defined
  "stealing" as "the taking and removal, by trespass, of personal property,
  which the trespasser knows to belong to another, with the felonious intent
  to deprive him of his ownership therein."  Id. at 231, 446 A.2d  at 374
  (citations omitted).  "This larcenous intent," we explained, "has in turn
  been further defined in Vermont as an intent to take and keep property of
  another wrongfully so that the trespasser may appropriate it for his own
  purposes."  Id. at 232, 446 A.2d  at 374 (internal citation omitted). 
   
       ¶  19.  Based on the discussion above, we conclude that the term
  "theft" in plaintiff's homeowner's policy requires a showing that his
  personal property was taken by another with the intent to steal.  Plaintiff
  cannot establish that the master acted with the intent to steal his
  property because he failed to contest her authority to remove his personal
  property in the family court proceeding.  The doctrine of collateral
  estoppel precludes plaintiff from challenging her authority here.  See
  Berlin Convalescent Ctr., Inc. v. Stoneman, 159 Vt. 53, 56, 615 A.2d 141,
  144 (1992) (The doctrine of collateral estoppel "bars the subsequent
  re-litigation of an issue which was actually litigated and decided in a
  prior case between the parties resulting in a final judgment on the merits,
  where that issue was necessary to the resolution of the action.") (internal
  quotation marks and citation omitted).  

       ¶  20.  As previously noted, plaintiff agreed to the master's final
  distribution of funds from the sale of his home, which did not account for
  the personal property that had been removed.  The family court approved the
  master's final report, and plaintiff did not appeal this decision.  Thus,
  the undisputed facts show that when the master removed plaintiff's
  belongings, she acted under the authority of a court order, unchallenged by
  plaintiff in the family court, to complete the sale of the home.  Plaintiff
  failed to present any evidence that would support a finding that his
  belongings were the subject of "theft" and summary judgment was properly
  granted for defendant.  

       ¶  21.  Based on our conclusion above, we need not address plaintiff's
  second argument that the court erred in concluding that the master did not
  have a duty to protect or preserve his property as a bailee.  Even assuming
  that the master had a duty to preserve plaintiff's belongings, her actions
  here, unaccompanied by an intent to steal, would not constitute theft
  within the meaning of plaintiff's homeowner's insurance policy.  

       Affirmed.                    




                                       FOR THE COURT:



                                       ________________________________ 
                                       Chief Justice (Ret.), Specially Assigned