C. Johnson Sheffield CPA, PC et al v. West American Insurance Company, No. 7:2008cv00191 - Document 65 (E.D.N.C. 2010)
Court Description: ORDER denying 35 Motion to Exclude, without prejudice; denying 37 Motion for Summary Judgment and denying 55 Motion for Sanctions. Court Orders a court-hosted settlement conference to be held before Magistrate Judge David W. Daniel. (See Order for complete details). Signed by Senior Judge Malcolm J. Howard on 7/27/2010. (Heath, D.)
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C. Johnson Sheffield CPA, PC et al v. West American Insurance Company Doc. 65 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NORTH CAROLINA SOUTHERN DIVISION NO. 7:08-CV-191-H C. JOHNSON SHEFFIELD CPA, PC; C. JOHNSON SHEFFIELD AND WIFE, EMILY F. SHEFFIELD D/B/A/ PAPE ENTERPRISE, Plaintiffs, ORDER v. WEST AMERICAN INSURANCE COMPANY, Defendant. This matter is before the court on defendant's motion for summary judgment and motion to exclude testimony and reports of plaintiffs proffered experts, sanctions. as well as plaintiffs' motion for Appropriate responses and replies have been filed, and the time for further filings has expired. These matters are ripe for adjudication. BACKGROUND C. Johnson Sheffield CPA, PC ("plaintiff") insured a commercial building and its contents located on Front Street in Warsaw, North Carolina under a Businessowner's defendant West American Insurance Company. Policy with Following two storms 1 Dockets.Justia.com (Tropical Storm Ernesto on August 31, November 22, damage to 2006), plaintiffs submitted claims to defendant for the roof contended that the claims, repairs from defendant and resul ting defendant issued a payment flying debris first storm, denied the but and as alleged Plaintiffs interior damage. the roof needed replacing. caused by the 2006 and a Nor'easter on After investigating to plaintiffs resulting to the roofing roof interior damage second damage for storm portion claim, and paid only for the interior damage. Plaintiffs filed the complaint in this matter on October 9, 2008 in Contract; North Duplin (2) Superior Court alleging (1) Breach of Unfair and Deceptive Trade Practices pursuant to Carolina Deceptive County Trade General Statute Practices Statute §58-63-15. 75-1.1; pursuant to and (3) North Unfair Carolina and General Defendant removed the matter to this court on November 14, 2008. March 27, which alleges 2009, § Plaintiffs filed an amended complaint on the same causes of action. Now before the court are the motions detailed supra. According to plaintiff, approximately ten years old, the polyurethane the storm, roof was and there had been no leaks prior to Tropical Storm Ernesto on or about August 31, following foam plaintiff interior water damage from a roof 2 and/or his 2006. staff leak or leaks. The day discovered On or about September 1, 2006, plaintiff contacted the defendant through his employee, Tammy Kirby, in order to file a claim for damage. Defendant sent independent insurance adjuster Donald Rice, employed by James inspect the Greene C. premises on physically inspected the polyurethane fan blade. matched foam roof independent behalf roof of adjusting company, defendant. and determined a had been punctured by Mr. to Rice section of the flying debris, a Rice determined that the location of interior damage the area of damage from the puncture. He also determined that the punctured section of the roof was the only section of the roof damaged by wind. Defendant notes specifically that Mr. Rice did not see any evidence of damage to the roof caused by wind uplift. no further testing or Plaintiffs note that Rice did inspection to determine if there was further wind damage and did not test or inspect for wind uplift damage. Plaintiffs contend that Mr. Rice and defendant should have determined that Tropical Storm Ernesto damaged the entire roof, requiring it to be completely removed and replaced. Based on his inspection and conclusions, an estimate for $2,729.09 to settle the Mr. claim, Rice prepared which included money to repair the puncture in the roof and the interior damage existing at plaintiffs' the $1,000 time. Defendant deductible and 3 reduced $54.72 in the estimate depreciation by and issued a check for $1,672.37 to the plaintiffs, which the affected the plaintiffs never negotiated. On November Warsaw area. intrusion, roof was 2006, 22, This storm although it caused another resulted is not during rain the in storm more extensive clear whether the damage first storm or the Senior building. Field Mr. Adjuster "MacH J. Tilley to the second Plaintiff again contacted the defendant and this time, sent water to storm. defendant inspect the Tilley inspected the interior of the building, but did not bring a ladder of sufficient length to enable him to physically inspect the roof. Instead of plaintiffs to contractor they ini tial inspecting obtain an would estimate of the roof estimate like $50,625, to himself, of Mr. repair use. from Plaintiffs maintaining that Defendant, through Tilley, plaintiffs' directly, who estimate to $28,800, which was too roofing entire an roof contacted the immediately still a submitted the needed to be replaced. contractor Tilley asked high reduced by the industry standards according to defendant. Because Tilley found the plaintiffs' to be suspicious, plaintiffs' roof. Tilley The asked another independent contractor's estimate contractor roofing Tilley that he did not believe the plaintiffs' 4 to inspect contractor told roof damage was caused by wind, so Tilley firm Forensic Engineering, retained an Incorporated independent (" FEl" ), engineering to inspect the FEl sent engineer Chad Bible to inspect the building. building. Following Bible's inspection, FEl determined that the leaking roof was not caused by wind but rather by degradation and age. After FEl's receiving defendant opinion, estimated $1,823.55 in covered damages related to interior ceiling damage and denied the replacement roof claim non-covered a loss. This check Defendant sent plaintiffs a check for this amount. was not negotiated either. The central issue in this suit is the cause of the roof leaks and whether such cause is a covered loss under plaintiff's policies. Tom Preston, installed plaintiffs' the contractor whose company originally polyurethane foam roof, testified in his deposition that the roof was constructed in 1988 and had a tenyear warranty. Preston explained in his deposi tion that after 10 years, a polyurethane foam roof needs to be re-coated and if not, start may ultraviolet to rays, Additionally, deteriorate normal Preston wear testified repaired sections of the roof Hurricane "recoated Fran and due to exposure to and tear, and that in 1996 following damage the whole (Preston Dep. at 13-14.) Additionally, 5 sun's weather. his company incurred during building in 1998, the in 1996." Preston prepared a proposal to "redo" the whole roof by installing a (See polyurethane foam roofing system on the entire building. Preston Dep. at 22-23.; Haake Aff. At However, the roof was not replaced at that time. Plaintiffs have submitted the names of [DE 1 Ex. new #41-1].) 1 three individuals who plan to offer expert testimony as to the cause of the roof damage. Defendant has filed a motion to exclude the testimony of these "experts," arguing that they do not meet the requisite standard for admissibility pursuant to Rule 702 of the Federal Rules motion of Evidence. summary jUdgment. for sanctions, Defendants have Additionally, arguing that also filed a for plaintiffs have filed a motion defendant's motion for summary judgment as well as defendant's motion to exclude the testimony of plaintiffs' experts are frivolous. COURT'S DISCUSSION I. Standard of Review Summary judgment is appropriate pursuant to Fed. R. Civ. P. 56 when no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. Anderson v. lThe record indicates that plaintiff submitted a claim to his former insurance company related to roof damage in 1998 following a tornado. It appears the 1998 proposal from Mr. Preston was requested during the 1998 claim process. As a result of that claim, the insurance company agreed to pay for appropriate repairs, not for the entire roof to be replaced. 6 Li}:)~!"~L_~oe.Py, Inc., summary seeking 477 U.S. 242, demonstrating the absence of a Ce~_()!:~~_~c::l!P,--_"\,T' Once party the may the bears judgment genuine moving party has rest on the met 'specific facts trial. Matsushi ta ~?_rp-,-, 475 U.S. Summary 574, judgment disputed factual 123, Supp. showing 125 Elec. 587 is (1986) not a of fact. burden, or the non-moving denials in its but "must come forward with there Indus. burden (1986). allegations that party issue of material its pleading, Anderson, 477 U.S. at 248, The initial Catrett, 477 U.S. 317, 325 not 'If (1986) . 247 is Co. , a genuine Ltd. v. (quoting Fed. R. vehicle for the issue Zeni th for Radio Civ. P. 56(e)). court to resolve a trial issues. (E.D.N.C. 1993). Instead, court reviewing a claim at the summary judgment stage should determine whether a genuine issue exists for trial. 249. In making inferences favorable Inc., 369 this drawn to the U.S. determination, from the underlying non-moving party. 654, 655 (1962) the court facts United (per in must the States curiam). view light the most v. Diebold, Only disputes between the parties over facts that might affect the outcome of the case Anderson, properly preclude 477 at U.S. the 247-48. entry of summary Accordingly, 7 the judgment. court must examine "both the materiality and the genuineness of the alleged fact issues Faircloth, in ruling on this motion. ff 837 F. Supp. at 125. II. Analysis Defendant moves the court to exclude the testimony of plaintiffs' proffered expert witnesses on the grounds that their testimony does not meet the standards of admissibility of expert testimony set forth in Rules 702 and 703 of the Federal Rules of Evidence and by the Uni ted States Merrell Dow Pharm., v. Carmichael, Inc., 509 U.S. Supreme 579 Court (1993) in Daubert v. and Kumho Tire Co. 526 U.S. 137 (1999). Under Daubert and Rules 702 and 703 of the Federal Rules of Evidence, whether federal an judges are to act as gatekeepers to determine expert's opinion is reliable testimony will be helpful to the jury. Pharms., 509 U.S. 579, 589 (1993). and whether Daubert v. his Merrell Dow The proponent of the expert bears the burden of proving admissibility. The this Supreme court expert whether may use testimony: it Court has to (1) been noted four determine whether a subject to 8 non-exhaust ive the factors reliability of theory peer has been review; (3) that scientific tes ted; whether (2) a technique has procedures; a and potential (4) rate whether of a theory within the scientific community. be applied in all "considerable leeway" in an need to error or U. S. generally accepted These four factors do not rd. trial the cases; case individual "whether particular expert testimony is Co ., 526 is standard operating has judge determine to Kumho Tire reliable." at 152 (1999). Defendant argues that the opinions of plaintiffs' proffered experts, are Jeff Foster, unreliable things: knowledge; and (2) speculative opinions assumptions, and Chris Watkins and Norman Campfield, wholly their (1 ) unsupported P.E., are not their because, based facts, opinions are on other speculative data not among or based and scientific on reliable principles or scientific methods. The testimony court finds that would that be defendant provided by has these not shown wi tnesses that the would be totally speculative or wholly irrelevant. State Farm, 129 Fed. Appx. 972 (6th Cir. 2005). The court finds that under the particular circumstances of this case and in view of the type of testimony at issue, these gatekeeping matters are more properly addressed at the trial of this matter, court may hear from the purported experts where the to determine whether they are qualified pursuant to Federal Rules of Evidence 702 and 9 104. Therefore, defendant's motion to exclude is DENIED WITHOUT PREJUDICE. B. Motion for Summary Having prej udice, J~~gm~~~ motion defendant's denied the court is compelled to find without exclude to there remain genuine issues of material fact which preclude entry of summary judgment The central issue in thls case is the cause of in this matter. the roof damage as well as interior damage to the building owned To answer this question, by plaintiffs. from various credibility jury, witnesses 2 , of such evaluate testimony. not the court. facts, These Therefore, the court has and are to hear determine questions the for the defendant's motion for summary judgment is DENIED. C. Motion for Sanctions The The court court finds has reviewed this understands plaintiffs' motions to frivolous. motion plaintiffs' to be concerns, Although motion wi thout meri t. but does not there are preclude summary judgment in this matter, for The court flnd defendant's issues the sanctions. of court fact finds which that The court notes that even if the potential expert witnesses are found not to be qualified as experts, they may still be able to testify as to what they saw during a visual inspection of the roof. 2 10 defendant's motions Therefore, are in reasonable these circumstances. plaintiffs' motion for sanctions is DENIED. Settlement Conference III. On the court's own motion, 101.2, EDNC, and Rules Procedure, the and pursuant to Local Civil Rule 16 and 53 of ORDERS court the Federal Rules Civil settlement court-hosted a of conference. United appointed States as directed to with aim an Magistrate settlement meet with toward Judge the parties reaching Judge Daniel establish such as may upon parties the conference. place and The selected their is Judge conducted Daniel Daniel upon of authority shall the hereby is negotiations, full which during be Judge lS resolution given desire, will Magistrate Daniel supervise amicable counsel conference by and an Magistrate he W. Magistrate master. issues. rules David be a to binding course at the of the time and notice to the parties. CONCLUSION For the foregoing reasons, DENIED ";,IITHOUT PREJUDICE summary judgment is DENIED defendant's motion to exclude is [DE #35J, [DE #37J, 11 defendant's motion for and plaintiEf's motion for sanctions is DENIED [DE #55]. Additionally, court-hosted settlement conference as detailed This ~7 the court orders a s~pr~. ~ day of July 2010. District Judge At Greenville, NC #26 12
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