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Reddick v. Chubb National Insurance Co.

United States District Court, W.D. Kentucky, Paducah

November 2, 2017




         This matter comes before the Court upon motion by Plaintiff Danny Reddick (“Plaintiff”) for summary judgment against Defendant ACE American Insurance Company (“Defendant”).[1][DN 8.] Defendant has responded. [DN 12.] This matter is ripe for adjudication. For the following reasons, Plaintiff's Motion is DENIED and his Complaint is DISMISSED.

         I. Background

         This case arises out of a boating accident that took place on Lake Barkley in Trigg County, Kentucky on July 26, 2016. [DN 8, at 2.] Plaintiff was participating in a local fishing competition and utilizing his personal boat. Plaintiff allowed Joe Noel, who was accompanying Plaintiff that day, to operate the boat. [Id.] Noel allegedly “operated the aforementioned boat [negligently, and] at a high right of speed which resulted in a collision with another vessel.” [Id.] As a result of the crash, Plaintiff suffered numerous injuries, “including fractured vertebra.” [Id.] Plaintiff has an ongoing lawsuit against Noel in state court, which is being held in abeyance. [Id.]

         The subject of the dispute currently before the Court is the insurance policy which covered Plaintiff's boat. Specifically, Plaintiff's Boatsman Policy, purchased from Defendant, provides for “bodily injury liability coverage in the amount of $300, 000.00.” [Id.] However, Plaintiff's policy also contains a liability exclusion for precisely the type of incident that occurred on Lake Barkley on July 26, 2016. [Id.] The exclusion at issue provides as follows:

(a) Liability of other Covered Persons to you or any Resident Relative
(b) your liability to any Resident Relative;
(c) liability assumed by a Covered Person under any contract or agreement;

[DN 12-2, at 13.] In the above-quoted language, “you” is defined as the named insured, Plaintiff. [Id. at 16.] A “covered person” is the named insured, “or any person or legal entity operating the Insured Vessel as shown on the Declarations Page with your direct and prior permission.” [Id.] As Defendant explains in its Factual Background section, “[b]ecause Mr. Noel was operating the boat with Mr. Reddick's permission, Mr. Noel is a Covered Person under the Policy, and, therefore, the Policy excludes coverage for damages arising from the liability of Mr. Noel to Mr. Reddick…. [DN 12-1, at 3.] Plaintiff does not dispute the exclusion's language, nor does he argue that it should not apply to his situation. Rather, Plaintiff argues that the “Boatsman Policy goes against public policy and is therefore non-enforceable.” [DN 8, at 2.]

         II. Legal Standard

         Summary judgment is proper where “the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). When examining whether a motion for summary judgment should be granted, the court is required to resolve all ambiguities and draw all reasonable inferences against the movant. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). However, “not every issue of fact or conflicting inference presents a genuine issue of material fact.” Street v. J.C. Bradford & Co., 886 F.2d 1472, 1477 (6th Cir. 1989). Rather, the question is whether the party who bears the burden of proof in the case has presented a jury question as to each element in the case. Hartsel v. Keys, 87 F.3d 795, 799 (6th Cir. 1996). This means that the plaintiff must present to the court more than a mere scintilla of evidence supporting her position. Id. Indeed, the plaintiff must present evidence on which the trier of fact could reasonably find for the plaintiff. Id. It is not enough for a plaintiff to present speculation as to elements of the case, because “the mere existence of a colorable factual dispute will not defeat a properly supported motion for summary judgment. A genuine dispute between the parties on an issue of material fact must exist to render summary judgment inappropriate.” Monette v. Elec. Data Sys. Corp., 90 F.3d 1173, 1177 (6th Cir. 1996).

         III. Discussion

         Under Kentucky law, “if a contract, howsoever innocently entered into, has a direct tendency to, and would if upheld and enforced, injuriously affect a material and substantial part of the public, it will be declared to be one against public policy and most generally nonenforceable.” Forbes v. Ashland, 55 S.W.2d 917, 919 (Ky. 1932). Notably though, “contracts voluntarily made between competent persons are not to be set aside lightly.” Zeitz v. Foley, 264 S.W.2d 267, 268 (Ky. 1954). Indeed, “a contract term is unenforceable on public policy grounds only if the policy asserted against it is clearly manifested by legislation or judicial decisions and is sufficiently strong to override the very substantial policies in favor of the freedom to contract and the enforcement of private agreements.” State Farm Mut. Auto. Ins. Co. v. Hodgkiss-Warrick, 413 S.W.3d 875, 880 (Ky. 2013) (emphasis added). This stems from individuals' ...

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