United States District Court, D. South Carolina, Charleston Division
James N. Evans, individually and as owner/agent of Club Ro-Za Bar & Grill, Club Ro-Za Bar & Grill d/b/a Club Ro-Ze Plaintiffs,
Nautilus Insurance Company, Defendant.
C. NORTON, UNITED STATES DISTRICT JUDGE
matter is before the court on defendant Nautilus Insurance
Company's (“Nautilus”) motion for summary
judgment, ECF No. 23. For the reasons set forth below, the
court grants the motion.
matter arises out of an insurance contract. Compl. ¶ 2.
James N. Evans (“Evans”) owns and operates Club
Ro-Za Bar and Grill (“Club Ro-Za”) (together,
“plaintiffs”). Nautilus had issued a commercial
general liability insurance policy (the “Policy”)
for Club Ro-Za, with effective dates of February 2, 2012 to
February 2, 2013. Pl.'s Resp., 2. On September 3, 2012,
Tirele Green (“Green”) was in a vehicle when he
was shot by a patron of Club Ro-Za. Id. Plaintiffs
contend that Green was shot inadvertently while the patron
fired his weapon indiscriminately as a result of his drunken
state. Id. Nautilus, on the other hand, contends
that the shooting was an intentional assault. On or about
November 5, 2014, Green filed an action in the Charleston
County Court of Common Pleas against Evans, alleging premises
liability resulting from plaintiffs' negligence in
connection with the shooting. Compl. ¶ 5. Shortly
thereafter, Evans contacted Nautilus to request that it
defend and indemnify plaintiffs in accordance with the
Policy. Id. ¶ 6. Nautilus responded that the
Policy provided no coverage and refused to provide a defense.
Id. ¶ 7. A default judgment was eventually
entered against plaintiffs, granting Green $250, 000 in
actual damages and $1, 250, 000 in punitive damages.
Id. ¶ 9.
filed the instant action against Nautilus in state court on
February 16, 2017. ECF No. 1. The action was removed to this
court on March 22, 2017. ECF No. 5. Plaintiffs filed an
amended complaint on August 3, 2017, alleging the following
causes of action: (1) breach of contract; (2) bad faith; and
(3) punitive damages. ECF No. 19. On September 27, 2017,
Nautilus filed a motion for summary judgment, ECF No. 23, to
which plaintiffs responded on October 23, 2017, ECF No. 28.
Nautilus replied on October 27, 2017, ECF No. 30, and
plaintiffs filed a sur reply on November 3, 2017, ECF No. 32.
The court held a hearing on this motion on December 12, 2017.
This motion is now ripe for the court's review.
judgment shall be granted “if the pleadings, the
discovery and disclosure materials on file, and any
affidavits show that there is no genuine dispute as to any
material fact and that the movant is entitled to judgment as
a matter of law.” Fed.R.Civ.P. 56(c). Rule 56(c) of the
Federal Rules of Civil Procedure requires that the district
court enter judgment against a party who, ‘after
adequate time for discovery . . . fails to make a showing
sufficient to establish the existence of an element essential
to that party's case, and on which that party will bear
the burden of proof at trial.'” Stone v.
Liberty Mut. Ins. Co., 105 F.3d 188, 190 (4th
Cir. 1997) (quoting Celotex Corp. v. Catrett, 477
U.S. 317, 322 (1986)). “By its very terms, this
standard provides that the mere existence of some alleged
factual dispute between the parties will not defeat an
otherwise properly supported motion for summary judgment; the
requirement is that there be no genuine issue of material
fact.” Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 247-48 (1986). “Only disputes over facts that
might affect the outcome of the suit under the governing law
will properly preclude the entry of summary judgment.”
Id. at 248. “[S]ummary judgment will not lie
if the dispute about a material fact is ‘genuine, '
that is, if the evidence is such that a reasonable jury could
return a verdict for the nonmoving party.” Id.
the summary judgment stage the judge's function is not
himself to weigh the evidence and determine the truth of the
matter but to determine whether there is a genuine issue for
trial.” Id. at 249. When the party moving for
summary judgment does not bear the ultimate burden of
persuasion at trial, it may discharge its burden by
demonstrating to the court that there is an absence of
evidence to support the non-moving party's case.
Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986).
The non-movant must then “make a showing sufficient to
establish the existence of an element essential to that
party's case, and on which that party will bear the
burden of proof at trial.” Id. at 322.
reasonable inferences are to be drawn in favor of the
nonmoving party. Anderson, 477 U.S. at 255,
Webster v. U.S. Dep't of Agric., 685 F.3d 411,
421 (4th Cir. 2012). However, to defeat summary judgment, the
nonmoving party must rely on more than conclusory
allegations, mere speculation, the building of one inference
upon another, or the mere existence of a scintilla of
evidence. See Anderson, 477 U.S. at 252;
Stone, 105 F.3d at 191. Rather, “a party
opposing a properly supported motion for summary judgment . .
. must ‘set forth specific facts showing that there is
a genuine issue for trial.'” Bouchat, 346
F.3d at 522 (quoting Fed.R.Civ.P. 56(e) (2002) (amended
2010)). If the adverse party fails to provide evidence
establishing that the fact-finder could reasonably decide in
his favor, then summary judgment shall be entered
“regardless of ‘[a]ny proof or evidentiary
requirements imposed by the substantive law.'”
Id. (quoting Anderson, 477 U.S. at 248).
requests that the court grant summary judgment on all of
plaintiffs' causes of action based on two grounds: (1) no
insurance policy existed on the date of the underlying
incident; and (2) even if the policy had been in effect, the
shooting constitutes an excluded assault or battery. Mot.
Sum. Judg., 1. The court grants summary judgment based on the
non-existence of the policy on the date of the shooting and
refrains from addressing the question of whether the shooting
constitutes an excluded assault or battery.
February 2012, Nautilus issued the Policy to Ro-Za Bar and
Grill, with a policy period extending from February 2, 2012
to February 2, 2013. ECF No. 23-2. On February 2, 2012,
plaintiffs entered into a finance agreement with IPFS
Corporation (“IPFS”) to finance the insurance
policy issued by Nautilus. Mot. Sum. Judg., 3. Pursuant to
this financing agreement, plaintiffs made monthly payments to
IPFS and appointed IPFS as their attorney-in-fact, giving
IPFS full authority to cancel the Policy if plaintiffs were
to default on their payments. Id. Plaintiffs failed
to make a scheduled payment on August 2, 2012, and IPFS
mailed plaintiffs a notice of intent to cancel the Policy on
August 7, 2012, warning that the Policy would be cancelled if
plaintiffs failed to make the overdue payment within ten
days. Id. When plaintiffs did not make the payment
within ten days, IPFS mailed a Notice of Cancellation to
Nautilus on August 27, 2012, cancelling the policy effective
September 1, 2012. Id. The shooting of Green
occurred two days later.
argues that due to the above-referenced notices, the Policy
was not in effect at the time of the shooting, and so
Nautilus owed no duty to defend or indemnify plaintiffs in
the underlying action. Id. at 9. In response,
plaintiffs contend that IPFS and Nautilus's attempted
cancellation did not comply with South Carolina Code §
38-39-90, and thus the Policy remained in effect at the time
of the shooting. Pl.'s Resp., 4. South Carolina Code
§ 38-39-90, titled “Cancellation of insurance
contracts by premium service company, ” provides as
(a) If a premium service agreement contains a power of
attorney enabling the company to cancel an insurance contract
listed in the agreement, the insurance contract may not be
canceled by the premium service company unless the