[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT FILED
________________________ U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
No. 11-12027 NOVEMBER 4, 2011
Non-Argument Calendar JOHN LEY
CLERK
________________________
D.C. Docket No. 1:10-cv-00174-TWT
RYAN MAHENS,
llllllllllllllllllllllllllllllllllllllll Plaintiff-Appellant,
versus
ALLSTATE INSURANCE COMPANY,
llllllllllllllllllllllllllllllllllllllll Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Northern District of Georgia
________________________
(November 4, 2011)
Before HULL, PRYOR and FAY, Circuit Judges.
PER CURIAM:
Ryan Mahens, proceeding pro se,1 appeals the district court’s grant of
1
While Mahens filed the instant appeal pro se, all of his pleadings in the district court
have been counseled.
summary judgment in favor of Allstate Property and Casualty Insurance Company
(“Allstate”) in his diversity lawsuit alleging a breach of an insurance contract. For
the reasons stated below, we affirm.
I. FACTS
Mahens purchased a house in Marietta, Georgia, and insured it through
Allstate’s home insurance policy.2 He never moved into the house and never
resided there; in fact, the policy declarations section indicated that Mahens’s
mailing address was in Florida. However, Mahens hired Laura Restrepo to
manage the property for him, and, for some time, the house was used by
Restrepo’s relatives and other tenants. At some point, Restrepo and Mahens
decided to renovate the property and sell it, leaving the house unoccupied.
Restrepo’s acquaintance, Clifford Ochemba, would occasionally visit the property
to assess the status of the renovations and to show the house to prospective buyers.
2
The policy described the covered property as “Your dwelling including attached
structures.” The term “dwelling” was defined as “a one, two, three or four family building
structure, identified as the insured property on the Policy Declarations, where you reside and
which is principally used as a private residence.” The policy contemplated occasions where the
insured property is unoccupied. For example, the policy did not cover damage caused by frozen
plumbing while the building stood vacant, unless heat was maintained on the property, and the
policy also excluded coverage for vandalism or malicious mischief occurring more than 30 days
after the property became unoccupied. Regarding any changes in coverage, the policy provided:
“When Allstate broadens coverage during the premium period without charge, you have the new
features if you have the coverage to which they apply. Otherwise, the policy can be changed only
by endorsement.”
2
In March 2009, approximately eight months after the house became vacant, it was
discovered that a water leak occurred on the property and caused substantial
damage.
At first, Allstate questioned its liability, but approximately two weeks after
the discovery of the leak, Allstate sent an independent claims adjuster, Irving
Emmert, to the property to inspect the damage. While there, Emmert met with
Restrepo, Ochemba, and Shannon Allred, a representative of Integrity Renovation
& Remodeling, Inc. (“Integrity”). According to Mahens, Emmert introduced
himself as Allstate’s representative, made recommendations regarding the
necessary repair work, assured Restrepo that Allstate would pay for the repairs,
and told Allred to bill Allstate directly.3 Restrepo signed a form authorizing
Integrity to commence repair work on the property and to bill Allstate directly.
The form warned that the customer bore responsibility for all charges not
reimbursed by the insurance company.
On March 30, 2009, after substantial repair work had been done on the
house, Restrepo received a letter from Allstate, advising her that she would receive
a check for $42,366, the amount payable under the policy. However, in June
3
Emmert testified at his deposition that he never authorized Integrity to commence work
on the property and never indicated that Allstate would pay for the repairs.
3
2009, Allstate informed Restrepo that it would not honor the claim, despite the
letter. Allstate also sent an e-mail to Restrepo, stating that it would settle with
Integrity for $15,000, provided that Mahens sign a waiver releasing Allstate from
all liability. Neither Restrepo nor Mahens signed the release waiver.
Subsequently, Mahens filed a lawsuit against Allstate, alleging a bad-faith
breach of the insurance contract, and Allstate removed the suit to federal court
pursuant to 28 U.S.C. § 1332. After discovery, Allstate moved for summary
judgment, arguing, among other things, that its policy did not cover the water
damage to Mahens’s property because he did not reside there, as required by the
terms of the policy. Mahens also moved for summary judgment, contending that
the policy did not require him to reside on the property, that principles of waiver
and estoppel precluded Allstate from denying coverage based on non-residency,
and that Allstate acted in bad faith.
The district court granted summary judgment to Allstate and denied the
same to Mahens. It found, in relevant part, that Allstate’s policy did not cover
Mahens’s property because he did not reside there; that a waiver of the residency
requirement could be accomplished only through endorsement, which was lacking
in this case; that principles of implied waiver and estoppel under Georgia law
could not be used to waive the residency requirement, as doing so would expand
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coverage to include risks not covered by the policy; and that Allstate did not act in
bad faith, having reasonable grounds on which to deny coverage. The instant
appeal followed.
II. ANALYSIS
Mahens raises three main issues on appeal.4 First, he argues that he had
satisfied the residency requirement of Allstate’s policy because his absence was
only temporary, and, in any event, the residency provision of the policy was
ambiguous and should have been construed against Allstate. Second, Mahens
contends that Allstate’s actions waived the residency requirement and estopped it
from denying coverage. Finally, he asserts that Allstate acted in bad faith by
refusing to pay his insurance claim.
We review “the granting of summary judgment de novo, and the district
court’s findings of fact for clear error.” Robinson v. Tyson Foods, Inc., 595 F.3d
1269, 1273 (11th Cir. 2010). A district court shall grant summary judgment “if the
4
Mahens also raises two claims that are not subject to our review. Specifically, he
argues that he had actually settled the insurance claim with Allstate, and its letter promising to
send a check for $42,366 evidenced the settlement agreement. Mahens also argues that the
doctrine of promissory estoppel precluded Allstate from denying coverage because, acting
through Emmert, Allstate promised to pay for the repairs, and Mahens relied on this promise to
his detriment. We decline to review these claims because Mahens did not raise them before the
district court, and no exceptions warrant a review of these claims for the first time on appeal.
See Access Now, Inc. v. Southwest Airlines Co., 385 F.3d 1324, 1331-32 (11th Cir. 2004) (stating
that this Court does consider claims raised for the first time on appeal and describing five
circumstances where an exception to this principle might apply).
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movant shows that there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). If the
movant satisfies the burden of production showing that there is no genuine issue
of fact, “the nonmoving party must present evidence beyond the pleadings
showing that a reasonable jury could find in its favor.” Shiver v. Chertoff, 549
F.3d 1342, 1343 (11th Cir. 2008) (quotation omitted). “We draw all factual
inferences in a light most favorable to the non-moving party.” Id. Nevertheless,
the non-moving party cannot create a genuine issue of material fact through
speculation, id., or evidence that is “merely colorable” or “not significantly
probative,” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106 S.Ct.
2505, 2511, 91 L.Ed.2d 202 (1986).
A. Residency Requirement
Under Georgia law, “[n]o construction of an insurance contract is required
or even permissible when the language is plain, unambiguous, and capable of only
one reasonable interpretation.” Ga. Farm Bureau Mut. Ins. Co. v. Kephart, 439
S.E.2d 682, 683 (Ga. App. 1993). However, an insurance contract “should be
construed by the court where the language is undisputed but the meaning of that
language is in dispute.” Grange Mut. Cas. Co. v. DeMoonie, 490 S.E.2d 451, 453
(Ga. App. 1997). “Like any other contract, an insurance policy must be construed
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according to its plain language and express terms.” Kephart, 439 S.E.2d at 683.
Moreover, the policy “should be read as a layman would read it and not as it might
be analyzed by an insurance expert or an attorney.” Banks v. Bhd. Mut. Ins. Co.,
686 S.E.2d 872, 874 (Ga. App. 2009) (quotation omitted).
The insurance policy issued by Allstate defined the covered premises as
“Your dwelling including attached structures.” The term “dwelling” meant “a one,
two, three or four family building structure, identified as the insured property on
the Policy Declarations, where you reside and which is principally used as a
private residence.” This language plainly and unambiguously required Mahens to
reside at the property listed on the policy. In fact, the Georgia Court of Appeals
has previously construed similar language to require residency. See Kephart, 439
S.E.2d at 683 (determining that a residency requirement existed where the
insurance policy defined the covered “residence premises” as “the one family
dwelling, other structures, and grounds; or . . . that part of any other building;
where you reside”); DeMoonie, 490 S.E.2d at 453-54 (concluding that a residency
requirement existed where the policy defined the covered premises as “the one or
two family dwelling where you reside”).
It is true that Allstate’s policy contemplated temporary absences by
specifically excluding certain risks during times of vacancy, such as frozen pipe
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damage or vandalism. However, the record clearly shows that Mahens had never
resided at the property and that his absence was not temporary. Moreover, the
aforementioned exclusions did not make Allstate’s policy ambiguous or
contradictory, such as to negate the residency requirement. See DeMoonie, 490
S.E.2d at 453 (stating that provisions in a policy excluding specific items from
coverage in the event of vacancy “do not negate the requirement that the insured
reside in the insured premises). Because Mahens did not fulfill the residency
requirement of Allstate’s policy, his house was excluded from coverage.
B. Waiver and Estoppel
Mahens points to four actions by Allstate that could have waived the
residency requirement or estopped it from denying coverage: (1) Allstate mailed
the policy documents to Mahens’s address in Florida, implying knowledge that he
did not reside at the insured property; (2) Allstate’s agent, Emmert, told Restrepo
that Allstate would pay for the repairs to the property; (3) Allstate sent a letter
indicating that it would issue a check for $42,366 to cover the repairs performed
by Integrity; and (4) Allstate tried to settle with Integrity for $15,000.
To begin, Allstate’s attempt to settle with Integrity could not have waived
the residency requirement of the policy, as Georgia law specifically provides that
an insurer’s “engaging in negotiations looking toward a possible settlement of any
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loss or claim,” shall not be deemed “to constitute a waiver of any provision of a
policy or of any defense of the insurer under the policy.” O.C.G.A. § 33-24-40(3).
Allstate’s other actions also did not result in waiver or estoppel. In Fire
& Cas. Ins. Co. of Conn. v. Fields, 96 S.E.2d 502, 503-04 (Ga. 1957), the
insurance policy in question contained a residency requirement, as well as a
provision that all waivers or changes to the policy must be made in writing. Id. at
503. The insurer’s agent knew that the insured property was vacant, but received a
premium from the insureds and informed them that their property was covered
despite the vacancy. Id. The Georgia Supreme Court held that the agent’s
knowledge regarding the vacancy and his oral assurances that the property was
covered did not estop the insurer from asserting a breach of the residency
condition, and the insurer’s continued receipt and retention of premiums did not
prevent it from relying on the written-waiver requirement. Id. at 504; see also Am.
Mut. Fire Ins. Co. v. Durrence, 872 F.2d 378, 379 (11th Cir. 1989) (holding that,
despite the insurer’s knowledge that the insured property was vacant, and despite
the agent’s assurances that the property was covered, the insurer was not estopped
from denying coverage based on a lack of residency because, under Georgia law,
“oral assurances of waiving policy terms do not estop the insurer from relying on
the defense of a written-waiver requirement” where the insured had possession of
9
the policy). Moreover, it is “well-established . . . that the doctrines of implied
waiver and estoppel, based upon the conduct or action of the insurer, or its agent,
are not available to bring within the coverage of a policy risks not covered by its
terms, or risks expressly excluded therefrom.” Danforth v. Gov’t Emps. Ins. Co.,
638 S.E.2d. 852, 858-59 (Ga. App. 2006) (quotations and alteration omitted).
In this case, Allstate’s policy provided that, “[w]hen Allstate broadens
coverage during the premium period without charge, you have the new features if
you have the coverage to which they apply. Otherwise, the policy can be changed
only by endorsement.” Nothing in the record suggests that Allstate broadened its
insurance coverage during Mahens’s premium period to include unoccupied
dwellings, and Mahens points to no evidence that Allstate issued any endorsement
waiving the residency requirement. Furthermore, waiving the residency
requirement would expand Allstate’s coverage to include a risk not covered by the
policy’s terms, namely, a risk that a problem occurring in a vacant building, such
as a leak, would go unnoticed and cause extensive damage that otherwise could
have been prevented through prompt attention. Accordingly, Allstate was not
estopped from denying coverage based on non-residency, even though it mailed
policy documents to Mahens’s Florida address, orally assured Restrepo (through
Emmert) that it would pay for the repairs, and sent a letter indicating that a check
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for the repairs was forthcoming. See Fields, 96 S.E.2d at 503-04; Durrence, 872
F.2d at 379; Danforth, 638 S.E.2d. at 858-59.
D. Bad Faith
To establish a claim of bad faith on the part of the insurer under Georgia
law, “the insured must prove two conditions: (1) that a demand for payment was
lodged against the insurer at least 60 days prior to filing suit and (2) that the
insurer’s failure to pay was motivated by bad faith.” Primerica Life Ins. Co. v.
Humfleet, 458 S.E.2d 908, 910 (Ga. App. 1995); O.C.G.A. § 33-4-6. “A refusal to
pay in bad faith means a frivolous and unfounded denial of liability. If there are
any reasonable grounds for an insurer to contest the claim, there is no bad faith.”
Swyters v. Motorola Emps. Credit Union, 535 S.E.2d 508, 510 (Ga. App. 2000)
(quotation omitted).
Mahens cannot prevail on a bad-faith claim. As described above, his
property was not covered by the insurance policy because he did not reside there.
Therefore, Allstate had reasonable grounds for denying coverage and could not
have acted in bad-faith by doing so. See Swyters, 535 S.E.2d at 510; Collins v.
Life Ins. Co. of Ga., 491 S.E.2d 514, 517 (Ga. App. 1997) (holding that the insurer
did not act in bad faith by refusing to pay for a benefit that was clearly not covered
by the insurance contract).
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Having reviewed the record and the parties’ briefs, we conclude that the
district court did not err in granting summary judgment to Allstate and denying
summary judgment to Mahens. Accordingly, we affirm.
AFFIRMED.
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