Beebie v. Brighthouse Fin. Inc.

DECISION and ORDER   Currently pending before the Court, in this insurance action filed by Rosemary Beebie (“Plaintiff”) against Brighthouse Financial, Incorporated and the Brighthouse Life Insurance Company (collectively “Defendants”) is Defendants’ motion for summary judgment pursuant to Fed. R. Civ. P. 56. (Dkt. No. 25.) For the reasons set forth below, Defendants’ motion for summary judgment is granted. I. RELEVANT BACKGROUND A. Plaintiff’s Claims Generally, liberally construed, Plaintiff’s Complaint claims that (1) Defendants breached the Temporary Insurance Agreement (“TIA”) by refusing to pay her late husband’s temporary insurance policy, and (2) the lack of notice that the TIA had apparently been terminated, coupled with Defendants’ failure to return the refund check until nineteen days after Plaintiff’s late husband’s death, led to Plaintiff’s detrimental reliance that her husband’s temporary life insurance policy was still in effect on the date of his death. (See generally Dkt. No. 12 [Plf.'s Compl.].) Familiarity with the factual allegations supporting these claims in Plaintiff’s Complaint is assumed in this Decision and Order, which is intended primarily for review by the parties. (Id.) B. Undisputed Material Facts Unless otherwise noted, the following facts were asserted and supported with accurate citations by Defendants in their Statement of Material Facts and expressly admitted by Plaintiff in her response thereto or denied without appropriate record citations. (Compare Dkt. No. 28 [Defs.' Rule 7.1 Statement] with Dkt. No. 32 [Plf.'s Rule 7.1 Response].) 1. Plaintiff’s husband, Mr. Craig J. Beebie (“Mr. Beebie”), applied for a term life insurance policy, number 212127669, in the amount of $500,000 with First MetLife Investors Insurance Company (“FMLI”). 2. On or about April 24, 2012, FMLI received a Life Express Order Ticket dated April 16, 2012, which included Mr. Beebie’s life insurance application. On that same day, FMLI also received a check from Mr. Beebie for $271.00, $149.00 of which represented the deposit for and at least one-twelfth of an annual premium for his policy. 3. Mr. Beebie received a TIA and receipt at the time of his application. 4. The express terms of the TIA are as follows: Temporary Insurance on any person will end on the earliest of the following: 1. When coverage under a policy issued by the Company as a result of the tele-application takes effect. 2. When a policy issued by the Company as a result of the tele-application interview is not accepted. 3. When the Company offers to refund any payment received under this Receipt. 4. The date the Proposed Insured or the Applicant learns that either the tele-application has been declined or the Company has decided to terminate the Temporary Insurance, or five days from the date the Company mails to the Proposed Insured(s) or an Applicant, at the address provided, a notice that the tele-application has been declined or the Company has decided to terminate the Temporary Insurance. 5. One hundred and twenty (120) days from the end of the tele-application interview. If no policy takes effect, any payment received will be refunded when Temporary Insurance ends. 5. The signatures section of the TIA states, I also affirm that I have read this entire Receipt and Agreement, and understand what Temporary Insurance provides, when Temporary Insurance starts, when Temporary Insurance ends, and who is eligible for Temporary Insurance. 6. Mr. Beebie signed the TIA on April 16, 2012. 7. On May 17, 2012, Mr. Beebie completed a telephone interview as part of the Application for Life Insurance. 8. The Application for Life Insurance designated Plaintiff as the primary beneficiary of the proposed policy. It also provided that, “Except as stated in the [TIA], no insurance will take effect until a policy is delivered to the Owner and the full first premium due is paid.” 9. As part of its review, FMLI requested and received Mr. Beebie’s medical records from Mr. David Pesses, M.D. FMLI considered the information it received from Dr. Pesses in connection with its review of Mr. Beebie’s application for life insurance. 10. On September 19, 2012, FMLI declined Mr. Beebie’s application for life insurance. That same day, FMLI notified Mr. David Norton, Mr. Beebie’s and Plaintiff’s Financial Services Representative, of its determination to decline Mr. Beebie’s application for life insurance. 11. On September 22, 2012, Mr. Beebie died. 12. FMLI never accepted Mr. Beebie’s application to issue life insurance policy number 212127669. Familiarity with the remaining undisputed material facts of this action, as well as the disputed material facts is assumed in this Decision and Order, which (again) is intended primarily for review by the parties. (Id.) C. Parties’ Briefing on Defendants’ Motion Generally, in support of their motion for summary judgment, Defendants assert the following two arguments: (1) Defendants are entitled to summary judgment for Plaintiff’s breach-of-contract claim because there was no temporary coverage in effect at the time of Mr. Beebie’s death; and (2) Defendants are entitled to summary judgment on Plaintiff’s equitable estoppel claim because (i) equitable estoppel cannot create coverage when no coverage exists, and (ii) Plaintiff’s equitable estoppel claim fails as a matter of law because she cannot demonstrate the threshold elements required under New York State law. (See generally Dkt. No. 29 [Defs.' Memo. of Law].) Generally, in opposition to Defendants’ motion, Plaintiff asserts the following three arguments: (1) Defendants’ motion should be denied because, due to the ambiguities within the TIA, there is a question of fact as to whether the temporary coverage was in effect at the time of her husband’s death; (2) Defendant’s reliance on “120 day clock” in the Application for Life Insurance raises a question of fact as to the validity of the document because it was not properly executed or witnessed as required in the document itself; and (3) Defendant’s motion for summary judgment on Plaintiff’s second claim (for equitable estoppel) should be denied because there are genuine issues of material facts as they relate to that claim. (See generally Dkt. No. 33 [Plf.'s Opp'n Memo. of Law].) Generally, in their reply, Defendants assert the following two arguments: (1) Plaintiff fails to raise a genuine issue of material fact regarding whether no temporary insurance existed when Mr. Beebie died because (i) the terms of the TIA are unambiguous as a matter of law, (ii) Plaintiff’s interpretation of the TIA does not create an ambiguity in the TIA’s language, and (iii) Plaintiff relies on speculation and irrelevant facts to create the illusion of a genuine issue of material fact; and (2) Plaintiff fails to raise a genuine issue of material fact with respect to her equitable estoppel claim because (i) equitable estoppel cannot create coverage when no coverage exists, and (ii) Plaintiff’s equitable estoppel claim fails as a matter of law in that she cannot demonstrate the threshold elements of that claim under New York State law. (See generally Dkt. No. 36 [Defs.' Reply Memo. of Law].) II. RELEVANT LEGAL STANDARDS Under Fed. R. Civ. P. 56, summary judgment is warranted if “the movant shows that there is no genuine dispute as to any material fact and that the movant is entitled to a judgment as a matter of law.” Fed. R. Civ. P. 56(a). A dispute of fact is “genuine” if “the [record] evidence is such that a reasonable jury could return a verdict for the [non-movant].” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).¹ As for the materiality requirement, a dispute of fact is “material” if it “might affect the outcome of the suit under the governing law…. Factual disputes that are irrelevant or unnecessary will not be counted.” Anderson, 477 U.S. at 248. In determining whether a genuine issue of material fact exists, the Court must resolve all ambiguities and draw all reasonable inferences against the movant. Anderson, 477 U.S. at 255. In addition, “[the movant] bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the…[record] which it believes demonstrate[s] the absence of any genuine issue of material fact.” Celotex v. Catrett, 477 U.S. 317, 323-24 (1986). However, when the movant has met its initial burden, the non-movant must come forward with specific facts showing a genuine issue of material fact for trial. Fed. R. Civ. P. 56(a), (c), (e).² Implied in the above-stated burden-shifting standard is the fact that, where a non-movant willfully fails to respond to a motion for summary judgment, a district court has no duty to perform an independent review of the record to find proof of a factual dispute — even if that non-movant is proceeding pro se.³ (This is because the Court extends special solicitude to the pro se litigant by ensuring that he or she has received notice of the consequences of failing to properly respond to the motion for summary judgment.)⁴ As has often been recognized by both the Supreme Court and Second Circuit, even pro se litigant must obey a district court’s procedural rules.⁵ Of course, when a non-movant willfully fails to respond to a motion for summary judgment, “[t]he fact that there has been no [such] response…does not…[by itself] mean that the motion is to be granted automatically.” Champion v. Artuz, 76 F.3d 483, 486 (2d Cir. 1996). Rather, as indicated above, the Court must assure itself that, based on the undisputed material facts, the law indeed warrants judgment for the movant. Champion, 76 F.3d at 486; Allen v. Comprehensive Analytical Group, Inc., 140 F. Supp. 2d 229, 232 (N.D.N.Y. 2001) (Scullin, C.J.); N.D.N.Y. L.R. 7.1(b)(3). What the non-movant’s failure to respond to the motion does is lighten the movant’s burden. For these reasons, this Court has often enforced Local Rule 7.1(a)(3) by deeming facts set forth in a movant’s statement of material facts to be admitted, where (1) those facts are supported by evidence in the record, and (2) the non-movant has willfully failed to properly respond to that statement⁶ — even where the non-movant was proceeding pro se.⁷ Similarly, in this District, where a non-movant has willfully failed to respond to a movant’s properly filed and facially meritorious memorandum of law, the non-movant is deemed to have “consented” to the legal arguments contained in that memorandum of law under Local Rule 7.1(b)(3).⁸ Stated another way, when a non-movant fails to oppose a legal argument asserted by a movant, the movant may succeed on the argument by showing that the argument possess facial merit, which has appropriately been characterized as a “modest” burden. See N.D.N.Y. L.R. 7.1(b)(3) (“Where a properly filed motion is unopposed and the Court determined that the moving party has met its burden to demonstrate entitlement to the relief requested therein….”); Rusyniak v. Gensini, 07-CV-0279, 2009 WL 3672105, at *1, n.1 (N.D.N.Y. Oct. 30, 2009) (Suddaby, J.) (collecting cases); Este-Green v. Astrue, 09-CV-0722, 2009 WL 2473509, at *2 & n.3 (N.D.N.Y. Aug. 7, 2009) (Suddaby, J.) (collecting cases). III. ANALYSIS A. Whether the Court Can Grant Summary Judgment for Defendants on Plaintiff’s Breach-of-Contract Claim After carefully considering the matter, the Court answers this question in the affirmative for one of the reasons stated in Defendants’ memoranda of law. (Dkt. No. 29; Dkt. No. 36.) To this reason, the court adds the following analysis, which is intended to supplement, not supplant, Defendants’ reasoning. “Under New York law, insurance policies are interpreted according to the general rules of contract interpretation.”⁹ Olin Corp. v. Am. Home Assur. Co., 704 F.3d 89, 98 (2d Cir. 2012). “Where the parties dispute the meaning of particular contract clauses, the task of the court is to determine whether such clauses are [clear or] ambiguous when read in the context of the entire agreement.” Law Debenture Trust Co. of N.Y., v. Maverick Tube Corp., 595 F.3d 458, 467 (2d Cir. 2010) (“Debenture Trust”) (quoting Sayers v. Rochester Tel. Corp. Supp. Mgmt. Pension Plan, 7 F.3d 1091, 1095 [2d Cir. 1993]) (internal quotation marks omitted). A contract’s language is clear when it provides “a definite and precise meaning, unattended by the danger of misconception in the purport of the contract itself, and concerning which there is no reasonable basis for a difference of opinion.” Olin Corp. v. OneBeacon Am. Ins. Co., 864 F.3d 130, 148 (2d Cir. 2017) (quoting Hunt Ltd. V. Lifschultz Fast Freight, Inc., 889 F.3d 1274, 1277 [2d Cir. 1989]). “‘Language whose meaning is otherwise plain does not become ambiguous merely because the parties urge different interpretations in the litigation,’ [Hunt Ltd., 889 F.2d at 1277], unless each is a ‘reasonable’ interpretation.” Debenture Trust, 595 F.3d at 467 (quoting Seiden Assocs., Inc. v. ANC Holdings, Inc., 959 F.2d, 425, 428 [2d Cir. 1992]).” Ambiguity itself is not enough to preclude summary judgment; rather, there must also exist relevant extrinsic evidence of the parties’ actual intent. Mellon Bank v. United Bank Corp., 31 F.3d 113, 115 (2d Cir. 1994). “Ascertaining whether the language of a contract is clear or ambiguous is a question of law to be decided by the court.” Lucente v. Int’l Bus. Machs. Corp., 310 F.3d 243, 257 (2d Cir. 2002) (citing Mellon Bank, 31 F.3d at 115). “Summary judgment is only proper in contract disputes if the language of the contract is wholly unambiguous.” Lucente, 310 F.3d at 257 (quoting Mellon Bank, 31 F.3d at 115). Two rules are particularly relevant when interpreting a contract. OneBeacon, 864 F.3d at 147. “First, the ‘words and phrases [in a contract] should be given their plain meaning, and the contract should be construed so as to give full meaning and effect to all of its provisions.’” Id. at 147-48 (quoting LaSalle Bank Nat’l Ass’n v. Nomura Asset Capital Corp., 424 F.3d 195, 206 [2d Cir. 2005]). Stated another way, “the clear and explicit meaning of insurance policy provisions, interpreted in their ordinary and popular sense[,] controls judicial interpretation unless used by the parties in a technical sense or a special meaning is given to them by usage.” Int’l Bus. Machs. Corp. v. Liberty Mut. Ins. Corp., 363 F.3d 137, 147 (2d Cir. 2004) (internal quotation marks omitted). “Second, contract terms are ambiguous if they are capable of more than one meaning when viewed objectively by a reasonably intelligent person who has examined the context of the entire integrated agreement and who is cognizant of the customs, practices, usages and terminology as generally understood in the particular trade or business.” OneBeacon, 864 F.3d at 148 (quoting Nowak v. Ironworkers Local 6 Pension Fund, 81 F.3d 1182, 1192 [2d Cir 1996]) (internal quotation marks omitted). “Evidence as to such custom and usage is to be considered by the court where necessary to understand the context in which the parties have used terms that are specialized.” Debenture Trust, 595 F.3d at 466. “The trade usage must be ‘so well settled, so uniformly acted upon, and so long continued as to raise a fair presumption that it was known to both contracting parties and that they contracted in reference thereto.’” British Int’l Ins. Co., v. Seguros La Republica, S.A., 342 F.3d 78, 84 (2d Cir. 2003) (quoting Reuters Ltd. v. Dow Jones Telerate, Inc, 662 N.Y.S. 2d 450, 454 [1st Dep't 1997]). A custom, in order to become a part of a contract, must be so far established and so far known to the parties, that it must be supposed that their contract was made in reference to it. For this purpose the custom must be established, and not casual, uniform and not varying, general and not personal, and known to the parties. Debenture Trust, 595 F.3d at 466 (emphasis in original) (quoting Belasco Theatre Corp. v. Jelin Prods. Inc., 59 N.Y.S. 2d 42, 46 [1st Dep't 1945]). It is important to note that “[p]roof of custom and usage does not mean proof of the parties’ subjective intent, for ‘[e]xtrinsic evidence of the parties’ intent may be considered only if the agreement is ambiguous.’” Id. (quoting Greenfield v. Phillies Records, Inc., 98 N.Y. 562, 569 [2002]). 1. Defendants’ Offer to Refund Here, the Court finds that a genuine dispute of material fact exists as to whether Mr. Beebie’s temporary life insurance ended on or about August 24, 2012. “New York law holds that when…there is proof of the office procedure followed in a regular course of business, and these procedures establish the required notice has been properly addressed and mailed, a presumption arises that notice was received.” Meckel v. Cont’l Res. Co., 758 F.2d 811, 817 (2d Cir. 1985). Denial of receipt alone does not rebut the presumption; there must be, in addition to denial of receipt, “some proof that the regular office practice was not followed or was carelessly executed so that the presumption that notice was mailed becomes unreasonable.” Meckel, 758 F.2d at 817. In support of their position that Defendants issued a refund check to Mr. Beebie prior to his death, Defendants provide the Court with a copy of a check, dated August 24, 2012. (Dkt. No. 27-5, at 2.) However, Defendants do not provide any affidavits of mailing, certified mailings, return receipts, or any other proof of mailings in support of their position. Instead, Defendants’ proof merely consists of a check that was dated “08/24/2012.” (Dkt. No. 27-5.) Meanwhile, Plaintiff swears that neither she nor Mr. Beebie (to the extent she possesses the requisite personal knowledge) received any notifications or mailings of Defendants’ offer to refund Mr. Beebie’s payment for temporary insurance until more than two weeks after Mr. Beebies death. (Dkt. No. 31, at

19-20, 25, 28.) Moreover, on October 10, 2012, after Mr. Beebie’s death, Plaintiff wrote a letter to Defendants’ agent requesting Mr. Beebie’s entire file. (Id. at 24.) On October 11, 2012, Plaintiff received a first-class mailer from Defendants containing Defendants’ refund checks. (Id. at