ADDITIONAL CASES Great American Insurance Company, Third-Party Plaintiff v. Boom Construction Corp., Third-Party Defendant. Boom Construction Corp., Fourth-Party Plaintiff v. Evanston Insurance Company, Fourth-Party Defendant. MEMORANDUM & ORDER Plaintiff Wellsville Manor LLC (“Wellsville”) commenced the above-captioned action on March 7, 2022, against Defendant Great American Insurance Company (“Great American”), alleging a breach of contract claim based on Defendant’s failure to reimburse Plaintiff for damages to Plaintiff’s property, which Plaintiff asserts Defendant was required to do under the terms of Plaintiff’s insurance policy. (Compl.
7-10, Docket Entry No. 1.) On March 22, 2024, Defendant moved for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure and Plaintiff cross-moved for summary judgment.1 For the reasons discussed below, the Court denies both Defendant’s and Plaintiff’s motions for summary judgment. I. Background The following facts are undisputed unless otherwise noted.2 a. Factual background i. The policy Plaintiff operates a nursing home and assisted living facility at 4192A Bolivar Road, Wellsville, NY 14895 (the “Premises”). (Def.’s 56.1 Resp. 1.) Defendant issued a commercial property insurance policy to Plaintiff under policy MAC E558186, effective from February 7, 2021, through February 7, 2022 (the “Policy”).3 (Id. 3.) The Policy provides that Defendant “will pay for direct physical loss of or damage to [the Premises]…caused by or resulting from any Covered Cause of Loss.” (Policy 45, annexed to Decl. of Kevin Buckley (“Buckley Decl.”) as Ex. 1, Docket Entry No. 44-2;4 Def.’s 56.1 Resp. 4.) Covered cause of loss is defined as “Risks of Direct Physical Loss unless loss is: (1) excluded in Section C. Exclusions; or (2) limited in Section D. Limitations.” (Policy 47; Def.’s 56.1 Resp. 4.) The policy lists as an excludable cause of loss “[f]aulty, inadequate or defective…design, specifications, workmanship, repair, construction, renovation, remodeling, grading, [or] compaction.” (Policy 52; Def.’s 56.1 Resp. 5.) The Policy states that “[Defendant] will not pay for loss or damage caused by or resulting from” this cause of loss, unless it results in a covered cause of loss, in which case “[Defendant] will pay for the loss or damage caused by that Covered Cause of Loss.” (Policy 52; Def.’s 56.1 Resp. 5.) As relevant here, Section D, which specifies the limitations to covered causes of loss, states: [Defendant] will not pay more than $10,000 for loss or damage to the interior of any building or structure or to the contents in the building or structure caused by or resulting from rain, snow, sleet, ice, sand or dust, whether driven by wind or not, unless: a. the building or structure first sustains damage by a Covered Cause of Loss to its roof, excluding temporary coverings, or walls through which the rain, snow, sleet, ice, sand or dust enters[.] (Policy 53; Def.’s 56.1 Resp. 5.) In the event of loss or damage to the Premises, the Policy states that Plaintiff must: Take all reasonable steps to protect the [Premises] from further damage by a Covered Cause of Loss, and keep a record of [Plaintiff's] expenses necessary to protect the [Premises] from such a loss, for consideration in the settlement of the claim.…Also, if feasible, set damaged property aside and in the best possible order, for examination. (Policy 38; Def.’s 56.1 Resp. 6.) The Policy also required that in the event of loss or damage, Plaintiff “must see that the following are done”: (1) “[a]s often as may be reasonably required, permit [Defendant] to inspect the property proving the loss or damage”; (2) “permit [Defendant] to take samples of damaged and undamaged property for inspection, testing and analysis”; and (3) “[c]ooperate with [Defendant] in the investigation or settlement of the claim.” (Policy 38; Def.’s 56.1 Resp. 6.) Finally, the Policy also required that in the event of loss or damage, Plaintiff “must resume all or part of [its] ‘operations’ as quickly as possible.” (Policy 39; Def.’s 56.1 Resp. 6.) ii. The damage to the Premises In June of 2021, Plaintiff retained Boom Construction Corp. (“Boom”) to replace the entire roof at the Premises. (Def.’s 56.1 Resp. 7.) During the construction, Boom removed the permanent sea gravel ballast layer of the roof, which was one of four layers of the roof and the layer responsible for preventing upward movement of the roof membrane due to wind, and did not put down a replacement ballast.5 (Id. 8; Def.’s 56.1
