The opinion of the court was delivered by: Noel L. Hillman, U.S.D.J.
Plaintiff, Marilyn Gingham, obtained a homeowner's insurance policy from defendant, Liberty Mutual Fire Insurance Company ("Liberty Mutual"), to insure her property in Vineland, New Jersey. However, after a fire damaged plaintiff's insured property in January 2009, Liberty Mutual denied plaintiff's insurance claim and rescinded the policy on the basis of plaintiff's alleged misrepresentation that the insured property was her primary residence. Plaintiff filed a complaint against Liberty Mutual, alleging that the insurance company acted in bad faith, in violation of its common law duty and New Jersey statutory law, and that it impermissibly refused to disclose the claim and underwriting files relating to plaintiff and her policy and claim.
Liberty Mutual now moves to dismiss plaintiff's complaint on the grounds that it fails to state a claim upon which relief may be granted. Along with opposing Liberty Mutual's motion, plaintiff cross-moves for leave to file an amended complaint to add a claim for breach of contract.
For the reasons expressed below, Liberty Mutual's Motion to Dismiss is granted, and plaintiff's Motion for Leave to File an Amended Complaint is granted.
This Court exercises subject matter jurisdiction over the underlying claim pursuant to 28 U.S.C. § 1332. There is complete diversity between plaintiff and defendant. Plaintiff, Gingham, is a citizen of the State of New Jersey. Defendant, Liberty Mutual, is incorporated in the State of Wisconsin with its principal place of business in Boston, Massachusetts. Plaintiff alleges that the amount in controversy exceeds $75,000.00.
Plaintiff owned property at 400 North Third Street in Vineland, New Jersey.*fn1 She applied to Liberty Mutual for an insurance policy to cover her property. Liberty Mutual issued a homeowner's policy of insurance to plaintiff, insuring the property against certain losses.
On or about January 4, 2009, a fire ravaged plaintiff's property, damaging the home and its contents. As a result, plaintiff submitted a claim to Liberty Mutual pursuant to her homeowner's insurance policy and Liberty Mutual opened a claim file. Plaintiff cooperated during the investigation, providing a recorded statement to Liberty Mutual representatives.
Upon completion of the investigation of the claim, Liberty Mutual, in a letter dated February 2, 2009, informed plaintiff that it was rescinding the insurance policy and, thus, was denying coverage for her loss. In particular, Liberty Mutual stated in the letter:
This action has been taken by [Liberty Mutual] because of what are believed to be material misrepresentations on your application for homeowner insurance. Specifically, the following information was undisclosed, concealed or otherwise misrepresented:
* You stated that the insured location was your primary residence. However, you never have lived at the 400 N ...