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Luzzi v. HUB International Northeast Ltd.

United States District Court, D. New Jersey

August 21, 2018

JUDY LUZZI, Plaintiff,
v.
HUB INTERNATIONAL NORTHEAST LTD., and FIDELITY AND GUARANTY INSURANCE UNDERWRITERS, INC., a subsidiary of The Travelers Companies, Inc. Defendants.

          OPINION

          HON. KEVIN MCNULTY UNITED STATES DISTRICT JUDGE.

         The plaintiff, Judy Luzzi, brings this action against HUB International Northeast Ltd. ("HUB") and Fidelity and Guaranty Insurance Underwriters, Inc. ("Fidelity"), an affiliate of The Travelers Companies, Inc. ("Travelers").[1]

         Defendants now move for summary judgment. As to defendant HUB, the motion is granted on all Counts. As to defendant Fidelity, it is granted as to Count I, but denied as to Counts II and III.

         I. Background

         A. Relevant Facts[2]

         In December 2013, at the suggestion of her real estate agent, Ms. Luzzi decided to obtain renter's insurance before moving into a second-floor apartment of a two-family home in Woodland Park, New Jersey. (DSMF ¶ 1; Pl. Dep. 13:12-:23, 38:6-39:17). She testified that she "was seeking coverage for renter's insurance, whatever that covered." (Pl. Dep. 44:12-: 13). Thereafter, in mid to late December, she telephoned the same company that she used for her auto insurance, Travelers of New Jersey. (Id. at 39:24-40:1, 41:l-:2, 43:13-:14). Luzzi spoke to an unidentified individual who told her to call HUB (id. at 40:19-:23), an "insurance agency licensed to issue policies of insurance in the State of New Jersey." (Compl. ¶ 1. See Ans. ¶ 1) (admitting that HUB "is authorized to conduct business in the State of New Jersey and HUB maintains its principal place of business in the State of New York").

         Luzzi telephoned and spoke to Anna Rodriguez, who she believed was a representative of HUB. (DSMF ¶ 2; PRSMF ¶ 2; Pl. Dep. at 42:20-:22, 43:l-:2).[3] According to Luzzi, during that call, Ms. Rodriguez asked her only the following questions: 1) if she had a Fire extinguisher, 2) where the extinguisher was, 3) if she had a deadlock on the door, and 4} how many rooms were in the apartment. (Id. at 45:22-:25, 55:l-:2), Luzzi testified that although she thought that the renter's insurance would cover her personal property, no one ever explained to her what the renter's insurance would cover. (Id. at 44:14-45:2). Luzzi testified that Ms. Rodriguez did not ask her about her personal property or the value of that property. (Id. at 46:10-: 11, 54:14-:20). According to Luzzi, Ms. Rodriguez also did not discuss, or ask her about, the dollar limits of coverage. (Id. at 47:3-:4). See (id. at 46:10-: 17, 50:21-:22). Luzzi testified that she "trusted" Rodriguez and believed that the questions Rodriguez asked "were the only questions that needed to be asked." (Id. at 46:4-:7). See (id. at 51:l-:4, 54:9-: 13). Because she was not asked, Luzzi did not provide any information about her personal property.[4] (Id. at 54:14-:20).

         Ms. Rodriguez had a different recollection of die telephone conversation. After reviewing her notes of the conversation, Rodriguez testified that she specifically asked Luzzi about personal property; specifically, she asked about furs, fine china, jewelry, or other valuable items. (Rod. Dep. 26:16-: 17, 27:8-:10). Based on her notes, Rodriguez testified that she explained valuable-item coverage to Luzzi, who ultimately "declined" such coverage. (Id. at 27:l-:25). Rodriguez also recalled that she asked Luzzi if she wanted a "platinum package," which provided coverage for valuable items on an all-risk basis. (Id. at 34:8-: 17). Rodriguez's notes indicate that Luzzi "declined" that package. (Id. at 34:18-: 19. See Rod. Dep., Exh. AR-3 (providing a copy of Rodriguez's notes)).[5]

         Thereafter, Luzzi moved into die apartment. She received a letter from Travelers dated December 30, 2013, which enclosed a copy of a Travelers renter's insurance Declarations Page and Homeowners Policy Booklet.[6] (Pl. Dep., Exh. A, P-4). The letter identified the policy period as December 26, 2013 through December 26, 2014, and stated, in part:

You will find important documents related to your Travelers policy and coverage:
Your New Insurance Policy, which includes your Declarations, [7] policy form and endorsements. Please take a moment to review these important materials, especially your Declarations Page, which shows the coverages and limits that you have selected.

[Id.) (emphasis in original). The Declarations Page set a total policy premium of $126. (ECF No. 48-4, Exh. B at 1). Section I of the form, entitled "Property Coverages," set a $15, 000 limit for personal property. [Id.) As for the Homeowners Policy Booklet, [8] Section I addressed "Property Coverages," including coverage for personal property. (Id. at 13-14).

         Luzzi did not read the policy because she "wouldn't have understood it." (Pl. Dep. 65:14). She explained: "I don't understand these policies. They're written way above my head." (Id. at 65:15-: 16). She also testified that she was unaware that the policy had limits of coverage for certain types of personal property, and never read that section of the policy because she "wouldn't have understood it, anyway." (Id. at 73:2-: 11). She stated: "I had the policy and I figured I was covered." (Id. at 65:20). Plaintiff placed her copy of the policy in a Tiling cabinet. (Id. at 65:19, 71:l-:5).

         Nearly two months later, on February 17, 2014, a fire occurred at Luzzi's apartment. (Compl. ¶ 9). After the fire, Luzzi reported the loss to HUB and Fidelity, and submitted a claim for the loss of her personal property. (PSMF ¶ 19; Compl. ¶ 10). Specifically, she submitted "Inventory Submission" spreadsheets in which she identified the items that were lost in the fire. (Pl. Dep., Exh. P-7) (listing 354 items and the "quantity lost" for each of those items)). These included two decorative figurines each of which had a $750 replacement cost, 475 pairs of shoes with a total replacement cost of $56, 350, an $8, 000 full-length mink coat, a $6, 000 three-quarter length mink coat, a $4, 500 mid-length mink coat, a $4, 000 full-length Persian lamb coat, a $3, 000 Persian lamb jacket with a mink collar, four diamond bracelets each of which had a $2, 125 replacement cost, and seven gold bracelets each of which had a replacement cost of $857.14. According to Luzzi, her actual damages on a replacement cost basis were $270, 000, plus additional living expenses. Fidelity paid $15, 000, the policy's personal property limit. (PSMF ¶ 20; Compl. ¶ 10).

         B. Procedural History

         On June 24, 2015, Luzzi filed a Complaint against HUB and Fidelity in the Superior Court of New Jersey, Law Division, Passaic County. (Compl.) She asserts three claims against HUB and Fidelity based on the theory that "[i]n obtaining a policy of insurance from Fidelity," HUB was acting as the agent, servant, workman or employee of Fidelity for the purpose of providing a policy of insurance issued by Fidelity." (Id. at ¶ 6).

         Count I of the Complaint asserts breach of contract. "In obtaining the policy of insurance for Plaintiff," HUB, as agent for Fidelity, "either negligently failed to obtain the correct information from Plaintiff concerning the proposed insured property" or "failed to transmit the correct information to Fidelity," thereby causing Fidelity to limit Plaintiffs recovery "to only $15, 000." (Comp., I ¶ 11).

By failing to obtain the proper information in order to obtain appropriate insurance coverage for [her] premises or, alternatively in failing to transmit the proper information necessary to obtain insurance coverage for [her] property, HUB breached its agreement to obtain reasonable, necessary and proper insurance coverage for [her] property thereby becoming liable for the resulting damage caused by Fidelity's limitation of [her] claim.

(Id. at I ¶ 12) (emphasis added).

         Count II of the Complaint alleges negligence:

The direct and factual cause of the uncovered losses was the negligence and carelessness of HUB in failing to obtain the reasonable, necessary and proper insurance coverage for [her] property and/or in failing to properly transmit the necessary information in order to obtain insurance coverage for [her] property.

(Id. at II ¶ 2).

         Count III of the Complaint alleges negligence/respondeat superior liability:

The failure of Fidelity's agent HUB, acting within the course and scope of its authority and on the business of Fidelity in failing to obtain and/or transmit the necessary information is negligence and such negligence is imputed to Fidelity under the Doctrine of Respondeat Superior.

(Id. at III ¶ 4).

         The Complaint seeks compensatory damages, attorney's fees, costs of suit, and "such other relief as the Court may deem equitable and just." (Id. at text following I ¶ 12, II ¶ 2, III ¶ 4. See Comp. ΒΆ 10 (stating that "actual damages were ...


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