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Omni Health Solutions, LLC v. Zurich American Insurance Co.

United States District Court, M.D. Georgia, Macon Division

November 14, 2017




         Before the Court are Defendant Zurich American Insurance Company's Partial Motion to Dismiss, and Plaintiff Omni Health Solutions, LLC's Motion for Leave to Amend Complaint. Having considered the pleadings, the parties' arguments, and relevant legal authority, Defendant's Partial Motion to Dismiss [Doc. 8] is DENIED, and Plaintiff's Motion to for Leave to Amend [Doc. 13] is GRANTED.


         Plaintiff originally filed this action against Defendant, the insurer for four of Plaintiff's medical offices, in the Superior Court of Bibb County, Georgia. Defendant timely removed the case to this Court pursuant to the Court's diversity jurisdiction under 28 U.S.C. § 1332(a)(1). Plaintiff asserts two claims for breach of contract and one claim for bad faith, stemming from Defendant's delay in deciding coverage and determining the amount of loss Plaintiff suffered when one of Plaintiff's medical offices, 841 Mulberry Street, Macon, Georgia, 31201, sustained hail damage. Plaintiff also contends that once Defendant decided coverage and determined the amount of loss, Defendant did not pay Plaintiff the full amount Plaintiff was owed under the policy, and Defendant's delay and failure to pay were in bad faith, entitling Plaintiff to damages under O.C.G.A § 33-4-6.

         1. Defendant's Partial Motion to Dismiss

         Although Defendant entitled its Motion a Partial Motion to Dismiss, because it is after the pleadings have closed, Defendant is seeking a Judgment on the Pleadings under Fed.R.Civ.P. 12(c). Defendant argues Plaintiff's breach of contract claims fail as a matter of law because (1) O.C.G.A § 33-4-6, Georgia's statute providing damages for an insurer's bad faith refusal to pay claims, provides Plaintiff's exclusive remedy, and (2) Plaintiff fails to identify the particular contractual provision Defendant violated in Count II of its Complaint.

         Legal Standard

         “After the pleadings are closed-but early enough not to delay trial-a party may move for judgment on the pleadings” pursuant to Rule 12(c) of the Federal Rules of Civil Procedure.[1] “Judgment on the pleadings is appropriate where there are no material facts in dispute and the moving party is entitled to judgment as a matter of law.”[2] Thus, the standard of review for a motion for judgment on the pleadings is “almost identical to that used to decide motions to dismiss.”[3]

         When considering a motion for judgment on the pleadings, the Court must accept all well-pleaded facts in the complaint as true and draw all reasonable inferences in favor of the plaintiff, the non-movant.[4] However, “the court need not accept inferences drawn by plaintiffs if such inferences are unsupported by the facts set out in the complaint. Nor must the court accept legal conclusions cast in the form of factual allegations.”[5] A complaint will survive judgment on the pleadings if it contains “sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'”[6]


         Defendant first seek to dismiss Plaintiff's breach of contract claims by arguing that Plaintiff cannot claim both breach of contract and bad faith under O.C.G.A § 33-4-6, because the claims are duplicative and preempted by O.C.G.A § 33-4-6. Citing Howell v. Southern Heritage Insurance Company, [7] Defendant contends that damages under O.C.G.A § 33-4-6 must be Plaintiff's exclusive remedy. Defendant's reliance on Howell, however, is misguided. Howell does not address a plaintiff's ability to assert a breach contract claim and a bad faith claim under O.C.G.A § 33-4-6.[8] On the contrary, since “Georgia courts have ‘implicitly recognized the ability of an insured to bring a breach of contract claim and a claim for bad faith simultaneously, ' O.C.G.A. § 33-4-6 does not bar Plaintiffʹs breach of contract claim.”[9]

         Defendant next argues the Court must dismiss Plaintiff's second breach of contract claim because Plaintiff fails to identify the specific contract provision Defendant allegedly violated. Under Georgia law, to state a claim for breach of contract a plaintiff must allege (1) a valid contract; (2) material breach of its terms; and (3) damages arising therefrom.[10] Defendant is correct that in order “[t]o survive a motion to dismiss, a plaintiff asserting a breach of contract claim must allege a particular contractual provision that the defendant violated.”[11] However, the Court disagrees that Plaintiff has failed to do so.

         In the section of its Complaint entitled “Facts Common to All Counts, ” Plaintiff cites Section E of the insurance policy and states that this section “requires that Zurich make a coverage decision and notify its insured as to whether Zurich will repair the property, pay for the repair of the property, take possession and pay for the property, or simply pay the value of the property within 30 days of receiving a proof of loss.”[12] In the copy of the policy Plaintiff attaches to its Complaint, Section E not only states Defendant will give notice of its intentions within 30 days of receiving proof of loss, but it also states in the event of loss or damage covered by this “Coverage Part, ” Defendant will, at its option, pay the value of the loss or damages property, pay the cost of repair or replacement, take the property at an agreed or appraised value, or repair, rebuild, or replace the property.[13]

         Plaintiff alleges that it fulfilled the conditions precedent necessary to entitle Plaintiff to payment under the policy, but Defendant refused to pay the full value of the property, thereby breaching the contract. Section E, the contract provision Plaintiff cites in the Complaint, which is common to all counts, obligates Defendant to either pay for covered property that has been damaged or provide similar reimbursement. Plaintiff alleges Defendant did not do so. Thus, Plaintiff sufficiently alleges the contractual provision it claims Defendant breached and states a claim for breach of contract.

         2. Plaintiff's Motion for Leave to Amend Complaint

         In Plaintiff ‘s Motion for Leave to Amend its Complaint, Plaintiff seeks to add an additional claim for breach of the insurance policy based on information exchanged between the parties in the course of discovery. Additionally, Plaintiff seeks leave to identify an expert witness as to the proposed additional claim. Plaintiff has filed the proposed First Amended Complaint, and Defendant has not responded.

         Legal ...

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