United States District Court, M.D. Georgia, Macon Division
CHANDRA H. BREWTON, Plaintiff,
THE FIRST LIBERTY INSURANCE CORPORATION, Defendant.
T. TREADWELL, JUDGE.
First Liberty Insurance Corporation, has moved for summary
judgment. Doc. 51. First Liberty argues that (1) Brewton is
judicially estopped from bringing her claims because she
failed to disclose her claim during her bankruptcy case, and
(2) First Liberty in fact assessed whether the value of
Brewton's home was diminished and thus Brewton's
“failure to assess” claim fails as a matter of
law. Id. at 1. As discussed below, First
Liberty's motion (Doc. 51) is GRANTED in
part and DENIED in part. Summary
judgment is granted for First Liberty on Brewton's
failure to assess claim, but Brewton is not judicially
estopped from pursuing her “failure to pay”
case is one of several putative class actions filed in this
Court against insurers who, the plaintiffs allege, take the
position that their homeowner's insurance policies do not
provide coverage for the diminished value of property damaged
as the result of a loss that is otherwise covered by their
policies. Basically, the plaintiffs, who are all represented
by the same lawyers, want their insurers to accept what they
contend has been clearly established by the Georgia Supreme
Court-when the value of a home has decreased as the result of
a covered loss even though the home has been fully repaired,
the insurer must compensate the insured for that diminished
value.The plaintiffs in these putative class
actions claim that insurers have failed to assess their homes
for diminished value and have failed to pay for diminished
value, also called diminution of value or stigma damages, has
a very specific meaning. “In [some] cases,
notwithstanding remedial measures undertaken by the injured
party, there remains a diminution in value of the property,
and an award of only the costs of remedying the defects will
not fully compensate the injured party.” John
Thurmond & Assocs., Inc. v. Kennedy, 284 Ga. 469,
471 n.2, 668 S.E.2d 666, 669 n.2 (2008) (citation omitted).
In particular, the underlying cause of a loss can stigmatize
a property, resulting in “a negative public perception
or fear that damage to property could create future
problems.” Doc. 53-7 at 2 (First Liberty's Georgia
Diminution in Value Frequently Asked Questions). “Even
though the property has been restored to its pre-loss
condition in terms of appearance and function, the property
carries an intangible taint or ‘stigma' due to the
nature of the loss.” Id. Thus, if a policy
covers diminished value, adjusters must determine whether the
insured property, as a result of stigma, is worth less even
though it has been repaired. State Farm Mut. Auto. Ins.
Co. v. Mabry, the seminal diminished value case,
involved automobile insurance policies, and automobiles
provide a well-known example of diminished value as the
result of stigma. 274 Ga. 498, 556 S.E.2d 114 (2001).
Typically, the repair of a wrecked car fixes it. But there is
a common perception that a wrecked car loses value
notwithstanding complete repairs. Thus, when a CARFAX report,
for example, reveals that a car has been damaged in an
accident, the value of the car in the eye of a potential
purchaser decreases even though the car has been repaired.
helpful to discuss what has happened in the first of these
putative class actions, Thompson v. State Farm Fire and
Casualty Insurance Company. In Thompson, the
Court granted in part and denied in part the plaintiffs'
motion for class certification under Federal Rule of Civil
Procedure 23(b)(3) or 23(c)(4). No. 5:14-cv-32, Doc. 78 at 1
(Mar. 9, 2016). Specifically, the Court, applying
Mabry, certified a class of State Farm policyholders
A breach of contract claim against State Farm based on its
failure to assess for diminished value.
Id. at 27-28. The plaintiffs also requested
certification of a claim for “failure to pay” for
diminished value, but the Court found that “the absence
of predominance precludes certification of the . . . failure
to pay claim . . . .” Id. at 18.
the Court ruled on several competing motions for summary
judgment, finding that, as a matter of law, (1) State
Farm's standard form policies covered diminished value,
(2) State Farm breached its duty to assess for diminished
value, and (3) the plaintiffs were not entitled to recover
monetary damages for that breach; rather, the remedy for
breach of the duty to assess, pursuant to Mabry, was
equitable. Thompson, No. 5:14-cv-32, Doc. 161 at 3-4
(Aug. 31, 2017).
Brewton's complaint and amended complaints are
“cookie cutter” complaints-that is, they are
essentially identical to the complaints filed by her lawyers
against other insurers that claim their policies do not cover
diminished value.Specifically, Brewton alleges that her
policy covers diminished value, an allegation First Liberty
denied in its answer, and then alleges that First Liberty
failed to assess her property to see whether its value had
decreased. See generally Docs. 49 ¶¶ 28,
42; 50 ¶¶ 28, 42. Thus, Brewton alleges First
Liberty breached the policy. Doc. 49 ¶ 31.
motion for summary judgment, First Liberty argues that
Brewton is judicially estopped from bringing this claim
because she failed to disclose this claim in her bankruptcy
case and thus took inconsistent positions under oath in a
manner calculated to make a mockery of the judicial system.
Doc. 51-1 at 1. In the alternative, First Liberty argues that
partial summary judgment is appropriate on Brewton's
failure to assess claim because First Liberty did assess
Brewton's property for diminished value. Id.
Summary Judgment Standard
shall grant summary judgment “if the movant shows that
there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”
Fed.R.Civ.P. 56(a). “A factual dispute is genuine only
if ‘a reasonable jury could return a verdict for the
nonmoving party.'” Info. Sys. & Networks
Corp. v. City of Atlanta, 281 F.3d 1220, 1224
(11th Cir. 2002) (quoting United States v. Four Parcels
of Real Prop., 941 F.2d 1428, 1437 (11th Cir. 1991));
see also Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 248 (1986). The burden rests with the moving party to
prove that no genuine issue of material fact exists.
Id. (citation omitted). The party may support its
assertion that a fact is undisputed by “citing to
particular parts of materials in the record, including
depositions, documents, electronically stored information,
affidavits or declarations, stipulations (including those
made for purposes of the motion only), admissions,
interrogatory answers, or other materials.”
moving party makes this showing, “the burden shifts to
the non-moving party to rebut that showing by producing . . .
relevant and admissible evidence beyond the pleadings.”
Josendis v. Wall to Wall Residence Repairs, Inc.,
662 F.3d 1292, 1315 (11th Cir. 2011) (citing Celotex
Corp. v. Catrett, 477 U.S. 317, 324 (1986)). The
non-moving party does not satisfy its burden “if the
rebuttal evidence ‘is merely colorable, or is not
significantly probative' of a disputed fact.”
Id. (quoting Anderson, 477 U.S. at 249-50).
Further, where a party fails to address another party's
assertion of fact as required by Federal Rule of Civil
Procedure 56(c), the Court may consider the fact undisputed
for purposes of the motion. Fed.R.Civ.P. 56(e)(2). However,
“[c]redibility determinations, the weighing of the
evidence, and the drawing of legitimate ...