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Valley Equipment Leasing, Inc. v. McGriff, Seibels & Williams Of Oregon, Inc.

United States District Court, D. Colorado

April 28, 2016

VALLEY EQUIPMENT LEASING, INC., Plaintiff,
v.
McGRIFF, SEIBELS & WILLIAMS OF OREGON, INC., and RYAN ERICKSON, Defendants.

ORDER GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

CHRISTINE M. ARGUELLO United States District Judge

This matter is before the Court on Defendants’ Motion for Summary Judgment (Doc. # 76.) Because Defendants have demonstrated that there are no genuine disputes of material fact on each of Plaintiff’s claims such that Defendants are entitled to judgment as a matter of law, the Motion is granted.

I. BACKGROUND

1) Valley, McGriff and the GSIC policy

Plaintiff Valley Equipment Leasing, Inc. (“Valley”) is a trucking company that hauls freight using both its own fleet of trucks and drivers and contracted independent owner-operators. (Doc. # 76-2 at 2, 44, 71.) Defendant McGriff, Seibels & Williams of Oregon, Inc. (“McGriff”) is an insurance brokerage firm and Defendant Ryan Erickson (“Erickson”) was at all relevant times a McGriff employee engaged in the business of selling and administering insurance policies and advising clients. (Doc. # 41 at 2.)

In 2009, Erickson contacted Valley to market insurance. (Doc. # 76-2 at 4, 7.) Erickson detailed a number of insurance products, and Valley shared information about the nature of its business and its insurance needs. (Id. at 4-5, 8, 14, 46-48, 114-115, 122.) Over the course of these dealings, Valley communicated that a particular client - Groendyke - required Valley to maintain higher than normal liability coverage limits. (Id. 14-15, 123, 138.) Wishing to avoid a scenario where it over-insured its entire fleet of vehicles to suit the coverage requirements of a single client, Valley directed Erickson to generate a proposal for the so-called “excess” insurance needed to satisfy Groendyke. (Id. at 137, 138.)

Erickson presented Valley with two options: (1) scheduled unit coverage, which would provide excess insurance for specifically identified vehicles; or (2) scheduled contract coverage, which would provide excess insurance for specifically identified shipping contracts, regardless of which vehicles were used to service the contracts. (Id.

at 19-21, 50-51, 147.) In an email to the employee responsible for administering Valley’s insurance program, Erickson summarized the options as follows:

Following our conversation, here are the option [sic] we have for the excess:

• Current carrier - can add [contracts] as you need them but will have to issue a change [sic] for this of $250 per endorsement to the policy.
• General Star - has come back with a scheduled unit quote for 6 trucks at $21, 000. This is about $7, 000 less than what we have for you right now, but would be limited to the scheduled units. [ ] This option allows for more flexibility with your customers as it is not limited by contract.
Let me know what you would like to do with this and will make it happen right away.

(Id. at 155.) Valley responded by assenting to Erickson’s recommendation that it purchase scheduled unit coverage from General Star Indemnity Company (“GSIC”):

Looks like [Valley President] Gary [Musgrave] understands the situation with the excess insurance and how it would be beneficial to get set up with a policy with General Star as you described. Let me know when and how you want to go about this.

(Id. at 153.)

In September 2010, Valley cancelled an existing scheduled contract policy and purchased the GSIC scheduled unit policy recommended by Erickson and McGriff. (Id. at 20, 25, Doc. # 81 at 3.) Valley renewed the GSIC scheduled unit policy in March 2011 and March 2012. (Doc. # 81 at 3.) The policy explicitly provides that coverage applies only to six vehicles listed in an attached endorsement. (Doc. # 76-3 at 237.)

At all times, Valley President Gary Musgrave made final insurance purchasing decisions. (Doc. # 76-2 at 3-4, 45.) Musgrave admits in deposition testimony that he was presented with a scheduled contract policy and a scheduled unit policy and chose the latter. (Id. at 53.) Musgrave further admits that he knew what a scheduled unit policy was and understood “coverage would only be provided for the vehicles that [were] actually scheduled on [the] policy.” (Id. at 49.) Musgrave also acknowledged that it was Valley’s responsibility to ensure day-to-day compliance with the GSIC policy. (Id. at 17-18.) Each year the policy was in effect, Valley specified in writing which vehicles to list on the endorsement. (Id. at 28, 36-38, 58-59, 79, 92-93, 96-98, 196-201.)

Sometime before the 2011 renewal and in apparent contradiction of his stated understanding of scheduled unit coverage, Dave Musgrave asked Erickson what would happen if a Valley truck servicing Groendyke but not listed on the GSIC policy was involved in a wreck. (Id. at 55.) Erickson allegedly assured Musgrave that he would “make it work” by backdating a change to the policy endorsement to include the VIN number of any truck involved in an accident. (Id.) Musgrave claims Erickson made similar promises at a lunch meeting in the summer of 2012. (Id. at 56.) In both cases, the alleged representations were made orally and no written record ...


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