United States District Court, D. Colorado
ORDER GRANTING SUMMARY JUDGMENT
William J. Martínez United States District Judge
Praetorian Insurance Company (“Praetorian”)
brought this lawsuit seeking a declaratory judgment that it
has no obligation to pay insurance benefits under a
builder's risk policy (the “Policy”) issued
to Defendants Axia Contracting LLC (“Axia”) and
255 Blackhawk Hospitality LLP (“Blackhawk”)
summary judgment, the parties seek clarity from this Court on
whether, under the Policy, Defendants' failure to
maintain a protective device, a six-foot fence enclosing the
entire job site, which was listed in an endorsement and
schedule attached to the contract, relieves Praetorian of its
obligation to pay for Defendants' losses due to fire.
(ECF No. 50.) Plaintiff also seeks summary judgment on
Defendants' counterclaims. For the reasons discussed
below, the Court will grant Praetorian's Motion for
Summary Judgment (“the Motion”), direct entry of
judgment, and terminate this case.
facts are fairly straightforward and undisputed. Citations to
docketed materials are to the page number in the CM/ECF
header rather than to any internal pagination.
19, 2017, Defendants were in the process of constructing a
hotel (the “Project”) at 255 Blackhawk Street,
Aurora, Colorado (the “Property”). Blackhawk
owned the Property and Axia was the general contractor for
the Project. Early in the morning on June 19, 2017, a fire
occurred at the Property damaging the unfinished hotel
City of Aurora Fire Department investigated the fire and a
fire investigator concluded that it was “the result
of an intentional and direct human act” and
classified the fire as “incendiary . . . that is
deliberately set with the intent to cause the
fire.” (ECF No. 50-1 at 10 (emphasis in original).)
Based on information provided by Axia, the City of Aurora
Fire Department estimated the property and structural damage
to be approximately $3, 000, 000.
time of the fire, Praetorian had issued to Defendants the
Policy covering “perils during the course of
construction, subject to the terms and conditions of the
Policy, ” including the terms of the Builders' Risk
Coverage as well as any endorsements and schedules identified
on the schedule of coverages. (ECF No. 50 at 3-4,
¶¶ 7-8; see ECF No. 50-2.) Under the
Policy, Praetorian is responsible for “risks of direct
physical loss or damage unless the loss is limited or caused
by a peril that is excluded.” (ECF No. 50-2 at 20.)
Policy includes a “Protective Devices Schedule”
and a “Protective Devices Endorsement”
(“PDE”). (ECF No. 50-2 at 50-51.) The Protective
Devices Schedule lists the following protective devices or
services (together, “Protective Safeguards”):
Site will be protected with chain link fencing, or other
similar security fencing, at least 6 ft. in height completely
enclosing the jobsite.
All entrance and access gates shall remain securely locked
during non-working hours.
Jobsite will be fully illuminated each night with lights
continuously from sunset to sunrise.
(Id. at 50.) The PDE added both “other
conditions” and “perils excluded.” Under
“other conditions, ” the PDE stated:
Protective Devices - “You” are
required to maintain, at all times during the policy period,
the protective devices and services described on the
Protective Devices Schedule.
(ECF No. 50-2 at 51.) Under “perils excluded, ”
the PDE added the following language:
following exclusion is added . . . under Perils Excluded [of
the Builders' Risk Coverage] and applies only when a
device or service, shown on the ...