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ACE AMERICAN INS. CO. v. KEYSTONE CONSTRUCTION & MAINTENANCE SERVICES, INC.
United States District Court, D. Connecticut.
September 27, 2012.
Algonquin next moves to dismiss the negligence and recklessness claims against it. Both claims are based on Algonquin's failure to warn Kleen that it was dangerous to use natural gas in a gas blow. Traditionally, a duty to warn claim is brought against a product seller. Under the Connecticut Product Liability Act, "[a] product seller may be subject to liability for harm caused to a claimant who proves by a fair preponderance of the evidence that the product was defective in that adequate warnings or instructions were not provided." Conn. Gen. Stat. § 52-572q(a). A "product seller" means "any person or entity, including a manufacturer, wholesaler, distributor or retailer who is engaged in the business of selling such products whether the sale is for resale or for use or consumption." Conn. Gen. Stat. § 52-572m(a). "The term `product seller' also includes lessors or bailors of products who are engaged in the business of leasing or bailment of products." Id. A transporter is not a product seller under the Connecticut Product Liability Act. Product sellers are not the only entities subject to a duty to warn. A common carrier may have a duty to warn. Green v. H.N.S. Mgmt. Co., 91 Conn.App. 751, 759 (2005). A possessor of land may have a duty to warn invitees of danger. Romenici v. Trumbull Electric Mfg. Co., 145 Conn. 691, 694 (1958). But the plaintiffs have cited no case, and I have found none, suggesting that a transporter of a good owes a duty to the buyer of the good to warn that the good may be dangerous when used in the intended manner. This is particularly true when, as here, the plaintiffs do not even allege that the good was transported in a negligent or reckless manner. Therefore, Algonquin's motion to dismiss the negligence and recklessness claims is granted. E. Spectra's Motion to Dismiss Spectra also moves to dismiss all claims against it. Spectra, like Algonquin, was a transporter of natural gas. If the claims against it were limited to transportation, they would be insufficient to constitute a cause of action. But the plaintiffs allege that Spectra took a more active role in the gas blow than that. Specifically, the plaintiffs allege that Spectra "participat[ed] in developing a protocol for gas blows at the Kleen Plant which expelled excessive volumes of natural gas into a confined area where it collected with several ignition sources present resulting in an explosion causing death, injuries and property damage." 3d Am. Compl. at ¶ 99(c).2 In the complaint, the plaintiffs did not allege the nature of Spectra's involvement in the gas blow protocol, but merely alleged that Spectra was a "participant."3 In order to survive a motion to dismiss, the plaintiffs must state with some degree of specificity what conduct of the defendant's raises the claims to the level of plausibility. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555-56 (2007). Because the plaintiffs have failed to do so here, Spectra's motion to dismiss is granted without prejudice to repleading a claim based on involvement in the gas blow within thirty days of this ruling. F. Subcontractors' Motions to Dismiss The subcontractors, Bluewater, Keystone, Siemens, and WorleyParsons, bring motions to dismiss alleging that all counts against them should be dismissed. Several of the subcontractors argue that certain of the claims against them are insufficiently pled. All of the subcontractors seek dismissal because (1) they are insured under plaintiffs' policies, and insurers cannot seek subrogation against their own insureds; and (2) because Kleen waived its right to subrogation. 1. Bluewater's Motion to Dismiss the Claim for Recklessness (Count Three)
1. Unless otherwise noted, all background information is taken from the Third Amended Complaint.
2. Although the plaintiffs made similar allegations with regard to Algonquin, at the motion hearing the plaintiffs admitted that they had no reason to believe Algonquin was involved in developing gas blow protocols.
3. In response to the motion to dismiss, the plaintiffs provided the court with an affidavit describing Spectra's involvement in the gas blows. I am unable to consider that additional material at the motion to dismiss stage.
4. Plaintiffs' various builder's risk insurance policies follow the form of a single lead policy issued by Ace American Insurance Company. Unless otherwise noted, the term "insurance policy" refers to Kleen's insurance agreements with the plaintiffs.
5. In support of their argument, the plaintiffs cite Stop & Shop Supermarket Co. v. Abco Refrigeration Supply Corp., 48 Conn.Sup. 301 (2003). Stop & Shop was also a subrogation action, in which the defendant claimed to be an additional insured. The contract in that case stated that "Unless otherwise provided, the Owner shall purchase and maintain . . . property insurance upon the entire Work at the site to the full insurable value thereof. This insurance shall be on an all-risk policy form and shall include interests of the Owner, the Contractor, Subcontractors, and Sub-subcontractors in the Work and shall insure against the perils of fire." Id. at 305. The Court concluded that the defendant was not an "additional insured" under that agreement because "[w]hen Stop & Shop wanted to designate others as additional insureds, it did so." Id. at 311. I believe there is more evidence in this case that the subcontractors were actual insureds under the contract, including the fact that the Contractor was considered a fiduciary for the "insureds," including the subcontractors.
6. Perhaps the least convincing of Bluewater's arguments is that the contract should be read in the subcontractors' favor because the contract is ambiguous. "`As with contracts generally, a provision in an insurance policy is ambiguous when it is reasonably susceptible to more than one reading. . . . Under those circumstances, any ambiguity in the terms of an insurance policy must be construed in favor of the insured because the insurance company drafted the policy.'" Johnson v. Conn. Ins. Guar. Ass'n, 302 Conn. 639, 640 (2011) (quoting Conn. Med. Ins. Co. v. Kulikowski, 286 Conn. 1, 5-6 (2008)). The ambiguity here stems not from the insurance agreement, however, but the contract between Kleen and O&G. There is no indication that Kleen alone drafted the contract, and thus the usual rule regarding ambiguity in insurance agreements does not apply here.
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