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Robert Mcadam v. State National Insurance Company

September 24, 2012

ROBERT MCADAM,
PLAINTIFF,
v.
STATE NATIONAL INSURANCE COMPANY, INC. AND ROES 1 THROUGH 25, INCLUSIVE, DEFENDANTS.



The opinion of the court was delivered by: Barry Ted Moskowitz, Chief Judge United States District Court

ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

Defendant State National Insurance Company, Inc. ("Defendant") has filed a motion for judgment on the pleadings with respect to Plaintiff's third cause of action under Cal. Bus. & Prof. Code § 17200. For the reasons discussed below, Defendant's motion is GRANTED.

I. BACKGROUND

This action arises out of a "Hull and Machinery/Protection and Indemnity" Policy ("Policy") issued by Defendant to Plaintiff Robert McAdam for the term May 5, 2011 to May 5, 2012.

Plaintiff is the owner of the vessels Jessica M and Shirley B, both of which are insured under the Policy. In late 2011, Master Marine, Inc. ("MMI"), in Bayou La Batre, Alabama, performed repairs and upgrades on Jessica M and Shirley B to convert the vessels from shrimp trawlers to deep sea fishing boats. The repairs included work on the vessels' rudder and shaft assemblies.

On February 24, 2012, Shirley B'srudder snapped off while the vessel was fishing near New Zealand. Jessica M, which was 70 miles away, came to provide assistance and towed Shirley B to port in Tauranga, New Zealand. Defendant directed the Shirley B to a repair yard in Whangarei, New Zealand.

Repairs totaling $162,283.74 were made on the Shirley B. Defendant's surveyor determined that the loss of the rudder was caused by faulty work of MMI. Defendant reimbursed Plaintiff $114,375.07 for the repairs, deducting amounts for repairs that it deemed betterment.

The Jessica M also underwent repairs in New Zealand. The Captain of the Jessica M noticed "play" in the rudder while towing the Shirley B, and according to Plaintiff, subsequent testing and inspection showed that Jessica M suffered from the same repair defects as the Shirley B -- i.e., welds that were not full-penetration and provided no strength or stability to the rudder area.

When Plaintiff tendered a claim for the repair of Jessica M, Defendant denied coverage. Defendant took the position that the "play" in the rudder was due to lack of maintenance of the rudder stock and bearings, not faulty welds.

On June 4, 2012, Plaintiff commenced this action. The Complaint asserts the following four causes of action: (1) breach of insurance contract; (2) breach of the implied covenant of good faith and fair dealing; (3) injunctive relief and restitution pursuant to Bus. & Prof. Code § 17200, et seq.; and (4) declaratory relief.

II. STANDARD

"After the pleadings are closed -- but early enough not to delay trial -- a party may move for judgment on the pleadings." Fed. R. Civ. P. 12(c). Judgment on the pleadings is proper "when the moving party clearly establishes on the face of the pleadings that no material issue of fact remains to be resolved and that it is entitled to judgment as a matter of law." Hal Roach Studios, Inc. v. Richard Feiner & Co, Inc., 896 F.2d 1542, 1550 (9th Cir. 1989). All allegations of fact by the party opposing the motion are accepted as true, and construed in the light most favorable to that party. General Conference Corp. of SeventhDay Adventists v. Seventh-Day Adventist Congregational Church, 887 F.2d 228, 230 (9th Cir. 1989).

Courts have discretion to grant Rule 12(c) motions with leave to amend. In re Dynamic Random Access Memory Antitrust Litigation, 516 F. Supp. 2d 1072, 1084 (N.D. Cal. 2007). Courts also have discretion to grant dismissal on a 12(c) motion, in lieu of judgment, on any given claim. Id.; see ...


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