SC Farm Bureau v. The Travelers Home

THIS OPINION HAS NO PRECEDENTIAL VALUE. IT SHOULD NOT BE
CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING
EXCEPT AS PROVIDED BY RULE 268(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

South Carolina Farm Bureau Ins. Co., Appellant,

v.

Marion L. Driggers, Shiralee Driggers, Tammy D. Floyd,
Arthur McKenzie, a/k/a Arther McKenzie, The Travelers
Home and Marine Insurance Company, The United
States of America acting by and through its agency, The
Internal Revenue Service and The South Carolina Tax
Commission, Defendants,

of which The Travelers Home and Marine Insurance
Company is the Respondent.

Appellate Case No. 2021-000494

Appeal From Williamsburg County
Kristi F. Curtis, Circuit Court Judge

Unpublished Opinion No. 2024-UP-235
Heard March 5, 2024 – Filed July 3, 2024

AFFIRMED

J. Dwight Hudson, of Hudson Law Offices, of Myrtle
Beach, and J.R. Murphy, of Murphy & Grantland, P.A.,
of Columbia, both for Appellant.
Susan Drake DuBose, of Baker, Ravenel, & Bender,
LLP, of Columbia, for Respondent.

PER CURIAM: In November 2009, a fire nearly destroyed a home in Lake City,
South Carolina. At the time of the fire, the home was titled to Tammy Floyd and
occupied by Arthur McKenzie, now deceased, under a lease-to-own contract.
Though Floyd was the record owner, payments under the lease-to-own contract went
to her father, Marion Driggers.

Two insurance policies were active on the date of loss. McKenzie insured his
interest in the property under a policy with The Travelers Home and Marine
Insurance Company (Travelers). Driggers is the named insured on a South Carolina
Farm Bureau Insurance Company (Farm Bureau) homeowner's policy. Still, the
record owner was Floyd, not Driggers.
After the loss, McKenzie made a claim on his Travelers policy and indicated that
"Tammie Floyd" had an interest in the property. After an investigation, Travelers
adjusted McKenzie's claim, determined that he had an insurable interest in the
property, and then settled and paid out part of his claim. Travelers did not pay any
sums to Driggers or Floyd.
The record reflects that Driggers did not notify Farm Bureau of the loss, for fear of
his rates increasing, until October 2012. After notification of the claim, Farm Bureau
brought this declaratory judgment action against Driggers, his wife, Floyd,
McKenzie, and Travelers. It sought declarations as to the value of the property at
the time of loss; the ownership interests between the defendants; whether S.C. Code
Ann. § 38-75-20 (2015), dealing with the allocation of coverage between multiple
insurance policies, applied; and a ruling on whether Farm Bureau was prejudiced by
late notice of the loss. After years of litigation, the circuit court granted summary
judgment to Travelers, allowed it to interplead the remaining amount it owed on
McKenzie's claim into the court, and dismissed Travelers from the action.
In this appeal, Farm Bureau argues that Travelers should not be dismissed from the
case and that Travelers's motion for interpleader should have been denied because it
was, and allegedly still is, unclear whether the funds Travelers sought to deposit are
sufficient to cover Travelers's portion of the covered loss. At oral argument, Farm
Bureau conceded that section 38-75-20 (cited above and sometimes referred to as
the "pro rata" statute) does not apply and that there was no "special relationship"
between Travelers and Farm Bureau. For the following reasons, we affirm the circuit
court's judgment allowing interpleader and dismissing Travelers with prejudice.
"[A] moving party is entitled to summary judgment 'if the [evidence before the court]
show[s] that there is no genuine issue as to any material fact and that the moving
party is entitled to a judgment as a matter of law.'" Kitchen Planners, LLC v.
Friedman, 440 S.C. 456, 459, 892 S.E.2d 297, 299 (2023) (alterations in original)
(quoting Rule 56(c), SCRCP). "When determining whether triable issues of fact
exist, all evidence and inferences drawn from the evidence must be viewed in the
light most favorable to the non-moving party." Belton v. Cincinnati Ins. Co., 360
S.C. 575, 578, 602 S.E.2d 389, 391 (2004).

Interpleader is required where a party "is or may be exposed to double or multiple
liability." Rule 22(a), SCRCP. As a defendant in the original action, Travelers
brought its claim for interpleader by way of cross-claim as allowed by the rule.
See id. Between McKenzie, Floyd, and Driggers, it seems plain that Travelers was
exposed to multiple potential claims on the remaining insurance funds. Given the
circuit court's finding that the deposited funds were sufficient to cover the remaining
claims, the court properly granted Travelers's motions for interpleader and summary
judgment, releasing Travelers from any further liability under Rule 22(b). See Rule
22(b), SCRCP ("Any party seeking interpleader, as provided in subdivision (a) of
this rule, may deposit with the court the amount claimed . . . . The court may
thereupon order such party discharged from liability as to such claims, and the action
continued as between claimants of such money or property.").
By itself, Farm Bureau's assertion that the amount on deposit may not be sufficient
to satisfy all remaining claims against the Travelers policy is insufficient to overturn
the circuit court's grant of summary judgment. Instead, Farm Bureau was required
to provide the court at least some factual evidence tending to bolster its position that
the deposited funds did not adequately account for Travelers's potential liability. See
Lord v. D & J Enterprises, Inc., 407 S.C. 544, 553, 757 S.E.2d 695, 699 (2014)
("Once the moving party carries its initial burden, the opposing party must do more
than rest upon the mere allegations or denials of his [or her] pleadings, but must, by
affidavit or otherwise, set forth specific facts to show that there is a genuine issue
for trial.").

We are sensitive to and fully appreciate Farm Bureau's argument that it was
prejudiced by Driggers's late notice of the loss and that the delay impeded Farm
Bureau's ability to assess the value of the property and the potential claims. Even
so, the delayed notice and any prejudice stemming from it are plainly attributable to
Driggers, Farm Bureau's own insured. The late notice by Driggers may be reason
for Farm Bureau to deny Driggers's claim under the Farm Bureau policy, but it does
not justify prolonging the participation of Travelers, which sought to pay out its
remaining insurance funds and demonstrated the amount to be deposited was
sufficient to cover its potential exposure to claims.

Travelers settled with McKenzie for around $232,000. Roughly $117,000 went to
McKenzie's attorneys' fees and expenses, as allowed by federal law. See
26 U.S.C.A. § 6323 (allowing the prioritization of a settling attorneys' fees where,
as here, the property was subject to federal tax liens). The remaining funds of about
$115,000 reflected the agreed upon amounts payable under McKenzie's dwelling
coverage (roughly $101,000) and personal property coverage (roughly $68,000).
There is nothing in the record tending to show that these amounts are insufficient to
cover the losses attributable to the 2009 fire, and we find no error in the circuit court's
assessment that these amounts were sufficient to satisfy potential claims.

Farm Bureau claims it is potentially owed a greater amount than the amount
Travelers sought to deposit with the court, and claims it is therefore entitled to
equitable indemnity from Travelers. We do not see, however, how expenses like the
fees incurred by Farm Bureau in bringing this declaratory judgment action are
attributable to Travelers. Our caselaw requires the party seeking indemnity to show
that it sustained damage due to the actions of the indemnitor. Walterboro Cmty.
Hosp. v. Meacher, 392 S.C. 479, 485, 709 S.E.2d 71, 74 (Ct. App. 2011) ("[A]
plaintiff asserting an equitable indemnification cause of action [must prove]: (1) the
indemnitor was liable for causing the plaintiff's damages; (2) the indemnitee was
exonerated from any liability for those damages; and (3) the indemnitee suffered
damages as a result of the plaintiff's claims against it, which were eventually proven
to be the fault of the indemnitor."). We understand Farm Bureau's decision to bring
this action and clarify the chaotic situation, but we are not aware of a legal principle
attributing any damage from Farm Bureau's delay in assessing and adjusting
Driggers's claim to Travelers.

Lastly, we address Farm Bureau's argument that it lacked a full and fair opportunity
to conduct meaningful discovery. We cannot square this argument with the record.
The property burned down in 2009. Driggers made his claim under the Farm Bureau
policy in 2012. Farm Bureau brought its declaratory judgment action in 2014. There
were several scheduling orders over the case's lifespan. The circuit court granted
summary judgment in April 2021, after the case had been pending for nearly seven
years. The circuit court judge who ultimately granted summary judgment
understandably expressed frustration upon learning that the amended discovery
deadlines she had last established, in an effort to move the case towards a conclusion,
had been ignored.
"A party claiming summary judgment is premature because they have not been
provided a full and fair opportunity to conduct discovery must advance a good reason
why the time was insufficient under the facts of the case . . . ." Guinan v. Tenet
Healthsystems of Hilton Head, Inc., 383 S.C. 48, 54, 677 S.E.2d 32, 36
(Ct. App. 2009); see also CEL Prod., LLC v. Rozelle, 357 S.C. 125, 129–30, 591
S.E.2d 643, 645 (Ct. App. 2004) (finding that where a party had not attempted to
schedule depositions until thirteen months after filing a counterclaim, and no
affidavits were presented supporting the delay to oppose summary judgment,
summary judgment was appropriate). Though Farm Bureau argued that the
pandemic and Driggers's lack of cooperation made it impossible to conduct the
depositions it needed for its opposition to Travelers's motion for summary judgment,
the case had been pending for roughly six years before the pandemic began in March
2020. The summary judgment motions at issue here were filed in April 2019—well
in advance of the pandemic.

For the foregoing reasons, the circuit court's judgment is

AFFIRMED.

GEATHERS, HEWITT, and VINSON, JJ., concur.