R & D Towing, Inc. v. Plaza Insurance Company

IN THE INTERMEDIATE COURT OF APPEALS OF WEST VIRGINIA
FILED
July 1, 2024
R & D TOWING, INC.,
ASHLEY N. DEEM, CHIEF DEPUTY CLERK
Plaintiff Below, Petitioner INTERMEDIATE COURT OF APPEALS
OF WEST VIRGINIA

v.) No. 23-ICA-243 (Cir. Ct. Greenbrier Cnty. Case No. CC-13-2018-C-83)

PLAZA INSURANCE COMPANY,
Defendant Below, Respondent

MEMORANDUM DECISION

Petitioner R & D Towing, Inc. (“R & D”) appeals the Circuit Court of Greenbrier
County’s May 8, 2023, Order Granting Motion for Summary Judgment that dismissed
Petitioner’s claims with prejudice. Respondent Plaza Insurance Company (“Plaza”) filed a
timely response.1 No reply was filed. The issue on appeal is whether the circuit court erred
in granting summary judgment because material issues of fact existed.

This Court has jurisdiction over this appeal pursuant to West Virginia Code § 51-
11-4 (2022). After considering the parties’ arguments, the record on appeal, and the
applicable law, this Court finds no substantial question of law and no prejudicial error. For
these reasons, a memorandum decision affirming the circuit court’s order is appropriate
under Rule 21 of the Rules of Appellate Procedure.

This case arises from a claim filed by R & D under a policy of insurance issued by
Plaza. R & D owns and operates a towing company, storage yard, and garage in White
Sulphur Springs, West Virginia. Ron Cook is the owner and president of R & D. On June
23, 2016, a major flood event damaged vehicles and equipment located on property owned
by R & D. Some of the vehicles and equipment on the property were owned by entities
other than R & D, including, but not limited to, two business entities, Danron, Inc.,
(“Danron”) and Machinery Transport, Inc., (“Machinery Transport”) which were both
owned previously, in part, by Ron Cook. R & D filed a claim for all the damaged vehicles
and equipment on its property, regardless of ownership, under its Plaza Policy No.
PTOWK007120-00 (“the Policy”). Relevant to this case are the following:

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R & D Towing, Inc. is represented by Anthony M. Salvatore, Esq. Plaza Insurance
Company is represented by Michael P. Markins, Esq.

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• 2000 Peterbilt (VIN 1XP5DB9X3YN507638) – owned by Danron but
initially claimed as property owned by R & D
• 2006 Ford F-550 (VIN 1FDAF57P66EB61270) – owned by Danron but
initially claimed as property owned by R & D
• CAT Forklift Model V50B (Serial No. 81M3704) – owned by Danron
• CAT Forklift Model V800 (Serial No. 31S396) – owned by Danron
• Sulair Skid Mounted Diesel Air Compressor Model 175DUG JD (Serial No.
004-112825) – owned by Danron
• Lincoln Gas Welding Machine Model Ranger 250 (Serial No. 11151-
U1040423622) – owned by Danron
• Thermal Arc Gas Welding Machine Model Predator (Serial No.
A00230A191707D) – owned by Danron
• Mack Truck Model CH613 (VIN 1M2AAY2SW053608) – owned by
Brandon and/or Laramie Myers and was included in a parallel litigation
which was settled by Plaza

The Policy has multiple coverage parts, including two relevant coverages: (1) the
Commercial Automobile Coverage Part; and (2) the Commercial General Liability
Coverage Part (“CGL Coverage”). The primary coverage at issue here is the Commercial
Automobile Coverage Part which is comprised of (1) the Business Auto Coverage Form
and (2) the Garagekeepers Coverage Form Endorsement. Both the Commercial
Automobile Coverage Part and the CGL Coverage specify that Plaza will pay all sums an
insured is legally obligated to pay as damages because of property damage to which the
insurance applies.

Because R & D initially claimed that it owned the Ford F-550 and the Peterbilt
described above, those claims were analyzed under the Business Auto Coverage Form
which provides coverage for “damages because of ‘bodily injury’ or ‘property damage’ to
which this insurance applies, caused by an ‘accident’ and resulting from the ownership,
maintenance, or use of a covered ‘auto.’” A “covered auto” depends on the contents of the
Schedules to the Business Auto Coverage Form. Under the Policy, physical damage
comprehensive coverage was limited to the specific vehicles listed on the Declarations
page for which a premium was paid – that list included five vehicles, none of which were
the Ford F-550 or the Peterbilt.

The claims pertaining to the third-party storage of vehicles and equipment at R &
D’s facility fall under the Garagekeepers Form and the CGL Policy. The Garagekeepers
Form provides that:

[Plaza] will pay all sums the “insured” legally must pay as damages for “loss”
to a “customer’s auto” or “customer’s auto equipment” left in the “insured’s”

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care while the “insured” is attending, servicing, repairing, parking or storing
it in your “garage operations” under:

a. Comprehensive Coverage From any cause except:
(1) The “customer’s auto’s” collision with another object; or
(2) The “customer’s auto’s” overturn.

b. Specified Causes of Loss Coverage Caused by:
(1) Fire, lightning or explosion;
(2) Theft; or
(3) Mischief or vandalism.

c. Collision Coverage Caused by:
(1) The “customer’s auto’s” collision with another object; or
(2) The “customer’s auto’s” overturn.

The Garagekeepers Form includes a duty to defend, but Plaza has “no duty to defend any
‘insured against a suit’ seeking damages for a ‘loss’ to which this insurance does not
apply.” The Garagekeepers Form also includes a contractual liability exclusion which
excludes “[l]iability resulting from any contract or agreement by which the ‘insured’
accepts responsibility for ‘loss.’”

The CGL Coverage provides that Plaza “will pay those sums that the insured
becomes legally obligated to pay as damages because of . . . ‘property damage’ to which”
the Policy applies. Coverage only exists if the “‘property damage’ is the result of an
‘occurrence’ defined as an ‘accident, including continuous or repeated exposure to
substantially the same general harmful conditions.’”

Pursuant to the Policy, Plaza made payments for the vehicles and equipment owned
by R & D, but the claims were denied for those not owned by R & D.

R & D filed a complaint in circuit court on June 21, 2018, alleging Plaza failed to
provide coverage to R & D for its losses and engaged in bad faith and breach of contract
for failing to provide coverage. In Count One, R & D claimed it suffered loss and
destruction to various commercial vehicles it owned, including a “newly acquired” and
“not yet licensed” 2006 Ford F-550 and a 2000 Peterbilt, and sought a declaration that
Plaza is obligated to pay the claim for the loss of these two vehicles. However, Mr. Cook
later admitted during his deposition that these vehicles were owned by Danron Holdings,
a successor to Danron, Inc., the real estate company he previously had an interest in with
his long-term romantic partner, rather than R & D. In Count Two, R & D claimed it stored
various pieces of commercial equipment and vehicles on behalf of Machinery Transport
and alleged that the Garagekeepers Endorsement of the Policy requires Plaza to satisfy the
claims made against R & D regarding the loss of this commercial equipment by Machinery

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Transport’s Bankruptcy Trustee. R & D also claimed that a Mack Truck owned by a
customer, Brandon Myers, was destroyed by floodwaters and that Plaza is obligated for
those damages. Counts Three and Four of the Complaint alleged punitive damages and
breach of contract claims arising from the losses alleged in Counts One and Two.

Also on June 21, 2018, Laramie A. Myers, d//b/a White Oak Farms filed suit against
R & D for the loss of its Mack Truck. Plaza hired an attorney to provide a defense to R &
D in this litigation, settled the litigation on R & D’s behalf, and fully funded the settlement.
Plaza also hired an attorney to defend R & D in litigation filed by Machinery Transport’s
bankruptcy trustee for recovery of its loss of equipment and vehicles. That proceeding
continued until a jury trial found that Machinery Transport could not recover from R & D.
Plaza provided a defense to R & D through the resolution of the litigation.

Danron did not file a claim with Plaza for the loss of its equipment or vehicles, or
file suit against R & D or Plaza, but Mr. Cook claims that he promised Danron that he
would reimburse its losses. He alleges he filed the Complaint on behalf of R & D to seek
damages for what Danron could potentially claim against R & D.

On July 29, 2022, Plaza filed its Motion for Summary Judgment in the underlying
case. Responsive pleadings were filed and oral argument was held on March 15, 2023,
before Plaza’s motion was granted in its entirety by order dated May 8, 2023. The circuit
court held that it is axiomatic that an entity cannot recover damages for property that it did
not own. Young v. Appalachian Power Co., No. 2:07-479, 2008 WL 4571819, at *9 (S.D.
W.Va. 2008); see also Shaffer v. Calvert Fire Ins. Co., 135 W. Va. 153, 159, 62 S.E.2d
699, 703 (1950) (holding that if an insured has divested himself of his insurable interest in
the property at the time of the loss, he cannot recover.) It is undisputed that R & D did not
own the vehicles or commercial equipment at issue, nor have any insurable interest in these
vehicles, and the Policy does not provide direct primary coverage for property owned by
others. Rather, the circuit court found that the Policy is a liability policy that would only
pay out claims for which R & D is legally responsible and no such claims were set forth in
Count I of the Complaint or were otherwise developed in discovery, and accordingly, there
was no legal obligation or basis for compensation for these losses under the Policy. The
circuit court specifically found that R & D’s assertions that it wanted a policy with different
coverages than the one purchased do not change the terms and conditions of the policy it
actually procured, and to the extent such allegations are true, found they had no impact on
the analysis of the matter because they would constitute parol evidence. Further, the court
found that to the extent such allegations are true, R & D’s remedies would lie with their
insurance agent, not with Plaza.

The circuit court also found summary judgment on Count II of the Complaint
because R & D’s allegations that Plaza refused to satisfy the claims asserted against R &
D by Machinery Transport and Laramie Myers were false and unsupported by the record.
Plaza paid for the defense of the jury trial against Machinery Transport and paid for the

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defense and settlement of the Myers suit. Summary judgment was awarded on Count III of
the Complaint as there was no evidence that Plaza acted in bad faith or breached any duty
owed to R & D or otherwise acted maliciously, wantonly, or knew that R & D’s claim was
proper. Finally, summary judgment was granted on Count IV of the Complaint because the
breach of contract claims were essentially identical to the declaratory judgment claims in
Counts I and II. The court found there was no breach of the insuring agreement and
therefore no common law bad faith claim. It is from this order that R & D now appeals.

Our review of a circuit court’s entry of summary judgment is de novo. Syl. Pt. 1,
Painter v. Peavy, 192 W. Va. 189, 190, 451 S.E.2d 755, 756 (1994). In conducting a de
novo review, this Court applies the same standard for granting summary judgment that a
circuit court must apply: “[a] motion for summary judgment should be granted only when
it is clear that there is no genuine issue of fact to be tried and inquiry concerning the facts
is not desirable to clarify the application of the law.” United Bank, Inc. v. Blosser, 218 W.
Va. 378, 383, 624 S.E.2d 815, 820 (2005) (quoting Painter, 192 W. Va. at 190, 451 S.E.2d
at 756, syl. pt. 2). “Summary judgment is appropriate if, from the totality of the evidence
presented . . . the nonmoving party has failed to make a sufficient showing on an essential
element of the case that it has the burden to prove.” Syl. Pt. 2, Williams v. Precision Coil,
Inc., 194 W. Va. 52, 56, 459 S.E.2d 329, 333 (1995). “[T]he party opposing summary
judgment must satisfy the burden of proof by offering more than a mere ‘scintilla of
evidence’ and must produce evidence sufficient for a reasonable jury to find in a
nonmoving party’s favor.” Id. at 60, 459 S.E.2d at 337 (quotations and citations omitted).

On appeal, R & D argues that summary judgment was inappropriate for two reasons:
first, that there was a disputed issue of fact surrounding the type of insurance coverage
Plaza offered to R & D that precludes summary judgment; and second, that there is a
material issue of fact as to whether Plaza conducted a reasonable investigation of the claims
at issue as R & D requested.2

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Due to R & D’s failure to cite to the appendix record in the Statement of the Case
or the Argument sections of its brief and its failure to properly cite law in support of its
arguments, we remind R & D of the mandates of Rules 10(c)(4) and 10(c)(7) of the West
Virginia Rules of Appellate Procedure:

(4) Statement of the Case: Supported by appropriate and specific references
to the appendix or designated record, the statement of the case must contain
a concise account of the procedural history of the case and a statement of the
facts of the case that are relevant to the assignments of error.

(7) Argument: The brief must contain an argument clearly exhibiting the
points of fact and law presented, the standard of review applicable, and citing
the authorities relied on, under headings that correspond with the
assignments of error. The argument must contain appropriate and specific

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On the first point, R & D asserts that an affidavit of Ron Cook, submitted below as
an exhibit to its response to Plaza’s motion for summary judgment, establishes that Mr.
Cook requested direct primary coverage from his insurance agent which arguably would
have covered the third-party claims at issue herein. Mr. Cook’s affidavit asserts that he was
told that R & D received direct primary coverage, whereas Plaza maintains that the
coverage was for liability only. R & D now asserts that where Mr. Cook’s affidavit
contradicts Plaza’s position on the type of coverage provided under the Policy, a question
of fact remains.

We find this argument unpersuasive. Our review of the appendix record establishes
that Mr. Cook’s affidavit is contradictory to the assertions made in the underlying
complaint and to other sworn statements made in related proceedings arising from the 2016
flood event. Submission of such a self-serving affidavit some four years into the litigation
does not create a question of fact sufficient to defeat summary judgment. As our Supreme
Court of Appeals has noted, “[a] conflict in the evidence does not create ‘a genuine issue
of fact’ if it unilaterally is induced.” Williams v. Precision Coil, Inc., 194 W. Va. 52, 60
n.12, 459 S.E.2d 329, 337 n.12 (1995). By the same rationale, our Supreme Court has
observed “that a court must be free to disregard a conflicting affidavit.” Kiser v. Caudill,
215 W. Va. 403, 408, 599 S.E.2d 826, 831 (2004). Here, we do not find that Mr. Cook’s
affidavit creates a genuine issue of material fact sufficient to defeat summary judgment.

In its second point, R & D argues that a material issue of fact exists as to whether
Plaza conducted a reasonable investigation of the claim at issue as R & D requested.
However, this argument is not clearly developed or supported by either the appendix record
or any citation to the law. Instead, R & D puts forth several disjointed and conclusory
statements regarding Plaza “simply [sitting] on its hands” and choosing not to investigate,
a half-hearted statement implying that perhaps the terms of the Policy are ambiguous, and
an unexplained admonition that “this Court should not consider any ruling by the Federal
Court as controlling.” Accordingly, we deem this argument abandoned as it was not fully
briefed. As our Supreme Court has observed, “[a]lthough we liberally construe briefs in
determining issues presented for review, issues which are not raised, and those mentioned
only in passing but are not supported with pertinent authority, are not considered on
appeal.” State v. LaRock, 196 W. Va. 294, 302, 470 S.E.2d 613, 621 (1996); State v. Lilly,
194 W. Va. 595, 605 n.16, 461 S.E.2d 101, 111 n.16 (1995) (finding that cursory treatment
of an issue is insufficient to raise it on appeal).

citations to the record on appeal, including citations that pinpoint when and
how the issues in the assignments of error were presented to the lower
tribunal. The Intermediate Court . . . may disregard errors that are not
adequately supported by specific references to the record on appeal.

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Finding no reversible error, we affirm the May 8, 2023, Order Granting Summary
Judgment.

Affirmed.

ISSUED: July 1, 2024

CONCURRED IN BY:

Chief Judge Thomas E. Scarr
Judge Charles O. Lorensen
Judge Daniel W. Greear

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