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North Coast Sea-Foods Corp. v. Philadelphia Indemnity Insurance Co.

United States District Court, D. Massachusetts

April 1, 2019

NORTH COAST SEA-FOODS CORP., Plaintiff,
v.
PHILADELPHIA INDEMNITY INSURANCE COMPANY, Defendant.

          MEMORANDUM AND ORDER ON CROSS MOTIONS FOR SUMMARY JUDGMENT

          ALLISON D. BURROUGHS U.S. DISTRICT JUDGE

         Plaintiff North Coast Sea-Foods Corp. (“North Coast”) brings claims for breach of contract and for a declaratory judgment arising from Defendant Philadelphia Indemnity Insurance Company's (“PIIC”) refusal to defend and indemnify North Coast pursuant to an insurance policy. Currently before the Court are cross motions for summary judgment. [ECF Nos. 15, 21]. For the reasons discussed herein, PIIC's cross motion for summary judgment is GRANTED, and North Coast's motion for summary judgment is DENIED.

         I. BACKGROUND[1]

         North Coast is a Massachusetts seafood wholesaler that relied on Diamond Staffing Services, Inc. (“Diamond”) for some of its staffing needs. North Coast Facts ¶¶ 1, 12. On March 8, 2009, North Coast and Diamond entered into a six-page Temporary Staffing Services Agreement (the “2009 Agreement”). Id. ¶ 1. It is North Coast's general practice to have a master written agreement with its staffing agency and to change the rates on a periodic basis. Id. ¶ 11. The 2009 Agreement included provisions with headers such as “Terms of Agreement, ” “Scope of Agreement, ” “Safety, ” “Client and Diamond Staffing Obligations, ” as well as a lengthy section concerning “Proprietary Information.” [See ECF No. 15-4 at 1-5]. There are also sections of the 2009 Agreement that cover insurance, workers' compensation, and indemnity. Id. at 4. The indemnity clause of the 2009 Agreement provided, in pertinent part:

[Diamond] unconditionally indemnifies, holds harmless, protects and defends [North Coast] . . . against any and all claims, demands, damages, injuries, deaths, actions, costs and expenses and all other consequences of any sort, regarding any claim by any [Diamond] Employee related to or arising out of any workplace Injury . . . . The provision shall survive the termination of this Agreement.

Id. at 4.

         Paragraph 4 of the 2009 Agreement, titled “Rates and Invoicing, ” states that “[t]he rates for the Services will be set forth in Attachment A. Id. at 2. Attachment A, which is attached to the 2009 Agreement and numbered as page 7, is a one-page rate sheet that specifies costs for temporary employees and day laborers. It also states, in part:

Terms will remain in effect for a period of 3 years beginning on the date this Agreement is signed.
If you choose to terminate our business relationship following the full length of the term of agreement, a thirty (30) day written notice is required, at which time all outstanding invoices must be paid in full.

Id. at 7. North Coast and Diamond signed both the Services Agreement and Attachment A on March 8, 2009. Id. at 6-7; see also North Coast Facts ¶ 1.

         The 2009 Agreement states that it “will continue in effect until March 3, 2012.” [ECF No. 15-4 at 1]. On March 9, 2012, after the 2009 Agreement expired, North Coast and Diamond signed the “2012 Agreement, ” which was drafted by Diamond. North Coast Facts ¶ 17; [see ECF No. 15-6]. North Coast did not seek advice from counsel before signing the 2012 Agreement, and there is no record of PIIC making any representation that the 2009 Agreement's terms and conditions would continue in effect. PIIC Facts ¶¶ 44-45. The 2012 Agreement is similar in format and length to Attachment A to the 2009 Agreement in that it is a one-page document that primarily focuses on rates and costs. The 2012 Agreement contains all of the terms of Attachment A to the 2009 Agreement and additionally includes the following: a commitment by Diamond to maintain general liability insurance; workers' compensation insurance, and liabilities concerning unemployment benefits; a statement that the rate will automatically renew at the end of the term; a provision concerning minimum wage adjustments; and a requirement that “invoices are Due Net 21 Days.” [ECF No. 15-6]. Both Attachment A and the 2012 Agreement end with “[s]ignature below verifies and confirms terms and conditions between Diamond Staffing Services, Inc. and North Coast Seafoods.” [ECF No. 15-4 at 7; ECF No. 15-6].[2] The 2012 Agreement does not have a separate services agreement, is not labeled as an attachment, does not explicitly refer to or integrate the 2009 Agreement, and makes no reference to indemnification. PIIC Facts ¶¶ 38-40; [see also ECF No. 15-6].

         II. SUMMARY JUDGMENT STANDARD

         Summary judgment is appropriate where the movant can show that “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “A fact is material if its resolution might affect the outcome of the case under the controlling law.” Cochran v. Quest Software, Inc., 328 F.3d 1, 6 (1st Cir. 2003) (citation omitted). “A genuine issue exists as to such a fact if there is evidence from which a reasonable trier could decide the fact either way.” Id. (citation omitted).

         “To succeed in showing that there is no genuine dispute of material fact, ” the moving party must point to “specific evidence in the record that would be admissible at trial.” Ocasio-Hernandez v. Fortuño-Burset, 777 F.3d 1, 4 (1st Cir. 2015). “That is, it must ‘affirmatively produce evidence that negates an essential element of the non-moving party's claim,' or, using ‘evidentiary materials already on file . . . demonstrate that the non-moving party will be unable to carry its burden of persuasion at trial.'” Id. (quoting Carmona v. Toledo, 215 F.3d 124, 132 (1st Cir. 2000)). “One of the principal purposes of the summary judgment rule is to isolate and dispose of factually unsupported claims or defenses . . . .” Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). Once the movant takes the position that the record fails to ...


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