Atlantic Specialty Insurance Company v. Bindea
632 F.Supp.3d 681
W.D. Va.2022Background
- Owner Bogdan Bindea operated the offshore supply vessel M/V Bob Rouse; on Nov. 17–19, 2020 the vessel capsized in Haitian waters with crew casualties and salvage costs incurred.
- ASIC issued a Commercial Marine Package (CMP) policy (effective Mar. 20, 2020–Mar. 20, 2021) listing navigational limits as “within the east coast of Florida” and a crew limit of three; ASIC accepted premiums and delivered the written policy to Bindea in Virginia.
- Insurance applications submitted to ASIC by Bindea’s agents/brokers contained representations limiting operations to Ft. Lauderdale/Florida and listing three crew; the parties agree those applications contained inaccurate statements about intended operations and crew size.
- Bindea contends he neither saw nor agreed to the written policy terms and that he expected coverage for Haitian operations; he sues ASIC (counterclaim) and third-party defendants (agents/brokers) for negligent procurement.
- ASIC sued for declaratory judgment (policy void ab initio or, alternatively, no coverage for the Haiti loss or reduced coverage due to crew-limit breach) and moved for judgment on the pleadings under Rule 12(c).
- The court granted ASIC’s Rule 12(c) motion, holding (1) no enforceable contract because no mutual assent to the policy terms, and (2) in any event the navigational warranty unambiguously excludes coverage for the loss in Haiti.
Issues
| Issue | Plaintiff's Argument (ASIC) | Defendant's Argument (Bindea) | Held |
|---|---|---|---|
| Existence of an enforceable insurance contract | No meeting of the minds: Bindea never assented to the policy terms ASIC issued; therefore no contract. | Bindea paid premiums and received a certificate and so believes ASIC must honor coverage he requested. | Held for ASIC: no mutual assent to the written CMP policy; no enforceable contract. |
| Effect of navigational warranty (coverage territory) | The policy expressly suspends coverage when the vessel is outside "within the east coast of Florida," so loss in Haiti is excluded. | The navigational phrase is ambiguous and conflicts with broader "coverage territory" language; ASIC waived or is estopped from invoking it. | Held for ASIC: clause is clear and unambiguous; Haiti is not "within the east coast of Florida," so the loss is excluded. |
| Crew-limit endorsement (number of crew) | If coverage applied, liability/hull limits should be reduced proportionally because more than three crew were aboard. | Bindea disputes applicability and asserts agents misrepresented crew needs. | Not reached as dispositive: court disposed on no-contract and navigation exclusion grounds (crew-limit issue not necessary to award relief). |
| Waiver/estoppel of policy conditions | ASIC did not waive or act to induce reliance that would estop it from enforcing the written terms. | Bindea argues ASIC/agents induced belief he had broader coverage and thus ASIC should be estopped/waived from denying coverage. | Held for ASIC: facts do not support waiver or estoppel; no evidence ASIC knew and intentionally surrendered rights or that it changed position to Bindea’s detriment. |
Key Cases Cited
- Volvo Constr. Equip. N. Am. v. CLM Equip. Co., 386 F.3d 581 (4th Cir. 2004) (factors for declaratory judgment jurisdiction and when DJ is appropriate)
- Penn-Am. Ins. Co. v. Coffey, 368 F.3d 409 (4th Cir. 2004) (declaratory judgment serves to clarify insurance relations and remove uncertainty)
- Massey v. Ojaniit, 759 F.3d 343 (4th Cir. 2014) (court may consider documents integral to the complaint on Rule 12(c))
- Wilburn Boat Co. v. Fireman’s Fund Ins. Co., 348 U.S. 310 (1955) (state law governs marine insurance in absence of federal maritime rule)
- Lauritzen v. Larsen, 345 U.S. 571 (1953) (admiralty choice-of-law factors)
- Seabulk Offshore, Ltd. v. Am. Home Assur. Co., 377 F.3d 408 (4th Cir. 2004) (contract formation: policy delivery completes formation)
- Amgen Inc. v. Conn. Ret. Plans & Tr. Funds, 568 U.S. 455 (2013) (judicial admissions in pleadings bind parties)
- Erie Ins. Exch. v. EPC MD 15, LLC, 822 S.E.2d 351 (Va. 2019) (contract/policy terms given ordinary meaning; ambiguities construed against drafter)