Markel American Insurance v. Díaz-Santiago
674 F.3d 21
| 1st Cir. | 2012Background
- On Oct. 8, 2008, MDS Caribbean Seas Limited purchased the vessel Black Sea and executed a preferred ship mortgage in FirstBank’s favor, with MDS owning the vessel and Diaz-Santiago and his wife providing a continuing guaranty.
- MDS, not Diaz-Santiago, was the insured owner; Díaz-Santiago submitted insurance applications listing himself as owner, creating a misrepresentation in the record.
- The CBP seized the Black Sea in March 2009, prompting FirstBank to pursue release via administrative forfeiture and criminal proceedings, and to file a claim with Markel for insurance coverage.
- Markel denied the claim on July 9, 2009 due to the misrepresentation of ownership in the insurance papers, triggering FirstBank’s cost-bearing obligations under the Mortgage’s Default provisions.
- In April 2010 the district court granted FirstBank’s partial summary judgment; Diaz-Santiago and Markel filed a Consent Motion acknowledging the policy was void; FirstBank sought and obtained an order awarding costs and attorneys’ fees.
- Diaz-Santiago challenged the district court’s strike/protective-order rulings, the grant of summary judgment, and the denial of his Rule 59 motion; the First Circuit affirmed the court’s rulings on appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the strike/protective-order rulings were properly reviewable. | Díaz-Santiago argued the June 14 order denying strikes/protective relief should be reviewed. | FirstBank argued lack of jurisdiction over that challenge. | Jurisdiction granted; challenge rejected; district court’s rulings affirmed. |
| Whether the district court correctly granted FirstBank’s partial summary judgment. | Díaz-Santiago contends facts show unclean hands and disputed issues preclude summary judgment. | FirstBank established breach of the Mortgage/guaranties and costs incurred were recoverable. | Summary judgment affirmed; FirstBank entitled to costs and expenses. |
| Whether the Rule 59(e) motion to alter judgment was properly denied. | Díaz-Santiago argued equitable defense of unclean hands warranted relief. | FirstBank argued Rule 59(e) was misuse for new arguments; no manifest error. | Rule 59(e) denial affirmed; no abuse of discretion. |
Key Cases Cited
- Torres v. Oakland Scavenger Co., 487 U.S. 312 (1988) (Rule 3(c) jurisdictional, liberally construed for fair notice)
- Smith v. Barry, 502 U.S. 244 (1992) (liberal construction of notices of appeal; fairness)
- Kotler v. American Tobacco Co., 981 F.2d 7 (1st Cir. 1992) (intent to appeal determined by notice in context of record)
- FirsTier Mortgage Co. v. Investors Mortgage Ins. Co., 498 U.S. 269 (1991) (liberal construction of appeal and record considerations; preclusion of narrow readings)
- In re Jarvis, 53 F.3d 416 (1st Cir. 1995) (special deference to district court application of local rules)