Onebeacon America Insurance v. Commercial Union Assurance Co.
2012 U.S. App. LEXIS 14205
| 1st Cir. | 2012Background
- OneBeacon sues Aviva re insurance reinsurance for Harrisons US policies (1980–1982).
- 1980 OneBeacon policy C8-9101-002 and 1980 Aviva policy 6687287 reference a reinsurance relationship.
- 1980 OneBeacon Endorsement 4 states 100% reinsured by Aviva policy 6687287 with cross-cancellation trigger.
- 1981 Aviva Endorsement excludes Harrisons US from Aviva policy; subsequent 1981 and 1982 OneBeacon policies lack reinsurance language.
- Facultative Certificate No. 9009419 (Nov 26, 1980) purportedly evidences Aviva reinsurance for Mar 28, 1980–Apr 1, 1981; premium and payment details accompany the certificate.
- District court granted Aviva summary judgment; this court affirms, holding no continuing reinsurance after year one.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Aviva reinsured the 1981 policy year. | OneBeacon argues the 1980 agreement (policies + Endorsement 4) and the Facultative Certificate create ongoing reinsurance for 1981. | Aviva contends the 1981 year was not reinsured; 1981 policy lacked Endorsement 4 and 1981 Aviva Endorsement excludes Harrisons US. | No continuing reinsurance; 1981 year not covered. |
| Whether the 1981 Aviva Endorsement and 1981 OneBeacon Policy alter the scope of reinsurance beyond year one. | Endorsement 4 and 1980 policies together establish an ongoing reinsurance arrangement. | Endorsement 1981 excludes Harrisons US and shows termination of reinsurance; no continuing obligation. | Endorsement 1981 modifies/terminates the reinsurance; not ongoing. |
| Whether extrinsic evidence supports termination of the reinsurance after year one. | Premium flow and ledger entries may indicate continued reinsurance beyond year one. | Extrinsic evidence shows OneBeacon kept premiums post-year one and no reinsurer entries exist for 1981–1982. | Extrinsic evidence supports termination after first year. |
| Whether the district court properly granted Aviva summary judgment. | If reinsurance extended, OneBeacon wins; otherwise not. | End of reinsurance precludes coverage; no genuine fact issue remains. | Summary judgment for Aviva proper; OneBeacon not entitled to coverage. |
Key Cases Cited
- Denn Norske Bank AS v. First Nat'l Bank, 75 F.3d 49 (1st Cir. 1996) (extrinsic evidence admissible to aid in interpreting ambiguous terms)
- Sarsfield v. Great Am. Ins. Co. of N.Y., 335 F. App'x 63 (1st Cir. 2009) (de novo review of summary judgment; independence of grounds)
- Merchs. Ins. Co. v. U.S. Fid. and Guar. Co., 143 F.3d 5 (1st Cir. 1998) (insurance contract interpretation per Massachusetts law)
- Allmerica Fin. Corp. v. Certain Underwriters at Lloyd's, London, 871 N.E.2d 418 (Mass. 2007) (words in contract given meaning; policy terms interpreted fairly)
- Markline Co. v. Travelors Inc. Co., 424 N.E.2d 464 (Mass. 1981) (burden on insured to show policy grants coverage)
- Hartford Fire Ins. Co. v. CNA Ins. Co. (Europe) Ltd, 633 F.3d 50 (1st Cir. 2011) (standard for cross-motions on summary judgment)