Abbasid, Inc. v. Travelers Indemnity Co. , 404 F. App'x 253 ( 2010 )

FILED
United States Court of Appeals
Tenth Circuit
December 7, 2010
UNITED STATES COURT OF APPEALS
Elisabeth A. Shumaker
Clerk of Court
FOR THE TENTH CIRCUIT
ABBASID, INC.,
Plaintiff-Appellant,
No. 10-2079
v. (D.C. No. 1:07-CV-01006-WJ-LFG)
(D. N.M.)
THE TRAVELERS INDEMNITY
COMPANY,
Defendant-Appellee.
ORDER AND JUDGMENT *
Before TACHA and ANDERSON, Circuit Judges, and BRORBY, Senior Circuit
Judge.
Abbasid, Inc. (Abbasid) appeals the district court’s entry of summary
judgment in favor of Travelers Indemnity Co. (Travelers) in this diversity action.
Abbasid made a claim on its insurance policy with Travelers due to water and
*
After examining the briefs and appellate record, this panel has determined
unanimously to grant the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore
ordered submitted without oral argument. This order and judgment is not binding
precedent, except under the doctrines of law of the case, res judicata, and
collateral estoppel. It may be cited, however, for its persuasive value consistent
with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
sewage damage to its inventory of Oriental rugs on September 7, 2005. 1
Travelers denied coverage based on a policy exclusion for damage caused by a
water or sewer backup or overflow. The district court held that the exclusion
applied to deny coverage and granted Travelers’ motion for summary judgment.
Background
Shortly after moving into retail space in Santa Fe, New Mexico, water and
sewage leaked into Abbasid’s premises from the restaurant above it. The leak
was caused by a blockage in the sewer pipe that caused an uncapped connection
of the sanitary sewer main serving the restaurant to overflow. Abbasid submitted
claims to its insurance company, Travelers, who denied coverage. The relevant
provision in the Travelers policy states:
B. EXCLUSIONS
1. We will not pay for loss or damage caused directly or indirectly by
any of the following. Such loss or damage is excluded regardless of
any other cause or event that contributes concurrently or in any
sequence to the loss.
....
g. Water
....
(3)(a) Water or sewage that backs up or overflows from a
sewer, drain or sump.
(b) Except for septic tanks, cesspool systems and exterior
drains, this exclusion does not apply when the cause of the
1
Abbasid made additional claims for insurance coverage, but has not
addressed those claims on appeal, so has waived them. See Ruiz v. McDonnell,
299 F.3d 1173, 1182 n.4 (10th Cir. 2002) (stating issues not argued to the
appellate court are deemed waived).
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water back-up or sewage overflow occurs due to a blockage
which originates on the described premises.
Aplt. App. at 37-38 (emphasis added).
According to Abbasid, Travelers failed to establish that the blockage
resulting in the water backup or sewage overflow did not originate on Abbasid’s
premises. In other words, Abbasid contends that Travelers did not show where
the backup occurred and thus did not satisfy its duty to prove the “exception to
the exclusion.” It contends that it is possible, even likely, that the blockage
originated on its premises, given that the Abbasid store occupied the space below
the restaurant from which the sewage spilled. Unfortunately, this argument has
been waived on appeal because Abbasid did not raise it to the district court.
Discussion
“Failure to raise an issue in the district court generally constitutes waiver.”
WildEarth Guardians v. Nat’l Park Serv., 604 F.3d 1192, 1197 (10th Cir. 2010)
(quotation omitted). Travelers asserts that Abbasid failed to dispute that the
sewage blockage or backup occurred off its premises. Aplee. Br. at 16. Abbasid
responds that in its opposition to summary judgment, it pointed out a lack of
evidence to support summary judgment. Aplt. Reply Br. at 2 (citing Aplt. App.
at 68-69). But in opposing summary judgment, Abbasid argued that Travelers had
failed to establish that the spill was caused by a “backup” rather than by some
other failure, not that it had failed to establish where the blockage originated.
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Aplt. App. at 68-69; see also id. at 113 (Abbasid’s surreply in opposition to
summary judgment arguing that “failure of a sewer pipe or cap is not
encompassed by a backup or overflow exclusion”).
Moreover, the district court found that “[n]either party dispute[d] that the
September 2005 sewage leak did not originate on Abbasid’s premises.” Aplt.
App. at 123. We note that Abbasid did not attempt to correct this claimed error
by filing a motion under Fed. R. Civ. P. 60(b). See Utah ex rel. Div. of Forestry,
Fire & State Lands v. United States, 528 F.3d 712, 722-23 (10th Cir. 2008)
(explaining that Rule 60(b) motions may provide relief “when the judge has made
a substantive mistake of law or fact in the final judgment or order” (quotation
omitted)).
The rule that an issue not raised to the district court is waived “is
particularly apt when dealing with an appeal from a grant of summary judgment,
because the material facts are not in dispute and the trial judge considers only
opposing legal theories.” Tele-Commc’ns, Inc. v. Commissioner, 104 F.3d 1229,
1232 (10th Cir. 1997). If this court were to consider new arguments on appeal to
reverse the district court, we would “undermine[] important judicial values. In
order to preserve the integrity of the appellate structure, we should not be
considered a ‘second-shot’ forum, a forum where secondary, back-up theories
may be mounted for the first time.” Id. at 1233. Finally, although this court has
discretion to review the issue, we decline to do so because Abbasid “do[es] not
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suggest, and we do not see, how the error alleged seriously affected the fairness,
integrity or public reputation of these judicial proceedings.” Valley Forge Ins.
Co. v. Health Care Mgmt. Partners, Ltd., 616 F.3d 1086, 1095 n.2 (10th Cir.
2010) (quotation and alterations omitted).
Conclusion
The judgment of the district court is AFFIRMED.
Entered for the Court
Stephen H. Anderson
Circuit Judge
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