Corbeil v. Pruco Life Insurance

12-2040-cv
Corbeil v. Blood
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
Rulings by summary order do not have precedential effect. Citation to a summary order filed on or after January 1, 2007,
is permitted and is governed by Federal Rule of Appellate Procedure 32.1 and this court’s Local Rule 32.1.1. When citing
a summary order in a document filed with this court, a party must cite either the Federal Appendix or an electronic
database (with the notation “summary order”). A party citing a summary order must serve a copy of it on any party not
represented by counsel.
At a stated term of the United States Court of Appeals for the Second Circuit, held at the
Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 21st
day of February, two thousand thirteen.
PRESENT:
DEBRA ANN LIVINGSTON,
RAYMOND J. LOHIER, JR.,
Circuit Judges,
LEWIS A. KAPLAN,
District Judge.*
_______________________________________________
KELLI L. CORBEIL,
Plaintiff – Appellant,
-v.- No. 12-2040-cv
PRUCO LIFE INSURANCE COMPANY,
Defendant – Cross Claimant – Cross Defendant – Appellee,
CLINTON H. BLOOD,
Defendant – Cross Defendant – Cross Claimant – Appellee.
_______________________________________________
*
The Honorable Lewis A. Kaplan, of the United States District Court for the Southern
District of New York, sitting by designation.
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THOMAS W. COSTELLO, Costello, Valente & Gentry, P.C.,
Brattleboro, Vermont, for Plaintiff-Appellant.
KAVEH S. SHAHI, Cleary Shahi & Aicher, P.C., Rutland, Vermont;
STEPHEN L. BRACY, Alston & Bird LLP, Atlanta, Georgia, for
Defendant – Cross Claimant – Cross Defendant – Appellee Pruco
Life Insurance Co.
LUIGI SPADAFORA, JODY N. CAPPELLO, Winget, Spadafora &
Schwartzberg, LLP, Stamford, Connecticut, for Defendant – Cross
Defendant – Cross Claimant – Appellee Clinton H. Blood.
Appeal from the judgment of the United States District Court for the District of Vermont
(Christina Reiss, C.J.).
UPON DUE CONSIDERATION, it is hereby ORDERED, ADJUDGED, and DECREED
that the judgment of the District Court entered April 17, 2012 is AFFIRMED.
Plaintiff-Appellant Kelli L. Corbeil (“Plaintiff”) appeals from a judgment granting
Defendants-Appellees summary judgment in this diversity action on all claims. On appeal, Plaintiff
argues that pursuant to Vermont law (which all parties agree is applicable) a reasonable jury could
conclude: (1) that Defendant-Appellee Clinton H. Blood’s (“Blood”) negligence in securing a life
insurance policy (the “Policy”) for her late husband William Corbeil (“Corbeil”) caused her harm;
(2) that Blood also breached a verbal contract with Corbeil to use reasonable skill, care, and
diligence to procure the Policy, resulting in liability; (3) that Blood served as an agent for
Defendant-Appellee Pruco Life Insurance Company (“Pruco”) throughout the application process;
and (4) that as a result of Blood’s conduct as its agent, Pruco was estopped from rescinding the
Policy after Corbeil’s death. Because Plaintiff does not press any of her other claims on appeal, she
has waived those claims. See LoSacco v. City of Middletown, 71 F.3d 88, 92 (2d Cir. 1995) (holding
issues not raised in appellate brief are abandoned).
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We review a district court’s award of summary judgment de novo, “resolving all ambiguities
and drawing all permissible factual inferences in favor of the party against whom summary judgment
is sought.” Burg v. Gosselin, 591 F.3d 95, 97 (2d Cir. 2010) (quoting Wright v. Goord, 554 F.3d
255, 266 (2d Cir. 2009)). Summary judgment is appropriate where “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).
We assume the parties’ familiarity with the underlying facts, procedural history of the case, and
issues on appeal, which we reference only as necessary to explain our decision to affirm.
1. The Tort Claim
Plaintiff first contends that Blood breached his duty of reasonable care in preparing a 2007
life insurance application for Corbeil and that, contrary to the District Court’s determination,
Blood’s negligence directly and proximately caused Plaintiff’s injury when Pruco rescinded the
Policy following Corbeil’s death in 2009. We disagree.
Under Vermont law, a common law negligence cause of action includes four elements: “(1)
the defendant must owe a legal duty to conform to a certain standard of conduct so as to protect the
plaintiff from an unreasonable risk of harm; (2) the defendant must have committed a breach of this
duty by failing to conform to the standard of conduct required; (3) the defendant’s conduct must be
the proximate cause of the plaintiff’s injury; and (4) the plaintiff must have suffered actual loss or
damage.” Langle v. Kurkul, 510 A.2d 1301, 1304 (Vt. 1986) (citing W. Prosser & W. Keeton, The
Law of Torts § 30, at 164–65 (5th ed. 1984)).
Assuming arguendo that Blood did breach his duty to use reasonable care when he recorded
inaccurate answers on Corbeil’s May 2007 life insurance application to Pruco and did not review
the answers with Corbeil in July 2007, see Booska v. Hubbard Ins. Agency, Inc., 627 A.2d 333, 335
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(Vt. 1993) (noting that an insurance agent has a duty “to use reasonable care and diligence to
procure insurance that will meet the needs and wishes of the prospective insured, as stated by the
insured” (internal quotation marks and citation omitted)), and that the Plaintiff has suffered some
harm, we agree with the District Court that Plaintiff’s claim fails because she has not adduced
sufficient evidence to permit a reasonable jury to conclude that it was Blood’s purported negligence
– and not the independent omissions of Corbeil in signing the July 2007 Good Health Statement –
that directly and proximately caused Plaintiff’s harm. Pruco rescinded the Policy following
Corbeil’s death, citing not Blood’s conduct in limiting the questions on the May 2007 application
to events that had occurred in the past two months, but Corbeil’s failure to notify Pruco of several
medical events – including a CT scan that revealed a “1-cm spiculated lesion” in Corbeil’s lung –
occurring after the initial May application and before Corbeil signed the Good Health Statement on
July 21, 2007. Plaintiff does not contend otherwise.
Plaintiff argues instead that Blood’s purported negligence nevertheless caused her harm on
the theory that, but for Blood’s negligence in not thoroughly reviewing the May application with
Corbeil (including its Certification Clause requiring Corbeil to “inform [Pruco] of any changes in
[his] health, [or] mental or physical condition”) in either May or June, Corbeil would have
completed the July Good Health Statement accurately and the Policy would never have issued.
Plaintiff, aware that her husband had no life insurance, would as a result have refrained from
securing a loan that she contends she cannot now pay off. We agree with the District Court,
however, that even assuming arguendo that but for causation could be established in this way,
Corbeil’s omissions on the July Good Health Statement constituted an intervening event that broke
the causal chain. See Collins v. Thomas, 938 A.2d 1208, 1211 (Vt. 2007) (holding that proximate
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cause does not exist where “the injurious consequences that flow [from the defendant’s negligence]
[are] diverted by the intervention of some efficient cause that makes the injury its own” (first
alteration in original) (internal quotation marks and citation omitted)). Accordingly, Plaintiff is
unable to establish causation as a matter of law. See Roberts v. State, 514 A.2d 694, 696 (Vt. 1986)
(“Proximate cause is ordinarily an issue to be resolved by the jury unless the proof is so clear that
reasonable minds cannot draw different conclusions or where all reasonable minds would construe
the facts and circumstances one way.” (internal quotation marks and citation omitted)).
2. The Contract Claims
Plaintiff next contends that sufficient evidence exists for a jury to find that Blood entered into
a verbal contract with Corbeil to use reasonable care to secure a life insurance policy and that Blood
breached that contract. However, we agree with the District Court that no reasonable jury could find
in favor of Plaintiff as to this contract claim. Even assuming arguendo that such a verbal contract
existed, there is no evidence that any contractual breach by Blood caused the damages that Plaintiff
now claims. See Smith v. Country Vill. Int’l, Inc., 944 A.2d 240, 243–44 (Vt. 2007) (noting that a
breach of contract claim fails unless the plaintiff can show either “direct damages that naturally and
usually flow from the breach itself, [or] special or consequential damages, which must pass the tests
of causation, certainty and foreseeability” (internal quotation marks and citation omitted)).
Accordingly, we affirm the District Court’s award of summary judgment in favor of Blood on this
claim.
As to Pruco Life Insurance Company, Plaintiff asserts, relying on Middlebrook v. Banker’s
Life & Casualty Co., 234 A.2d 346 (Vt. 1967), that Pruco was estopped from rescinding the Policy
on the basis of Corbeil’s material omissions because Corbeil acted in good faith and his omissions
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on the July Good Health Statement were caused by Blood’s misconduct at a time when Blood was
serving as Pruco’s agent. Pruco counters that Blood was not acting as its agent, that Corbeil did not
fill out the application in good faith, and that Middlebrook’s common law rule has been superseded
by 8 V.S.A. § 3736, which permits rescission of an insurance policy because of a material
misrepresentation by the insured, irrespective of the insured’s good faith.
Assuming arguendo that a reasonable jury could find that Blood served as Pruco’s agent and
that Corbeil acted in good faith, we nonetheless conclude that Plaintiff’s claim against Pruco fails
because Middlebrook does not apply here. In Middlebrook, the insurance company was estopped
from rescinding a policy on the basis of false answers supplied by the insurance agent without the
insured’s knowledge. 234 A.2d at 347–48; see also Whitmore v. Mut. Life Ins. Co. of N.Y., 173 A.2d
584, 588–90 (Vt. 1961) (applying rule later adopted in Middlebrook to situation where rescission
was based on false statements provided by underwriter without the insured’s knowledge). Here,
rescission was based on Corbeil’s material omissions on the July Good Health Statement and not
on Blood’s alleged misconduct. Middlebrook is therefore inapposite on its own terms, and we need
not address any inconsistency between it and 8 V.S.A. § 3736.
All arguments not otherwise discussed in this summary order are found to be moot or without
merit. Accordingly, for the foregoing reasons, the judgment of the District Court is AFFIRMED.
FOR THE COURT:
Catherine O’Hagan Wolfe, Clerk
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