United States District Court, D. Kansas
MEMORANDUM AND ORDER
KATHRYN H. VRATIL United States District Judge.
Cincinnati Insurance Company (“Cincinnati
Insurance”) filed suit against KDL, Inc. seeking
declaratory relief on a contract for property insurance. This
matter comes before the Court on Plaintiff's Motion
For Summary Judgment (Doc. #36) filed October 30, 2015.
For reasons stated below, the Court overrules plaintiff's
judgment is appropriate if the pleadings and materials in the
record show no genuine dispute as to any material fact and
that the moving party is entitled to judgment as a matter of
law. See Fed.R.Civ.P. 56(a). A factual dispute is
“material” only if it “might affect the
outcome of the suit under the governing law.”
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986). A “genuine” factual dispute requires more
than a mere scintilla of evidence. Id. at 252.
moving party bears the initial burden of showing the absence
of a genuine issue of material fact. Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986). Once the moving party
meets its burden, the burden shifts to the nonmoving party to
demonstrate that genuine issues remain for trial as to those
dispositive matters for which it carries the burden of proof.
Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 586-87 (1986); Applied Genetics Int'l,
Inc. v. First Affiliated Sec., Inc., 912 F.2d
1238, 1241 (10th Cir. 1990). The nonmoving party may not rest
on its pleadings but must set forth specific facts.
Applied Genetics, 912 F.2d at 1241.
Court views the record in the light most favorable to the
nonmoving party. Scott v. Harris, 550 U.S. 372, 380
(2007). It may grant summary judgment if the nonmoving
party's evidence is merely colorable or is not
significantly probative. Liberty Lobby, 477 U.S. at
250-51. In response to a motion for summary judgment, a party
cannot rely on ignorance of facts, on speculation, or on
suspicion, and may not escape summary judgment in the mere
hope that something will turn up at trial. Conaway v.
Smith, 853 F.2d 789, 794 (10th Cir. 1988). Essentially,
the inquiry is “whether the evidence presents a
sufficient disagreement to require submission to the jury or
whether it is so one-sided that one party must prevail as a
matter of law.” Liberty Lobby, 477 U.S. at
following material facts are uncontroverted, deemed admitted
or, where disputed, viewed in the light most favorable to
KDL, the non-movant.
Insurance insured KDL under a Commercial Policy of Insurance,
effective June 1, 2009 to June 1, 2010. KDL is a property
holdings company. KDL has shared ownership structures with
Lindemuth, Inc., Lindy's Inc., K Douglas, Inc. and
Bellairre Shopping Center, Inc. (the “Lindemuth
Entities”). Collectively, KDL, the Lindemuth Entities
and Kent and Vikki Lindemuth own and manage some 120
commercial, industrial and residential properties, most of
which are located in Topeka, Kansas. KDL has no outside or
independent property manager. KDL, the Lindemuth Entities and
Kent and Vikki Lindemuth are “Named Insureds”
under the Policy.
of KDL's property management functions, it owns,
maintains and stores machinery and equipment. KDL commonly
uses unoccupied spaces for storage of its equipment and
machinery, especially in spaces such as strip centers or
malls where several tenants are housed in one building
structure or within close proximity to other properties which
KDL owns and manages. KDL also routinely uses its open space
to store the personal property of Lindemuth Entities.
owns and operates a commercial shopping center known as Deer
Creek Shopping Center in Topeka, Kansas. Deer Creek has about
63, 397 square feet of commercial lease space. In June of
2009, Falley's Market, a grocery store which occupied
about 41, 687 square feet of retail space at Deer Creek,
closed. After the grocery store closed, KDL
maintained electricity service but discontinued gas and water
service in the grocery store space. KDL also used the space
to store equipment and supplies, including materials for
construction repair, painting and remodeling. KDL used almost
all of the Falley's space for storage. KDL routinely
rotated equipment and machinery in the Falley's space and
replaced it with other equipment and machinery.
time around March 27 to 30, 2010, an individual damaged the
heating, ventilating and air conditioning units
(“HVAC”) on the roof of Deer Creek and stole
copper pipes. Shortly thereafter, Topeka Police Department
officers apprehended the individual.
HVAC units and copper pipes are “covered
property” under the Policy. Absent an exclusion, the
damage and loss related to the HVAC units and copper piping
is a covered loss under the Policy. The Policy contains an
exclusion for theft and vandalism as follows:
(1) As used in this Vacancy Condition, the term building and
the term vacant have the meanings set forth in (1)(a) and
(a) When this Coverage Part is issued to a tenant, and with
respect to that tenant's interest in Covered Property,
building means the unit or suite rented or leased to the
tenant. Such building is vacant when it does not contain