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Coleman v. Garrison Property & Casualty Insurance Co.

United States District Court, N.D. Illinois, Eastern Division

July 31, 2019

MALAIKA COLEMAN, individually and on behalf of all others similarly situated, Plaintiff,
v.
GARRISON PROPERTY & CASUALTY INSURANCE CO. and UNITED SERVICES AUTOMOBILE ASSOCIATION, Defendants.

          MEMORANDUM OPINION AND ORDER

          Virginia M. Kendall Judge.

         Defendants Garrison Property & Casualty Insurance Co. (“Garrison”) and United Service Automobile Association (“USAA”) (together, “Defendants”) move to dismiss the complaint under Rule 12(b)(6) for failure to state valid breach of contract claims. For the reasons stated below, the Court grants Defendants' Motion to Dismiss [Dkt. 20].

         BACKGROUND

         Plaintiff Malaika Coleman brings this action individually and on behalf of two classes against her car insurance provider. Plaintiff totaled her car and sought reimbursement from her insurer. She alleges she was harmed because her insurer did not include the costs of sales tax and title transfer fees in the reimbursement. Plaintiff alleges that Defendants' failure to pay those costs is a breach of her insurance agreement. (Dkt. 1 ¶¶ 1-5.) Plaintiff's two-count complaint includes a breach of contract claim against each Defendant. (Id. ¶¶ 62-82.) Defendants move to dismiss Plaintiff's individual claims only and note that the “putative class claims are not at issue” in the motion. (Dkt. 21 at 4.)

         Plaintiff had car insurance through Defendants for her 2006 Chrysler 300. (Dkt. 1 ¶¶ 26, 42.) On September 7, 2018, Plaintiff was involved in an accident while driving her car and filed a property damage claim with Defendant Garrison. (Id. ¶ 43.) Defendants determined that Plaintiff's car was a total loss with a base value of $3, 466.00. (Id. ¶ 44.) Defendants paid Plaintiff that amount plus a $25 license/tag transfer fee, but did not pay her the costs of sales tax ($216.25) or title transfer fees ($95). (Id. ¶¶ 47-49.)

         Plaintiff's USAA insurance policy provides that Defendants will pay for each “loss” to a covered auto. (Id. ¶ 26; see also Dkt. 1-1 at 26.) The policy defines “loss” as “direct and accidental damage, ” which “includes a total loss, but does not include any damages other than the cost to repair or replace.” (Id. ¶ 28; see also Dkt. 1-1 at 25.) The limit of USAA's liability for loss is “the actual cash value of the vehicle, ” which the policy defines as “the amount it would cost, at the time of loss, to buy a comparable vehicle.” (Id. ¶¶ 29-30; see also Dkt. 1-1 at 25.) The policy does not define “actual cash value” as excluding the costs of sales taxes or title fees. (Id. ¶ 32.) Plaintiff alleges that Defendants breached their agreement by not including the costs of sales tax or title transfer fees in the “actual cash value” payment for her total loss. (Id. ¶¶ 37-38, 50.)

         STANDARD OF REVIEW

         “To survive a motion to dismiss under 12(b)(6), a complaint must ‘state a claim to relief that is plausible on its face.'” Adams v. City of Indianapolis, 742 F.3d 720, 728 (7th Cir. 2014) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. (quoting Ashcroft v. Iqbal, 566 U.S. 662, 678 (2009)). “[I]t is not enough for a complaint to avoid foreclosing possible bases for relief; it must actually suggest that the plaintiff has a right to relief . . . by providing allegations that ‘raise a right to relief above the speculative level.'” E.E.O.C. v. Concentra Health Servs., Inc., 496 F.3d 773, 777 (7th Cir. 2007) (citing Twombly, 550 U.S. at 555) (emphasis in original).

         The Court construes the complaint and attached exhibits “in the light most favorable to the nonmoving party, accept[s] well-pleaded facts as true, and draw[s] all inferences in her favor.” Reynolds, 623 F.3d at 1146. “[L]egal conclusions and conclusory allegations merely reciting the elements of the claim are not entitled to this presumption of truth.” McCauley v. City of Chicago, 671 F.3d 611, 616 (7th Cir. 2011) (citing Iqbal, 566 U.S. at 678). “Where an exhibit and the complaint conflict, the exhibit typically controls.” Forrest v. Universal Sav. Bank, F.A., 507 F.3d 540, 542 (7th Cir. 2007). “A court is not bound by the party's characterization of an exhibit and may independently examine and form its own opinions about the document.” Id.

         DISCUSSION

         Defendants argue that Plaintiff's breach of contract claims fail because Defendants are not obligated to pay Plaintiff's sales tax and title fees. Defendants argue that nothing in the policy requires them to pay those costs and that they are not required to do so as a matter of Illinois law.

         I. Plaintiff's Insurance Policy

         To succeed on her breach of contract claims, Plaintiff must demonstrate 1) the existence of a valid contract, 2) that she substantially performed her obligations, 3) that defendant breached, and 4) resulting damages. Dual-Temp of Ill., Inc. v. Hench Control, Inc., 821 F.3d 866, 869 (7th Cir. 2016). “A breach can only exist where a party fails to carry out a term, promise, or condition of a contract.” Officemax, Inc. v. NHS Human Servs., Inc., No. 16 C 9111, 2017 WL 1022078, at *2 (N.D. Ill. March 15, 2017) (citations omitted). The only element at issue in Defendants' motion is whether Plaintiff adequately pleaded a breach.

         Plaintiff argues that Defendants promised to pay her the “actual cash value” for her totaled car, which she argues includes sales tax and title transfer fees. The only policy provision Plaintiff cites to support her theory is the one defining “actual cash value” as “the amount it would cost, at the time of loss, to buy a comparable vehicle.” (Dkt. 1 ¶ 37; see also Dkt. 25 at 4.) Plaintiff alleges that sales tax and title fees are “necessary and mandatory vehicle replacement costs in the State of Illinois, ” citing the relevant Illinois statutes (see Dkt. 1 ΒΆ 34), and concludes that because those taxes and ...


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