United States District Court, D. Connecticut
RICHARD T. HYDE and DENISE B. HYDE Plaintiffs,
ALLSTATE INSURANCE COMPANY and LIBERTY INSURANCE CORPORATION Defendants.
MEMORANDUM OF DECISION GRANTING ALLSTATE'S MOTION
TO DISMISS [DKT. 36]
Vanessa L. Bryant United States District Judge.
the Court is a Motion to Dismiss from Allstate Insurance
Company (“Allstate”) in yet another concrete
decay case. Decades ago, a number of homes in Connecticut
were constructed with a certain type of concrete which, in
certain cases, would suffer from a damaging corrosive
chemical reaction. Now, years later, residents are
discovering pattern cracking in the concrete of their homes
and are seeking coverage of the damage from their insurance
the Hydes made claims with two insurers, Allstate and
Liberty, for the damage resulting from the concrete decay
afflicting their basement walls. Each company denied the
claim, stating that the policies did not cover the claimed
loss. The Hydes brought the instant lawsuit alleging breach
of contract and violations of CUTPA and CUIPA. Allstate has
now moved to dismiss all claims against it, arguing that the
Hydes have failed to state a claim upon which relief can be
granted in light of the Allstate policy language. The Court
agrees for the reasons explained below and accordingly
dismisses Counts I and II of the First Amended Complaint.
Richard T. Hyde and Denise B. Hyde (the “Hydes”)
have owned the residential property at 36 Willow Creek Drive,
Tolland, Connecticut (the “Property”) since 1998.
[Dkt. 29 (First Am. Compl.) ¶ 6]. The residence was
built in 1997. Id. Between 1998 and 2014, the Hydes
insured the Property via Allstate homeowner's insurance
policies (the “Policies”), which automatically
renewed annually. Id. ¶¶ 7-8. The relevant
terms of the policies from 1998 to 2014 remained the
same. See [Dkt. 36-1 at n.1].
fall of the 2016, having decided to pursue selling their
home, the Hydes hired an engineer to confirm that the
Property was not afflicted by the concrete decay issues they
had seen in the media in Connecticut. Id.
¶¶ 9-10. The engineer found that the Property had
been constructed with defective concrete, finding
“pattern cracking” in the basement walls of the
Property. Id. ¶¶ 11-12. The engineer told
the Hydes that the concrete was likely from the J.J. Mottes
Concrete Company and included a chemical compound which, when
mixed with the other elements, “began to oxidize (rust)
and expand, breaking the bonds of the concrete internally and
reducing it to rubble.” Id. ¶¶
Hydes allege that “[a]t some point between the date on
which the basement walls of the home were poured and the
month of December of 2016, the basement walls suffered a
substantial impairment to their structural integrity.”
Id. ¶ 15. The Hydes reported the damage to
Allstate on May 15, 2017, making a claim for the loss in
accordance with the terms of the Policies. Id.
¶ 20. By letter dated September 26, 2017, Allstate
denied the claim for coverage stating that the Policies did
not cover the loss. Id. ¶ 21.
Policies state that Allstate “will cover sudden and
accidental direct physical loss” to covered property,
such as the Hydes' home. [Dkt. 36-2 (Mot. Dismiss, Ex. A,
Allstate Policy) at 28 of PDF]. The Policies further state
that they “do not cover loss consisting of or caused by
any of the following: . . . rust or other corrosion, mold,
wet or dry rot; . . . settling, cracking, shrinking, bulging
or expansion of pavements, patios, foundations, walls,
floors, roofs or ceilings; . . . Planning, Construction, or
Maintenance, meaning faulty, inadequate or defective . . .
materials used in repair, construction, renovation or
remodeling.” Id. at 29-30 of PDF.
Additionally, the Policies specify that they do not cover
“[c]ollapse, except as specifically provided in Section
I - Additional Protection under item 11,
“Additional Protection” for “Collapse,
” the Policies state that they cover “the entire
collapse” of a covered building or part of a covered
building structure. Id. at 37 of PDF; [Dkt. 29
¶ 22]. But in order “[f]or this coverage to apply,
the collapse . . . must be a sudden and accidental direct
physical loss caused by one or more of the following: . . .
hidden decay of the building structure . . . [or] defective
methods or materials used in construction, repair, remodeling
or renovation.” [Dkt. 36-2 at 37 of PDF]. They further
specify that “[c]ollpase does not include settling,
cracking, shrinking, bulging or expansion.”
Hydes allege that the Property's “basement walls .
. . are in a state of collapse, which collapse was the result
of a covered cause.” [Dkt. 29 ¶ 23]. They further
allege that their claimed loss is covered under the terms of
the Policies and Allstate's denial of their claim was
contrary to the express provisions of said Policies and thus
a breach of the Policy contracts. Id. ¶¶
Hydes also allege that Allstate's participation in the
Insurance Services Office, Inc. (the
“ISO”)-“a cooperative organization formed
and controlled by its participants for the purposes, among
others, of collecting data on the type of claims made, the
policy provisions cited for the basis of each claim, the
geographic areas in which the claimed damage has occurred,
and the action taken by insurers in response to such
claims”-in addition to Allstate's handling of the
Hydes' and others' concrete decay claims, constitute
unfair and deceptive trade practices in violation of the
Connecticut Unfair Insurance Practices Act
(“CUIPA”) and the Connecticut Unfair Trade
Practices Act (“CUTPA”). Id.
filed the Motion to Dismiss now before the Court, seeking to
dismiss both of the claims against it for failure to state a
claim. Allstate argues that the clear language of the
Policies bar coverage of the Hydes' claimed loss because
the damage was not “sudden and accidental, ” nor
is it an “entire collapse, ” and further because
of the specific exclusions for loss caused by cracking, rust,
and defectives materials. See [Dkt. 36-1 (Mem. Mot.
Dismiss) at 3]. The Hydes disagree and argue that the
language of the Policies is ambiguous, and therefore should
be construed in favor of coverage. See [Dkt. 38
(Opp'n Mot. Dismiss) at 4].
survive a Motion to Dismiss under Federal Rule of Civil
Procedure 12(b)(6), the complaint must plead “enough
facts to state a claim to relief that is plausible on its
face.” 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.” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009). In general, the
Court's review on a motion to dismiss pursuant to Rule
12(b)(6) “is limited to the facts as asserted within
the four corners of the complaint, the documents attached to
the complaint as exhibits, and any documents incorporated by
reference.” McCarthy v. Dun & Bradstreet
Corp., 482 F.3d 184, 191 (2d Cir. 2007).
Court must “accept all factual allegations as true
and draw all reasonable inferences in favor of the
plaintiff” when deciding a motion to dismiss.
Litwin v. Blackstone Grp., L.P.,634 F.3d 706, 715
(2d Cir. 2011). A court may, however, “choose to begin
by identifying pleadings that, because they are no more than
conclusions, are not ...