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Miller v. Am. Family Mut. Ins. Co.

United States District Court, D. Colorado

May 8, 2015


For Michael Miller, Diane Miller, Plaintiffs: Donna DeVaney Stockham, LEAD ATTORNEY, Stockham Ackley, P.A., Tampa, FL; Barrett Thomas Weisz, Barrett Weisz, Attorney at Law, Denver, CO; Michael Justin Rosenberg, Roberts Levin Rosenberg, P.C., Denver, CO.

For American Family Mutual Insurance Company, a Wisconsin Corporation, Defendant: Christian Shaw Monson, Colin C. Campbell, Campbell, Latiolais & Averbach, LLC, Denver, CO.


R. Brooke Jackson, United States District Judge.

At the conclusion of plaintiffs' evidence in the still ongoing trial of this case the Court granted in part the defendant's motion for judgment as a matter of law under Rule 50 of the Federal Rules of Civil Procedure. Plaintiffs have, in substance, moved for reconsideration of that order. The Court has considered the parties' arguments and briefs, including a supplemental brief filed by the defendant yesterday (the jury was excused for the day); and the Court has conducted additional research of its own. For the reasons set forth in this order, the Court now vacates its Rule 50 order to the extent that the Court had held that the earth movement exclusion in the plaintiffs' policy necessarily excluded damage to the foundation of the home. Rather, the Court now finds that whether the exclusion applies depends on the facts of the case as found by the jury. This order also supersedes the Court's previous comments from the bench concerning the exclusion.

I. Background

A. The Present Dispute

The parties dispute whether and to what extent the so-called earth movement exclusion in the Millers' insurance policy is applicable to the present facts. For purposes of a motion for a directed verdict, the Court must construe all evidence in favor of the plaintiffs. Doing so here, the relevant facts are as follows.

The plaintiffs' home was damaged in the Waldo Canyon Fire in the summer of 2012. Soon after the plaintiffs became aware that the fire might reach their home, they began clearing the brush and removing trees around the house in an attempt to prevent it from catching fire. When the fire did reach their garage, firefighters who were deciding which homes in the area might be saved selected the Millers' home, at least in part because they knew that the Millers had undertaken extensive mitigation efforts. By doing so, the firefighters may have also prevented dozens of other nearby homes from catching fire. However, in the process of putting out the fire at the Millers' house, the firefighters used an estimated 10,000 to 20,000 gallons of water. Plaintiff's evidence is that some of this water entered the soil beneath the home, causing it to swell and ultimately damaging the foundation of the house.

The parties dispute whether American Family is obligated to pay for repairs to the foundation if the damage was caused in whole or in part by the water released during the fire-fighting effort. They appear to agree, and indeed it seems obvious to the Court, that if the earth movement was unrelated to the fire or fire-fighting efforts, then any resulting damage is not covered by the policy. The disputed question is whether damage resulting from earth movement is excluded even if it was caused, in whole or in part, by the fire-fighting efforts.

B. The Policy Language

The policy provides, in relevant part, as follows:



The following exclusions apply to Coverage A -- Dwelling and Dwelling Extension, Coverage B -- Personal Property, Coverage C -- Loss of Use and the supplementary Coverages -- Section 1. We do not insure for loss caused directly or indirectly by any of the following. Such loss is excluded regardless of any other cause or event contributing concurrently or in any sequence to the loss.

1. Earth Movement, meaning any loss caused by, resulting from, contributed to or aggravated by earthquake; landslide; subsidence; sinkhole; erosion; mud flow; earth sinking, rising, shifting, expanding or contracting; volcanic eruption, meaning the eruption, explosion or effusion of a volcano.
This exclusion applies whether or not the earth movement is combined ...

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