Facts

In January 2005, Richard and Paula Barnett, plaintiffs, experienced water damage to their home due to heavy rains. First National Insurance Company of America, defendant, was plaintiffs' homeowners insurance company. The defendant covered damage caused by wind-driven rain through the roof, but refused to cover damage to the garage based on a surface water exclusion. In late 2005, after re-inspection, defendant increased its damage estimate to more than $12,000 and paid for the mold and other expenses, amounting to $33,000. The plaintiffs sued the defendant.

PLAINTIFFS' CONTENTIONS:
The plaintiffs alleged breach of contract and bad faith. They argued the company underestimated the cost of repairing the damage to their home, asserting the actual cost would be $70,000. The plaintiffs further argued defendant failed to tell them of Additional Living Expenses (ALE) coverage while they were living in their mold-ridden home. They argued they should have been paid $97,000 under ALE coverage. The plaintiffs also argued their policy's $10,000 limit for mold-related repairs should not apply, because it was not mailed to them. They claimed defendant delayed the processing of reimbursement expenses unnecessarily.

DEFENDANT'S CONTENTIONS:
The defendant argued it owed plaintiffs no coverage in the first place for any damages. First National claimed the payments it provided to plaintiffs were a mistake, because all damages should have been excluded as "surface water" due to improper design of the patio around the home, which caused drainage problems or as excluded damages due to defective construction. The defendant also claimed the home was not uninhabitable, which is why defendant did not advise plaintiffs of ALE coverage. The defendant also claimed that any delay in paying expenses was reasonable.

Damages

The plaintiffs sought $70,000 for water damage to their home, $97,000 for ALE, unlimited mold coverage, $225,000 for emotional distress, and $200,000 for attorney fees.

Result

The jury found in favor of the defense, finding that there were never any covered damages under plaintiffs' policy. The court awarded $39,057.44 to defendant in costs, but disallowed $80,000 in expert fees.

Other Information

Both sides have filed appeals.

Deliberation

one hour

Poll

11-1

Length

22 days