Case Title: US Fire Ins. Co. v. Safeco Ins. Co.

Citation: 444 So. 2d 844

Docket Number: 

State: alabama

Court: Alabama Supreme Court

Date: 1983-08-26T00:00:00Z

Document:
444 So. 2d 844 (1983)
UNITED STATES FIRE INSURANCE COMPANY
v.
SAFECO INSURANCE COMPANY.
82-331.

Supreme Court of Alabama.
August 26, 1983.
Rehearing Denied January 20, 1984.
D. Edward Starnes, III of Ford, Caldwell, Ford & Payne, Huntsville, for appellant.
H. Harold Stephens of Lanier, Shaver & Herring, Huntsville, for appellee.
FAULKNER, Justice.
This appeal is from the Circuit Court of Madison County granting judgment in favor of Safeco Insurance Company and against United States Fire Insurance Company for damages in excess of Safeco's coverage for losses sustained from water leakage through insured's roof onto its leasee's merchandise. We reverse and remand.
The cause was tried and submitted to the court on the pleadings, stipulation of facts and issues, and testimony of witnesses taken by deposition. When the cause is tried in this manner, this court rules on the evidence as well as the application of the law, and there is no presumption in favor of the lower court's finding of fact. Smith v. Dalrymple, 275 Ala. 529, 156 So. 2d 622 (1963); Knowles v. Knowles, 246 Ala. 228, 20 So. 2d 200 (1949).
The facts stipulated by the parties were presented as follows:
The question presented to this court is whether the additional damage caused by rainfall in March resulting from Bama Roofing's failure "to effectively cover a portion of the roof on which it was working" was part of a single occurrence as defined by the insurance policy with Safeco. The pertinent section of the policy defines "one occurrence" as follows:
This court has not defined the phrase "one occurrence," and under the principles of contract and insurance law, this court must give it the meaning intended by the parties to the policy (i.e., the definition in the policy). In Alabama Farm Bureau Mutual Cas. Ins. Co. v. Goodman, 279 Ala. 538, 541, 188 So. 2d 268 (1966), this court stated:
Appellant argues that the terms "substantially" and "general" are ambiguous. An ambiguous term is one which has "duplicity, indistinctiveness, or uncertainty of meaning." Black's Law Dictionary (5th ed. 1979). Although these terms are broad and judicial application of them in any given case is dependent upon the findings of fact, this alone does not make them ambiguous. This court does not find the terms ambiguous and will construe them with their common meaning and import. Goodman, supra.
Safeco argues that there was only one occurrence because water was dripping inside the store every day and because all of the damage was caused by water dripping through the ceiling. In his deposition, the assistant manager of the store made it quite clear that the leaks were all over the store and dripped every day he was in the store. However, the continuous nature of the dripping water is only one factor in analyzing whether or not there was only one occurrence.
U.S. Fire argues that there were two occurrences because some of the damage resulted from negligent acts of the roofing crew.
Herein lies the question, as posed by Safeco's definition of the term "occurrence." Did "substantially the same general conditions" exist from November 23, 1979, to August 15, 1980?
There was a condition which existed continuously. The roof of the store had cracks and holes, and the ceiling dripped water onto the floor and the merchandise. The dripping resulted from both rainwater accumulation and condensation. It is irrelevant whether the ceiling dripped every single day from November to August. In Appalachian Ins. Co. v. Liberty Mut. Ins. Co., 676 F.2d 56, 61 (3rd Cir.1982), the third circuit stated:
The definition in the policy cited in Appalachian is very similar to that in the policy in the instant case, and like application of it should be made.
The question then becomes: Did the injuries (damages) stem from one proximate cause?
This "cause analysis" was adopted in an early case addressing the application of a similar clause limiting liability in "one occurrence." *847 In Truck Ins. Exchange v. Rohde, 49 Wash. 2d 465, 471, 303 P.2d 659, 662 (1956), the Washington Supreme Court asked if "[t]here was but one proximate, uninterrupted, and continuing cause which resulted in all of the injuries and damage."
Since the Rohde decision the majority of courts have adopted the "cause" theory of analysis. See, Bartholomew v. Insurance Co. of North America, 502 F. Supp. 246 (1980); Annotation 55 A.L.R.2d 1300 (1957). One state court explained further that if the cause is interrupted or replaced by another cause, the chain of causation is broken and more than one accident or occurrence has taken place." 8A Long, Insurance Law and Practice § 4891.25 at 18 (1981) (citing Olsen v. Moore 56 Wis.2d 340, 202 N.W.2d 236 (1972)).
In the case at hand, the negligent act of the roofing crew was a separate, intervening cause. The damage caused by the roofing crew's failure to adequately cover the exposed portion of the roof was not proximate to the cracks and holes in the other areas of the roof; nor did the latter cause the former. The lack of a proximate causal link between the two is evident if we assume, hypothetically, that the roof had no cracks or holes prior to the re-roofing attempt by Bama Roofing. The resulting damage from the negligent failure to cover the exposed area would clearly have no relation to the condition of the roof prior to the repair attempt. Furthermore, the two events are easily distinguishable in time and space, and one event did not cause the other. For these reasons, such cases as Saint Paul-Mercury Indemnity Co. v. Rutland, 225 F.2d 689 (5th Cir.1955), and Tri-State Roofing Co. v. New Amsterdam Casualty Co., 139 F. Supp. 193 (W.D.Pa. 1955), do not persuade this court that one occurrence had taken place in the instant case. Rutland, Tri-State, and their progeny involve fact situations where a single incident or simultaneous incidents resulted in multiple injuries or damages. To the contrary, these cases persuade this court that two occurrences have taken place.
Furthermore, this court is not persuaded by cases addressing the application of similar clauses in insurance policies to claims for flood damage. The federal law speaking to what constitutes a single occurrence from flood water is very specialized and has little application to the case at hand. See generally, Miller v. Macy, 526 F. Supp. 46 (D.Mass.1981).
For the foregoing reasons, we reverse the lower court decision and remand this cause for assessment of damages.
REVERSED AND REMANDED.
TORBERT, C.J., and ALMON, EMBRY and ADAMS, JJ., concur.