Title: Farr v. Gulf Agency

State: alabama

Issuer: Alabama Supreme Court

Document:

Rel: 
06/17/2011 
Notice: 
T h i s 
o p i n i o n i s s u b j e c t t o f o r m a l 
r e v i s i o n b e f o r e 
p u b l i c a t i o n i n 
t h e advance 
s h e e t s o f 
Southern Reporter. 
R e a d e r s a r e r e q u e s t e d t o n o t i f y t h e 
Reporter of Decisions, 
Alabama 
A p p e l l a t e 
C o u r t s , 
300 D e x t e r Avenue, 
Montgomery, 
Alabama 
36104-3741 
((334) 
2 2 9 - 0 6 4 9 ) , o f 
any t y p o g r a p h i c a l o r o t h e r e r r o r s , i n 
o r d e r t h a t c o r r e c t i o n s may be made 
b e f o r e t h e 
o p i n i o n i s 
p r i n t e d i n 
Southern Reporter. 
SUPREME COURT OF ALABAMA 
OCTOBER TERM, 2010-2011 
1090073 
Brady F a r r 
v. 
The G u l f Agency e t a l . 
Appeal from Montgomery C i r c u i t 
Court 
(CV-07-1724) 
PARKER, 
J u s t i c e . 
B r a d y 
F a r r 
a p p e a l s 
t h e M o n t g o m e r y 
C i r c u i t 
C o u r t ' s 
j u d g m e n t 
e n t e r i n g 
summary 
j u d g m e n t s i n f a v o r o f The G u l f 
A g e n c y , I n c . ( " G u l f A g e n c y " ) , O r a n g e B e a c h I n s u r a n c e A g e n c y , 
1090073 
I n c . 
("Orange 
B e a c h " ) ,
1 
and 
L e x i n g t o n 
I n s u r a n c e 
Company 
( " L e x i n g t o n " ) ( h e r e i n a f t e r c o l l e c t i v e l y 
r e f e r r e d t o as " t h e 
i n s u r a n c e c o m p a n i e s " ) . 
We 
a f f i r m t h e t r i a l 
c o u r t ' s j u d g m e n t 
i n p a r t and r e v e r s e i t i n p a r t . 
F a c t s and P r o c e d u r a l 
H i s t o r y 
I n t h e e a r l y 1 9 8 0 s , F a r r p u r c h a s e d a h o u s e s i t u a t e d on a 
b e a c h f r o n t 
l o t i n O r a n g e 
B e a c h on 
P e r d i d o 
B e a c h 
B o u l e v a r d 
( " t h e 
p r o p e r t y " ) . 
F a r r ' s d e p o s i t i o n t e s t i m o n y 
i n d i c a t e s t h a t 
he b e g a n r e n o v a t i n g t h e h o u s e i n t h e l a t e 1990s and c o m p l e t e d 
r e n o v a t i n g 
i t i n 2003 
a t 
a 
t o t a l 
c o s t 
o f 
a p p r o x i m a t e l y 
$ 5 6 8 , 0 0 0 . 
F a r r 
f u r t h e r 
t e s t i f i e d 
t h a t , i n e a r l y 2004, 
he 
d e c i d e d 
t o s e l l t h e p r o p e r t y t o a d e v e l o p e r , 
who was 
b u y i n g 
p r o p e r t y on w h i c h t o b u i l d a h i g h - r i s e c o n d o m i n i u m c o m p l e x . 
F a r r t e s t i f i e d t h a t , i n a n t i c i p a t i o n o f t h e s a l e , he 
o b t a i n e d 
a l o a n o f $1,000,000 s e c u r e d by a m o r t g a g e on t h e p r o p e r t y . As 
p a r t o f t h e l o a n p r o c e s s , 
F a r r ' s m o r t g a g e company o r d e r e d 
an 
a p p r a i s a l 
o f t h e p r o p e r t y , 
w h i c h 
was 
p e r f o r m e d 
by 
R o n a l d 
H o l y f i e l d on M a r c h 8, 2004 ("the H o l y f i e l d 
a p p r a i s a l " ) . 
The 
p r o p e r t y 
was 
a p p r a i s e d 
f o r a 
v a l u e 
o f 
$ 1 , 3 2 5 , 7 1 0 ; 
t h e 
1 A t some p o i n t d u r i n g t h e l i t i g a t i o n , O r a n g e B e a c h became 
M c C a r r o n I n s u r a n c e 
G r o u p , I n c . 
However, 
i n t h e i n t e r e s t o f 
c l a r i t y , we 
w i l l 
c o n t i n u e t o r e f e r t o t h i s 
e n t i t y as "Orange 
B e a c h . " 
2 
1090073 
i m p r o v e m e n t s on 
t h e p r o p e r t y were v a l u e d 
a t $ 3 1 3 , 0 0 0 . 
F a r r 
t e s t i f i e d 
t h a t 
he 
t h o u g h t 
t h a t 
t h e 
a p p r a i s e d 
v a l u e 
o f 
t h e 
h o u s e was 
t o o l o w and 
t h a t he c o n t a c t e d 
H o l y f i e l d t o 
e x p r e s s 
h i s 
c o n c e r n s . 
F a r r t e s t i f i e d 
t h a t he d i d n o t g i v e 
H o l y f i e l d 
any 
a d d i t i o n a l i n f o r m a t i o n c o n c e r n i n g 
t h e v a l u e o f t h e h o u s e 
and 
t h a t 
he 
d i d 
n o t 
h i r e 
a n o t h e r 
a p p r a i s e r 
t o 
p e r f o r m 
an 
a d d i t i o n a l 
a p p r a i s a l . 
I n 
M a r c h 
2004, 
F a r r 
s o u g h t 
t o 
o b t a i n 
homeowner's 
i n s u r a n c e c o v e r a g e f o r t h e h o u s e s i t u a t e d on t h e p r o p e r t y . 
To 
t h a t end, 
F a r r 
t e s t i f i e d 
t h a t he 
c o n t a c t e d O r a n g e B e a c h 
and 
r e q u e s t e d 
" f u l l c o v e r a g e " 
t o i n s u r e a g a i n s t a " t o t a l 
l o s s " 
o f 
t h e h o u s e on t h e p r o p e r t y and t h a t he had t r u s t e d O r a n g e B e a c h 
t o s e c u r e t h e a p p r o p r i a t e c o v e r a g e l i m i t s . 
On M a r c h 29, 2004, 
F a r r 
s i g n e d 
and 
s u b m i t t e d 
an 
a p p l i c a t i o n 
f o r 
homeowner's 
i n s u r a n c e c o v e r a g e w i t h L e x i n g t o n t o O r a n g e B e a c h , w h i c h i s a 
" s u b - a g e n t 
o r 
r e t a i l 
a g e n t , " 
r e q u e s t i n g 
$300,000 w o r t h 
o f 
i n s u r a n c e c o v e r a g e a g a i n s t w i n d damage f o r t h e d w e l l i n g on 
t h e 
p r o p e r t y and $20,000 w o r t h o f c o n t e n t s - i n s u r a n c e c o v e r a g e . 
The 
$300,000 p o l i c y 
l i m i t was 
b a s e d on t h e 
H o l y f i e l d 
a p p r a i s a l .
2 
2 A p p a r e n t l y O r a n g e B e a c h had o r d e r e d i t s own 
a p p r a i s a l o f 
t h e p r o p e r t y when F a r r r e q u e s t e d i n s u r a n c e c o v e r a g e . 
However, 
a m i s t a k e 
was made r e g a r d i n g t h a t a p p r a i s a l , 
and 
t h e 
p a r t i e s 
r e l i e d 
on 
t h e 
H o l y f i e l d 
a p p r a i s a l 
i n 
s e t t i n g 
t h e 
p o l i c y 
3 
1090073 
O r a n g e 
B e a c h 
f o r w a r d e d 
F a r r ' s 
a p p l i c a t i o n 
f o r 
i n s u r a n c e 
c o v e r a g e t o G u l f A g e n c y , a s u r p l u s l i n e s b r o k e r . 
G u l f A g e n c y 
d i d 
t h e u n d e r w r i t i n g on F a r r ' s 
a p p l i c a t i o n 
t o L e x i n g t o n i n 
a c c o r d a n c e w i t h g u i d e l i n e s g i v e n i t 
b y L e x i n g t o n and i s s u e d an 
i n s u r a n c e 
p o l i c y 
t o 
F a r r 
on 
b e h a l f 
o f 
L e x i n g t o n 
("the 
p o l i c y " ) . 
The 
e f f e c t i v e 
d a t e s o f t h e p o l i c y were M a r c h 25, 
2004, t o M a r c h 24, 2005. 
On M a r c h 25, 2004, L e x i n g t o n 
m a i l e d 
t h e p o l i c y t o O r a n g e B e a c h f o r d e l i v e r y t o F a r r . 
The 
p o l i c y 
s p e c i f i c a l l y 
e x c l u d e d 
p r i m a r y 
f l o o d 
i n s u r a n c e . 
Thus, 
i n 
a d d i t i o n t o t h e p o l i c y , 
F a r r a l s o s e c u r e d 
a f l o o d - i n s u r a n c e 
p o l i c y t h r o u g h t h e N a t i o n a l F l o o d I n s u r a n c e 
P r o g r a m ("NFIP") 
f r o m A s s u r a n t S o l u t i o n s i n t h e c o v e r a g e amount o f $250,000 f o r 
t h e h o u s e and $20,000 f o r p e r s o n a l p r o p e r t y . 
The p o l i c y a l s o 
i n c l u d e d t h e f o l l o w i n g 
p r o v i s i o n : 
" O t h e r I n s u r a n c e . 
I f a l o s s 
c o v e r e d b y 
t h i s 
p o l i c y 
i s a l s o c o v e r e d b y o t h e r i n s u r a n c e , we 
w i l l p a y o n l y 
t h e 
p r o p o r t i o n 
o f 
t h e 
l o s s 
t h a t 
t h e 
l i m i t 
o f 
l i a b i l i t y 
t h a t 
a p p l i e s u n d e r 
t h i s 
p o l i c y 
b e a r s 
t o 
t h e 
t o t a l amount o f i n s u r a n c e c o v e r i n g t h e 
l o s s . " 
On May 
18, 2004, 
F a r r s i g n e d a s a l e s a g r e e m e n t t o 
s e l l 
t h e p r o p e r t y t o a t h i r d p a r t y f o r $1,500,000 
w i t h a 
$100,000 
down p a y m e n t . 
l i m i t s . 
4 
1090073 
I n t h e l a t e 
summer o r e a r l y 
f a l l 
o f 2004, 
F a r r 
was 
c o n c e r n e d 
t h a t 
t h e p o l i c y 
l i m i t s 
w e r e 
n o t 
s u f f i c i e n t 
t o 
a d e q u a t e l y 
c o v e r a t o t a l 
l o s s o f t h e h o u s e . 
As a r e s u l t , he 
c o n s u l t e d h i s a t t o r n e y a t t h e t i m e , C h r i s S a n s p r e e , and J o h n 
A l l e n , an i n s u r a n c e - c l a i m s 
c o n s u l t a n t 
l i s t e d b y F a r r as an 
e x p e r t 
w i t n e s s . 
S a n s p r e e and A l l e n w e r e b o t h o f t h e o p i n i o n 
t h a t 
F a r r ' s 
i n s u r a n c e 
c o v e r a g e was i n a d e q u a t e . 
On M a r c h 1, 
2004, F a r r h a d e x e c u t e d a g e n e r a l power o f a t t o r n e y i n f a v o r 
o f S a n s p r e e f o r 
t h e p u r p o s e o f d e a l i n g w i t h m a t t e r s 
r e g a r d i n g 
any 
i n s u r a n c e 
p o l i c i e s 
F a r r 
h a d i n p l a c e 
c o n c e r n i n g 
t h e 
p r o p e r t y . 
F a r r i n d i c a t e d i n 
h i s 
d e p o s i t i o n t e s t i m o n y 
t h a t he 
p e r s o n a l l y made no a t t e m p t s t o i n c r e a s e t h e p o l i c y 
l i m i t s on 
t h e p r o p e r t y . 
S a n s p r e e and A l l e n , h o w e v e r , i n d i c a t e d i n t h e i r 
a f f i d a v i t 
t e s t i m o n y 
o r d e p o s i t i o n 
t e s t i m o n y 
t h a t 
t h e y h a d 
c o n t a c t e d O r a n g e B e a c h and G u l f A g e n c y on b e h a l f o f F a r r and 
had 
r e q u e s t e d an i n c r e a s e i n c o v e r a g e u n d e r t h e p o l i c y .
3 
The 
p o l i c y 
l i m i t s w e r e n e v e r 
i n c r e a s e d . 
On S e p t e m b e r 16, 2004, t h e h o u s e on t h e p r o p e r t y 
was 
d e s t r o y e d 
b y H u r r i c a n e 
I v a n . 
On S e p t e m b e r 20, 2004, 
F a r r 
c o n t a c t e d 
O r a n g e 
B e a c h 
and 
f i l e d 
a 
c l a i m 
f o r 
i n s u r a n c e 
3 T h e 
i n s u r a n c e 
c o m p a n i e s 
f i l e d 
a 
m o t i o n 
t o 
s t r i k e 
S a n s p r e e ' s 
a f f i d a v i t , w h i c h t h e t r i a l 
c o u r t 
g r a n t e d . 
5 
1090073 
b e n e f i t s 
u n d e r t h e p o l i c y . 
Orange 
B e a c h 
f o r w a r d e d 
F a r r ' s 
c l a i m t o L e x i n g t o n 
on S e p t e m b e r 2 1 , 2004. 
F a r r 
i n c l u d e d 
a 
c l a i m f o r b e n e f i t s u n d e r t h e c o n t e n t s p o r t i o n o f t h e p o l i c y i n 
t h e amount o f $ 5 3 , 4 2 1 . 6 1 . 
On 
November 
12, 
2004, 
F a r r 
s i g n e d 
an 
amended 
s a l e s 
a g r e e m e n t w i t h t h e t h i r d p a r t y ; t h e s a l e s p r i c e was 
d e c r e a s e d 
f r o m $1,500,000 
t o $ 1 , 1 8 0 , 0 0 0 , 
i n a d d i t i o n t o t h e $100,000 
down p a y m e n t . 
The amended s a l e s a g r e e m e n t a c k n o w l e d g e d t h a t 
t h e h o u s e h a d b e e n d e c l a r e d 
a " f u l l 
l o s s " and t h a t i t c o u l d 
n o t be " r e s t o r e d , r e p a i r e d , o r r e b u i l t i n t h e p r e s e n t 
l o c a t i o n 
o f t h e i m p r o v e m e n t . " 
On F e b r u a r y 7, 2005, 
F a r r d e e d e d t h e 
p r o p e r t y 
t o t h e t h i r d p a r t y and was p a i d 
$ 1 , 2 8 0 , 0 0 0 . 
A l v i n W e l l s was t h e f l o o d a d j u s t e r f o r t h e N F I P 
a s s i g n e d 
t o F a r r ' s 
c l a i m u n d e r t h e f l o o d - i n s u r a n c e 
p o l i c y . 
A c c o r d i n g 
t o h i s c l a i m summary, W e l l s d e t e r m i n e d 
t h a t t h e r e p l a c e m e n t 
v a l u e o f t h e h o u s e was $454,272 and t h a t 6 0 % o f t h e damage t o 
t h e h o u s e , o r t h e amount o f $ 2 7 2 , 5 3 6 . 2 0 , was 
a t t r i b u t a b l e t o 
f l o o d damage. 
A c c o r d i n g l y , W e l l s d e t e r m i n e d t h a t F a r r was due 
t h e 
f u l l 
p o l i c y 
l i m i t 
o f 
t h e 
f l o o d - i n s u r a n c e 
p o l i c y , 
o r 
$ 2 5 0 , 0 0 0 . 
W e l l s 
a l s o 
d e t e r m i n e d 
t h a t 
F a r r 
h a d 
s u f f e r e d 
$29,548.95 w o r t h o f damage t o t h e c o n t e n t s o f t h e h o u s e . 
On 
6 
1090073 
A p r i l 
22, 
2005, A s s u r a n t 
S o l u t i o n s 
p a i d 
F a r r $250,000 u n d e r 
h i s 
f l o o d - i n s u r a n c e 
p o l i c y 
f o r 
t h e damage t o 
t h e 
h o u s e 
and 
$20,000 f o r t h e damage t o t h e 
c o n t e n t s . 
A t 
F a r r ' s 
r e q u e s t , 
L e x i n g t o n 
r e t a i n e d 
H a l l i w e l l 
E n g i n e e r i n g 
A s s o c i a t e s , 
I n c . 
( " H a l l i w e l l " ) , 
t o 
i n s p e c t 
t h e 
p r o p e r t y 
and 
t o d e t e r m i n e 
t h e 
c a u s e o f 
t h e 
l o s s . 
H a l l i w e l l 
d e t e r m i n e d 
t h a t 
t h e " p r o x i m a t e c a u s e " o f 
t h e 
d e s t r u c t i o n 
o f 
t h e 
h o u s e 
"was 
t h e 
h i g h 
... 
s t o r m 
s u r g e 
and 
wave 
a c t i o n 
a s s o c i a t e d 
w i t h 
H u r r i c a n e 
I v a n . " 
H a l l i w e l l 
a l s o 
d e t e r m i n e d 
t h a t 
t h e 
r o o f 
o f 
t h e 
h o u s e 
had 
b e e n 
damaged 
by 
w i n d s 
a s s o c i a t e d 
w i t h H u r r i c a n e 
I v a n . 
As 
a r e s u l t , 
on J a n u a r y 
19, 
2006, 
L e x i n g t o n 
p a i d 
F a r r 
$50,000 
f o r 
t h e 
damage 
t o 
t h e 
h o u s e .
4 
N o t h i n g i n t h e 
r e c o r d 
i n d i c a t e s t h a t 
L e x i n g t o n 
p a i d 
F a r r a n y t h i n g 
u n d e r t h e 
c o n t e n t s p o r t i o n o f t h e 
p o l i c y . 
A l l e g i n g 
t h a t 
t h e 
p o l i c y 
d i d 
n o t 
p r o v i d e 
a d e q u a t e 
c o v e r a g e 
and 
t h a t 
L e x i n g t o n 
had 
f a i l e d 
t o 
pay 
t h e 
p r o p e r 
b e n e f i t s u n d e r t h e 
p o l i c y , 
F a r r s u e d t h e 
i n s u r a n c e 
c o m p a n i e s 
on 
November 
2, 
2007, 
a s s e r t i n g 
c l a i m s 
o f 
f r a u d , 
m i s r e p r e s e n t a t i o n , 
n e g l i g e n c e , 
and c o n s p i r a c y 
t o d e f r a u d . 
F a r r 
4 T h e $50,000 payment f r o m L e x i n g t o n 
t o F a r r was 
i n i t i a l l y 
c h a r a c t e r i z e d as an " a d v a n c e . " H o w e v e r , f o l l o w i n g L e x i n g t o n ' s 
i n v e s t i g a t i o n 
i n t o 
F a r r ' s 
c l a i m , 
L e x i n g t o n 
d e t e r m i n e d 
t h a t 
t h e r e 
was 
no 
b a s i s 
f o r any 
f u r t h e r p a y m e n t s . 
7 
1090073 
l a t e r 
amended t h e 
c o m p l a i n t 
t o 
i n c l u d e 
c l a i m s 
o f b r e a c h 
o f 
c o n t r a c t 
and 
b a d - f a i t h 
f a i l u r e 
t o 
pay 
an 
i n s u r a n c e 
c l a i m 
a g a i n s t 
L e x i n g t o n .
5 
The 
i n s u r a n c e 
c o m p a n i e s 
a n s w e r e d 
and 
a s s e r t e d v a r i o u s 
c o u n t e r c l a i m s 
a g a i n s t 
F a r r . 
The 
i n s u r a n c e c o m p a n i e s e a c h f i l e d a m o t i o n f o r a summary 
j u d g m e n t , and 
t h e 
c i r c u i t c o u r t s e t t h e m o t i o n s f o r a 
h e a r i n g 
on 
A u g u s t 
24, 
2 0 0 9 .
6 
On 
A u g u s t 
21, 
2 0 0 9 , 
F a r r 
f i l e d 
an 
o p p o s i t i o n 
t o 
t h e 
i n s u r a n c e 
c o m p a n i e s ' 
summary-judgment 
m o t i o n s . 
A t t a c h e d 
t o F a r r ' s r e s p o n s e was 
an 
a f f i d a v i t 
o f h i s 
f o r m e r 
a t t o r n e y , 
C h r i s 
S a n s p r e e . 
The 
i n s u r a n c e 
c o m p a n i e s 
moved t o s t r i k e S a n s p r e e ' s a f f i d a v i t f r o m F a r r ' s r e s p o n s e f o r 
v a r i o u s r e a s o n s , 
and t h e c i r c u i t c o u r t g r a n t e d t h e m o t i o n . 
On 
S e p t e m b e r 
1, 
2009, 
t h e 
c i r c u i t 
c o u r t 
e n t e r e d 
a 
j u d g m e n t 
g r a n t i n g 
t h e 
i n s u r a n c e 
c o m p a n i e s ' 
m o t i o n s 
f o r 
a 
summary 
j u d g m e n t . 
F a r r 
f i l e d 
a m o t i o n t o a l t e r , amend, o r v a c a t e 
t h e 
c i r c u i t c o u r t ' s j u d g m e n t p u r s u a n t t o R u l e 5 9 ( e ) , A l a . R. 
C i v . 
5 F a r r a l s o 
f i l e d 
a s e c o n d amended c o m p l a i n t 
a d d i n g 
S t a t e 
Farm I n s u r a n c e Company 
as 
a p a r t y 
and 
a l l e g i n g 
a 
c l a i m 
o f 
b r e a c h o f c o n t r a c t a g a i n s t i t . T h a t c l a i m i s n o t t h e 
s u b j e c t 
o f 
t h i s 
a p p e a l 
and r e m a i n s p e n d i n g i n t h e 
c i r c u i t 
c o u r t . 
6 T h e h e a r i n g on t h e i n s u r a n c e c o m p a n i e s ' summary-judgment 
m o t i o n s a c t u a l l y o c c u r r e d 
on A u g u s t 26, 
2009. 
8 
1090073 
P., w h i c h t h e c i r c u i t 
c o u r t 
d e n i e d . 
F a r r t h e n 
a p p e a l e d 
t o 
t h i s 
C o u r t . 
The 
i n s u r a n c e 
c o m p a n i e s ' c o u n t e r c l a i m s 
a g a i n s t F a r r h a d 
n o t b e e n 
a d j u d i c a t e d a t t h e t i m e 
F a r r 
a p p e a l e d 
t h e 
c i r c u i t 
c o u r t ' s 
p a r t i a l 
summary 
j u d g m e n t ; 
l i k e w i s e , 
F a r r ' s 
c l a i m s 
a g a i n s t 
S t a t e Farm I n s u r a n c e 
Company ( " S t a t e 
F a r m " ) h a d n o t 
b e e n a d j u d i c a t e d ( s e e s u p r a n o t e 5 ) . As a r e s u l t , 
t h i s 
C o u r t 
e n t e r e d 
an 
o r d e r 
r e m a n d i n g t h e c a s e t o t h e c i r c u i t 
c o u r t 
n o t i n g t h a t t h e a p p e a l was n o t f r o m a f i n a l j u d g m e n t b e c a u s e 
t h e c o u n t e r c l a i m s o f t h e i n s u r a n c e c o m p a n i e s a n d F a r r ' s c l a i m s 
a g a i n s t 
S t a t e Farm h a d n o t b e e n a d j u d i c a t e d . 
On M a r c h 10, 
2010, 
t h e c i r c u i t 
c o u r t e n t e r e d an o r d e r m a k i n g i t s S e p t e m b e r 
1, 2009, j u d g m e n t 
f i n a l p u r s u a n t 
t o R u l e 
5 4 ( b ) , A l a . 
R. C i v . 
P., 
s t a t i n g 
t h a t 
" [ t ] h e r e i s no j u s t 
r e a s o n 
f o r d e l a y and 
j u d g m e n t i s e n t e r e d on b e h a l f o f t h e [ i n s u r a n c e c o m p a n i e s ] as 
t o 
[ F a r r ' s ] c l a i m s . 
The 
c o u n t e r c l a i m s 
o f t h e 
[ i n s u r a n c e 
c o m p a n i e s ] r e m a i n p e n d i n g . " 
The c l a i m s 
a g a i n s t 
S t a t e 
Farm 
a l s o r e m a i n p e n d i n g . 
T h i s C o u r t 
t h e n 
r e i n s t a t e d t h e a p p e a l . 
S t a n d a r d o f R e v i e w 
We r e v i e w a summary j u d g m e n t by t h e f o l l o w i n g 
s t a n d a r d : 
" ' " I n 
r e v i e w i n g t h e d i s p o s i t i o n o f a 
m o t i o n f o r 
summary j u d g m e n t , we u t i l i z e t h e 
9 
1090073 
same s t a n d a r d as t h a t o f t h e t r i a l c o u r t i n 
d e t e r m i n i n g w h e t h e r t h e 
e v i d e n c e b e f o r e 
t h e 
c o u r t made o u t a g e n u i n e i s s u e o f m a t e r i a l 
f a c t " a n d w h e t h e r t h e movant was 
e n t i t l e d 
t o a j u d g m e n t as a m a t t e r o f l a w . B u s s e y v .  
J o h n D e e r e Co., 531 So. 2d 860, 862 ( A l a . 
1 
98 8 ); R u l e 5 6 ( c ) , A l a . R. C i v . P. When 
t h e 
movant makes a p r i m a 
f a c i e 
s h o w i n g 
t h a t 
t h e r e i s 
no g e n u i n e i s s u e o f m a t e r i a l 
f a c t , 
t h e 
b u r d e n t h e n s h i f t s t o t h e nonmovant t o 
p r e s e n t s u b s t a n t i a l e v i d e n c e c r e a t i n g 
s u c h 
an 
i s s u e . 
B a s s 
v . 
S o u t h T r u s t 
Bank o f  
B a l d w i n 
C o u n t y , 
538 So.2 d 794, 797-98 
( A l a . 
1 9 8 9 ) . E v i d e n c e i s " s u b s t a n t i a l " i f 
i t 
i s o f " s u c h 
w e i g h t a n d q u a l i t y 
t h a t 
f a i r - m i n d e d 
p e r s o n s 
i n t h e e x e r c i s e o f 
i m p a r t i a l j u d g m e n t c a n r e a s o n a b l y i n f e r t h e 
e x i s t e n c e o f t h e f a c t s o u g h t t o 
be p r o v e d . " 
West v . F o u n d e r s 
L i f e 
A s s u r a n c e 
Co. o f 
F l o r i d a , 547 So. 2d 870, 871 ( A l a . 1 9 8 9 ) . ' 
"Ex p a r t e G e n e r a l M o t o r s C o r p . , 769 So. 2d 903, 
906 
( A l a . 
1 9 9 9 ) . When t h e b a s i s o f a summary-judgment 
m o t i o n i s 
a f a i l u r e o f t h e 
n o n m o v a n t ' s e v i d e n c e , 
t h e 
m o v a n t ' s b u r d e n , 
h o w e v e r , i s l i m i t e d t o i n f o r m i n g 
t h e 
c o u r t o f t h e b a s i s o f i t s 
m o t i o n -- t h a t i s , t h e 
m o v i n g 
p a r t y 
must 
i n d i c a t e 
where 
t h e n o n m o v i n g 
p a r t y ' s 
c a s e 
s u f f e r s 
an e v i d e n t i a r y 
f a i l u r e . See  
G e n e r a l M o t o r s , 769 So. 2d a t 909 ( a d o p t i n g J u s t i c e 
H o u s t o n ' s 
s p e c i a l c o n c u r r e n c e i n 
B e r n e r v . C a l d w e l l , 
543 
So. 2d 
68 6, 
691 
( A l a . 
1 
98 9 ) , 
i n w h i c h 
he 
d i s c u s s e d 
t h e 
b u r d e n 
s h i f t 
a t t e n d a n t 
t o 
summary-judgment 
m o t i o n s ) ; a n d C e l o t e x 
C o r p . 
v .  
C a t r e t t , 477 U.S. 317, 3 2 3 , 10 6 S . C t . 2548, 91 L. 
Ed. 2d 265 (1 
98 6) 
( s t a t i n g 
t h a t 
'a p a r t y 
s e e k i n g 
summary 
j u d g m e n t 
a l w a y s 
b e a r s 
t h e 
i n i t i a l 
r e s p o n s i b i l i t y o f i n f o r m i n g t h e [ t r i a l ] c o u r t o f 
t h e 
b a s i s o f i t s 
m o t i o n ' ) . The m o v i n g p a r t y must s u p p o r t 
i t s 
m o t i o n 
w i t h 
s u f f i c i e n t 
e v i d e n c e 
o n l y i f t h a t 
p a r t y h a s t h e b u r d e n 
o f p r o o f a t 
t r i a l . 
G e n e r a l 
 
M o t o r s , 769 So. 2d a t 
909." 
10 
1090073 
R e c t o r 
v. 
B e t t e r H o u s e s , 
I n c . , 
820 
So. 
2d 
75, 
7 
9-80 
( A l a . 
2 0 0 1 ) . 
A d d i t i o n a l l y , 
we 
" a c c e p t 
t h e 
t e n d e n c i e s 
o f 
t h e 
e v i d e n c e 
most 
f a v o r a b l e 
t o 
t h e 
n o n m o v i n g 
p a r t y 
and 
must 
r e s o l v e 
a l l r e a s o n a b l e 
d o u b t s 
i n 
f a v o r 
o f 
t h e 
n o n m o v i n g 
p a r t y . " 
B r u c e v. C o l e , 854 
So. 
2d 47, 
54 
( A l a . 2 0 0 3 ) . 
D i s c u s s i o n 
The 
c i r c u i t 
c o u r t e n t e r e d a g e n e r a l o r d e r g r a n t i n g e a c h 
i n s u r a n c e company's summary-judgment m o t i o n . 
I n e a c h o f 
t h e 
summary-judgment m o t i o n s , 
t h e i n s u r a n c e c o m p a n i e s a r g u e d t h a t 
F a r r ' s 
t o r t 
c l a i m s were 
b a r r e d 
by 
t h e 
t w o - y e a r 
s t a t u t e 
o f 
l i m i t a t i o n s f o r t o r t c l a i m s i n § 6-2-38, A l a . Code 1975. 
The 
i n s u r a n c e c o m p a n i e s m a i n t a i n t h i s a r g u m e n t on a p p e a l , 
a r g u i n g 
t h a t F a r r knew o f t h e c a u s e s o f a c t i o n u n d e r l y i n g t h e a l l e g e d 
t o r t s on M a r c h 29, 2004, t h e d a t e he s i g n e d h i s a p p l i c a t i o n t o 
L e x i n g t o n 
f o r $300,000 
w o r t h 
o f 
i n s u r a n c e 
c o v e r a g e . 
The 
i n s u r a n c e c o m p a n i e s a r g u e t h a t t h e t o r t a l l e g a t i o n s i n F a r r ' s 
c o m p l a i n t 
f i l e d 
on November 7, 2007, a p p r o x i m a t e l y 
t h r e e 
and 
o n e - h a l f 
y e a r s 
a f t e r he had 
n o t i c e o f t h e p o l i c y 
l i m i t s , 
a r e 
b a r r e d by t h e t w o - y e a r s t a t u t e o f l i m i t a t i o n s . 
We 
a g r e e . 
E a c h o f F a r r ' s 
t o r t 
c l a i m s 
i s g o v e r n e d by 
t h e 
t w o - y e a r 
s t a t u t e o f l i m i t a t i o n s s e t f o r t h i n § 6 - 2 - 3 8 ( l ) . 
See B o y c e v. 
11 
1090073 
C a s s e s e , 941 So. 2d 932, 943-44 ( A l a . 2006) ( a p p l y i n g t h e 
t w o -
y e a r 
s t a t u t e o f l i m i t a t i o n s 
s e t f o r t h 
i n § 6-2-38 t o b a r 
c l a i m s o f f r a u d and c o n s p i r a c y t o d e f r a u d ) ; A u t o - O w n e r s I n s . 
 
Co. v . A b s t o n , 822 So. 2d 1187, 1194 ( A l a . 2001) ( n o t i n g 
t h a t 
"any 
f r a u d 
c l a i m must be b r o u g h t 
w i t h i n two y e a r s o f t h e 
a c c r u a l 
o f t h e c l a i m . A l a . Code 
1 
975, 
§ 
6 - 2 - 3 8 ( l ) " ) ; and 
B o o k e r v . U n i t e d 
A m e r i c a n I n s . Co., 7 
00 So. 2d 1 3 3 3 , 1339 
( A l a . 1997) ( a p p l y i n g t h e t w o - y e a r s t a t u t e o f l i m i t a t i o n s s e t 
f o r t h i n 
§ 6-2-38 t o b a r c l a i m s o f n e g l i g e n c e and w a n t o n n e s s ) . 
The 
s t a t u t e o f l i m i t a t i o n s b e g a n t o r u n on F a r r ' s a l l e g e d 
t o r t 
c l a i m s 
when 
F a r r 
s i g n e d 
t h e a p p l i c a t i o n t o L e x i n g t o n f o r 
i n s u r a n c e 
c o v e r a g e on M a r c h 29, 2004, and was e f f e c t i v e l y p u t 
on 
n o t i c e o f t h e c o v e r a g e .
7 
See L i b e r t y N a t ' l L i f e I n s . 
Co. 
 
v. I n g r a m , 887 So. 2d 2 2 2 , 227 ( A l a . 2004) 
( h o l d i n g t h a t t h e 
s t a t u t e o f l i m i t a t i o n s i n § 6-2-38 h a d b e g u n t o r u n on t h e 
i n s u r e d ' s 
t o r t 
c l a i m s when he r e c e i v e d h i s i n s u r a n c e 
p o l i c y , 
e f f e c t i v e l y p u t t i n g h i m on n o t i c e o f h i s c l a i m s ) . 
T h e r e f o r e , 
t h e 
t o r t c l a i m s a s s e r t e d i n F a r r ' s c o m p l a i n t , 
f i l e d more t h a n 
7We n o t e t h a t t h e p o l i c y was a c t u a l l y i s s u e d and d e l i v e r e d 
t o 
F a r r on M a r c h 25, 2004, 
f o u r 
d a y s 
b e f o r e 
t h e d a t e 
F a r r 
s i g n e d t h e a p p l i c a t i o n f o r 
t h e p o l i c y . 
T h e r e a p p e a r s t o be no 
e v i d e n c e 
e x p l a i n i n g why t h e p o l i c y was 
i s s u e d 
b e f o r e 
t h e 
a p p l i c a t i o n was s i g n e d . 
However, t h e p a r t i e s a r e i n a g r e e m e n t 
as t o t h e s e 
d a t e s . 
12 
1090073 
t h r e e y e a r s a f t e r M a r c h 29, 2004, were b a r r e d by t h e t w o - y e a r 
s t a t u t e o f 
l i m i t a t i o n s . 
I n h i s b r i e f on a p p e a l , 
F a r r a r g u e s t h a t t h e s t a t u t e o f 
l i m i t a t i o n s was 
t o l l e d by v a r i o u s 
e v e n t s , 
n a m e l y 
L e x i n g t o n ' s 
p a y i n g 
F a r r $50,000 on J a n u a r y 19, 2006, and f a c t s 
s u r r o u n d i n g 
a d d i t i o n a l 
n e g o t i a t i o n s 
b e t w e e n 
t h e p a r t i e s 
a t 
t h a t 
t i m e . 
However, 
F a r r 
p r o v i d e s 
no 
l e g a l 
a u t h o r i t y 
t o 
s u p p o r t h i s 
c l a i m . 
I n 
U n i v e r s i t y 
o f 
S o u t h 
A l a b a m a 
v. 
P r o g r e s s i v e 
I n s u r a n c e Co., 904 So. 2d 1242, 1247-48 ( A l a . 
2004) t h i s C o u r t 
h e l d : 
" R u l e 2 8 ( a ) ( 1 0 ) , A l a . R. App. P., r e q u i r e s 
t h a t 
a r g u m e n t s 
i n 
an 
a p p e l l a n t ' s 
... 
b r i e f 
c o n t a i n 
' c i t a t i o n s 
t o 
t h e 
c a s e s , 
s t a t u t e s , 
o t h e r 
a u t h o r i t i e s , and p a r t s o f t h e r e c o r d 
r e l i e d o n . ' The 
e f f e c t o f a f a i l u r e t o c o m p l y w i t h R u l e 2 8 ( a ) ( 1 0 ) i s 
w e l l 
e s t a b l i s h e d : 
" ' I t 
i s s e t t l e d 
t h a t a 
f a i l u r e 
t o c o m p l y 
w i t h t h e r e q u i r e m e n t s o f R u l e 
2 8 ( a ) ( [ 1 0 ] ) 
r e q u i r i n g 
c i t a t i o n 
o f 
a u t h o r i t y 
f o r 
a r g u m e n t s 
p r o v i d e s 
t h e C o u r t w i t h a b a s i s 
f o r d i s r e g a r d i n g t h o s e a r g u m e n t s : 
"'"When 
an 
a p p e l l a n t 
f a i l s 
t o 
c i t e 
any 
a u t h o r i t y 
f o r 
an 
a r g u m e n t 
on a p a r t i c u l a r 
i s s u e , 
t h i s 
C o u r t 
may 
a f f i r m 
t h e 
j u d g m e n t as t o t h a t i s s u e , f o r 
i t 
i s 
n e i t h e r 
t h i s C o u r t ' s d u t y n o r 
i t s 
f u n c t i o n 
t o 
p e r f o r m 
an 
a p p e l l a n t ' s 
l e g a l 
r e s e a r c h . 
R u l e 
2 8 ( a ) ( [ 1 0 ] ) ; 
S p r a d l i n 
v . 
13 
1090073 
B i r m i n g h a m A i r p o r t A u t h o r i t y , 613 
So. 
2d 347 
( A l a . 1 9 9 3 ) . " 
" ' C i t y 
o f 
B i r m i n g h a m 
v. 
B u s i n e s s 
R e a l t y 
 
I n v . Co., 
722 
So. 
2d 747, 
752 
( A l a . 1 9 9 8 ) . 
See 
a l s o McLemore v. 
F l e m i n g , 
604 
So. 
2d 
353 
( A l a . 1 9 9 2 ) ; 
S t o v e r 
v. 
A l a b a m a 
Farm  
B u r e a u 
I n s . 
Co., 
467 
So. 
2d 
251 
( A l a . 
1 9 8 5 ) ; 
and 
Ex 
p a r t e 
R i l e y , 
464 
So. 
2d 
92 
( A l a . 
1 9 8 5 ) . ' 
"Ex p a r t e S h o w e r s , 812 
So. 
2d 277, 
281 
( A l a . 2 0 0 1 ) . 
'[W]e 
c a n n o t 
c r e a t e 
l e g a l 
a r g u m e n t s 
f o r 
a 
p a r t y 
b a s e d 
on 
u n d e l i n e a t e d 
g e n e r a l 
p r o p o s i t i o n s 
u n s u p p o r t e d 
by 
a u t h o r i t y o r a r g u m e n t . ' S p r a d l i n v.  
S p r a d l i n , 
601 
So. 
2d 76, 
79 
( A l a . 1 9 9 2 ) . " 
T h e r e f o r e , 
we 
w i l l 
n o t 
c o n s i d e r 
F a r r ' s 
t o l l i n g 
a r g u m e n t 
on 
a p p e a l . 
N e x t , F a r r a l l e g e s t h a t t h e e n t r y o f a summary j u d g m e n t 
by t h e 
c i r c u i t 
c o u r t on h i s b r e a c h - o f - c o n t r a c t and b a d - f a i t h 
c l a i m s 
was 
i n 
e r r o r . 
F a r r 
a r g u e s 
t h a t 
t h e 
p o l i c y 
was 
a 
" r e p l a c e m e n t 
v a l u e p o l i c y " and t h a t , b a s e d on t h e v a l u e o f t h e 
h o u s e 
a t 
t h e 
t i m e 
i t was 
d e s t r o y e d 
by 
H u r r i c a n e 
I v a n 
and 
d e s p i t e t h e p o l i c y 
l i m i t o f $ 3 0 0 , 0 0 0 , L e x i n g t o n was 
o b l i g a t e d 
t o 
p a y 
t h e 
f u l l amount i t w o u l d c o s t t o r e p l a c e t h e 
h o u s e . 
F a r r ' s 
b r e a c h - o f - c o n t r a c t 
a r g u m e n t 
i s 
p r e m i s e d 
on 
h i s 
a s s e r t i o n 
t h a t t h e 
p o l i c y 
l i m i t s 
were 
i n c r e a s e d by 
an 
o r a l 
c o n t r a c t 
e n t e r e d 
i n t o 
by 
S a n s p r e e , 
on 
b e h a l f 
o f 
F a r r , 
and 
Orange B e a c h a n d / o r G u l f A g e n c y , on b e h a l f o f L e x i n g t o n . 
F a r r 
14 
1090073 
a r g u e s t h a t , b a s e d on t h e i n c r e a s e d p o l i c y 
l i m i t s , 
L e x i n g t o n 
b r e a c h e d t h e p o l i c y by p a y i n g h i m o n l y $ 5 0 , 0 0 0 , r a t h e r 
t h a n 
t h e c o s t o f r e p l a c i n g t h e h o u s e . 
F a r r a l l e g e s t h a t t h e h o u s e 
was 
w o r t h a t l e a s t 
$568,000 -- t h e c o s t o f t h e r e n o v a t i o n s 
F a r r h a d c o m p l e t e d on t h e 
h o u s e -- a n d t h a t L e x i n g t o n 
b r e a c h e d 
t h e p o l i c y by f a i l i n g t o p a y t o h a v e t h e h o u s e 
r e p l a c e d . 
The 
o n l y e v i d e n c e t o s u p p o r t 
F a r r ' s 
a s s e r t i o n t h a t t h e 
p o l i c y 
l i m i t s 
were 
i n c r e a s e d b y an 
o r a l 
c o n t r a c t 
b e t w e e n 
S a n s p r e e , 
r e p r e s e n t i n g 
F a r r , a n d Orange B e a c h 
a n d / o r 
G u l f 
A g e n c y , r e p r e s e n t i n g L e x i n g t o n , i s 
t h e a f f i d a v i t o f S a n s p r e e . 
S a n s p r e e ' s 
a f f i d a v i t 
s t a t e s , i n p e r t i n e n t p a r t : 
" L a t e r 
i n t h e summer o f 2004, 
a f t e r 
D r . 
F a r r 
r e c e i v e d h i s p o l i c i e s f o r h i s home ( f l o o d a n d w i n d ) , 
Dr. 
F a r r e x p r e s s e d 
c o n c e r n t h a t h i s 
b e a c h 
r e s i d e n c e 
was 
u n d e r i n s u r e d 
b a s e d 
upon 
t h e r e m o d e l i n g 
a n d 
u p g r a d e s 
i n m a t e r i a l s 
on t h e b e a c h 
p r o p e r t y a n d 
a s k e d i f 
I w o u l d 
c o n t a c t 
Orange B e a c h 
. 
. 
. a n d The 
G u l f A g e n c y t o e n s u r e t h a t he h a d a d e q u a t e c o v e r a g e s 
c o v e r i n g h i s p r o p e r t y . 
I a g r e e d t o do so a n d D r . 
F a r r 
s u b s e q u e n t l y 
p r o v i d e d me w i t h 
d e t a i l e d 
c o p i e s 
o f r e c e i p t s a n d c a n c e l l e d c h e c k s d i r e c t l y r e l a t e d t o 
t h e 
r e m o d e l i n g 
a n d u p g r a d e s 
t o t h e b e a c h 
home 
l o c a t e d i n Orange B e a c h , A l a b a m a , f o r 
t h e p e r i o d o f 
1998 
t h r o u g h 2004 
I n t h e 
m i d d l e t o l a t t e r 
p a r t 
o f 
A u g u s t 
o f 2004, 
I p r e s e n t e d 
c o p i e s 
o f 
t h o s e 
r e c e i p t s a n d c a n c e l e d 
c h e c k s t o K e v i n M c C a r r o n a n d 
J o - J o 
M c C a r r o n i n O r a n g e B e a c h a n d a l s o 
p r e s e n t e d 
c o p i e s 
o f t h e same t o T e r r i 
M a n t a y a t The 
G u l f 
A g e n c y i n M o n t g o m e r y . 
15 
1090073 
"At e a c h o f t h e above m e e t i n g s , 
I s p e c i f i c a l l y 
r e q u e s t e d 
an i n c r e a s e o f $250,000.00 i n homeowner's 
i n s u r a n c e 
c o v e r a g e 
t o 
c o v e r 
any 
damages c a u s e d 
by 
w i n d 
on 
Dr. 
F a r r ' s b e a c h home and 
an 
i n c r e a s e 
i n 
f l o o d 
c o v e r a g e 
o f $250,000.00 
t o 
c o v e r 
any 
damage 
c a u s e d by 
f l o o d and w a t e r t o Dr. 
F a r r ' s b e a c h home. 
D u r i n g 
t h e m e e t i n g w i t h T e r r i M a n t a y , Ms. M a n t a y 
and 
I 
r e v i e w e d 
Dr. 
F a r r ' s 
i n i t i a l 
p o l i c i e s , 
t h e 
p o l i c i e s ' c o v e r a g e l i m i t s , d i s c u s s e d t h e l o c a t i o n 
o f 
t h e 
p r o p e r t y , 
t h e 
f a c t 
t h a t 
t h e 
p r o p e r t y 
was 
n o t 
u s e d as a r e n t a l p r o p e r t y and d i s c u s s e d how much t h e 
a d d i t i o n a l premiums w o u l d be 
t o i n c r e a s e Dr. 
F a r r ' s 
c o v e r a g e s 
as 
s e t 
f o r t h 
a b o v e . 
I 
r e v i e w e d 
t h e 
r e c e i p t s and c a n c e l e d c h e c k s w i t h Ms. M a n t a y and 
Ms. 
M a n t a y 
t o l d 
me 
t h a t 
The 
G u l f 
A g e n c y 
had 
t h e 
a u t h o r i t y 
t o 
b i n d 
t h e 
c o v e r a g e 
f o r t h e 
a d d i t i o n a l 
l i m i t s w i t h o u t 
h a v i n g t o i n v o l v e L e x i n g t o n 
o r 
h a v i n g 
t o 
f i l l 
o u t an a d d i t i o n a l 
a p p l i c a t i o n b e c a u s e i t was 
w i t h i n 
The 
G u l f A g e n c y ' s 
u n d e r w r i t i n g 
l i m i t s . 
Ms. 
M a n t a y t o l d me 
t h a t she w o u l d i n c r e a s e t h e 
c o v e r a g e s 
i m m e d i a t e l y 
on 
t h e 
w i n d 
and 
f l o o d 
i n s u r a n c e 
c o v e r a g e s and 
t o l d me 
t h a t t h e i n c r e a s e i n c o v e r a g e 
was 
b o u n d and 
w o u l d t a k e 
e f f e c t 
as 
o f 
t h a t 
d a y . 
I 
p a i d 
t h e 
a d d i t i o n a l 
p r e m i u m on 
b e h a l f 
o f 
Dr. 
F a r r 
f o r t h e i n c r e a s e d p r e m i u m c o s t s a s s o c i a t e d w i t h 
t h e 
i n c r e a s e d 
l i m i t s and 
I d e p a r t e d 
t h e 
o f f i c e s o f 
The 
G u l f A g e n c y . " 
As 
n o t e d 
a b o v e , 
t h e 
i n s u r a n c e 
c o m p a n i e s 
f i l e d 
m o t i o n s 
t o 
s t r i k e S a n s p r e e ' s a f f i d a v i t . 
The 
c i r c u i t c o u r t g r a n t e d 
t h e i r 
m o t i o n s , 
s e t t i n g 
f o r t h 
i t s r e a s o n i n g 
a t 
t h e 
h e a r i n g 
on 
t h e 
summary-judgment m o t i o n s : 
"THE 
COURT: T h i s i s what I c a n ' t u n d e r s t a n d . I f 
you 
r e a d 
t h e 
c o m p l a i n t , 
i t 
t a l k s 
i n 
t e r m s 
o f 
r e p r e s e n t a t i o n s 
made 
i n 
M a r c h 
o f 
2004. 
And 
Mr. 
S a n s p r e e ' s a f f i d a v i t , a l l he w a n t s t o t a l k a b o u t i s 
s o m e t h i n g 
t h a t 
h a p p e n e d 
i n A u g u s t 
o f 
2 0 0 [ 4 ] . 
You 
n e v e r 
amended 
t h e 
c o m p l a i n t 
t o 
d i s c u s s 
a n y t h i n g 
16 
1090073 
a b o u t a r e p r e s e n t a t i o n 
t h a t 
o c c u r r e d 
i n A u g u s t o f 
2 0 0 [ 4 ] . 
" [ F a r r ' s 
t r i a l 
c o u n s e l ] : 
W e l l , 
J u d g e , number o n e , 
t h a t ' s n o t a v e r i f i e d 
c o m p l a i n t 
"THE COURT: W e l l , i t ' s t h e one we're g o i n g t o 
t r i a l 
on Monday. 
" [ F a r r ' s 
t r i a l 
c o u n s e l ] : 
W e l l , 
on t h e amended 
c o m p l a i n t . 
When t h a t 
f i r s t 
c o m p l a i n t 
was drawn up, 
I d o n ' t know who s i g n e d t h e c o m p l a i n t . 
Okay. 
"THE COURT: W e l l , i t 
i s 
what i t i s . 
" [ F a r r ' s 
t r i a l 
c o u n s e l ] : B u t I d o n ' t t h i n k t h a t , i n 
r e g a r d 
t o 
w h a t e v e r 
t h e 
e v i d e n c e 
w h a t e v e r 
t h e 
e v i d e n c e 
i s s u b s e q u e n t l y 
p r o d u c e d , 
I 
t h i n k 
t h a t 
[ L e x i n g t o n ] 
h a s 
f i l e d 
some 
c o u n t e r c l a i m s . 
A n d I 
t h i n k most 
e v e r y b o d y d i d on t h e b a s i s 
t h a t 
we're 
g o i n g 
t o amend o u r c o m p l a i n t 
t o c o n f o r m 
t o t h e 
e v i d e n c e . 
"THE COURT: N o t w i t h me, y o u ' r e n o t — L e t me t e l l y o u 
what I'm g o i n g 
t o do. I'm g o i n g 
t o g r a n t 
summary 
j u d g m e n t . I'm g o i n g t o s t r i k e t h e a f f i d a v i t . 
T h a t ' s 
n o t 
an 
a f f i d a v i t . 
I t ' s an 
amendment 
t o t h e 
c o m p l a i n t . 
Y o u ' r e a d d i n g a t o t a l l y d i f f e r e n t 
l a w s u i t 
by 
b r i n g i n g 
i n a b u n c h o f 
a l l e g a t i o n s made i n 
2 0 0 [ 4 ] , 
n o t a one o f w h i c h 
y o u r 
w i t n e s s , 
[ F a r r ] , 
t e s t i f i e d 
t o i n h i s d e p o s i t i o n . 
He 
d o e s n ' t s a y 
a n y t h i n g 
a b o u t a new c o n t r a c t i n A u g u s t o f ' 0 [ 4 ] . " 
The c i r c u i t c o u r t g r a n t e d t h e i n s u r a n c e 
c o m p a n i e s ' m o t i o n s t o 
s t r i k e 
S a n s p r e e ' s 
a f f i d a v i t 
on t h e b a s i s 
t h a t i t 
was, i n 
a c t u a l i t y , 
an a t t e m p t t o amend t h e c o m p l a i n t . 
I n h i s b r i e f 
b e f o r e 
t h i s 
C o u r t , 
F a r r 
a r g u e s 
t h a t t h e 
c i r c u i t 
c o u r t 
e r r e d i n s t r i k i n g 
S a n s p r e e ' s 
a f f i d a v i t , b u t he 
17 
1090073 
f a i l s t o a d d r e s s t h e c i r c u i t c o u r t ' s r e a s o n i n g f o r d o i n g s o . 
I n s t e a d , 
F a r r 
a d d r e s s e s 
t h e 
r e a s o n i n g 
s e t 
f o r t h 
i n t h e 
i n s u r a n c e c o m p a n i e s ' m o t i o n s t o s t r i k e S a n s p r e e ' s 
a f f i d a v i t s . 
F a r r h a s f a i l e d t o p r o v i d e 
t h i s C o u r t w i t h any l e g a l 
a r g u m e n t 
as t o why he b e l i e v e s t h a t t h e c i r c u i t c o u r t e r r e d i n s t r i k i n g 
S a n s p r e e ' s 
a f f i d a v i t 
as an a t t e m p t t o amend t h e 
c o m p l a i n t . 
T h e r e f o r e , we a f f i r m t h e c i r c u i t c o u r t ' s 
r u l i n g 
g r a n t i n g t h e 
i n s u r a n c e 
c o m p a n i e s ' 
m o t i o n s t o s t r i k e 
S a n s p r e e ' s 
a f f i d a v i t . 
See R u l e 2 8 ( a ) ( 1 0 ) , A l a . 
R. App. P.; and U n i v e r s i t y o f S o u t h  
A l a b a m a , 
s u p r a . 
As a r e s u l t , 
t h e r e i s no b a s i s f o r F a r r ' s 
s e c o n d b r e a c h - o f - c o n t r a c t 
a r g u m e n t .
8 
M o r e o v e r , t h e c i r c u i t c o u r t d i d 
n o t e x c e e d i t s d i s c r e t i o n 
i n 
s t r i k i n g 
S a n s p r e e ' s 
a f f i d a v i t as an i m p e r m i s s i b l e 
a t t e m p t 
by F a r r t o amend h i s c o m p l a i n t . 
As t h e c i r c u i t c o u r t 
n o t e d 
i n d e n y i n g t h i s a t t e m p t t o amend h i s c o m p l a i n t , F a r r ' s a t t e m p t 
came 12 d a y s b e f o r e t h e c a s e was t o go t o t r i a l . 
R u l e 
1 5 ( a ) , 
8We 
n o t e 
t h a t 
F a r r 
d o e s 
a d d r e s s 
t h e 
c i r c u i t 
c o u r t ' s 
r e a s o n i n g 
f o r s t r i k i n g 
S a n s p r e e ' s 
a f f i d a v i t 
i n h i s r e p l y 
b r i e f . 
However, " [ w ] h e r e an a p p e l l a n t 
f i r s t 
c i t e s 
a u t h o r i t y 
f o r an a r g u m e n t i n h i s r e p l y b r i e f , 
i t 
i s as i f 
t h e a r g u m e n t 
was 
f i r s t 
r a i s e d i n t h a t 
r e p l y 
b r i e f , 
and i t w i l l 
n o t be 
c o n s i d e r e d . " 
S t e e l e v. R o s e n f e l d , L L C , 936 So. 2d 488, 493 
( A l a . 
2 0 0 5 ) . 
18 
1090073 
A l a . 
R. 
C i v . P., 
g o v e r n s 
amendments 
t o 
p l e a d i n g s . 
I t 
p r o v i d e s , i n p e r t i n e n t p a r t : 
" U n l e s s 
a c o u r t h a s o r d e r e d 
o t h e r w i s e , 
a p a r t y may 
amend a p l e a d i n g w i t h o u t 
l e a v e o f c o u r t , b u t s u b j e c t 
t o 
d i s a l l o w a n c e 
on t h e c o u r t ' s 
own 
m o t i o n 
o r a 
m o t i o n t o s t r i k e o f an a d v e r s e p a r t y , a t any t i m e 
more 
t h a n 
f o r t y - t w o 
(42) d a y s 
b e f o r e 
t h e 
f i r s t 
s e t t i n g o f t h e c a s e f o r t r i a l , 
and s u c h 
amendment 
s h a l l be 
f r e e l y 
a l l o w e d when 
j u s t i c e so r e q u i r e s . 
T h e r e a f t e r , 
a p a r t y may amend a p l e a d i n g 
o n l y b y  
l e a v e o f c o u r t , and l e a v e 
s h a l l be g i v e n 
o n l y upon  
a s h o w i n g o f good c a u s e . " 
( E m p h a s i s added.) 
I n B o r o s v. B a x l e y , 
621 So. 2d 240 
( A l a . 
1 9 9 3 ) , we 
e x p l a i n e d : 
" A l t h o u g h 
R u l e 
1 5 ( a ) 
i t s e l f 
c a l l s 
f o r 
l i b e r a l 
amendment, 
t h i s 
C o u r t h a s h e l d 
c o n s i s t e n t l y 
t h a t 
' t h e 
g r a n t o r d e n i a l o f l e a v e t o amend i s a m a t t e r 
t h a t i s w i t h i n t h e d i s c r e t i o n o f t h e t r i a l c o u r t and 
i s 
s u b j e c t t o r e v e r s a l on a p p e a l 
o n l y f o r an a b u s e 
o f 
d i s c r e t i o n . ' " 
621 So. 2d a t 245 
( c i t a t i o n s o m i t t e d ) . 
Thus, " R u l e 15, [ A l a . 
R. 
C i v . P . ] , i s n o t 
c a r t e 
b l a n c h e 
a u t h o r i t y t o amend 
a 
c o m p l a i n t 
a t any t i m e . " 
S t a l l i n g s v. A n g e l i c a U n i f o r m Co., 
388 So. 2d 942, 947 ( A l a . 1 9 8 0 ) . 
" [ U ] n d u e d e l a y i n f i l i n g an 
amendment, when i t 
c o u l d h a v e b e e n 
f i l e d 
e a r l i e r b a s e d on t h e 
i n f o r m a t i o n a v a i l a b l e o r d i s c o v e r a b l e , i s 
i n i t s e l f g r o u n d f o r 
d e n y i n g an amendment." 
P u c k e t t , 
T a u l & U n d e r w o o d , I n c . v .  
S c h r e i b e r C o r p . , 551 So. 2d 979, 984 
( A l a . 1 9 8 9 ) . 
" [ I ] f 
t h e 
19 
1090073 
c o u r t 
d e t e r m i n e s 
... 
t h a t 
a 
p a r t y 
has 
had 
s u f f i c i e n t 
o p p o r t u n i t y 
t o 
s t a t e 
a 
c l a i m 
... 
b u t 
has 
f a i l e d 
t o 
do 
s o , 
l e a v e t o amend may 
p r o p e r l y be d e n i e d . " 
W a l k e r v. 
T r a u g h b e r , 
351 
So. 
2d 
917, 
922 
( A l a . C i v . App. 
1 9 7 7 ) . 
F a r r ' s b r e a c h - o f - c o n t r a c t 
c l a i m must 
f a i l b e c a u s e 
t h e r e 
i s no e v i d e n c e t o s u p p o r t h i s a s s e r t i o n t h a t t h e p o l i c y l i m i t s 
were 
e v e r 
i n c r e a s e d .
9 
I n 
f a c t , 
F a r r makes 
an 
a l t e r n a t i v e 
a r g u m e n t i n h i s b r i e f b e f o r e 
t h i s C o u r t t o a t t e m p t t o a d d r e s s 
s u c h a d e t e r m i n a t i o n : 
" A s s u m i n g a r g u e n d o , t h a t F a r r ' s p o l i c y 
l i m i t s 
were 
n o t 
i n c r e a s e d , 
t h e n 
t h e 
[ i n s u r a n c e 
c o m p a n i e s ] 
f a i l e d 
i n t h e i r d u t y t o p r o c u r e a d e q u a t e i n s u r a n c e 
on 
F a r r ' s 
b e h a l f t h e r e b y 
c a u s i n g F a r r damages." 
F a r r ' s b r i e f , a t p. 
51. 
I t i s u n d i s p u t e d 
t h a t t h e 
a p p r a i s a l was 
t h e 
o n l y 
i n f o r m a t i o n 
p r o v i d e d 
t h e 
i n s u r a n c e 
c o m p a n i e s c o n c e r n i n g 
t h e v a l u e 
o f 
t h e 
h o u s e and 
t h a t t h e p o l i c y l i m i t s were s e t a c c o r d i n g l y . 
F a r r 
a g r e e d t o t h e p o l i c y l i m i t s by 
s i g n i n g t h e 
a p p l i c a t i o n . 
Any 
d u t y i n c u m b e n t upon t h e 
i n s u r a n c e 
c o m p a n i e s 
i n e s t a b l i s h i n g 
t h e p o l i c y l i m i t s were s a t i s f i e d 
and were a g r e e d t o by 
F a r r . 
9 F a r r a l l e g e s t h a t t h e d e p o s i t i o n t e s t i m o n y 
o f A l l e n a l s o 
s u p p o r t s 
F a r r ' s a s s e r t i o n t h a t an o r a l c o n t r a c t i n c r e a s i n g t h e 
p o l i c y l i m i t s e x i s t e d . 
However, n o t h i n g i n A l l e n ' s d e p o s i t i o n 
t e s t i m o n y 
i n d i c a t e s t h a t an 
o r a l c o n t r a c t was made, t h a t 
t h e 
p o l i c y 
l i m i t s 
w o u l d 
be 
i n c r e a s e d , 
o r 
t h a t 
S a n s p r e e 
had 
a c t u a l l y p a i d a d d i t i o n a l premiums on 
F a r r ' s 
b e h a l f . 
20 
1090073 
Thus, 
we 
c o n s t r u e 
t h e 
q u o t e 
f r o m 
F a r r ' s 
b r i e f 
n o t 
as 
an 
a l l e g a t i o n 
t h a t 
L e x i n g t o n 
b r e a c h e d 
t h e 
p o l i c y 
as 
i t 
was 
o r i g i n a l l y a g r e e d t o , b u t 
o n l y 
as 
t h a t 
p o l i c y was 
a l l e g e d l y 
amended. 
However, as d i s c u s s e d a b o v e , t h e r e i s no e v i d e n c e t o 
s u p p o r t F a r r ' s c l a i m t h a t t h e p o l i c y was amended. 
T h e r e f o r e , 
t h e c i r c u i t c o u r t ' s j u d g m e n t g r a n t i n g t h e i n s u r a n c e 
c o m p a n i e s ' 
summary-judgment m o t i o n s i s a f f i r m e d as t o F a r r ' s 
a l l e g a t i o n 
t h a t 
L e x i n g t o n 
h a d 
b r e a c h e d 
t h e 
p o l i c y 
by 
n o t 
p a y i n g 
F a r r 
b e n e f i t s u n d e r t h e wind-damage p o r t i o n o f t h e p o l i c y . 
F u r t h e r , 
c o n c e r n i n g 
F a r r ' s a r g u m e n t t h a t 
t h e 
i n s u r a n c e 
c o m p a n i e s 
had 
" f a i l e d i n t h e i r d u t y t o p r o c u r e a d e q u a t e i n s u r a n c e 
on 
F a r r ' s 
b e h a l f , " as d i s c u s s e d a b o v e , F a r r ' s t o r t c l a i m s 
a r e b a r r e d 
by 
t h e t w o - y e a r s t a t u t e o f 
l i m i t a t i o n s . 
F a r r a l s o a r g u e s , 
i n r e l a t i o n 
t o h i s 
b r e a c h - o f - c o n t r a c t 
c l a i m , 
t h a t L e x i n g t o n 
i s " n o t 
e n t i t l e d 
t o c l a i m as a s e t 
o f f 
t o 
t h e 
damages 
[ i t ] c a u s e d , 
amounts 
p a i d 
by 
a 
c o l l a t e r a l 
s o u r c e 
c o m p l e t e l y 
u n r e l a t e d 
t o 
[ i t s ] w r o n g d o i n g . " 
F a r r ' s 
b r i e f , 
a t p. 
42. 
However, F a r r r a i s e s t h i s a r g u m e n t f o r 
t h e 
f i r s t 
t i m e 
on 
a p p e a l ; 
t h u s , 
we 
w i l l 
n o t 
c o n s i d e r 
i t . 
See 
 
T o t t e n 
v. 
L i g h t i n g & S u p p l y , I n c . , 
507 
So. 
2d 
502, 
503 
( A l a . 
1 9 8 7 ) . 
21 
1090073 
A l t e r n a t i v e l y , 
h o w e v e r , 
F a r r 
a l l e g e s 
t h a t 
L e x i n g t o n 
b r e a c h e d t h e p o l i c y b y f a i l i n g t o p a y h i m t h e $20,000 w o r t h o f 
c o n t e n t s c o v e r a g e he h a d u n d e r t h e p o l i c y . 
A t t a c h e d t o 
h i s 
m o t i o n 
o p p o s i n g 
t h e i n s u r a n c e 
c o m p a n i e s ' 
summary-judgment 
m o t i o n s , 
F a r r 
i n c l u d e d 
e v i d e n c e 
i n d i c a t i n g 
t h a t 
he 
h a d 
s u f f e r e d a t l e a s t $29,548.95 w o r t h o f damage t o t h e c o n t e n t s 
o f t h e h o u s e . 
F a r r a r g u e s on a p p e a l t h a t L e x i n g t o n 
b r e a c h e d 
t h e 
p o l i c y by f a i l i n g t o p a y F a r r u n d e r t h e c o n t e n t s 
p o r t i o n 
o f t h e p o l i c y . 
L e x i n g t o n 
f a i l s t o a d d r e s s 
t h i s 
c l a i m i n i t s 
b r i e f . 
L e x i n g t o n 
p a i d 
F a r r 
$50,000 
u n d e r 
t h e p o l i c y 
as i t s 
p o r t i o n o f t h e damage s u s t a i n e d t o t h e h o u s e . 
L e x i n g t o n d i d 
n o t 
p a y F a r r a n y amount 
u n d e r t h e c o n t e n t s 
p o r t i o n o f t h e 
p o l i c y . 
F a r r 
p r o d u c e d 
s u b s t a n t i a l 
e v i d e n c e 
t h a t 
he h a d 
s u f f e r e d a t l e a s t $29,548.95 w o r t h o f damage t o t h e c o n t e n t s 
i n t h e h o u s e . 
T h e r e f o r e , 
e v e n t h o u g h A s s u r a n t S o l u t i o n s 
p a i d 
F a r r 
t h e f l o o d - i n s u r a n c e 
p o l i c y 
l i m i t 
o f $20,000 
f o r t h e 
damage t o h i s 
c o n t e n t s , t h e u n d i s p u t e d e v i d e n c e i n d i c a t e s t h a t 
F a r r 
s u f f e r e d 
a t l e a s t 
$ 2 9 , 5 4 8 . 9 5 
w o r t h o f damage t o h i s 
c o n t e n t s 
and 
t h a t 
L e x i n g t o n 
d i d n o t p a y 
F a r r 
u n d e r t h e 
c o n t e n t s 
p o r t i o n o f t h e p o l i c y . 
T h e r e f o r e , 
we 
r e v e r s e t h e 
22 
1090073 
c i r c u i t c o u r t ' s j u d g m e n t i n s o f a r as i t h e l d t h a t L e x i n g t o n 
had 
n o t 
b r e a c h e d t h e 
p o l i c y by 
f a i l i n g t o pay 
F a r r 
any 
p r o c e e d s 
u n d e r t h e 
c o n t e n t s p r o v i s i o n o f t h e p o l i c y . 
N e x t , F a r r a l s o a r g u e s on a p p e a l t h a t t h e 
c i r c u i t 
c o u r t ' s 
j u d g m e n t 
g r a n t i n g 
L e x i n g t o n ' s 
summary-judgment 
m o t i o n 
on 
F a r r ' s b a d - f a i t h c l a i m was 
i n e r r o r . 
T h i s C o u r t s e t f o r t h t h e 
e l e m e n t s 
o f 
a 
b a d - f a i t h - r e f u s a l - t o - p a y 
c l a i m 
i n 
N a t i o n a l 
 
S e c u r i t y 
F i r e & C a s u a l t y 
Co. 
v. Bowen, 417 
So. 
2d 
179 
( A l a . 
1 9 8 2 ) : 
" [ T ] h e 
p l a i n t i f f i n a 
'bad 
f a i t h 
r e f u s a l ' c a s e 
has 
t h e b u r d e n o f 
p r o v i n g : 
" ( a ) 
an 
i n s u r a n c e 
c o n t r a c t b e t w e e n t h e 
p a r t i e s 
and 
a b r e a c h t h e r e o f 
by 
t h e 
d e f e n d a n t ; 
"(b) 
an i n t e n t i o n a l r e f u s a l t o pay t h e 
i n s u r e d ' s 
c l a i m ; 
" ( c ) t h e a b s e n c e o f any r e a s o n a b l y l e g i t i m a t e o r 
a r g u a b l e r e a s o n 
f o r t h a t 
r e f u s a l 
( t h e a b s e n c e o f 
a 
d e b a t a b l e 
r e a s o n ) ; 
"(d) 
t h e 
i n s u r e r ' s 
a c t u a l 
k n o w l e d g e 
o f 
t h e 
a b s e n c e o f any 
l e g i t i m a t e o r a r g u a b l e 
r e a s o n ; 
" ( e ) 
i f i n t e n t i o n a l f a i l u r e 
t o 
d e t e r m i n e 
t h e 
e x i s t e n c e 
o f 
a 
l a w f u l 
b a s i s 
i s 
r e l i e d 
u p o n , 
t h e 
p l a i n t i f f 
must 
p r o v e 
t h e 
i n s u r e r ' s 
i n t e n t i o n a l 
f a i l u r e 
t o d e t e r m i n e w h e t h e r t h e r e 
i s a 
l e g i t i m a t e 
o r a r g u a b l e r e a s o n t o r e f u s e 
t o pay 
t h e 
c l a i m . 
" I n 
s h o r t , 
p l a i n t i f f must 
go 
b e y o n d 
a 
mere 
s h o w i n g 
o f 
nonpayment 
and 
p r o v e 
a 
b a d 
f a i t h 
23 
1090073 
n o n p a y m e n t , 
a 
nonpayment 
w i t h o u t 
any 
r e a s o n a b l e 
g r o u n d 
f o r 
d i s p u t e . 
Or, 
s t a t e d 
d i f f e r e n t l y 
t h e 
p l a i n t i f f must show t h a t 
t h e 
i n s u r a n c e 
company 
had 
no 
l e g a l o r f a c t u a l d e f e n s e t o t h e i n s u r a n c e 
c l a i m . " 
417 
So. 
2d 
a t 183. 
See 
a l s o C h a v e r s v. N a t i o n a l 
Sec. 
F i r e 
& 
C a s . 
Co., 
405 
So. 
2d 
1 
( A l a . 1 9 8 1 ) . 
B a s e d on o u r c o n c l u s i o n 
t h a t L e x i n g t o n 
d i d n o t b r e a c h 
t h e 
p o l i c y 
by 
p a y i n g 
F a r r $50,000 
f o r t h e damage t o 
t h e 
h o u s e , 
F a r r 
c a n n o t 
m a i n t a i n 
h i s 
b a d - f a i t h 
c l a i m 
b a s e d 
on 
t h a t 
p a r t i c u l a r 
b r e a c h - o f - c o n t r a c t 
c l a i m . 
F a r r 
c o u l d , 
h o w e v e r , 
m a i n t a i n 
h i s b a d - f a i t h 
c l a i m a g a i n s t 
t h e 
i n s u r a n c e 
c o m p a n i e s 
c o n c e r n i n g L e x i n g t o n ' s f a i l u r e t o pay 
t h e c o n t e n t s p o r t i o n 
o f 
t h e p o l i c y . 
However, F a r r has 
f a i l e d t o d i r e c t 
t h i s C o u r t 
t o 
any 
e v i d e n c e 
i n d i c a t i n g 
t h a t L e x i n g t o n 
o p e r a t e d i n b a d 
f a i t h 
i n 
i t s f a i l u r e t o pay 
F a r r u n d e r t h e 
c o n t e n t s p o r t i o n o f 
t h e 
p o l i c y . 
I n f a c t , F a r r 
f a i l s t o p r e s e n t any a r g u m e n t on 
a p p e a l 
c o n c e r n i n g h i s b a d - f a i t h c l a i m b a s e d on L e x i n g t o n ' s b r e a c h 
o f 
t h e c o n t e n t s p o r t i o n o f t h e p o l i c y ; t h u s , we 
w i l l n o t 
c o n s i d e r 
i t 
on 
a p p e a l . 
See 
R u l e 
2 8 ( a ) ( 1 0 ) , 
A l a . 
R. 
App. 
P.; 
and 
U n i v e r s i t y 
o f S o u t h A l a b a m a , 
s u p r a . 
T h e r e f o r e , 
t h e 
c i r c u i t 
c o u r t ' s j u d g m e n t g r a n t i n g L e x i n g t o n ' s summary-judgment m o t i o n 
c o n c e r n i n g F a r r ' s b a d - f a i t h 
c l a i m i s 
a f f i r m e d . 
C o n c l u s i o n 
24 
1090073 
B a s e d 
on 
t h e 
f o r e g o i n g , 
we 
a f f i r m t h e 
c i r c u i t 
c o u r t ' s 
j u d g m e n t 
i n s o f a r 
as 
i t e n t e r e d 
a summary j u d g m e n t 
f o r 
t h e 
i n s u r a n c e 
c o m p a n i e s 
on 
F a r r ' s 
t o r t 
c l a i m s , 
h i s 
b r e a c h - o f -
c o n t r a c t 
c l a i m 
a g a i n s t 
L e x i n g t o n 
as 
t h a t 
c l a i m 
r e l a t e s 
t o 
L e x i n g t o n ' s payment u n d e r t h e 
p o l i c y f o r t h e w i n d damage 
t o 
t h e h o u s e , and 
h i s b a d - f a i t h 
c l a i m . 
We 
r e v e r s e 
t h e 
c i r c u i t 
c o u r t ' s 
j u d g m e n t 
i n f a v o r 
o f 
L e x i n g t o n 
on 
F a r r ' s 
b r e a c h - o f -
c o n t r a c t 
c l a i m as 
t o L e x i n g t o n ' s 
f a i l u r e 
t o pay 
t h e 
c o n t e n t s 
p o r t i o n o f t h e p o l i c y , and we remand t h e c a u s e f o r p r o c e e d i n g s 
c o n s i s t e n t 
w i t h 
t h i s 
o p i n i o n .
1
0 
AFFIRMED IN PART; REVERSED IN PART; AND 
REMANDED. 
S t u a r t , Shaw, and W i s e , J J . , c o n c u r . 
B o l i n , 
J . , c o n c u r s i n t h e 
r e s u l t . 
Cobb, C . J . , 
r e c u s e s h e r s e l f . 
1
0 F a r r 
i n c l u d e d 
two 
o t h e r 
a r g u m e n t s we 
do 
n o t 
a d d r e s s 
on 
a p p e a l : 
1) 
t h a t 
" t h e 
h o u s e 
was 
n o t 
u n d e r 
c o n s t r u c t i o n 
o r 
u n o c c u p i e d when t h e 
i n s u r a n c e 
a p p l i c a t i o n was 
s i g n e d " 
and 
2) 
t h a t " t h e r e 
i s no a b s o l u t e 
r u l e t h a t r e g a r d l e s s 
o f t h e f a c t u a l 
c i r c u m s t a n c e s , 
a s u r p l u s 
l i n e s b r o k e r can n e v e r h a v e an a g e n c y 
r e l a t i o n s h i p w i t h an i n s u r e d . " 
F a r r ' s b r i e f , a t pp. 39-42 
and 
58-59, r e s p e c t i v e l y . 
However, b a s e d on o u r 
d e c i s i o n on 
o t h e r 
i s s u e s , we 
p r e t e r m i t 
d i s c u s s i o n 
o f t h o s e a r g u m e n t s . 
25