[Cite as E. Liverpool v. Owners Ins. Co., 2021-Ohio-1474.]

IN THE COURT OF APPEALS OF OHIO 

SEVENTH APPELLATE DISTRICT 

COLUMBIANA COUNTY

CITY OF EAST LIVERPOOL, 

Plaintiff-Appellant, 

v. 

OWNERS INSURANCE COMPANY et al., 

Defendants-Appellees.

 

OPINION AND JUDGMENT ENTRY 

Case No. 20 CO 0009 

 

Civil Appeal from the 

Court of Common Pleas of Columbiana County, Ohio 

Case No. 2018-CV-81 

BEFORE: 

Carol Ann Robb, Gene Donofrio, Cheryl Waite, Judges. 

JUDGMENT: 

Affirmed. 

Atty. Charles L. Payne, Law Director, 617 St. Clair Ave, P.O. Box 114, East Liverpool, 

Ohio 43920 and Atty Thomas W. Connors, Warner Mendenhall, 190 N. Union St. Akron, 

Ohio 44304 for Plaintiff-Appellant and 

Atty. Craig G. Pelini, Atty. Nicole Richard, Pelini, Campbell & Williams LLC, Bretton

Commons - Suite 400, 8040 Cleveland Avenue N.W., North Canton, Ohio 44720 and 
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Case No. 20 CO 0009

Atty. Joseph F. Nicholas, Jr., Atty. Frank H. Scialdone, Atty. George V. Pilat, Atty. Michael

P. Byrne, Mazanec, Raskin & Ryder Co., L.P.A., 100 Franklin's Row, 34305 Solon Road, 

Cleveland, Ohio 44139 for Defendants-Appellees. 

 

Dated April 21, 2021 

 

Robb, J. 

{¶1} Plaintiff-Appellant City of East Liverpool (the City) appeals the decision of 

the Columbiana County Common Pleas Court granting summary judgment for 

Defendants-Appellees Owners Ins. Co., Auto-Owners Ins. Co., Auto-Owners Ins. Group 

(the three Owners Insurance Companies collectively referred to as Owners), John 

Gauron, Jack L. Mills Agency, Inc., and Mega Ins. Agency, Inc. (all Appellees collectively 

referred to as Appellees). Multiple assignments of error are raised in this appeal. The 

first assignment of error is whether the term “intake well house” is plain and unambiguous. 

If it is not, then does the evidence indicate it is reasonably susceptible to more than one 

interpretation? Reasonably susceptible to more than one interpretation would create a 

genuine issue of material fact and thereby preclude the granting of summary judgment 

against the City. In the second assignment of error, the City asserts the trial court erred 

in granting summary judgment in Owners’ favor on the bad faith denial of coverage claim 

and failure to investigate claim. The third assignment of error raises issue with the trial 

court’s decision denying the City’s Civ.R. 56(F) motion for a continuance of the summary 

judgment ruling so that it could conduct more discovery. The final assignment of error 

raises arguments concerning the trial court’s decision to grant summary judgment for 

Appellees’ on the reformation, equitable estoppel, and negligence claims. For the 

reasons discussed below, the trial court’s ruling is affirmed. 

Statement of the Facts 

{¶2} Many of the facts are undisputed in this case. In 1986, the City requested 

bids for insurance for Water Department buildings and equipment. Appellee Auto Owners 

submitted its bid in 1986 through agent Appellees Gauron and Mega Ins. Group. The bid 

request listed the “Intake Well House” located at 2220 Michigan Avenue, East Liverpool, 

Ohio. The bid was accepted by the City in 1986. 
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Case No. 20 CO 0009

{¶3} Appellee Owners asked the City to provide estimated values of the buildings 

and equipment. The City hired Stilson & Associates, Inc. to provide the estimated values 

and they issued a report in 1989. 

{¶4} The report defines and assigns a value for the “Intake Structure.” It defines 

the structure as the point where the river water enters the system. The structure is located 

in the Ohio River and is constructed out of reinforced concrete. It contains several valves 

and piping from the river to the Well House, as well as minor electrical lighting for warning 

lights. The replacement value of the Intake Structure is listed in the Stilson & Associates 

Report as $750,000. 

{¶5} The report also separately defines the “Well House.” It “receives water from 

the intake structure and acts as a suction well for the pumps in the Pump Station.” The 

Well House is 14 feet in diameter and is constructed of brick and contains ventilation, 

service electricity, and a one-ton crane. The replacement value of the Well House is listed 

at $115,800. 

{¶6} In 1990, a renewal policy was issued. The declarations pages of the policy 

did not list the Intake Structure and Well House as separate structures. The renewal 

policy effective March 21, 2015 likewise does not list the Intake Structure and Well House 

separately. Instead, the 2015 policy, for example, listed “Intake Well House” as being 

located at 2198 Michigan Avenue and the limit of insurance as $142,800. 

{¶7} On February 19, 2016, the water vessel Mary Artie Brannon owned by 

Defendant Crounse Corporation collided with the Intake Structure in the Ohio River. 

Following the collision, the City submitted a claim to Owners. That claim was denied on 

the basis that the Intake Structure was not covered by the terms of the policy; the 

assertion was the term “Intake Well House” only covered the Well House, not the Intake 

Structure. 

Statement of the Case 

{¶8} Following the denial of the claim, the City filed suit against Appellees and 

Defendant Crounse Corp. 2/15/18 Complaint; 3/28/19 Amended Complaint. The City 

asserted causes of action sounding in breach of contract, reformation of contract, 

equitable estoppel, misrepresentation, bad faith denial of a claim, failure to obtain the 

requested coverage, and negligence with a request for punitive damages. The 
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Case No. 20 CO 0009

negligence claim was solely against Defendant Crounse Corp. The claim against John 

Gauron who was working for or doing business as Jack L. Mills Agency, Inc. and Mega 

Ins. Agency, Inc. was that Gauron failed to obtain the insurance the City requested. 

{¶9} All defendants filed answers. Crounse admitted that its vessel, the Mary 

Artie Brannon, collided with the Intake Structure located at Mile Marker 40.2, but denied 

the nature and extent of the damage the City claimed was caused by the collision. 3/15/18 

Answer of Crounse; 5/10/19 Crounse Answer of First Amended Complaint. Owners 

Insurance Company answered and filed a cross claim against Crounse. 3/22/18 Owners 

Insurance Company Answer and Cross Claim; 5/23/19 Answer of Owners Insurance 

Company to First Amended Complaint. Appellees Mega Ins. Agency, Gauron, and Jack 

L. Mills Agency answered asserting the building insured was the Intake Well House 

located at 2220 Michigan Avenue, not the Intake Structure located in the Ohio River. 

4/2/18 Answer of Defendant Mega Ins. Agency; 4/20/18 Gauron and Jack L. Mills Agency 

Answer; 5/20/19 Answer of Gauron and Mega Ins. Agency to First Amended Complaint; 

5/21/19 Answer of Gauron and Jack L. Mills Agency to First Amended Complaint. 

{¶10} Defendant Crounse Corp. answered the cross claim. 3/29/18 Answer of 

Crounse Corp. to Cross Claim. 

{¶11} Following discovery, Owners filed a Motion for Summary Judgment

asserting the language of the policy is clear that the Intake Structure was not listed in the 

policy. The policy instead listed the “Intake Well House” located at 2220 Michigan Avenue 

with a coverage limit of $142,800. (The 2015 policy actually lists the location as 2198 

Michigan Ave.). Similarly, Appellees Gauron, Jack L. Mills Agency and Mega Ins. Agency 

filed a motion for summary judgment asserting the Intake Well House remained on the 

policy as a single item for over 20 years at a value ranging from approximately $120,000 

to $140,000. 5/31/19 Motion for Summary Judgment. However, when the Stilson Report 

was completed in 1989 the replacement value listed on that report for the Intake Structure 

was $750,000. Owners asserted the Stilson Report was not a request for coverage and 

the City failed to read the policy to ensure that there was coverage for the Intake Structure. 

{¶12} The City filed motions in opposition to the motions for summary judgment 

asserting there was a genuine issue of material fact as to what the term “Intake Well 
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Case No. 20 CO 0009

House” means. 8/5/19 Plaintiff’s Brief in Opposition to Motion for Summary Judgment. 

Appellees filed a reply in support of summary judgment. 8/19/19 Reply. 

{¶13} Defendant Crounse Corp also filed a motion for partial summary judgment. 

8/7/19 Crounse Corp Motion for Partial Summary Judgment. 

{¶14} The trial court granted summary judgment for Appellees on the claims the 

City asserted against them. 11/5/19 J.E. The judgment entry did not address the claims 

the City asserted against Crounse. Thus, the decision was not a final appealable order. 

{¶15} Following the summary judgment ruling, the City and Crounse reached a 

settlement. The trial court then issued a judgment entry indicating the November 5, 2019 

grant of summary judgment for Appellees is a final appealable order. 2/20/20 J.E. 

{¶16} On April 29, 2020 the City and Crounse entered an agreed entry of 

dismissal stating, “The within action having been fully compromised and settled between 

Plaintiff City of East Liverpool and Defendant Crounse Corporation, Plaintiff’s Amended 

Complaint and all pending Motions may be and are hereby dismissed, with prejudice each 

party to bear its own costs.” 4/29/20 Agreed Entry of Dismissal. 

{¶17} The notice of Appeal was filed prior to the Entry of Dismissal. 3/12/20 Notice 

of Appeal. Appellees filed a Motion to Dismiss. 3/20/20 Motion to Dismiss. On May 4, 

2020, days after the agreed entry of dismissal was filed with the trial court, we granted 

the motion to dismiss indicating the order granting summary judgment would not become 

final until the entry of dismissal was filed and other issues such as allocation of court costs 

were resolved. 5/4/20 J.E. (acknowledging the parties were granted until May 29, 2020 

to file an agreed entry of dismissal or judgment). 

{¶18} On May 13, 2020 the City filed a second notice of appeal attaching the April 

29, 2020 Entry of Dismissal. 5/13/20 Notice of Appeal. A new appeal number was 

assigned. 

Standard of Review for the First, Second, and Fourth Assignments of Error 

{¶19} An appellate court reviews a summary judgment ruling de novo. Comer v. 

Risko, 106 Ohio St.3d 185, 2005-Ohio-4559, 833 N.E.2d 712, ¶ 8. Thus, we shall apply 

the same test as the trial court in determining whether summary judgment was proper. A 

court may grant summary judgment only when (1) no genuine issue of material fact exists; 

(2) the moving party is entitled to judgment as a matter of law; and (3) the evidence can 
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Case No. 20 CO 0009

only produce a finding that is contrary to the non-moving party. Civ.R. 56(C). “Trial courts 

should award summary judgment with caution, being careful to resolve doubts and 

construe evidence in favor of the nonmoving party.” Welco Industries, Inc. v. Applied Cos., 

67 Ohio St.3d 344, 346, 617 N.E.2d 1129 (1993). 

{¶20} With that standard in mind, we review the first, second, and fourth 

assignments of error. 

First Assignment of Error 

“The trial court erred by granting summary judgment dismissing the City’s breach 

of contract claims against Owners.” 

{¶21} This assignment of error addresses the breach of contract claims asserted 

by the City against Owners and focuses on the phrase “Intake Well House” found in the 

declarations pages of the insurance contract. The City contends there is a genuine issue 

of material fact as to the meaning of “Intake Well House.” The City argues the phrase 

was meant to include the Intake Structure, while Appellees contend it only covers the Well 

House. Thus, the City asserts the phrase “Intake Well House” is ambiguous since it is 

reasonably susceptible of two meanings and/or has a special meaning. Thus, according 

to it, extrinsic evidence can be considered to determine the meaning of the phrase. The 

City contends that while the insurance contract at issue is the 2015 renewal policy, the 

prior policies dating back to the request for the Stilson Report should be considered to 

determine the special meaning the City understood the phrase to mean. The City argues 

the trial court misapplied the test for determining the existence of a special meaning of 

“Intake Well House.” It asserts the trial court did not determine whether there was 

evidence that reasonable minds could find the existence of a special meaning. Instead, 

it weighed the evidence regarding the meaning and invaded the province of the jury. 

{¶22} The City argues the Stilson Report was commissioned to provide an 

evaluation of structures for insurance purposes and this report lists the Intake Structure 

as well as the Well House. This, according to it, is evidence that the Intake Structure was 

intended to be insured. Thus, the Intake Well House phrase in the declarations page 

included both the Well House and the Intake Structure. The City points to the testimony 

of Bob Disch, the City’s Public Utility Director at the time of the insurance contracts, that 

the Intake Well House includes both the Intake Structure and the Well House. The City 
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Case No. 20 CO 0009

argues it was the trier of fact’s province to weigh the evidence to determine the intent of 

the parties regarding the meaning of the phrase Intake Well House. It asserts the trial 

court acted improperly when it would not consider the corrections Disch made to his 

deposition in the errata sheets. 

{¶23} Owners Insurance counters asserting the language of the policy is plain; the 

policy provides coverage for damage to the Intake Well House located at 2220 Michigan 

Avenue. There was never a request to cover the Intake Structure. It further contends the 

Intake Structure was specifically left off of the policy per the instruction of Bob Disch. The 

intent to only cover the Well House is also evidenced by the appreciably lower value listed 

in the policy that corresponds with the value of the Well House alone. The policy provided 

for coverage in the amount of roughly $140,000. The Intake Structure was valued at 

$750,000 in the 1989 Stilson Report. They also assert that the deposition testimony from 

Bob Disch also indicates that the Intake Structure and the Well House were two separate 

structures. Owners further argues that the City is incorrect that the trial court did not 

consider the statements Disch made to the errata sheets of his deposition. The trial court 

did consider them, but found them insufficient to create a genuine issue of material fact 

because the corrections directly contradicted other statements in the deposition. 

{¶24} To succeed on a breach of contract claim, a plaintiff must demonstrate (1) 

the existence of a contract, (2) plaintiff's performance, (3) defendant's breach, and (4) 

damages or loss to the plaintiff. Thyssen Krupp Elevator Corp. v. Constr. Plus, Inc., 10th 

Dist. Franklin No. 09AP-788, 2010-Ohio-1649, ¶ 13. The interpretation of a written 

contract is an issue of law. Nationwide Mut. Fire Ins. Co. v. Guman Bros. Farm, 73 Ohio 

St.3d 107, 108, 652 N.E.2d 684 (1995). The purpose of contract construction is to realize 

and give effect to the parties' intent. Skivolocki v. E. Ohio Gas Co., 38 Ohio St.2d 244, 

313 N.E.2d 374 (1974), paragraph one of the syllabus. 

{¶25} “[T]he intent of the parties to a contract resides in the language they chose 

to employ in the agreement.” Shifrin v. Forest City Ents., Inc., 64 Ohio St.3d 635, 638, 

597 N.E.2d 499 (1992). When “‘the terms in a contract are unambiguous, courts will not 

in effect create a new contract by finding an intent not expressed in the clear language 

employed by the parties.’” Holdeman v. Epperson, 111 Ohio St.3d 551, 2006-Ohio-6209, 

857 N.E.2d 583, ¶ 12, quoting Shifrin. “A court will resort to extrinsic evidence in its effort 
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Case No. 20 CO 0009

to give effect to the parties' intentions only where the language is unclear or ambiguous, 

or where the circumstances surrounding the agreement invest the language of the 

contract with a special meaning.” Kelly v. Medical Life Ins. Co., 31 Ohio St.3d 130, 132, 

509 N.E.2d 411 (1987).

{¶26} When extrinsic evidence is used to resolve an ambiguity or understand a 

special meaning, the court must first examine parol evidence to determine the parties' 

intent. In re Estate of Taris, 10th Dist. Franklin No. 04AP-1264, 2005-Ohio-1516, citing 

Cline v. Rose, 96 Ohio App.3d 611, 615, 645 N.E.2d 806 (1994). The extrinsic evidence 

may include: (1) the circumstances surrounding the parties at the time the contract was 

made; (2) the objectives the parties intended to accomplish by entering into the contract; 

and (3) any acts by the parties that demonstrate the construction they gave to their 

agreement. Blosser v. Carter, 67 Ohio App.3d 215, 219, 586 N.E.2d 253 (4th Dist.1990). 

Ordinarily, courts should not grant summary judgment when an ambiguity exists, however 

if the extrinsic evidence stands undisputed, then the court may take this step. Ma v. 

Cincinnati Children's Hosp. Med. Ctr., 2020-Ohio-1471, 153 N.E.3d 866, ¶ 18 (1st Dist.), 

citing Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216, 2003-Ohio-5849, 797 N.E.2d 

1256, ¶ 13 (“It is generally the role of the finder of fact to resolve ambiguity.”) and Lewis 

v. Mathes, 161 Ohio App.3d 1, 2005-Ohio-1975, 829 N.E.2d 318, ¶ 25 (4th Dist.) 

(“Ordinarily, summary judgment is inappropriate when contractual language is 

ambiguous, because a question of fact remains. But if the extrinsic evidence 

demonstrates that no genuine issue of material fact exists, we conclude that summary 

judgment may still be appropriate.”). 

{¶27} When parol evidence cannot resolve an ambiguity or special meaning and 

show the intent of the parties, a court must apply the secondary rule of contract 

construction whereby the ambiguous language/special meaning is strictly construed 

against the drafter. Graham v. Drydock Coal Co., 76 Ohio St.3d 311, 313, 667 N.E.2d 

949 (1996); Reida v. Thermal Seal, Inc., 10th Dist. Franklin No. 02AP-308, 2002-Ohio6968. 

{¶28} Under the Building and Personal Property Coverage Form of the 

Insurance policy, it states: 
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Case No. 20 CO 0009

A. Coverage 

We will pay for direct physical loss of damage to Covered Property at the 

premises described in the Declarations caused by or resulting from any 

Covered Cause of Loss. 

 1. Covered Property 

 Covered Property, as used in this Coverage Part, means the type of 

 property described in Section A.1., and limited in A.2., Property Not 

 Covered, if a Limit of Insurance is shown in the Declarations for that 

 type of property. 

 a. Building. Meaning the building or structure described in the 

 Declarations, including: 

 (1) Completed additions; 

 (2) Fixtures, including outdoor fixtures; 

 (3) Permanently installed: 

 (a) Machinery; and 

 (b) Equipment; 

 (4) Building glass, meaning glass that is part of the 

 building or structure; 

 (5) Personal property owned by you that is used to 

 maintain or service the building or structure or its 

 premises, including: 

 (a) Fire-extinguishing equipment; 

 (b) Outdoor furniture; 

 (c) Floor coverings; and 

 (d) Appliances used for refrigerating, ventilating, 

 cooking, dishwashing or laundering; and 

 (6) If not covered by other insurance: 

 (a) Additions under construction, alterations and 

 repairs to the building or structure; and 

 (b) Materials, equipment, supplies and 

 temporary structures, on or within 1,000 feet of 
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Case No. 20 CO 0009

 the described premises, used for making 

 additions, alterations or repairs to the building or 

 structure. 

2015 Insurance Policy. 

{¶29} Location 003 in the Declarations Sections is the only declaration being 

argued that could cover the Intake Structure. This declaration indicates there are no 

additional forms for this location. The address listed for Location 003 is “BLDG 001 3R 

2198 Michigan Avenue, East Liverpool, OH 43920.” This declaration labels this location 

as “Intake Well House” and limits the insurance to $142,800. 

{¶30} There is no plain and ordinary definition for “Intake Well House”; dictionaries 

do define “intake” and “well house,” but there is no listed definition for “Intake Well House.” 

Well House is defined as a “covered structure (as a house or room) built around the top 

of a well.” https://www.merriam-webster.com/dictionary/well%20house. Intake is defined 

“an opening through which fluid enters an enclosure.” https://www.merriamwebster.com/dictionary/intake. 

{¶31} In looking at just the policy declarations and those definitions, the plain and 

ordinary meaning of “Intake Well House” is the well house that connects to the intake. 

The word “intake” modifies and describes the well house for which the insurance policy 

provides coverage. This definition corresponds to the address listed for the well house 

that is connected to the Intake Structure. Thus, the label “Intake Well House” describes 

that property. Furthermore, the address listed is not the mile marker in the Ohio River 

where the Intake Structure is located. Had that address been listed then possibly the 

label “Intake Well House” would have included the Intake Structure. Moreover, the City 

was the first party to use the term “Intake Well House” and specify that it was located at 

2220 Michigan Avenue. It did so in 1986 when it published its Notice for Bids and Request 

for Bid. Defendant’s Exhibit A and B to Disch Depo. The City cannot now claim that its 

own term, first used by it, is ambiguous. Therefore, this court concludes the language is 

not ambiguous. It is plain that what is located at that Michigan Avenue address, the well 

house that connects to the intake, is all that is covered. 

{¶32} Even if this court were to conclude the term is ambiguous, the use of parol 

evidence would still limit the coverage to the one structure. The extrinsic evidence would 
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Case No. 20 CO 0009

include, but not be limited to, the Stilson Report and Request for Bid. It is undisputed that 

the Stilson Report was done for purposes of insurance. It was prepared in response to 

new construction and renovations to existing structures. Disch Depo. Exhibit C. The 

Stilson Report stated the scope of the report was to provide the City with a summary of 

information and estimated replacement costs for the major structures for the purpose of 

submitting to the insurance company. Disch Depo. Exhibit C. “The insurance company 

will then be in a better position to evaluate and assess the rates to be charged for 

insurance protection to the City.” Disch Depo. Exhibit C. However, as Disch 

acknowledged, that report lists the two (Intake Structure and Well House) separately. 

Disch Depo. 33. The replacement value of the Intake Structure listed in the Stilson Report 

is $750,000. The replacement value of the “Well House” in that same report is $115,800. 

Despite the Stilson Report’s separate listings, the insurance contract does not list the Well 

House and Intake Structure separately. The contract also did not insure the “Intake Well 

House” for the combined amount of the Well House and Intake Structure. Instead, the 

contract covered the “Intake Well House” for an amount equivalent to the amount of the 

Well House alone; the insurance coverage was for approximately $150,000. 

{¶33} Furthermore, the “Intake Well House” as described in the insurance contract 

was for a Michigan Avenue address, not for a structure in the Ohio River. As stated 

above, the Request for Bid that was sent out by the City in 1986 states, “The Location of 

Board of Public Utilities Buildings & Tanks to be bid are: * * * Intake Well House, 2220 

Michigan Avenue, E.L.O.” Likewise, this bid request does not list the structures 

separately and only lists a Michigan Avenue address for the location. 

{¶34} Given the difference in the values between what was covered and what the 

structures were worth, it is glaring as to what the intent of the parties was by the use of 

the phrase intake well house. It was to only cover the Well House where the intake 

connects. Had the intent been to cover the Intake Structure, it would have been listed 

separately as it was in the Stilson Report or it would have been valued at a much higher 

amount. 

{¶35} Admittedly, Disch did testify, “If you say to me ‘intake pier,’ that’s the cement 

thing out in the middle of the river. If you say ‘intake well house,’ it kind of tells me you’ve 

combined these two features into one.” Disch Depo. 32. The City focuses on Disch’s 
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Case No. 20 CO 0009

deposition testimony and the corrections he made to his testimony to indicate he 

subjectively understood the insurance contract to insure the Intake Structure and the Well 

House when it used the phrase “Intake Well House.” The City asserts the corrected 

testimony creates genuine issue of material fact as to what “Intake Well House” means. 

We disagree and agree with the trial court’s reasoning. 

{¶36} The trial court explained that the statements on the errata sheet of Disch’s 

deposition are little more than conclusory statements offered in support of his subjective 

belief and understanding. 11/5/19 J.E. The trial court acknowledged Civ.R. 30(E) permits 

a witness to make changes in form or substance to deposition testimony, but it is not a 

safe harbor. 11/5/19 J.E. It stated self-serving deposition testimony is insufficient to 

demonstrate a material issue of fact. The trial court determined: 

The subjective belief or understanding of Mr. Disch as set forth on the Eratta 

sheet to his deposition stands alone and is opposed by the objective 

evidence in the record. This includes the Notice For Bids, the Request for 

Bid, the express limitation contained therein, the insurance quote of Mr. 

Gauron, the Stilson report, the Statement of Values signed by Mr. Disch and 

his knowledge acquired during his long tenure with the City of East Liverpool 

and/or the Board of Public Utilities, and the unambiguous language of the 

Renewal Policy and Declarations, which Mr. Disch chose not to read for 

years. This evidence is not doubtful, uncertain, or ambiguous. All of it has 

been thoroughly analyzed, an appropriate activity at the stage of summary 

judgment. 

Mr. Disch apparently never expressed his “understanding” or raised any 

concern to anyone for some 20 years before the collision at issue. During 

this same time he continued to choose not to read the insurance policies 

that were renewed year after year. Had he read the insurance policies he 

would have or should have discovered that Auto-Owners did not insure the 

intake structure as of September 19, 2016. Even when construing the 

evidence most strongly in favor of the City of East Liverpool, the Eratta 

sheet to the deposition of Mr. Disch, supported only by his unexpressed 
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Case No. 20 CO 0009

understanding cannot as a matter of law create a genuine issue of material 

fact that precludes summary judgment. 

Based upon the entirety of the record before me, the only reasonable 

conclusion I can reach is that Auto-Owners insured the intake well house, 

but it did not insure the intake structure as of February 19, 2016. This 

conclusion is consistent with the intent of the Board of Public Utilities as 

expressed through the express limitation contained in the Notice for Bids 

and Request for Bid. This conclusion is consistent with the insurance 

policies issued starting in 1986 and renewed annually thereafter. It is 

consistent with the Renewal Policy that was in effect on September 19, 

2016. 

11/5/19 J.E. 

{¶37} Our sister districts have indicated, “changes in Errata sheet—which 

completely change the deposition testimony—cannot be used to defeat a Motion for 

Summary Judgment.” Musil v. Gerken Materials, Inc., 6th Dist. Lucas No. L-19-1262, 

2020-Ohio-3548, fn. 2, citing Christian v. Wal-Mart Stores East, LP, 5th Dist. Holmes No. 

09CA014, 2010-Ohio-3040, ¶ 18, quoting Hambleton Bros. Lumber Co. v. Balkin Ents., 

Inc., 397 F.3d 1217, 1225 (9th Cir.2005). 

{¶38} Specifically in the deposition testimony Disch was asked if he ever 

requested the Intake Structure located in the river be insured. Disch Depo. 103. He 

responded he did not. Disch Depo. 103. Then on the errata sheet he changed his 

response to make it “clearer by adding” the city made the request prior to him being the 

director and that was the bid to insure all water department buildings including the intake 

well house, which he understood to mean the intake and the well house. 7/22/19 Filing. 

The five changes he made to his deposition were all similar to this one indicating that he 

understood the Intake Well House to mean the Intake Structure and the Well House. 

{¶39} Considering that the major issue in this case is what is the meaning of Intake 

Well House, his changes in the errata sheet did change his answers substantially as to 

his subjective belief. Furthermore, during his tenure the policy was renewed and he 

admittedly did not read the policy except for the phrase “Intake Well House.” When his 
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Case No. 20 CO 0009

corrections are taken into consideration with his admission he did not read the insurance 

policy, the trial court correctly indicated it did not create a genuine issue of material fact. 

{¶40} In conclusion, when viewed in the light most favorable to the City, 

reasonable minds conclude that the language used was clear and unambiguous. The 

Intake Structure was not covered by the policy. Our analysis could end at that point. 

However, even if we were to conclude the term was ambiguous, the only reasonable 

definition the extrinsic evidence suggests for “Intake Well House” is the Well House 

connected to the intake. It does not reasonably suggest coverage for the Intake Structure. 

The trial court’s analysis, even though reviewed de novo, was on point and did not 

overstep by weighing the evidence. This assignment of error lacks merit. 

Second Assignment of Error 

“The trial court erred by granting summary judgment dismissing the City’s bad faith 

claims against Owners.” 

{¶41} This assignment of error specifically addresses the bad faith claim. The 

City argues Owners had no lawful basis for denying the claim if the term “Intake Well 

House” has a special meaning that includes both the Intake Structure and the Well House 

or it is reasonably subject to such interpretation. It also contends that Owners had a duty 

to reasonably investigate the claim. Thus, they are raising a bad faith investigation and 

bad faith denial claim. 

{¶42} As to the bad faith investigation, the City argues to survive summary 

judgment it was only required to show that the insurer had no reasonable justification for 

failing to determine whether its refusal had a lawful basis. It asserts the claim was filed 

on March 9, 2016 and denied 9 days later on March 18, 2016 with a statement that the 

City could provide further information supporting coverage. 

{¶43} It claims Owners’ files were searched for photographs or information 

regarding the intake, but none were located and Owners was unaware of the Stilson 

Report in Gauron’s file. Further, Owners representative, John Biviano, a claims adjuster, 

would not answer questions at the deposition concerning whether the Stilson Report and 

Intake Structure photograph would have been pertinent to the investigation of the claim 

that the term “Intake Well House” referred to both the Intake Structure and the Well 
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Case No. 20 CO 0009

House. The City asserts this evidence is sufficient to find that a reasonable mind would 

have concluded Owners did not adequately investigate. 

{¶44} Owners counters, arguing the Stilson Report and findings confirm the 

position of no coverage. Thus, not reviewing it prior to denying coverage does not amount 

to bad faith. 

{¶45} As to the denial claim, a bad faith denial claim hinges on the success of the 

breach of contract claim. As this court found no merit with the first assignment of error, 

this argument fails. However, this court will still address the issues. 

{¶46} The City asserts the court must consider the evidence in the record showing 

a special meaning. Those are the 2015 renewal policy; the 1986 bid request; 1989 Stilson 

Report; and the statement by Tim Clark, the City representative, that the purpose of the 

Stilson Report was to identify all water department structures and have those insured. 

{¶47} Owners counters, asserting the breach of contract claim fails and thus, this 

claim also fails. However, it also asserts a lack of good faith is more than just bad 

judgment or an incorrect decision. A result adverse to the insured does not mean the 

insurer acted in bad faith. 

{¶48} The Ohio Supreme Court has determined that an insurer “fails to exercise 

good faith in processing a claim of its insured where its refusal to pay the claim is not 

predicated upon circumstances that furnish reasonable justification therefor.” Zoppo v. 

Homestead Ins. Co., 71 Ohio St.3d 552, 644 N.E.2d 397 (1994), paragraph one of the 

syllabus. Reasonable justification does not exist where an insurer's refusal to pay a claim 

is arbitrary or capricious. Hart v. Republic Mut. Ins. Co., 152 Ohio St. 185, 188, 87 N.E.2d 

347 (1949). 

{¶49} The Sixth Appellate District has explained: 

“[A]n insurer has the duty to act in good faith in the handling and payment 

of the claims of its insured.” Hoskins v. Aetna Life Ins. Co., 6 Ohio St.3d 

272, 452 N.E.2d 1315 (1983), paragraph one of the syllabus. Where an 

insurer refuses to pay a claim without providing reasonable justification, the 

insurer fails to act in good faith. McNair at ¶ 124, citing Zoppo v. Homestead 

Ins. Co., 71 Ohio St.3d 552, 644 N.E.2d 397 (1994), paragraph one of the 
 – 16 – 

Case No. 20 CO 0009

syllabus. Failure to act in good faith gives rise to a claim against the insurer. 

Hoskins at paragraph one of the syllabus. 

Watkins v. Allstate Vehicle & Property Ins. Co., 6th Dist. Lucas No. L-19-1235, 2020-

Ohio-3397, ¶ 53, appeal not allowed, 160 Ohio St.3d 1409, 2020-Ohio-4574, 153 N.E.3d 

113, ¶ 53. 

{¶50} The City’s assertion of the facts is correct concerning the amount of time to 

investigate and the consideration of the Stilson report. However, (as stated above) given 

the facts either there is a dispute as to what “Intake Well House” means or it is plain that 

it does not mean both the Intake Structure and the Well House. The division of the 

structures used in the Stilson Report and the different valuations does clearly support 

Owner’s position that intake and well house are two separate structures and “Intake Well 

House” is not a combination of the both. At most, the claim is fairly debatable. As the 

City points out, “’Where a claim is fairly debatable the insurer is entitled to refuse the claim 

* * *as long as such refusal is premised on a genuine dispute over either the status of the 

law at the time of the denial or the facts giving rise to the claim.’” Marshall v. Colonial Ins. 

Co., 7th Dist. Mahoning No. 15 MA 0169, 2016-Ohio-8155, ¶ 80. A failure to reasonably 

investigate before arriving at a legal or factual position can give rise to liability. Marshall, 

citing Zoppo v. Homestead Ins. Co., 71 Ohio St.3d 552, 554, 644 N.E.2d 397 (1994) 

(finding evidence from which the jury could conclude the insurer failed to conduct an 

adequate investigation on cause of fire and was not reasonably justified in denying the 

insured's claim). 

{¶51} Had the Stilson report defined Intake Well House differently and the values 

set forth in the report for the total of both structures been equivalent to the value insured, 

the result of not looking at that report may have been different. However, as it stands 

given the facts, the Stilson Report creates a further indication the two are separate 

structures and, by using the phrase “Intake Well House,” the word “intake” does not mean 

the Intake Structure but rather is a descriptor of the well house being insured. This further 

supports the position that even if there is a genuine issue as to what “Intake Well House” 

means and Owners incorrectly determined the definition, they are not necessarily liable 

for a bad faith claim. The actions and interpretation of Owners as described by the City 

do not amount to bad faith. Even an incorrect result does not mean bad faith. 
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Case No. 20 CO 0009

{¶52} This assignment of error is meritless. 

Preliminary Issue for Third and Fourth Assignments of Error 

{¶53} Mega and Gauron’s brief only addressed the Third and Fourth Assignments 

of Error asserting that as Owners’ agents these are the only assignments that relate to 

them. They address these assignments of error together. They start by asserting the 

City waived its claims against them because following its settlement with Crounse, the 

City voluntarily dismissed all its claims instead of just dismissing its claims against 

Crounse. Therefore, the interlocutory summary judgment order that would not become 

final until the claims against Crounse were resolved did not become final because the 

claims against everyone were dismissed. Effectually, they are asserting there is no order 

for this court to review because the interlocutory summary judgment ruling was dismissed 

along with all claims against all parties. 

{¶54} The Agreed Entry of Dismissal states the following, “The within action 

having been fully compromised and settled between Plaintiff City of East Liverpool and 

Defendant Crounse Corporation, Plaintiff’s Amended Complaint and all pending Motions 

may be and are hereby DISMISSED, with prejudice, each party to bear its own costs.” 

4/29/20 J.E. This dismissal was signed by the Judge and attorneys for the City and 

Crounse. 

{¶55} The April 29, 2020 dismissal does not indicate which subsection of Civ.R. 

41 the parties intended to dismiss in the matter. The dismissal in this case was titled 

“Agreed Entry of Dismissal,” and not a notice of dismissal or stipulation of dismissal. 

Notices and stipulations are covered by Civ.R. 41(A)(1). Civ.R. 41(A)(2) is the By Order 

of the Court provision and states, “Except as provided in division (A)(1) of this rule, a claim 

shall not be dismissed at the plaintiff's instance except upon order of the court and upon 

such terms and conditions as the court deems proper.” Given that the order was signed 

by the court and the parties settling, this was a Civ.R. 41(A)(2) dismissal. 

{¶56} Two months prior to the entry, the trial court was made aware of the 

settlement agreement between the City and Crounse. In February 2020, the trial court 

issued a decision indicating that due to the settlement agreement, the November 5, 2019 

grant of summary judgment became a final appealable order. 2/20/20 J.E. It is clear the 

trial court was only dismissing the claims pending against Crounse, not any other claims. 
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Case No. 20 CO 0009

Thus, the April 29, 2020 dismissal did not dismiss claims against Appellees. Mega and 

Gauron’s preliminary argument fails. 

Third Assignment of Error 

“The trial court erred by denying the City’s motions to compel deposition testimony 

and production of claims file from Owners and Mega.” 

{¶57} The City’s argument focuses on the discovery of materials from Owners and 

Mega. It asserts Owners refused to provide a witness on the history of the relationship 

between Owners and the City. Owners did produce John Biviano, a claims adjuster, to 

testify about the investigation and the denial of the claim. The City contends this 

representative was not prepared or refused to answer deposition questions. Mega, 

Owners agent, provided its president Tom Minor as its representative. He also refused 

to answer questions. The City then moved the trial court to compel discovery of Owners’ 

claim file and the testimony it sought from both Owners and Mega. That request was part 

of Civ.R. 56(F) motion to continue the decision on the summary judgment motions to allow 

the further requested discovery. 

{¶58} The trial court denied the motion when issuing its summary judgment ruling. 

11/5/19 J.E. It indicated the discovery in the case was already comprehensive, 

Fed.Civ.R. 30(b)(6) was not applicable, and additional discovery would not change the 

facts: 

Moreover, additional discovery will not change many of the facts already 

recited herein, including that the intake structure is in the Ohio River and 

has never been located on Michigan Avenue, even according to the City of 

East Liverpool and/or the Board of Public Utilities. Additional discovery will 

not change the fact that Mr. Disch did not read the insurance policies that 

were issued. Additional discovery will not change the many conclusions 

springing from the repeated failure to read the insurance policies and the 

resulting impact on the City of East Liverpool. Finally, additional discovery 

will not change the fact that, as a matter of law, the City of East Liverpool is 

presumed to be familiar with the contents of its insurance policy. 

11/5/19 J.E. 
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Case No. 20 CO 0009

{¶59} The City focuses on the denial of allowing additional discovery, while 

Appellees focus on the denial of the continuance. Civ.R. 56(F) states: 

Should it appear from the affidavits of a party opposing the motion for 

summary judgment that the party cannot for sufficient reasons stated 

present by affidavit facts essential to justify the party's opposition, the court 

may refuse the application for judgment or may order a continuance to 

permit affidavits to be obtained or discovery to be had or may make such 

other order as is just. 

Civ.R. 56(F). 

{¶60} We have previously explained: 

[A] review of the trial court’s decision regarding the motion to stay judgment 

on Appellants’ motion for summary judgment (construed as a Civ.R. 56(F) 

motion) is for abuse of discretion. State ex rel. Denton v. Bedinghaus, 98 

Ohio St.3d 298, 2003-Ohio-861, 784 N.E.2d 99, ¶ 31. An abuse of 

discretion reflects more than an error of judgment, but that the trial court 

acted unreasonably, arbitrarily or unconscionably in making its

determination. Blakemore v. Blakemore, 5 Ohio St.3d 217, 219, 450 N.E.2d 

1140 (1983). 

Taylor v. Burkhart, 7th Dist. Monroe No. 19 MO 0013, 2020-Ohio-3632, ¶ 19. 

{¶61} As Appellees point out, the questions the City claims it was entitled to 

answers and the questions deponents did not answer were questions asking for legal 

conclusions. They were: 1. “Whether Owners had a lawful basis for its denial of the 

claim?” 2. “Whether it was reasonable to investigate what ‘intake well house’ mean?” 3. 

“Whether the City’s belief that ‘intake well house refers to the intake and the well house 

is information pertinent to Owners investigation?” 4. “Whether the City’s understanding 

that ’intake well house’ refers to the intake and the well house, is reasonable under the 

circumstances?” 5. “Whether there were ambiguities in the policy?” 

{¶62} Appellees are right. The majority, if not all, of these questions ask for legal 

conclusions. For instance, whether the term “Intake Well House” is ambiguous is a 
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Case No. 20 CO 0009

question for a court to decide. Also, it is noted there were approximately 20 depositions 

filed in this case. Thus, there was extensive discovery. As such, the trial court is correct 

that allowing further discovery would not have changed the result. 

{¶63} Also, as referenced above, Disch testified he did not read the policy. His 

deposition testimony indicated the only portion he read was the portion dealing with the 

Intake Well House. Disch Depo. 32. Considering this statement, this means he did not 

look at the remainder of the policy. Had the policy listed the Intake Structure separately 

he would not have seen it. Had it listed the Well House separately he also would not 

have seen it. Therefore, the City’s conclusion that by reading only “Intake Well House” 

and its description indicated he read enough to draw the conclusion the Intake Structure 

and the Well House were both covered is an overbroad conclusion. An insured has a 

duty to examine the coverage provided and is charged with knowledge of the contents of 

his or her own insurance policies. Fry v. Walters & Peck Agency, Inc., 141 Ohio App.3d 

303, 310, 750 N.E.2d 1194 (6th Dist.2001); Jacubenta v. Cadillac Ranch, 8th Dist. 

Cuyahoga No. 98750, 2012-Ohio-586, ¶ 15; Craggett v. Adell Ins. Agency, 92 Ohio 

App.3d 443, 453, 635 N.E.2d 1326 (8th Dist.1993); Nickschinski v. Sentry Ins. Co., 88 

Ohio App.3d 185, 195, 623 N.E.2d 660 (8th Dist.1993). Reading one portion to draw the 

conclusion the Intake Structure was covered is insufficient because more could have 

been in the policy. Thus, reading one portion of the policy is insufficient to conclude the 

policyholder met the duty to read the policy. 

{¶64} For all the above stated reasons, the trial court did not abuse its discretion 

in denying the Civ.R. 56(F) motion. This assignment of error lacks merit. 

Fourth Assignment of Error 

“The trial court erred in granting summary judgment dismissing the City’s 

reformation, estoppel, negligence and misrepresentation claims against Owners and 

Owners’ agents.” 

{¶65} This assignment of error addresses the trial court’s decision to grant 

summary judgment to Appellees on the reformation, equitable estoppel, negligence, and 

misrepresentation claims. 
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Case No. 20 CO 0009

A. Reformation 

{¶66} As to reformation, the City argues the trial court improperly held Disch’s 

acknowledgment that he did not read the insurance contract in its entirety against him. 

He cites our Gerace Flick v. Westfield Nat. Ins. Co. decision to support his position. 

{¶67} In Gerace Flick, we held that the failure to read the insurance contract did 

not, given the facts of that case, prohibit the insured from coverage: 

Admittedly, [the insured’s] failure to ever read the Westfield Homepak 

policy, and thus determine on his own that the coverage may be inadequate, 

is remarkable. It is axiomatic that one receiving a written instrument in a 

business transaction is presumed to be familiar with its contents. Slovak v. 

Adams, supra at 845, 753 N.E.2d 910; and Atlas Realty, Inc. v. Ladies 

Auxiliary to Broth. of R.R. Trainmen (1960), 111 Ohio App. 396, 397, 171 

N.E.2d 382; citing, 31 Corpus Juris Secundum, page 838, § 150. 

Nevertheless, [the insured’s] failure to read the policy is typically the subject 

of a comparative negligence defense which is generally addressed at trial 

and not on a motion for summary judgment. See, Texler v. D.O. Summers 

Cleaners & Shirt Laundry Co. (1998), 81 Ohio St.3d 677, 681, 693 N.E.2d 

271 (the question as to whether plaintiffs' contributory negligence is the 

proximate cause of his injury is an issue of fact for the jury to decide 

pursuant to the comparative negligence provisions of R.C. § 2315); and 

Collier v. Northland Swim Club (1987), 35 Ohio App.3d 35, 39, 518 N.E.2d 

1226 (contributory negligence is generally an issue of fact unless the 

evidence shows that plaintiff's negligence was so extreme as a matter of 

law that no reasonable person could conclude plaintiff was entitled to 

recover). Thus, Appellees themselves raise a factual issue that a jury ought 

to decide. 

Gerace Flick v. Westfield Nat. Ins. Co., 7th Dist. Columbiana No. 01 CO 45, 2002-Ohio5222, ¶ 66-67. 

{¶68} We held there was a genuine issue of material fact as to whether the 

insurance company was negligent in securing the insurance coverage sought. Id. at ¶ 
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Case No. 20 CO 0009

95. We explained a jury could determine the failure to review the policy forecloses the 

ability to recover and thus, the issue is for trial. Id. at ¶ 97. Accordingly, the trial court 

erred when it granted summary judgment with respect to the request for equitable 

reformation of the insurance policy. Id. at ¶ 97.

{¶69} While we decline to overrule our prior decision, we recognize our sister 

districts do indicate a court should not reform an insurance policy where the party seeking 

reformation has failed to fulfill his duty to read the policy. LG Mayfield LLC v. United States 

Liab. Ins. Group, 2017-Ohio-1203, 88 N.E.3d 393, ¶ 63 (11th Dist.) (explaining,

“Reformation is a remedy in equity, and ‘[e]quity aids the vigilant.’ Marconi v. Savage, 8th 

Dist. Cuyahoga No. 99163, 2013-Ohio-3805, 2013 WL 4774506, ¶ 23 (discussing the 

equitable doctrine of laches and explaining that ‘a person is not entitled to relief when 

there has been an “[u]nreasonable delay; neglect to do a thing or to seek to enforce a 

right at a proper time’”), quoting Russell v. Fourth Natl. Bank, 102 Ohio St. 248, 265, 131 

N.E. 726 (1921). See also Jacubenta v. Ranch, 8th Dist. Cuyahoga No. 98750, 2013-

Ohio-586, ¶ 15 (‘An insurance policyholder has a duty to read its insurance policy.’); Hts. 

Driving School v. Motorists Ins. Co., 8th Dist. Cuyahoga No. 81727, 2003-Ohio-1737, ¶ 

38 (charging a policyholder with knowledge about the contents of his insurance policy); 

Allstate Ins. Co. v. Croom, 8th Dist. Cuyahoga No. 95508, 2011-Ohio-1697, ¶ 11. 

{¶70} The City is correct the trial court does cite the Gerace Flick decision. 

However, the City fails to acknowledge the decision was based on those unique facts. 

The facts here are different, which the trial court acknowledged when it made its 

reformation ruling. Disch indicated he did not read the insurance contract other than the 

phrase “Intake Well House.” He claims to have taken that phrase to mean both the Intake 

Structure and the Well House. He also acknowledged he saw the Stilson Report. That 

report was prepared for insurance purposes and listed the Intake Structure and the Well 

House separately. What is even more telling is the value of the Intake Structure alone 

was $750,000, while the Well house was approximately $120,000. Yet, on the portion of 

the policy that Disch allegedly read it only indicated the value of the “Intake Well House” 

at approximately $140,000. Had he read the policy, these facts would have raised red 

flags as to whether there was coverage for what was allegedly to be insured. This is not 

akin to Gerace Flick where the facts indicated the insured was asking questions about 
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Case No. 20 CO 0009

the insurance and explaining to the insurance company what was occurring in a manner 

that was clear he was trying to obtain the correct insurance for the house and its 

belongings that were in his daughter’s name and also contained his personal belongings 

(that were destroyed in a house fire). 

{¶71} Consequently, considering the facts at hand, the trial court did not err in 

granting summary judgment for Appellees on the reformation claim. 

B. Estoppel 

{¶72} The trial court also granted summary judgment to Appellees on the City’s 

equitable estoppel claim. The reasoning was also Disch’s failure to read the policy. 

Alternatively, the trial court stated there was no showing of any misleading factual 

misrepresentation arising to the level of actual or constructive fraud. 

{¶73} Once again, the City asserts this is a comparative negligence issue. It 

claims Ohio law specifically holds an insurance company will be equitably estopped from 

denying coverage where its agent has mistakenly mislead an insured into believing he 

had coverage for a loss that the policy did not provide and the insured relied on this 

mistake. It argues the coverage offered following the Stilson Report for the “Intake Well 

House” was sufficient evidence of misrepresentation. 

{¶74} Owners counters arguing it never made a factual representation to the City 

regarding the Intake Structure and there is no evidence of any misleading factual 

misrepresentation. 

{¶75} Under the doctrine of equitable estoppel, “‘a representation of past or 

existing fact made to a party who relies upon it reasonably may not thereafter be denied 

by the party making the representation if permitting the denial would result in injury or 

damage to the party who so relies.’” Hortman v. Miamisburg, 110 Ohio St.3d 194, 2006-

Ohio-4251, ¶ 20, quoting 4 R. Lord, Williston on Contracts, Section 8:3, 28-31 (4th 

Ed.1992). “‘The purpose of equitable estoppel is to prevent actual or constructive fraud 

and to promote the ends of justice.’” Doe v. Archdiocese of Cincinnati, 109 Ohio St.3d 

491, 2006-Ohio-2625, ¶ 43, quoting Ohio State Bd. of Pharmacy v. Frantz, 51 Ohio St.3d 

143, 145 (1990). “‘A prima facie case of equitable estoppel requires proof of (1) a factual 

representation that, (2) is misleading, (3) induces actual reliance that is reasonable and 
 – 24 – 

Case No. 20 CO 0009

in good faith, and (4) causes detriment to the relying party.’” Garb-Ko, Inc. v. Benderson, 

10th Dist. Franklin No. 12AP-430, 2013-Ohio-1249, ¶ 17. 

{¶76} As explained above, the Stilson Report was used for insurance purposes 

for providing valuations. However, there is no indication in the testimony it was a request 

for insurance of everything listed in it. Specifically, Keith Clark, the former Director of 

Public Utilities, could not point to a communication indicating it was a request for 

insurance of all structures listed in it. Clark Depo. 243-247, 250-253. Furthermore, there 

is no evidence Appellees stated or indicated the Intake Structure was covered. 

Accordingly, the trial court’s grant of summary judgment on the equitable estoppel claim 

are upheld. 

C. Negligence and Misrepresentation 

{¶77} The trial court indicated the amended complaint alleged negligence and 

misrepresentation on the part of Mega and Gauron for failure to obtain the requested 

policy coverage. The trial court stated both claims were time barred by the four-year 

statute of limitations. The court explained the delayed damages rule and the discovery 

rule does not change the result. The court indicated, as to negligence, that the case at 

hand was distinguishable from the Kunz case where the insured initially pursued 

insurance to cover everything. Here, it held, the City did not initially purchase insurance 

to cover the Intake Structure. As to misrepresentation, the court also stated, in addition 

to being barred by the statute of limitations, Disch’s failure to read the policy was an 

indication the City failed in its duty to know the contents of the policy. Furthermore, as 

with the above arguments it also noted there is no evidence anyone provided any false 

information to the City or the Board of Public Utilities prior to the damage occurring to the 

Intake Structure. 

{¶78} The City claims the trial court misconstrued both its negligence and 

misrepresentation claims as requesting application of delayed damages. It contends it 

was seeking damages for negligence and misrepresentation in connection with the 2015 

renewal policy. Thus, it was not setting forth a claim under the delayed damages rule 

and that rule would not be addressed. 

{¶79} The City argues an action for negligent procurement of an insurance policy 

or negligent misrepresentation of the terms of the policy begins to run when the policy is 
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Case No. 20 CO 0009

issued and the renewal of insurance is a separate and distinct contract. It contends the 

2015 contract is a separate contract having a beginning date of March 21, 2015 and an 

ending date of March 21, 2016. The failure to procure the requested coverage in the 

renewal policy is a separate act of negligence and misrepresentation. 

{¶80} Mega and Gauron argue the trial court correctly determined the statute of 

limitations barred the action and, alternatively, there was no evidence of 

misrepresentation or negligence. Specifically, there was no evidence false information 

was provided to the City stating the Intake Structure was covered under the policy. 

Owners similarly argues the actions are barred by the statute of limitations. It claims the 

statute of limitations should not be tolled simply because the policy is renewed year after 

year. Furthermore, it claims there was no misrepresentation or negligence; there was no 

statement or action indicating the Intake Structure was covered. 

{¶81} To establish actionable negligence, one must show there was a duty, the 

duty was breached, and an injury resulted from the breach. Mussivand v. David, 45 Ohio 

St.3d 314, 318, 544 N.E.2d 265 (1989). 

{¶82} The elements of negligent misrepresentation are: 

“(1) one who, in the course of his or her business, profession, or 

employment, or in any other transaction in which he or she has a pecuniary 

interest; (2) supplies false information for the guidance of others in their 

business transactions; (3) is subject to liability for pecuniary loss caused to 

them by their justifiable reliance upon the information; and (4) if he or she 

fails to exercise reasonable care or competence in obtaining or

communicating the information. Delman v. Cleveland Hts. (1989), 41 Ohio 

St.3d 1, 4, 534 N.E.2d 835, 837–838. A negligent misrepresentation claim 

does not lie for omissions: there must be an affirmative false statement. 

Textron Fin. Corp. v. Nationwide Mut. Ins. Co. (1996), 115 Ohio App.3d 137, 

149, 684 N.E.2d 1261, 1269; Zuber v. Ohio Dept. of Ins. (1986), 34 Ohio 

App.3d 42, 45-46, 516 N.E.2d 244, 246-248.” Martin v. Ohio State Univ. 

Found., 139 Ohio App.3d 89, 103-04, 742 N.E.2d 1198 (10th Dist.2000).

Jochum v. Howard Hanna Co., 11th Dist. Lake No. 2020-L-077, 2020-Ohio-6676, ¶ 39. 
 – 26 – 

Case No. 20 CO 0009

{¶83} The Ohio Supreme Court in LGR Realty, Inc. recently addressed the fouryear statute of limitations for professional-negligence claims governed by R.C. 

2305.09(D). LGR Realty, Inc. v. Frank & London Ins. Agency, 152 Ohio St.3d 517, 2018-

Ohio-334, 98 N.E.3d 241. The issue in that case was when the negligent-procurement 

and negligent-misrepresentation claims accrued, triggering the start of the statute of 

limitations. Id. at ¶ 12. The Ohio Supreme Court concluded the delayed damages rule 

does not apply to a negligent procurement or negligent misrepresentation claims where 

the terms of the policy when issued contains a provision specifically excluding the type of 

claim that the insured alleges it believed was covered by the policy. Id. at ¶ 31. “The 

cause of action in such a case accrues on the date the policy is issued.” Id. 

{¶84} In LGR Realty, Inc., the Court indicated the general rule is the statute of 

limitations begins to run when the injurious act is committed. Id. at ¶ 26. The language 

used by the Court appears to indicate when negligent procurement and misrepresentation 

claims are alleged, the alleged damage occurs the moment the contract is entered and 

the insured becomes obligated to pay a premium for the insurance policy that provided 

less coverage than it believed it would receive. Id. at ¶ 29. The case law does not indicate 

if there is a distinction between a renewal or original issuance. This raises the question 

of whether the statute of limitations begins to run at every renewal or does it only begin 

to run at the first issuance? The Ohio Supreme Court has stated a renewal insurance 

contract can represent a new contract of insurance separate from the initial policy. See 

Shay v. Shay, 113 Ohio St.3d 172, 2007-Ohio-1384, 863 N.E.2d 591, ¶ 24 (“In Benson,

we held that statutes pertaining to an insurance policy and its coverage that are enacted 

after the policy's issuance are incorporated into a renewal of the policy if the renewal 

represents a new contract of insurance separate from the initial policy.”). 

{¶85} Whereas here, the renewal policy has a stated start date and end date, the 

renewal may be a separate policy starting the statute of limitations for negligence and 

misrepresentation claims when the policy is renewed. Therefore, the statute of limitations 

would not bar this action. 

{¶86} Conversely, here the issue is the coverage and the policy had not changed 

as to coverage of the “Intake Well House” for the past 20 years, other than to slightly 

change the amount covered, Hence, there is an indication that it is not a new contract. 
 – 27 – 

Case No. 20 CO 0009

The testimony indicated coverage did change over time. Gauron said items were added. 

However, none of those items appear to have added anything to the “Intake Well House.” 

That portion of the policy remained unchanged. This seems to indicate that the action is 

barred by the statute of limitations. 

{¶87} Assuming without deciding that the claims are not barred by the statute of 

limitations, the claims cannot survive summary judgment for the reasons expressed under 

the estoppel analysis. There is no evidence in the record Appellees ever stated the Intake 

Structure was covered or the term “Intake Well House” meant to include coverage for 

both the Intake Structure and the Well House, or that the City specifically asked for 

coverage for the Intake Structure located in the Ohio River. 

{¶88} The trial court’s grant of summary judgment for Appellees on the 

reformation, equitable estoppel, negligence, and misrepresentation claims is supported 

by the record. This assignment of error lacks merit. 

Conclusion 

{¶89} All assignments of error lack merit and the trial court’s decision is affirmed 

in all respects. The language of the insurance contract is plain and unambiguous; the 

term “Intake Well House” does not mean Intake Structure and Well House, but rather 

means only the well house that is connected to the Intake Structure. Further, the trial 

court correctly determined there was not sufficient evidence to survive a summary 

judgment motion on the bad faith denial and failure to investigate claims. The trial court 

also did not abuse its discretion in denying the Civ.R. 56(F) motion to continue for further 

discovery. Lastly, the trial court’s grant of summary judgment for Appellees on the 

reformation, equitable estoppel, negligence, and misrepresentation claims is supported 

by the record. 

 

Donofrio, P J., concurs. 

Waite,.J., concurs. 
[Cite as E. Liverpool v. Owners Ins. Co., 2021-Ohio-1474.]

 

 

For the reasons stated in the Opinion rendered herein, the assignments of error

are overruled and it is the final judgment and order of this Court that the judgment of the

Court of Common Pleas of Columbiana County, Ohio, is affirmed. Costs to be taxed

against the Appellant. 

A certified copy of this opinion and judgment entry shall constitute the mandate in 

this case pursuant to Rule 27 of the Rules of Appellate Procedure. It is ordered that a 

certified copy be sent by the clerk to the trial court to carry this judgment into execution. 

 

NOTICE TO COUNSEL 

This document constitutes a final judgment entry.