UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

 

No. 05-1146

 

HARTFORD FIRE INSURANCE COMPANY,

Plaintiff - Appellant,

versus

ADCOR INDUSTRIES, INCORPORATED,

Defendant - Appellee.

 

Appeal from the United States District Court for the District of

Maryland, at Baltimore. Catherine C. Blake, District Judge. (CA04-3669-CCB)

 

Argued: September 20, 2005 Decided: December 14, 2005

 

Before LUTTIG and GREGORY, Circuit Judges, and Robert J. CONRAD,

Jr., United States District Judge for the Western District of North

Carolina, sitting by designation.

 

Affirmed by unpublished per curiam opinion.

 

ARGUED: George Edwin Reede, Jr., NILES, BARTON & WILMER, L.L.P.,

Baltimore, Maryland, for Appellant. Michael John Collins, THOMAS

& LIBOWITZ, P.A., Baltimore, Maryland, for Appellee. ON BRIEF:

Jeanie S. Ismay, NILES, BARTON & WILMER, L.L.P., Baltimore,

Maryland; E. Duncan Getchell, Jr., H. Carter Redd, MCGUIREWOODS,

L.L.P., Richmond, Virginia, for Appellant.

 

Unpublished opinions are not binding precedent in this circuit.

See Local Rule 36(c). 
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PER CURIAM:

Appellee Adcor Industries was insured under a policy issued by

appellant Hartford Fire Insurance Company. J.A. 16-49. On

February 18, 2003, a storage facility owned by Adcor collapsed

under the weight of an accumulation of ice and snow. Id. at 10,

57. Adcor claimed against its insurance policy for the damage.

Id. Hartford and Adcor could not agree on the value of Adcor’s

claim for business personal property, and, pursuant to the terms of

the policy, id. at 32, Adcor demanded an appraisal to resolve the

disputed value of its loss, id. at 10, 58. 

As required by the policy, each party selected an appraiser,

and the appraisers jointly selected an umpire. Id. The appraisers

could not agree on a mutually acceptable value and submitted the

disagreement to the umpire. Id. at 10-11, 58. The umpire largely

sided with Adcor’s appraiser, and together they voted to award

Adcor $11,217,667. Id. at 50-52. Unhappy with this outcome,

Hartford filed a declaratory judgment action in the district court

requesting that the court adjust the appraisal award because of

alleged “errors of law, erroneous calculations,” and improper

methodology. Id. at 12. Finding no error in the appraisal award

cognizable by a reviewing court, the district court granted Adcor’s

motion for summary judgment. Id. at 204.

The Maryland Court of Appeals has delineated a narrow set of

cases in which courts may set aside appraisal awards:
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When it is sought to set aside an award upon the ground

of a mistake committed by arbitrators, it is not

sufficient to show that they came to a conclusion of fact

erroneously, however clearly it may be demonstrated that

the inference drawn by them was wrong. It must be shown

that, by some error, they were so misled or deceived that

they did not apply the rules which they intended to apply

to the decision of the case, so that upon their own

theory, a mistake was made which has caused the result to

be somewhat different from that which they had reached by

their reason and judgment. . . . A mistake which will be

sufficient to avoid the award must be one that is plain

and palpable, such as an erroneous computation or

calculation of the amount, and the like.

Schreiber v. Pacific Coast Fire Ins. Co., 75 A.2d 108, 112 (Md.

1950) (emphasis added); see also Aetna Cas. & Sur. Co. v. Insurance

Comm’r, 445 A.2d 14, 20 (Md. 1982) (explaining that Maryland courts

“appl[y] arbitration law to appraisal clauses in insurance

policies”). Courts may also correct mistaken “concrete

propositions of law” announced by appraisers. Schreiber, 75 A.2d

at 112; see also High Country Arts & Craft Guild v. Hartford Fire

Ins. Co., 126 F.3d 629, 634 (4th Cir. 1997) (holding that an

appraiser commits correctable error when he goes beyond valuation

and purports to resolve coverage issues under the policy).

In this case, Hartford alleges that the umpire’s final

appraisal award erroneously included sales taxes, used the wrong

quote to value certain raw materials, used a replacement-value

measure rather than the actual-cash-value measure required by the

policy, and erroneously applied Adcor’s appraiser’s own methodology

to value finished goods. J.A. 10. Hartford claims that these

errors caused the appraisers to reach legal, coverage conclusions,
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Appellant’s Brief at 16, which this court can correct if erroneous,

see Schreiber, 75 A.2d at 112. 

To support its allegations of appraisal error, Hartford relied

on an affidavit from James J. Kern, an accountant who assisted

Hartford’s appraiser in the preparation of his appraisal. Because

the appraisal awards were unreasoned, i.e., they listed only

numbers without providing a basis for those figures, see id. at 93-

96, and Kern was not a party to the deliberations of the umpire or

Adcor’s appraiser, Kern can claim no special insight into how the

umpire or Adcor’s appraiser calculated his award, what quotes

either of them used to arrive at their awards, or even what

methodology they applied. The most Kern can do (and all he does)

is draw inferences from the numbers appearing on the award sheets.

Because of his lack of direct knowledge, Kern’s affidavit amounts

to little more than a recitation of Hartford’s allegations. Id. at

141-43. 

Kern’s speculative inferences and conclusory assertions are

not enough to create a genuine issue of material fact with regard

to one of the sorts of appraisal errors Schreiber held to be

judicially cognizable. See Thompson v. Potomac Elec. Power Co.,

312 F.3d 645, 649 (4th Cir. 2002) (stating that “[c]onclusory or

speculative allegations do not suffice” to avoid summary judgment).
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The district court’s grant of summary judgment to Adcor is

affirmed.

AFFIRMED