NOT RECOMMENDED FOR FULL-TEXT PUBLICATION

File Name: 15a0464n.06

Case No. 14-5500

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

CINCINNATI INSURANCE COMPANY,

Plaintiff-Appellee,

v.

HAROLD WILKERSON,

Defendant-Appellant.

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ON APPEAL FROM THE UNITED 

STATES DISTRICT COURT FOR 

THE WESTERN DISTRICT OF 

KENTUCKY

BEFORE: SILER, MOORE, and STRANCH, Circuit Judges.

SILER, Circuit Judge. Defendant Harold Wilkerson (“Wilkerson”) appeals the district 

court’s grant of summary judgment in favor of Cincinnati Insurance Company (“CIC”). The 

district court found that there was no coverage available to Wilkerson for injuries sustained by a 

minor on Wilkerson’s premises under the CIC policy at issue. For the following reasons, we

REVERSE and REMAND for further proceedings consistent with this opinion.

I.

In 1997, Wilkerson purchased the property located at 221 W. Main Street, 

Campbellsville, Kentucky (the “Property” or “221 W. Main”) at an auction. The plat shows that 

the Property was divided into three lots––all sharing the same address.
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At the time that Wilkerson purchased the Property, there were two buildings located at 

221 W. Main––a hotel apartment complex (where the rooms open to interior hallways) on Lot 

One and an abandoned single story motel (where the rooms open directly to the outside) on Lot 

Two. Lot Three was vacant. Today, there are only ruins of the structure on Lot One, and the 

previously-abandoned motel on Lot Two has been renovated into apartments. 

Wilkerson initially had insurance through Ohio Casualty for 221 W. Main, which 

afforded coverage for property damage to the hotel apartment complex on Lot One. The policy 

was not renewed at the end of the policy period. Thereafter, the Taylor County Bank, which held 

the mortgage on the Property, purchased insurance for 221 W. Main. The insurance included 

both liability insurance for 221 W. Main and coverage for property damage to the hotel. The 

hotel remained in operation until 2003 or 2004 when the building caught fire. While the hotel 

was closed pending a fire marshal’s investigation, it was vandalized and ransacked, which made 

it impractical to repair. The hotel has remained vacant since the fire. The Property remained 

uninsured from shortly after the fire––when the policy obtained by the bank covered the bank’s 

interest––until early 2008. 

In 2007, Wilkerson contacted his insurance agent, Scott Jessie (“Jessie”), because he 

needed coverage for an unrelated property in Greensburg, Kentucky. Wilkerson applied for and 

received a policy of insurance with a three-year coverage term––from November 28, 2007 to

November 28, 2010.

Also in 2007, Wilkerson decided to convert the abandoned motel at 221 W. Main (Lot 

Two) into apartments. Because the bank that financed the renovation required insurance, 

Wilkerson contacted Jessie and informed him that the bank wanted him to obtain insurance for 

221 W. Main. A “Commercial Policy Change Request,” listing 221 W. Main for the “Premises 
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Information,” was submitted to CIC in January 2008.1 Thereafter, an endorsement to the Policy 

amended the “Schedule of Locations” and “Limitation of Coverage to Designated Premises or 

Project Form” to include 221 W. Main. 

In October 2010, prior to the expiration of the Policy period, a trespassing minor was 

injured in the abandoned building located on Lot One. In 2013, the minor’s appointed guardian 

filed a personal injury complaint in the Taylor County Circuit Court (“state court complaint”) 

against Wilkerson. The state court complaint alleged that Wilkerson failed “to maintain the 

building and the property upon which it is located to ensure the safety of children who would 

find said property to [be] an ‘attractive nuisance.’” 

Thereafter, CIC filed a complaint for declaratory relief, pursuant to 28 U.S.C. §§ 1332 

and 2201, in federal district court, alleging that, under the Policy, it “d[id] not owe either 

indemnification and/or a defense to Defendant Wilkerson for the claims asserted against him” in 

the state court complaint. 

The district court granted summary judgment in favor of CIC. It found that the Policy 

was unambiguous. Specifically, it found that the coverage did not extend to the vacant hotel on 

Lot One because the Policy’s endorsement limited coverage to Lot Two––the location of the 

renovated apartment building. The court also found that reformation was not proper because 

there was no mutual mistake as to the scope of the Policy. Because the court found that the 

Policy did not provide coverage for the minor’s injuries, it did not address the parties’ arguments 

about whether Wilkerson provided timely notice in accordance with the Policy’s requirements.

 

1

The “Policy” referenced throughout this opinion collectively refers to the commercial 

general liability insurance policy issued to Wilkerson in November 2007 for the Greensburg 

property, along with the policy endorsement from January 2008 extended coverage to 221 W. 

Main. Wilkerson also purchased commercial property insurance on both properties, but that 

portion of the policy was not presented to the district court.
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II.

“We review a grant of summary judgment de novo, construing the evidence and drawing 

all reasonable inferences in favor of the nonmoving party.” Hirsch v. CSX Transp., Inc., 656 

F.3d 359, 362 (6th Cir. 2011). 

In diversity cases, we are bound to apply the same law as would be applied by the state 

courts. Kurczi v. Eli Lilly & Co., 113 F.3d 1426, 1429 (6th Cir. 1997). Under Kentucky law, 

“[i]t is well settled that the proper interpretation of insurance contracts generally is a matter of 

law to be decided by a court.” Cincinnati Ins. Co. v. Motorists Mut. Ins. Co., 306 S.W.3d 69, 73 

(Ky. 2010). “[D]etermining whether a contract is ambiguous,” the Kentucky Supreme Court 

advises, also “is a question of law for the courts.” 3D Enters. Contracting Corp. v. Louisville & 

Jefferson Cnty. Metro. Sewer Dist., 174 S.W.3d 440, 448 (Ky. 2005). “Under the doctrine of 

reasonable expectations, followed in Kentucky, when the language of an insurance policy is 

ambiguous, the ambiguity must be construed in favor of the insured and benefits granted in 

accordance with the reasonable expectations of the parties.” United States Fid. & Guar. Co. v. 

Preston, 26 S.W.3d 145, 147 (Ky. 2000); see also Senn’s Adm’x v. Michigan Mut. Liability Co., 

267 S.W.2d 526, 527 (Ky. 1954) (“It is also the rule that where an insurance contract is 

ambiguous or susceptible of different meanings, it will be construed most strongly against the 

insurer who prepared it.”).

In this case, Wilkerson initially obtained an insurance policy for a property in 

Greensburg. Shortly thereafter, Wilkerson contacted his agent to add 221 W. Main to the Policy. 

The relevant provisions of the Policy at issue are set forth below.

The Policy’s “COMMERCIAL GENERAL LIABILITY COVERAGE FORM” provides, 

in relevant part, as follows:
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SECTION I – COVERAGES

COVERAGE A. BODILY INJURY AND PROPERTY DAMAGE LIABILITY 

1. Insuring Agreement

a. We will pay those sums that the insured becomes legally obligated to pay as 

damages because of “bodily injury” or “property damage” to which this 

insurance applies. We will have the right and duty to defend the insured 

against any “suit” seeking those damages. However, we will have no duty to 

defend the insured against any “suit” seeking damages for “bodily injury” or 

“property damage” to which this insurance does not apply. 

(Emphasis added.) The endorsement to the Policy amended the “Schedule of Locations,” to 

include 221 W. Main. Additionally, the endorsement amended the “Limitation of Coverage to 

Designated Premises or Project” to “include the above location”––221 W. Main. The 

“Limitation of Coverage to Designated Premises or Project” makes clear that the insurance 

applies to “bodily injury.” Specifically, it states that: 

This insurance applies only to “bodily injury” . . . arising out of:

1. The ownership, maintenance or use of the premises shown in the Schedule 

and operations necessary or incidental to those premises . . . 

(Emphasis added.) 

The endorsement also amended the declarations for the commercial general liability 

coverage to add a classification for renting out nine single-family dwellings and listed the 

associated code and corresponding changes to the premium:2

Additionally, the endorsement makes clear that the Policy provides coverage for property 

damage liability to one dwelling at 221 W. Main. Specifically, the endorsement provides the 

following:

 

2

The General Change Endorsement amended a table on the Declarations Page, GA 501. 

In the bracketed text above, we reproduce the column titles for the text added by the 

endorsement.
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AMENDING COMMERCIAL GENERAL LIABILITY FORM GA501 TO INCLUDE:

[CLASSIFICATION] [CODE NO.] [PREM. BASE] [RATE] [ADV. PREMIUM]

DWELLINGS-1 FAMILY 63010 E)9 EACH 54.559 491

INCL PROD AND/OR

COMP OP

The only mention of the classification in the rest of the Policy is found in an unrelated aspect of 

coverage. Finally, the endorsement also altered the Commercial Property portion of the Policy, 

which was not filed with the district court, to add coverage for damage to the motel building. 

On appeal, Wilkerson argues that the district court misunderstood the scope of the 

premises. He claims that the district court “erred by considering the recorded plat of [his] 

property as having divided it into three separate lots.” 

In this case, it is clear from the endorsement that the Policy covered 221 W. Main. 

However, the Policy was ambiguous as to the boundaries of the Property. Put another way, the 

district court needed to look beyond the Policy to determine the boundaries of 221 W. Main. 

And the district court did look to the plat and focused on the three distinct “lots” depicted on the 

plat. But collectively, the three “lots” shared one address––221 W. Main. 

The Policy at issue here provides general liability insurance, including––coverage for 

bodily injury. As set forth above, the Policy states that it “applies only to ‘bodily injury’ . . . 

arising out of . . . [t]he ownership, maintenance, or use of the premises shown in the Schedule.” 

Because the endorsement amended the “Limitation of Coverage to Designated Premises or 

Project” form to include 221 W. Main on the “Schedule” of premises covered by the Policy, it 

follows that the Policy provides insurance coverage for “bodily injury” liability that arises out of 

the ownership of 221 W. Main. Here, the child was injured at 221 W. Main. For purposes of 

coverage for bodily injury, it does not matter on what “lot” the injury occurred so long as it 
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occurred on the Property. Therefore, the district court improperly relied on the three “lot” 

distinction on the plat to deny coverage.

There is a superficial ambiguity created by the fact that the Policy mentions the 

classification for single-family dwellings (Code No. 63010) but does not mention any 

classification for a vacant building.3 Taken in isolation, that incomplete accounting could cast 

doubt over whether the parties had a mutual understanding of the true boundaries of 221 W. 

Main. However, there is nothing in the Policy to indicate that the liability coverage was limited 

to the classification listed on the declaration form. Nothing in the Policy would have led

Wilkerson to reasonably expect that the liability would be excluded. See also Aetna Cas. & Sur. 

Co. v. Freeman, 427 S.W.2d 220, 222 (Ky. 1968) (broadly construing the classification of 

operations on a workers’ compensation insurance policy).

Nor is the scope of the Commercial General Liability coverage affected by the fact that the 

Commercial Property policy was amended to insure only the motel building. It is not 

unreasonable for a Commercial Property insurance policy to omit structures that either do not 

have any assessed value or are not covered for that purpose, and for the related Commercial 

General Liability policy to nonetheless cover the entirety of the premises. In fact, Jessie 

conceded the reasonability of this practice in his deposition testimony:

Q. Of course, we’re talking about this in terms of buildings and locations, but in 

reality, this is a liability claim that under—undergirds everything that we’re 

talking about. In a particular circumstance, and we’ll go back to our example 

where you said, “If I write a farm that has five barns on it” –

 

3

These classifications and classification codes are issued by the Insurance Services 

Office (“ISO”), which was founded as an association of insurance companies. The ISO drafts 

standardized policy forms and provides research support for underwriting. See Hartford Fire 

Ins. Co. v. Cal., 509 U.S. 764, 772 (1993). The ISO classifications are used to assess the 

appropriate risk level and premium rates for particular insured activities. See 2-9 New 

Appleman Law of Liability Insurance § 9.03 (Mathew Bender, Rev. Ed.).
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A. Right.

Q. When you do that and you exclude some of those barns, you’re excluding them 

for the purpose of property damage claims, right?

A. That’s correct.

Q. You’re not excluding them for liability claims, are you?

A. No.

Q. The liability claims attach to the property address, do they not?

A. Right, it’s apples and oranges, the property and liability claims.

Q. For example, somebody who gets hurt on that farm with the five barns down at 

the pond between barns three and four is likely to have coverage under the 

liability provision of the policy, right?

A. Gets hurt down at the barn?

Q. Gets hurt at the pond between the barns? If you’re covering the farm, you’re 

covering the farm, right?

A. Right. If we’re covering the farm, we would insure it as a farm and cover the 

farm, yes.

Q. Right. And so when you do liability coverage, it actually attaches to the 

address, not the particular structures, correct?

A. The address given?

Q. Yeah?

A. I mean, most of the cases, yes.

This industry practice acknowledged by CIC’s agent allows us to reconcile the apparently 

conflicting contractual terms and resolve the ambiguity in favor of a reading that extends liability
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coverage for bodily injury to the entirety of the premises at 221 W. Main. Accordingly, we

conclude that the Policy provided coverage for “bodily injury” occurring at 221 W. Main. 

III.

Although we have found that there is coverage under the Policy, there are two arguments 

that could ultimately defeat coverage under the Policy. In its summary judgment brief, CIC 

raised two alternative arguments in the event the district court found the child’s injuries were 

covered––mutual mistake and failure to comply with the Policy’s notice provision. CIC raised 

its mutual mistake argument on appeal, but it did not raise its notice argument.4 

A.

Under Kentucky law, “an insurance policy may be reformed the same as other written 

instruments, if, by reason of mutual mistake, or mistake on one side and fraud on the other, it 

does not conform to the real agreement.” Aetna Ins. Co. v. Steele, 299 S.W. 1091, 1092 (Ky. 

1927). Three elements must be established to reform a contract based on mutual mistake. First, 

CIC “must show that the mistake was mutual, not unilateral.” Abney v. Nationwide Mut. Ins. 

Co., 215 S.W.3d 699, 704 (Ky. 2006). Second, “the mutual mistake must be proven beyond a 

reasonable controversy by clear and convincing evidence.” Id. (quoting Campbellsville Lumber 

Co. v. Winfrey, 303 S.W.2d 284, 286 (Ky. 1957)) (emphasis in original). Third, “it must be 

shown that the parties had actually agreed upon terms different from those expressed in the 

written instrument.” Id. (quoting Campbellsville Lumber, 303 S.W.2d at 286). 

CIC argues that the Policy was issued based on a mutual mistake as to the scope of 

coverage. Specifically, CIC claims that both Wilkerson and Jessie only intended for the Policy 

to provide liability coverage for the renovated apartment building on Lot Two—not the 

 

4

Either of these arguments, if found persuasive, could relieve CIC of its obligations 

under the Policy.
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abandoned hotel on Lot One. Without providing a citation to the record, CIC states in its brief 

that, “[d]espite [Wilkerson’s] earlier admissions that he did not intend to purchase coverage for 

the vacant hotel when he added the renovated structure at 221 W. Main to his policy, Wilkerson 

now contends that his agent erred in obtaining coverage limited to only the renovated structure at 

221 W. Main.” 

 CIC appears to have misconstrued the record on this point. Nowhere in the record does 

Wilkerson state that he did not intend to purchase coverage for the vacant hotel. In fact, 

Wilkerson testified that he “called [Jessie] and informed him that Taylor County Bank was 

wanting insurance on the property.” During their conversation, Wilkerson told Jessie that he 

wanted insurance for 221 W. Main. Accordingly, the record does not support CIC’s assertion 

that Wilkerson admitted that he did not intend to cover the vacant hotel. Wilkerson testified that 

he made no reference to the abandoned hotel at all. By contrast, Jessie testified that he knew that 

Wilkerson owned the abandoned hotel but did not know that the abandoned hotel shared the 

same street address––221 W. Main––as the renovated apartment building. Jessie also testified 

that if he knew that the abandoned hotel was located on 221 W. Main he would not have written 

a policy that included liability coverage for that structure. 

CIC cannot show that both “parties had actually agreed upon terms different from those 

expressed in the written instrument,” Abney, 215 S.W.3d at 704 (quoting Campbellsville Lumber, 

303 S.W.2d at 286), because, as discussed above, the contract is written the way Wilkerson 

would expect. Wilkerson asked for coverage for 221 W. Main. Jessie testified that it is the 

industry practice for commercial general liability coverage to attach to the property, whereas 

commercial property coverage is determined on a structure-by-structure basis. Construing the 

evidence in the light most favorable to Wilkerson, the nonmoving party, and construing any 
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contractual ambiguities in favor of Wilkerson, the insured, CIC is not entitled to reformation 

because it has not shown by clear and convincing evidence that the parties agreed upon terms 

different from those in the Policy. 

B.

CIC also argued at the summary judgment stage that any obligation of coverage was 

negated by Wilkerson’s failure to provide timely notice of the child’s injury.5 The district court 

declined to address this issue because it concluded that there was no coverage under the Policy. 

CIC did not raise its notice argument on appeal. Because there is coverage under the Policy and 

the question of whether there was deficient notice resulting in prejudice to CIC has not been 

raised before us, we reverse and remand to the district court to decide the notice issue. See Jones 

v. Bituminous Cas. Corp., 821 S.W.2d 798, 801 (Ky. 1991) (holding that “an insurer cannot 

withdraw coverage on the ground that a notice condition has not been met unless the insurer can 

show that it was prejudiced by the act of the insured”).

REVERSED AND REMANDED.

 

5

The Policy provides that the insured has the duty to notify CIC “as soon as practicable” 

of an “occurrence” that may result in a claim. The Policy also provides that if a claim or suit is 

brought against the insured, then the insured must notify CIC “as soon as practicable.” Here, the 

child was injured in October 2010, and Wilkerson learned of the child’s injuries shortly 

thereafter. Wilkerson was not sued until March 2013. Wilkerson testified that he informed 

Jessie immediately after the suit was filed. Wilkerson also testified that the reason he did not 

notify Jessie upon learning of the accident is because: (1) the child’s mother was a patient of his; 

(2) the child’s mother informed him that the child should not have been on his property; and 

(3) he did not believe a claim would be pursued.