Opinion ID: 1157021
Heading Depth: 2
Heading Rank: 1

Heading: The circuit court improperly defined the term cause.

Text: The circuit court found that the cause of the pool floating was the Respondents removing all of the water without removing the plug. The court noted that the word cause is not defined in the Policy and cited State Farm Fire & Casualty Co. v. Barrett, 340 S.C. 1, 530 S.E.2d 132 (Ct.App.2000), for the proposition that [w]here a term is not defined in an insurance policy, it is to be defined according to the usual understanding of the term's significance to the ordinary person. Id. at 8, 530 S.E.2d at 136. The circuit court then continued, [t]he meaning of the pivotal word `cause' has primarily developed in the conte[x]t of tort and insurance law where causation is an essential element in establishing liability and applied tests utilized in determining legal causation. Citing the reasoning of Bebber v. CNA Insurance Companies, 189 Misc.2d 42, 729 N.Y.S.2d 844 (N.Y.Sup.Ct.2001), the court found that the draining was a but for cause of the floating and that the underground water pressure was a natural, static force which could not be an intervening cause. The court also concluded that the rainfall prior to the pool floating was not a factor, since the parties stipulated that the hydrostatic pressure was present both before and after the pool was emptied. Among other points, Appellant complains that the circuit court incorrectly defined the term cause in construing the policy. We agree. The circuit court correctly noted that the term cause is not defined by the policy and that in such case the court must define the term according to the usual understanding of the term's significance to the ordinary person. However, rather than attempting to ascertain the understanding to the ordinary person, the court looked instead to tort law and tests utilized in determining legal causation. Cause in the context of an insurance policy and in the usual understanding of the term's significance to the ordinary person is not the same as legal causation. See 7 Couch on Insurance 3d § 101:40 (Steven Plitt, et al., eds., 2008). The circuit court noted that [a] circumstance which merely `sets the state' is not regarded as being a proximate cause merely because the circumstance made possibl[e] the subsequent loss. ( citing Couch on Insurance, 2nd, sec. 74.713; Bebber, supra ). Yet the usual understanding of the word cause does not require that an event or condition be the proximate cause. The American Heritage Dictionary defines cause as [s]omething that produces an effect, result, or consequence and [t]he person, event, or condition responsible for an action or result. In applying this definition of cause the but for test is appropriate. While it is true, as the Bebber court noted, that but for the plaintiff's drainage of the pool the damage would not have occurred, it is also true that but for the underground water pressure, the damage would not have occurred. Therefore, the underground water pressure was a cause of the damage. However, the pressure was certainly not the sole cause of the floating. Case law from other jurisdictions demonstrates two main tests for determining coverage where the loss is the result of multiple causes. The majority of jurisdictions follow the efficient proximate cause doctrine which provides that in circumstances with two or more identifiable causes, the court looks to the cause which is determined to have set the chain of events in motion. See Amherst Country Club, Inc. v. Harleysville Worcester Ins. Co., 561 F.Supp.2d 138, 150 (D.N.H.2008). If this efficient proximate cause is covered under the terms of the policy, then the loss is covered. Id. The minority rule is the concurrent cause rule, which asks whether one of the causes of a loss is covered. Id. If so, then the loss is covered notwithstanding the fact that there is also an excluded cause in the chain of causation. Id. In the instant case, neither doctrine applies since the policy contains an anti-concurrent causation clause. The exclusion provides that [s]uch loss is excluded regardless of any other cause or event contributing concurrently or in any sequence to the loss. Consequently, though the underground water pressure was not the sole cause of the loss or even the efficient proximate cause, it was a cause of the loss and so, the exclusion applies.