Court Opinion

ID: 9472462
Source: CourtListenerOpinion
Date Created: 2023-08-05 04:00:42.849989+00
Date Added: 2024-06-11T17:42:56.885352
License: Public Domain

McMILLIAN, Circuit Judge,
dissenting.
I respectfully dissent. I believe the majority opinion has mischaracterized the basis of Missouri Terrazzo’s liability to National Supermarkets and that, based on this mischaracterization, has reached the wrong result in this case.
I believe that a flaw in the analysis of this case by the district court and the majority opinion is labeling the damages claimed by National Supermarkets as diminution in value of the building (566 F.Supp. at 553; supra at 650), without considering the component parts of this claim, i.e., the damage to the floor and the reduced market value of the building. Missouri Terrazzo’s liability was premised, at least in part, upon the physical damage to the floor; however, as the majority opinion recognizes, supra at 650, coverage for such liability is excluded by exclusions (n) and (o) of the policy.
In my opinion the balance of National Supermarket’s claim, i.e., either the decrease in the value of the building due to a buyer’s loss of confidence in the building’s quality even after a new defect-free terrazzo floor is installed or the decrease in the value of the building because of a less desirable tile floor, is not for “physical damage to tangible property” and is therefore not covered by the policy. The majority opinion’s reliance on Western Casualty & Surety Co. v. Polar Panel Co., 457 F.2d 957 (8th Cir.1972), is misplaced. The liability insurance policy in Polar Panel, as in the present case, covered sums which the insured was legally obligated to pay because of “property damage.” The policy in Polar Panel, however, did not define property damage as “physical damage to tangible property” as does the policy in the present case. I believe that, by so defining property damage, Iowa National intended to limit its coverage to liability for physical damage as opposed to injury to market value and that Iowa National expressed this intention in clear and unambiguous terms.
As the majority opinion notes, supra at 651, under Missouri law the language of an ambiguous insurance policy is to be construed in favor of the insured. This principle, however, does not authorize courts to rewrite insurance contracts to provide coverage for which the parties did not contract. Where there is no ambiguity and the policy provision is a valid one, the language of the policy must be enforced in accordance with its plain meaning. E.g., M.F.A. Mutual Insurance Co. v. American Family Mutual Insurance Co., 654 S.W.2d 230, 232 (Mo.Ct.App.1983). I do not think the majority opinion does this.
Although the facts of American Motorists Insurance Co. v. Trane Co., 544 F.Supp. 669 (W.D.Wis.1982), cited by the majority at 650, are distinguishable, its discussion of the distinction between injury to property as opposed to physical damage to property, a distinction which I believe is critical to this case, is instructive. The court there held that a plant which experienced a shortfall in production because of the failure of a component part was diminished in value and that such diminution in value constituted property damage under a liability insurance policy which defined property damage as “injury to tangible property.” Id. at 681-82. The court specifically noted that had a post-1973 policy, which defined property damage as “physical damage to tangible property,” been in *654effect, the manufacturer of the defective component part would not have been covered for its liability for diminution in the value of the plant.
Accordingly, I would reverse the judgment of the district court.