Court Opinion

ID: 6463925
Source: CourtListenerOpinion
Date Created: 2022-06-25 12:51:10.819114+00
Date Added: 2024-06-11T15:52:45.230182
License: Public Domain

Berry, J.
(dissenting, with whom Grainger, J., joins). I dissent from the majority’s reading of the insurance policy, which *445disregards an endorsement amending the policy that provides for the precise coverage here at issue. Alternatively, and at best, the majority opinion is inconsistent with Massachusetts law, which construes conflicting terms in a policy against the insurer. In addition, the majority result relies on the statement that “[t]he pertinent facts are undisputed.” To the contrary, there is a genuine and material disputed factual issue concerning the manner and means by which water caused damage to the plaintiff’s house, a question central to the existence of coverage.
1. The policy and “additional coverage” endorsement. I turn first to the policy provisions and principles of Massachusetts law applied in construing conflicting provisions against an insurer. The insurer issued an endorsement covering the damage at issue: it provided “additional coverage” for “ ‘Fungi’, Wet or Dry Rot, or Bacteria.”1 This is precisely a type of damage resulting from seepage of water over a period of time.
Notwithstanding that, Safety asserts that this endorsement was limited by a “Perils Insured Against” reservation.2 The *446reservation — according to Safety — was designed to exclude damage caused by water seepage unless the seepage was hidden. Additionally, Safety cites another conflicting provision to negate the ostensibly provided “additional coverage.” This is the exclusion for surface water3 — an exclusion on which the majority relies. In order to create an exclusion, the insurer must use language that is clear to the policy holder. Here, the surface water exclusion, notwithstanding the catchphrase “directly or indirectly,” simply cannot reasonably be interpreted to negate coverage for rot caused by (hidden) seepage. Interlacing these confusingly drafted paragraphs, Safety’s reading, and the majority construction, would negate the very existence of the additional coverage. This is incomprehensible doublespeak. Such a reading is contrary to the principle that “[ljanguage in an insurance policy must be given its ordinary meaning, however, and construed in the sense that the insured will reasonably understand to be the scope of his coverage.” Slater v. United States Fid. & Guar. Co., 379 Mass. 801, 803 (1980).
While it may be theoretically possible to find damage caused by hidden seepage that does not proximately involve surface water, the majority approach effectively allows the insurer to look to any phase of the water cycle and thereby deny coverage. This proves too much by far. In the instant case the plaintiff alleged, and provided expert evidence, that water fell to the surface as rain, then seeped into the plaintiff’s dwelling, causing damage. It borders on sharp practice for Safety to deny coverage for seepage by claiming that this constitutes damage indirectly caused by surface water. “Surface water,” defined by the policy in the context of “water damage,” refers to “tidal water” and “overflow of a body of water” (see note 4, infra) and is properly read as meaning a body of water that migrates beyond its usual *447bounds.4 “An interpretation which gives a reasonable meaning to all of the provisions of a contract is to be preferred to one which leaves a part useless or inexplicable.” Sherman v. Employers’ Liab. Assur. Corp. Ltd., 343 Mass. 354, 357 (1961).
A proper reading of the policy requires recognition that damage caused by water which has become seepage, whatever the source to which it might be originally traced, is covered by the contract between the parties. When a consumer pays for insurance under a policy, which by its language covers damage caused by seepage of water, that is what the insured consumer should receive.5
Even were we to assume that these policy provisions cannot be reconciled, it would not avail Safety. “If there are two rational interpretations of policy language, the insured is entitled to the benefit of the one that is more favorable to it.” Hazen Paper Co. v. United States Fid. & Guar. Co., 407 Mass. 689, 700 (1990). An insurer may not deploy ambiguous language and conflicting cross provisions in a policy to deny coverage. In cases of ambiguity, “Massachusetts construes insurance policies against the insurer.” City Fuel Corp. v. National Fire Ins. Co. of Harford, 446 Mass. 638, 643 n.5 (2006). Here, the “additional coverage” added by paragraph 12.a appears to do just that — provide additional coverage. An insurance policy is to “be construed to give reasonable effect to each of its provisions.” J. A. Sullivan Corp. v. Commonwealth, 397 Mass. 789, 795 (1986). “It is also appropriate, in construing an insurance policy, *448to consider what an objectively reasonable insured, reading the relevant policy language, would expect to be covered.” Hazen Paper Co. v. United States Fid. & Guar. Co., supra at 700.
2. Genuine issue of material fact. The record below does not support summary judgment. Rather, it includes substantial evidence that there was hidden seepage and leakage that caused the resulting rot damage — which would thereby be rendered a covered loss. With respect to this evidence, the judge noted as follows:
“It is undisputed that the water emanated from the outside and seeped or leaked in through the gap between the concrete patio and the rear wall of the house. The inspectors report that it was this gap and the placement of the patio, built sometime before Boazova purchased the property, that ultimately caused the damage.
“The reports are clear, especially when read with the affidavits of the inspectors, that the water that caused the damage was rain and melting snow that essentially ‘sat’ on the foundation wall and ran along the surface of the patio on the outside of the house until it seeped into the sill and beyond. There is no other possible source of water that can be gleaned from the facts . . . .”
Not surprisingly, the parties differ in the language they use to describe what occurred; these semantic disputes track the language of the various ostensibly conflicting provisions of the policy. On this point, the report in the summary judgment record submitted by Safety’s expert does not use the term surface water to describe the passage of water into the interior of the house. Rather, Safety’s expert’s report refers to surface water on top of the patio, “in the form of rain or snow falling onto the concrete patio at the rear of the house, running along the surface of the concrete patio to the rear wall of the house, and then running down into gaps and joints in the patio.” Even if, as described by Safety’s expert, water may have collected on the patio, and then moved as surface water above the patio and within patio *449gaps, that does not demonstrate that the water met the policy’s definition of surface water as it entered the house. Rather, as noted, from all that appears of record, the water leaked and seeped into the house interior. As the judge found, the water “seeped into the sill and beyond. There is no other possible source of water that can be gleaned from the facts . . . .” The plaintiff’s expert’s report does not speak of surface water moving into the house, but rather describes moisture “migrating] down to the foundation.”
At best, there is a genuine dispute whether the damage at issue was caused by water that “flowed,” or “leaked,” or “migrated,” or “seeped.” When the court considers the materials accompanying a motion for summary judgment, “the inferences to be drawn from the underlying facts contained in such materials must be viewed in the light most favorable to the party opposing the motion.” Hub Assocs., Inc. v. Goode, 357 Mass. 449, 451 (1970), quoting from United States v. Diebold, 369 U.S. 654, 655 (1962).
The grant of summary judgment was improper and should be vacated.

The full endorsement to the policy, as in effect during the filing of the subject claim, added paragraph 12 to the “Section 1 — Property Coverages” of the policy, to provide additional coverage for wet or dry rot as follows:
“The following Additional Coverage is added:
“12. ‘Fungi’, Wet or Dry Rot, or Bacteria
“a. The amount shown in the Schedule above [with $10,000 or
$50,000 limits of liability] is the most we will pay for:
“(1) The total of all loss payable under Section 1 — Property Coverages caused by ‘fungi’, wet or dry rot, or bacteria;
“(2) The cost to remove ‘fungi’, wet or dry rot, or bacteria from property covered under Section 1 — Property Coverages;
“(3) The cost to tear out and replace any part of the building or other covered property as needed to gain access to the ‘fungi’, wet or dry rot, or bacteria; and
“(4) The cost of testing of air or property to confirm the absence, presence or level of ‘fungi’, wet or dry rot, or bacteria
(Emphasis added.)

Specifically, subparagraph b to section 12 of Additional Coverages in the endorsement states as follows:
“The coverage described in 12.a. only applies when such loss or costs *446are a result of a Peril Insured Against that occurs during the policy period and only if all reasonable means were used to save and preserve the property from further damage at and after the time Peril Insured Against occurred.”

 “We do not insure for loss caused directly or indirectly by any of the following!;] • • • Water Damage, meaning . . . [f]lood, surface water, waves, tidal water, overflow of a body of water . . .” (emphasis added).

In granting summary judgment, the judge erroneously relied on a definition of surface water as water “from rain, melting snow, springs, or seepage, or floods that lie or flow on the surface of the earth and naturally spread over the ground but do not form a part of a natural watercourse or lake.” DeSanctis v. Lynn Water & Sewer Commn., 423 Mass. 112, 115 n.6 (1996). The policy language, however, is explicit to the contrary, and speaks to “waves, tidal water,” and “overflow of a body of water.” The insurer decided how it wished to define surface water in this policy, and the definition it chose does not fit the facts of this case. This case has nothing to do with the ecosystem of natural bodies of water, such as natural watercourses or lakes. We note as well that the definition of surface water chosen by the judge includes “seepage,” rendering it useless in this case.

Massachusetts law certainly does not require a consumer to understand, much less formulate independently, the five pages of legal interpretation and analysis employed by the majority to justify Safety’s denial of coverage. Hazen Paper Co. v. United States Fid. & Guar. Co., 407 Mass. 689, 700-701 (1990).