Insurance: Billitier v. Merrimack Mutual Fire Insurance Co.

U.S. District Court, WDNY

Insurance

Reasonable Precautions by Insured

Billitier v. Merrimack Mutual Fire Insurance Co.

08-CV-6482

Judge Larimer

Background: The plaintiff Ronald Billitier Jr. brings this action against Merrimack Mutual Fire Insurance Co., seeking coverage for water damage pursuant to a property insurance policy he purchased from Merrimack. Merrimack has moved for summary judgment on the grounds that its denial of coverage to Billitier for the underlying damages was justified by an applicable policy exclusion.
The policy stated that it did not insure losses due to “freezing of a plumbing, heating air conditioning or automatic fire protective sprinkler system or of a household appliance, or by discharge, leakage or overflow from within the system or appliance caused by freezing. This exclusion applies only while the dwelling is vacant, unoccupied or being constructed” unless reasonable care was used to maintain heat in the building; or shut off the water supply and drain the system and appliances of water. Between December 2007 and Jan. 24, 2008, water pipes in the property froze, burst, and caused damage alleged by Billitier to total $100,084.98. Billitier timely made a claim under the policy for the damage, which Merrimack denied on the grounds of the exclusion for frozen pipes in an unoccupied, unheated property with undrained plumbing.
When the last tenants vacated the property, the electric had been shut off even though Billitier claimed there had been a revert agreement whereby the electric should have been transferred to his name and kept on. Billitier testified that although he was informed that RG&E would need to send a technician to the property to restore power, he was not told that he would need to be there, or that he otherwise needed to take any further action to facilitate the restoration of power. Billitier was never informed by RG&E that its first effort to connect electric service had been unsuccessful.

Ruling: Assessing whether “reasonable care” was taken necessarily includes a fact-intensive analysis of, among other things, the parties’ credibility, the extent of RG&E’s representations or instructions to Billitier, Billitier’s actions to ensure the provision and continuation of electric service to the property when it was unoccupied, and the reasonableness of Billitier’s reliance on RG&E’s statements in connection with the request for power restoration. For that reason, summary judgment is inappropriate. The summary judgment motion is denied.

William P. Smith Jr. of Woods Oviatt Gilman LLP for the plaintiff; and Eric T. Boron of Mura & Storm PLLC for the defendant