Johnson & Associates, LLC v. The Hanover Insurance Group, Inc.

07/27/2018

IN THE COURT OF APPEALS OF TENNESSEE

AT KNOXVILLE

October 18, 2017 Session

JOHNSON & ASSOCIATES, LLC, ET AL. v. THE HANOVER

INSURANCE GROUP, INC., ET AL.

Appeal from the Chancery Court for Sullivan County

No. B0024946M John S. McLellan, III, Judge

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No. E2016-02469-COA-R3-CV

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This is a case concerning a commercial-property insurance policy dispute. The insured

party filed suit upon the insurance company denying theft coverage on a claim. The

insurance company claimed that the vacancy clause excluded the theft coverage of the

property at issue. The trial court found that the vacancy clause did not apply and that the

policy required the insurance company to cover the theft. The insurance company

appeals. We affirm the decision of the trial court.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court

Affirmed; Case Remanded

JOHN W. MCCLARTY, J., delivered the opinion of the court, in which D. MICHAEL

SWINEY, C.J., and THOMAS R. FRIERSON, II, J., joined.

Rockforde D. King, Knoxville, Tennessee, for the appellants, The Hanover American

Insurance Company and The Hanover Insurance Group, Inc.

Wayne A. Ritchie, II, Knoxville, Tennessee, for the appellees, Johnson & Associates,

LLC, and Johnson Industrial, LLC.

OPINION

I. Background

Johnson & Associates, LLC, is a commercial real estate leasing and management

company that manages commercial properties owned by related entities including the

property at issue, which is located at 212 Industrial Drive in Bristol, Tennessee. Johnson

Industrial, LLC, is the related entity who owns the subject property. Johnson &

Associates and Johnson Industrial are hereafter referred to together as “Johnson.”

Johnson purchased insurance for its properties from the Hanover Insurance Group,

Inc. and the Hanover American Insurance Company (“Hanover”). The Hanover policy

covered at least 31 different properties. From 2006 through 2013, Johnson relied on

insurance agents Hyde & O’Dell Insurance Services, Inc. (“H&O”) and BB&T

Insurance Services, Inc. (“BB&T”) to obtain their coverage.

The Hanover policy was set to expire in October 2012. In November 2011, the

tenant of the property at issue moved out, leaving the building vacant. Under the policy,

“vacant” is defined as when more than a certain percentage of a property’s square footage

is not being used for “customary operations.” Once a property was “vacant” for more

than 60 days, the policy’s standard vacancy clause became effective excluding certain

coverages, including theft. Hanover issued notice to Johnson stating that coverage was

being dropped on the vacant properties upon policy renewal. Johnson represented that

full coverage including theft was desired for the upcoming year.

The parties met to discuss the future of the policy regarding the vacant properties.

This meeting included an executive with Johnson, an agent of BB&T, and David Hyde of

H&O. At the conclusion of the meeting, the Johnson executive and Mr. Hyde were

informed by the BB&T agent that Johnson would retain full coverage over the properties,

including theft. Johnson and Hanover, through their agents, went back and forth on this

policy until the renewal date. The negotiations on behalf of Hanover were conducted

primarily by BB&T insurance agent Kay Simmons. Hanover ultimately agreed to keep

the properties on the policy based on certain conditions, including higher premiums and

higher deductibles.

Mr. Hyde asked for confirmation of the coverage from Ms. Simmons, and she

affirmed that theft coverage on the subject property was provided. BB&T prepared a

revised proposal for the Hanover renewal indicating that the property would be insured as

follows:

Vacant Properties Not included in Blanket Bldg:

212 Industrial Dr., Bristol, TN

Building: $12,413,775

Actual Cash Value

Special Form Including Theft

Deductible - $10,000

The renewal policy listed the vacant properties separately instead of under the “blanket”

section, as shown above. The policy also specified that the properties had a specific

coverage limit, premium charge, and a specific deductible for “theft.” The vacant

properties were each assigned a specific “occupancy” classification. The properties were

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given the occupancy classification of “Vacant Buildings.” The theft deductible for the

two properties classified as vacant was four times higher than the theft deductible for the

properties not classified as vacant.

The coverage listed for the Industrial Drive property was “Building.” The

building coverage form provided that Hanover would pay for loss or damages resulting

from “any Covered Cause of Loss.” For the Industrial Drive property, the causes of loss

are listed as “Special,” a reference to the “Causes of Loss – Special Form.” The Special

Form stated that “Covered Causes of Loss means Risk of Direct Physical Loss unless the

loss is: 1. Excluded in Section B., Exclusions; or 2. Limited in Section C., Limitations;

that follow.” The exclusions and limitations that followed did not exclude or limit

coverage for theft. Therefore, theft was a “Covered Cause of Loss”.

The policy also included a standard vacancy clause. The clause provided Hanover

will not pay for losses resulting from certain causes, including theft, even if they are

“Covered Causes of Loss,” for a building that has been “vacant for more than 60

consecutive days” before the loss occurs. Under the policy, a building is “vacant” unless

“at least 31%” of the building’s square footage is being used “to conduct customary

operations.” The “customary operations” of the properties outside of the “blanket” were

reflected in specific use or occupancy classifications listed in the policy determinations.

The occupancy classification for the Industrial Drive property is “Vacant Buildings.”

After receiving the policy, Mr. Hyde called Ms. Simmons again to confirm that

theft coverage was being provided for the two vacant properties, including the property at

issue. Mr. Hyde asked Ms. Simmons to show him where in the policy the vacant

buildings were covered for theft. Ms. Simmons pointed him to the property being listed

as “Vacant Buildings” and that the covered cause of loss was “Special,” which includes

theft, and that there was a “Theft Deductible” for the properties of $10,000.

In September 2013, during Hanover’s 2012-2013 policy period, a theft occurred at

the Industrial Drive property, resulting in about $847,557.33 of damage. Johnson

reported the theft to Hanover in April 2014. On May 1, 2014, Hanover informed Johnson

that “the theft to your property occurred more than 60 days after a time of known

vacancy,” and consequently Hanover was denying coverage pursuant to the vacancy

clause.

In December 2014, Johnson filed suit against Hanover and BB&T. Johnson

claimed that the theft caused damage, that the Hanover policy covered the theft, and that

Hanover breached the policy by denying the payment. Johnson also asserted that BB&T

agreed to “procure a policy of full coverage commercial insurance insuring the Covered

Property against, among other risks, the risk of theft,” and that in the event the court

found that Hanover did not owe coverage, Johnson was entitled to judgment against

BB&T for negligent failure to procure insurance.

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In February 2015, Hanover removed the case to federal court based on diversity

jurisdiction. Johnson then amended its complaint by adding H&O as a defendant,

asserting a similar claim to one against BB&T. The addition of H&O as a defendant

destroyed complete diversity of citizenship between the parties, forcing the case’s return

to state court.

Hanover moved for partial summary judgment, seeking only a declaration that the

policy did not cover the loss. Hanover’s motion did not request that it be dismissed from

the case. Johnson moved for summary judgment, seeking judgment in its favor that the

policy covered the loss; that Hanover was estopped form denying coverage based on the

statements of its agent; and that, if the loss was not covered, the agents were liable for

failing to procure the insurance coverage plaintiffs requested. BB&T and H&O also filed

related motions.

The trial court granted Johnson’s motion, denied Hanover’s motion, and ruled that

BB&T’s and H&O’s motions were moot. The court found that even though Johnson’s

building had been vacant for more than 60 days, Hanover owed coverage for the theft

because:

[I]n the policy declarations, the property’s “Occupancy” is described as

“Vacant Buildings,” the covered cause of loss for the property is “Special,”

which includes coverage for theft; the policy lists a theft deductible for the

property that is higher than the theft deductibles for the properties listed on

the “blanket” portion of the policy; and the premium charged for this

property is substantially higher than the premium charged for other covered

properties.

The court also determined that “the vacancy clause applies to the numerous properties

covered by the policy that were not vacant at the time the policy was issued – properties

that could become vacant during the policy period – and not the properties classified as

‘Vacant’ in the policy itself.” The court further found that “because all parties knew

[when the policy was issued] that the property was vacant and had been vacant for some

time, the vacancy clause…is deemed waived as to [the subject] property.” Finally, the

court stated that “even if Hanover’s interpretation of the policy is reasonable, the

interpretation offered by [Johnson] is reasonable as well, which means that the policy is

ambiguous” and “must be construed against Hanover.”

The court entered judgment in Johnson’s favor for the loss and prejudgment

interest. Hanover filed a timely notice of appeal.

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II.

ISSUES

The issues raised on appeal are restated as follows:

A. Whether the trial court correctly found that the theft exclusion in the

policy’s standard vacancy clause does not apply to the particular property at

issue.

B. Whether the trial court correctly found that the application of the theft

exclusion in the policy’s standard vacancy clause to the particular property

at issue is at least ambiguous, and that any ambiguity must be strongly

construed against the insurer.

C. Whether the judgment below should be affirmed because Hanover is

estopped from denying coverage based on the statements of its agent that

Hanover was providing full coverage, including theft, for the property at

issue as a vacant property.

III. STANDARD OF REVIEW

The grant or denial of a motion for summary judgment is a matter of law;

therefore, our standard of review is de novo with no presumption of correctness. Rye v.

Women’s Care Ctr. of Memphis, MPLLC, 477 S.W.3d 235, 250 (Tenn. 2015); Dick

Broad. Co., Inc. of Tenn. v. Oak Ridge FM, Inc., 395 S.W.3d 635, 671 (Tenn. 2013)

(citing Kinsler v. Berkline LLC, 320 S.W.3d 796,799 (Tenn. 2010)). “Summary

judgment is appropriate when ‘the pleadings, depositions, answers to interrogatories, and

admissions on file, together with the affidavits, if any, show that there is no genuine issue

as to any material fact and that the moving party is entitled to a judgment as a matter of

law.’” Rye, 477 S.W.3d at 250 (quoting Tenn. R. Civ. P. 56.04). Pursuant to Rule 56.04

of the Tennessee Rules of Civil Procedure, the trial court must “state the legal grounds

upon which the court denies or grants the motion” for summary judgment, and our

Supreme Court has instructed that the trial court must state these grounds “before it

invites or requests the prevailing party to draft a proposed order.” Smith v. UHS of

Lakeside, Inc. 439 S.W.3d 303, 316 (Tenn. 2014).

Concerning the requirements for a movant to prevail on a motion for summary

judgment, our Supreme Court has explained:

We reiterate that a moving party seeking summary judgment by attacking the

nonmoving party’s evidence must do more than make a conclusory assertion that

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summary judgment is appropriate on this basis. Rather, Tennessee Rule 56.03

requires the moving party to support its motion with “a separate concise

statement of material facts as to which the moving party contends there is no

genuine issue for trial.” Tenn. R. Civ. P. 56.03. “Each fact is to be set forth in a

separate numbered paragraph and supported by a specific citation to the record.”

Id. When such a motion is made, any party opposing summary judgment must

file a response to each fact set forth by the movant in the manner provided in

Tennessee Rule 56.03. “[W]hen a motion for summary judgment is made [and]

… supported as provided in [Tennessee Rule 56],” to survive summary

judgment, the nonmoving party “may not rest upon the mere allegations or

denials of [its] pleading,” but must respond, and by affidavits or one of the other

means provided in Tennessee Rule 56, “set forth specific facts” at the summary

judgment stage “showing that there is a genuine issue for trial.” Tenn. R. Civ. P.

56.06. The nonmoving party “must do more than simply show that there is some

metaphysical doubt as to the material facts.” Matsushita Elec. Indus. Co. [v.

Zenith Radio Corp.], 475 U.S. [574,] 586 [(1986)]. The nonmoving party must

demonstrate the existence of specific facts in the record which could lead a

rational trier of fact to find in favor of the nonmoving party.

Fuller v. Banks, No. W2015-01001-COA-R3-CV, 2016 WL 409639 at *3 (Tenn. Ct.

App. Feb. 3, 2016) (quoting Rye, 477 S.W.3d at 245).

Insurance policies are contracts. Merrimack Mut. Fire. Ins. Co., 59 S.W. 3d 142,

147 (Tenn. Ct. App. 2001). Questions relating to the interpretation of written contracts

involve legal rather than factual issues. Brandt v. Bib Enters., Ltd., 986 S.W.2d 586, 592

(Tenn. Ct. App. 1998). “As such, courts interpret insurance policies using the same

tenets that guide the construction of any other contract.” Am. Justice Ins. Reciprocal v.

Hutchinson, 15 S.W.3d 811, 814 (Tenn. 2000); Hurley v. Tenn. Farmers Mut. Ins. Co.,

922 S.W.2d 887, 892 (Tenn. Ct. App. 1995). The terms of an insurance policy “must be

interpreted fairly and reasonably, giving the language its usual and ordinary meaning.

Naifeh v. Valley Forge Life Ins. Co., 204 S.W.3d 758, 768 (Tenn. 2006). The primary

rule of contract interpretation is to ascertain and give effect to the intent of the parties.”

Clark v. Sputniks, 368 S.W.3d 431, 441 (Tenn. 2012). The policy should be construed

“as a whole in a reasonable and logical manner, and the language in dispute should be

examined in the context of the entire agreement.” Martin v. Powers, 505 S.W.3d 512,

517 (Tenn. 2016) (citations and internal quotations omitted).

IV. DISCUSSION

A.

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The trial court correctly found that the theft loss is covered by the terms of the

policy. Based on the plain language of the policy, the trial court determined that the

vacancy clause did not apply to the property at issue. The court observed that there was

“no dispute, that when the policy was renewed…all parties knew that the property at

issue had been vacant for well over 60 days.” Further, the court held that applying the

vacancy clause to an already vacant property is inconsistent with well-founded principles

of law. Therefore, the court concluded that the vacancy clause does not apply to the

property that was vacant at the time of the renewal, that was insured as “Vacant

Buildings,” and there was no clause which limited the time of vacancy. We agree.

When read as a whole, the insurance policy provides theft coverage for the

property at issue. The “cardinal rule” of contract interpretation is “to ascertain and give

effect to the intention of the parties.” White v. Empire Exp., Inc., 395 S.W.3d 696, 714-

715 (Tenn. Ct. App. 2012). The purpose of vacancy clauses is “to avoid liability where

the risk has been increased by vacancy.” Providence Washington Ins. Co. v. Stanley, 403

F.2d 844, 849 (5th Cir. 1968); Couch on Ins. § 94:102. Vacancy clauses “are to be

construed in the light of conditions existing when the policy is issued.” Couch on Ins. §

94:110. When a party intends for a property to remain vacant throughout the duration of

the coverage, they can have the property “insured as vacant property.” Couch on Ins. §

94:151.

An insured party complies with a vacancy limitation “if the property insured is put

to the use contemplated by the parties, as expressed in the contract of insurance.”

Winston-Salem Fire Fighters Club, Inc. v. State Farm Fire & Cas. Co., 131 S.E.2d 430,

434 (N.C. 1963) (quoting Corlies v. Westchester Fire Ins. Co., 108 A. 152, 154 (N.J.

1918)).

There is no dispute that when the policy is read as a whole–coverage forms, cause-

of-loss forms, and declarations–the property at issue generally has theft coverage. The

issue at bar is whether the vacancy exclusion applies. When evaluating the policy as a

whole, there seems to be no reasonable basis for believing that Hanover issued the policy

only to have it immediately excluded due to the vacancy. The negotiations of the policy

were drawn out for almost a year due to these two vacant properties. Hanover charged

higher theft deductibles and premiums on the vacant properties than the occupied

properties. Insurance companies calculate the premiums and deductibles based on the

risk that a certain property poses. Therefore, the increase attempts to offset the increased

risk of the vacant property. Further, the parties knew the lots were vacant at the time the

policy was issued, and there was no clause limiting the time the property could remain

vacant. Therefore, the vacancy exception cannot apply to the previously vacant lots.

As previously noted, “vacant” is a defined term under the policy. Per the policy,

“[s]uch building is vacant unless at least 31% of its total square footage is used by the

building owner to conduct customary operations.” As a result of Johnson and Hanover’s

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negotiations, the property at issue was insured as a “vacant building.” Therefore, even if

the vacancy provision did apply to this property, the property would not be vacant under

the defined term of the policy causing no effect on the property.

Hanover argues that Johnson has previously conceded that the property was

vacant. While Johnson and H&O both previously stated that the property was vacant,

they both were using the term vacant in its dictionary sense. The Merriam-Webster

Dictionary’s relevant definition for vacant is “being without content or occupant.”

Vacant, Merriam – Webster Dictionary (2018). The building was in fact vacant under

this definition. Johnson however, never conceded that the building was vacant as defined

by the policy. Further, nothing in the record supports that the property was vacant under

the policy’s definition.

Next, the trial court’s interpretation of the policy is consistent with the rules for

interpreting insurance policies. There are three particularly important rules to the case at

hand. First, “where [an insurance] policy is issued on vacant and unoccupied property

with that knowledge and upon an agreement or with the expectation on the part of the

insurer and the insured that the property is to remain vacant, the clause against vacancy is

deemed waived.” McCaleb v. American Ins. Co., 325 S.W.2d 274, 277 (Tenn. 1959)

(quotation marks omitted). In McCaleb, the court held that the waiver of the vacancy

clause was not effective unless the provider knew the property would remain vacant for a

period beyond the duration of the policy.

Hanover knew the property was vacant and conducted extensive negotiations with

Johnson to provide coverage. Hanover conceded to allowing the vacancy by classifying

the building as a “vacant building” and by failing to include a clause requiring a tenant to

limit the vacancy. Coupled with the increased premiums and deductibles there is no

evidence to show that Hanover had reason to believe that the property would certainly be

leased within the coverage period. It would defy all logic to allow an insurance company

to knowingly insure a vacant building only to deny coverage because that building’s

occupancy status has remained constant, barring a special provision requiring occupancy

to be achieved. Because Hanover knew of this vacancy at the time of the policy’s

issuance, the vacancy clause is waived in respect to the vacant properties at that time.

Second, exclusions or limitations “are to be most strongly construed against the

insurer.” See Warfield v. Lowe, 75 S.W.3d 923, 925 (Tenn. Ct. App. 2002). However,

the court “will not give them such a forced, unnatural or unreasonable construction as

would lead to nonsense or absurdity.” Board of Trustees of the Sumner Cnty. Employees’

Trust Fund v. Graves, 1999 WL 1086454, *3 (Tenn. Ct. App. 1999). Still, “[i]t is well

settled that exceptions, exclusions and limitations in insurance policies must be construed

against the insurance company and in favor of the insured.” Allstate Ins. Co. v. Watts,

811 S.W. 2d 883, 886 (Tenn. 1991).

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In evaluating the trial court’s application of the vacancy provision, the provision

does not appear to be a “forced, unnatural, or unreasonable construction as would lead to

nonsense or absurdity.” In fact, the alternative interpretation would lead to nonsense and

absurdity. This interpretation rather seems to make the most sense. The vacancy

provision still applies to all of the insured properties, less the ones classified as “vacant

buildings.” This provision will only apply to the buildings in which it makes sense, and

not the two “vacant buildings,” in particular the building at issue.

Third, “[a]ll provisions of a contract ‘should be construed in harmony with each

other, if possible, to promote consistency and to avoid repugnancy between the various

provisions of a single contract.’” Perkins v. Metro. Gov’t of Nashville, 380 S.W.3d 73,

85 (Tenn. 2012).

When the policy is read excluding the vacancy provision from the “vacant

buildings,” the policy seems consistent. The best way to harmonize this policy is to find

that every clause has a meaning. To achieve this goal, the vacancy clause must only

apply to the buildings that were not classified as vacant buildings. Otherwise the clause

providing coverage for the vacant properties would be useless. Thus, the trial court’s

interpretation of the policy was correct.

Finally, Hanover has failed to prove that the vacancy exclusion applies to the

property at issue. “‘[A]n insurance company has the burden of proving that an exclusion

in its policy applies to a claim.’” Patterson v. Shelter Mut. Ins. Co., No. M2014-01675-

COA-R9-CV, 2015 WL 5320231, *8 (Tenn. Ct. App. Sept. 11, 2015) (quoting Mass.

Mut. Life Ins. Co. v. Jefferson, 104 S.W. 3d 13, 22 n.10 (Tenn. Ct. App. 2002)). “It is

well settled that exceptions, exclusions and limitations in insurance policies must be

construed against the insurance company and in favor of the insured.” Watts, 811 S.W.2d

at 886. See also Travelers Ins. Co. v. Aetna Casualty & Surety Co., 491 S.W. 2d 363,

367 (Tenn. 1973) (“A provision in a policy limiting or reducing coverage is to be

construed strongly against the insurer.”). Further, “[a]ny contractual provision in a policy

of insurance, made for the benefit of the insurer, not mandatory under a statute, may be

waived by an officer or agent of [the] insurer who has actual or apparent authority so to

do.” Bill Brown Constr. Co. v. Glens Falls Ins. Co., 818 S.W.2d 1, 9 (Tenn. 1991).

Hanover failed to show that the exclusion applies to the property at issue. As

noted above, Johnson was using the property for the “use contemplated by the parties.”

The purpose of the vacancy clause was to avoid an increased risk of liability caused by

vacant properties. Therefore, given the clause’s text and purpose, and the requirement

that the clause be construed against the insurer, the property at issue was not “vacant”

within the meaning of the theft exception. Even if the clause was found to be applicable,

it would not apply due to Hanover and their agents waiving the clause by affirming that

there was theft coverage on the property at issue.

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B.

At a minimum the trial court was correct in finding that the policy was at least

ambiguous and must be construed in favor of the insured. “When an ambiguity is found

in an insurance policy, it ‘must be construed strongly against the insurer and in favor of

the insured.’” Fisher v. Revell, 343 S.W.3d 776, 780 (Tenn. Ct. App. 2009). See Ryan v.

MFA Mut. Ins. Co., 610 S.W.2d 428, 436 (Tenn. Ct. App. 1980) (“Where ambiguous, the

language of an insurance contract is always construed most strongly against the insurance

company which drafts it; an insurance contract should be read to accord with the

reasonable expectations of a purchaser so far as the language permits.”). “[C]ontracts of

insurance are strictly construed in favor of the insured, and if the disputed provision is

susceptible to more than one plausible meaning, the meaning favorable to the insured

controls.” Tata v. Nichols, 848 S.W.2d 649, 650 (Tenn. 1993).

The trial court held that the exception should not apply to the property at issue.

This is not the only meaning of the clause. It would also be plausible to say that the theft

exception applied to the property at issue. Therefore an ambiguity exists that must be

interpreted in favor of the insured. When the ambiguous clause is interpreted in favor of

the insured, the theft exclusion does not apply. In conclusion, theft coverage exists on the

property at issue.

C.

Hanover is estopped from denying theft coverage for the subject property based on

the representations of its agent and “producer” BB&T. The Tennessee Supreme Court

has held that an insurance company will be estopped from denying coverage by

representations by the company’s agent that requested coverage has or will be provided,

even if there is language in the policy to the contrary. An “insurance company is

generally deemed estopped to deny policy liability on a matter arising out of the

negligence or mistake of its agent, and if either party has to suffer from an insurance

agent’s mistake, it must be the insurance company.” Allstate Ins. Co. v. Tarrant, 363

S.W.3d 508, 519-21 (Tenn. 2012) (“[A]s to the specific matter of a mistake by an

insurance agent as occurred in this case, the common law clearly dictates that the insurer

is estopped to deny coverage.”). Estoppel is particularly appropriate where “the insured

instructed his insurance agent to make a change in the insured’s insurance coverage, and

the agent made a mistake in carrying out the instruction.” Allstate, 363 S.W.3d at 522.

“An insurance producer who solicits or negotiates an application for insurance

shall be regarded, in any controversy arising from the application for insurance or any

policy issued in connection with the application between the insured or insured’s

beneficiary and the insurer, as the agent of the insurer and not the insured or insured’s

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beneficiary. This subsection (b) shall not affect the apparent authority of an agent.”

Tenn. Code Ann. § 56-6-115(b). The purpose of this statute is “to prevent an insurance

company from denying responsibility for the representations and actions of its agent from

whom an application for insurance is voluntarily accepted to protect an applicant who

relies on the such representations and actions of the insurer’s agent.” Acuity Mut. Ins.

Co. v. Frye, 699 F. Supp. 2d 975, 986 (E.D. Tenn. 2010).

Here, there is no question that BB&T was a “producer” and was acting for

Hanover. The policy before the court specifically states that Hanover insurance is sold

through agents called “Producers,” and it lists BB&T as the “Agent” for the policy.

Hanover is thus bound by BB&T’s statements in which it, more than once represented

that theft coverage would or was being provided for the subject property as a vacant

property. Additionally, BB&T’s insurance agent, Ms. Simmons, provided separate

assurance in statements made to Johnson’s agent. Therefore, Hanover would be estopped

from denying coverage following Allstate.

V. CONCLUSION

The judgment of the trial court is affirmed, and the case is remanded for such

further proceedings as may be necessary. Costs of the appeal are taxed to the appellants,

Hanover American Insurance Company and Hanover Insurance Group, Inc.

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JOHN W. MCCLARTY, JUDGE

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