David Miles v. State Farm Fire and Casualty Company

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

DAVID MILES, et al., )

)

Plaintiffs, )

)

v. ) Case No. 2:22-cv-00152-NAD

)

STATE FARM FIRE AND )

CASUALTY COMPANY, )

)

Defendant. )

MEMORANDUM OPINION AND ORDER DENYING IN PART

DEFENDANT’S MOTION FOR SUMMARY JUDGMENT

For the reasons stated below and on the record in the August 9, 2023 motion

hearing (see minute entry, entered: 08/09/2023), the court DENIES IN PART

Defendant State Farm Fire and Casualty Company’s motion for summary judgment

(Doc. 25). See Doc. 46 (order granting in part summary judgment motion).

I. Background

Plaintiffs David and Sherri Miles filed a complaint against Defendant State

Farm, alleging two claims for relief: breach of contract (Count 1); and bad faith

(Count 2). Doc. 1-1 at 4–5. The Plaintiff Mileses’ allegations relate to an

insurance claim that they filed with State Farm after a flooding event in their home

(located in Homewood, Alabama), which began with a water leak in a second-floor

bathroom. Doc. 1-1 at 4.

The court already has granted in part State Farm’s summary judgment motion

and dismissed with prejudice the Mileses’ bad faith claim, and the following

“part[s]” of the Mileses’ breach of contract claim: any request for emotional

distress damages; any amounts attributable to upgrades to their kitchen cabinets; and

any amounts attributable to replacing the kitchen countertops. See Doc. 46 at 2;

Fed. R. Civ. P. 56(a) (“A party may move for summary judgment, identifying each

claim or defense—or the part of each claim or defense—on which summary

judgment is sought.”).

As a result, the August 9, 2023 motion hearing addressed only the parts of the

Mileses’ breach of contract claim for (1) “all amounts spent on the cabinets—less

the portions attributable to upgrades”—and (2) “damages to the home’s HVAC

ductwork,” (3) “the home’s electrical repairs,” and (4) “the home’s structural

repairs.” See Doc. 46 at 3; Doc. 41 at 2; Doc. 44 at 2. The motion hearing also

addressed State Farm’s argument for summary judgment based on the Mileses’

alleged failure to comply with their post-loss duties. See Doc. 26 at 27–30; Doc. 41

at 18–23; Doc. 44 at 12–14.

II. Discussion

Based on the record evidence and the controlling law, and construing all

evidence and reasonable inferences in the Mileses’ favor, there are genuine disputes

of material fact for a jury on the remaining parts of the Mileses’ breach of contract

claim.1

A. The Mileses’ breach of contract claim for amounts spent on the

cabinets (less the portions attributable to upgrades), damage to the

home’s HVAC ductwork, the home’s electrical repairs, and the

home’s structural repairs

There are genuine disputes of material fact for trial on the remaining parts of

Mileses’ breach of contract claim. Primarily, the parties dispute whether the

leak/flood caused the alleged damages and necessitated the relevant repairs; in this

case, that fact dispute will be for the jury. See Doc. 41 at 19–21; Doc. 44 at 3–12.

1. Damage to the cabinets

The parties do not dispute that the relevant insurance policy covered at least

some repairs to the cabinets, which the Mileses instead replaced completely. See,

e.g., Doc. 26 at 38–39; Doc. 41 at 1–2, 11, 21; Doc. 44 at 11–12. But the parties do

dispute the extent of that insurance coverage (i.e., practically speaking, the

appropriate remedy). While State Farm only covered limited repairs (see, e.g., Doc.

31-1 at 159), Mr. Miles testified in his deposition that, based on a repair quote he

1 See, e.g., Fed. R. Civ. P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 323–25

(1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986) (“Credibility

determinations, the weighing of the evidence, and the drawing of legitimate

inferences from the facts are jury functions, not those of a judge.”); Reese v. Herbert,

527 F.3d 1253, 1271 (11th Cir. 2008) (“[The] district court must not resolve factual

disputes by weighing conflicting evidence, since it is the province of the jury to

assess the probative value of the evidence.” (quoting Lane v. Celotex Corp., 782

F.2d 1526, 1528 (11th Cir. 1986)); see also United States v. Stein, 881 F.3d 853, 857

(11th Cir. 2018) (even “a litigant’s self-serving statements based on personal

knowledge or observation can defeat summary judgment”).

had received, it was more cost effective to replace the cabinets than to repair them

(Doc. 27-1 at 46–47).

In addition, William Burnham—the cabinetmaker who built the new cabinets

for the Mileses—testified in his deposition that wood in cabinets that has absorbed

water for some period of time is “never going to return back to like it was,” and

never would be as good as it was because of “swelling.” Doc. 34-6 at 4. Thus, the

Mileses have identified sufficient evidence to get to the jury on this part of their

breach of contract claim.

2. Damage to the HVAC ductwork

As noted above, the parties dispute whether the leak/flood damaged the

home’s HVAC ductwork. See Doc. 26 at 37–38; Doc. 41 at 19–20; Doc. 44 at 2,

9–11. In this regard, the record shows that there were floor air vents in the bathroom

where water from the leak could have entered into the ductwork. See, e.g., Doc. 27-

1 at 90; Doc. 28-2 at 29.

Mr. Miles testified in his deposition that, as a result of the leak, he saw water

inside the ductwork and insulation inside of the ductwork was wet. Doc. 27-1 at

23, 89–90; see Doc. 41-1.

Records from J.G. Willens Building LLC—the contractor that assessed the

house and then removed and replaced the ductwork, Doc. 27-1 at 58–59; Doc. 29-3

at 2—also stated that ductwork had to be removed on account of “filling with water

from plumbing leak located on second level.” Doc. 29-3 at 1, 5. But see Doc. 32-

1 at 38 (note in insurance case file that, during a call with a State Farm representative,

J.G. Willens stated that the ductwork was “fine,” but that Mr. Miles wanted the

ductwork removed; Willens also stated that he felt that Mr. Miles “did him wrong”).

In addition, the Mileses submitted a picture of the interior of the ductwork showing

what they assert to be mold. Doc. 41-1. Accordingly, and notwithstanding State

Farm’s evidence that water from the flooding event did not enter the ductwork (Doc.

32-1 at 38; Doc. 27-1 at 30), the Mileses have identified sufficient evidence to get

to the jury on this part of their breach of contract claim.

3. Electrical repairs

Again, the parties dispute whether the leak/flood caused damage that

necessitated the electrical repairs that the Mileses have claimed on their insurance

policy. See Doc. 26 at 36–37; Doc. 41 at 20; Doc. 44 at 7–9. Specifically, the

Mileses hired Pick Electric to rewire the house to replace wall switches and electrical

receptacles in the area affected by the flooding event; Pick Electric also removed

and replaced an electrical panel in the laundry room—outside of the flooded/affected

area—apparently to provide arc fault protection required for the new wiring. Doc.

27-1 at 36, 52; Doc. 30-4 at 12.

Mr. Miles testified in his deposition that, after the flooding event, an

electrician for J.G. Willens told him that the house would have to be rewired, and

that Rick Addington—a building inspection officer with the City of Homewood,

Doc. 35-1 at 3—told him that any wire, fixture, plug, or switch that got wet would

need to be rewired. Doc. 27-1 at 40–42, 59; see Doc. 28-2 at 30.

The record also includes a letter from Addington to the Mileses, which stated

that “[i]t is the city’s policy to have wiring, fixtures, and devices replaced entirely in

water damaged areas,” and that Homewood requires “Arc Fault protections on

circuits that are modified, replaced or extended.” Doc. 30-1 at 1; see Doc. 35-1.

In addition, a State Farm representative had advised Mr. Miles that State Farm

would consider covering “code upgrades” required by building or ordinance law.

Doc. 32-1 at 53 (“[Insured] inquired about code upgrades. Advised if code

upgrade[] is related to loss we would consider.”).

While State Farm produced evidence showing that a complete rewiring of the

flooded/affected area and a new electrical panel were not required (see Doc. 36-1 at

6–8), that factual dispute will be for the jury—i.e., the Mileses still have identified

sufficient evidence to get to the jury on this part of their breach of contract claim.

4. Structural repairs

Likewise, the parties dispute whether the leak/flood caused damage that

necessitated the structural/foundational repairs that the Mileses have claimed on

their insurance policy. See Doc. 26 at 35–36; Doc. 41 at 20–21; Doc. 44 at 3–7.

The records shows that several servicepersons had observed that water had entered

the crawlspace beneath the Mileses’ house on account of the flooding event. See

Doc. 32-6 at 12; Doc. 33-4 at 1; Doc. 32-1 at 54.

Mr. Miles testified in his deposition that before the flooding event he was able

to open a closet door that was within the flooded/affected area, but that after the

event the door would not open; Mr. Miles also noticed a “sag” in the floor near the

door after the flooding event. Doc. 27-1 at 32, 54; Doc. 28-2 at 28–29. The

Mileses hired BDry to work on structural repairs to the house after the flooding

event; an owner of BDry also noted a “sag” in the floor—confirmed with a laser

level—and testified in his deposition that water was the most common cause of

foundational issues. Doc. 34-1 at 5–6.

On the other hand, State Farm produced evidence suggesting that any

foundational issues were not caused by the flooding event. See Doc. 35-6 at 4–7.

This factual dispute also will be for the jury. The Mileses again have identified

sufficient evidence to get to the jury on this part of their breach of contract claim.

In this regard, State Farm also argues that the Mileses’ claim for structural

repairs fails because they do not have any expert testimony to support the allegation

that the flooding event caused the structural damage to the house. Doc. 44 at 3–4

& n.2. State Farm is correct that a lay witness cannot offer expert testimony on the

issue of causation. See, e.g., Ware v. Nationwide Ins. Co., No. 7:11-CV-4272-LSC,

2013 WL 1680514, at *4 (N.D. Ala. April 12, 2013); Fed. R. Evid 702. But proving

causation in an insurance case does not necessarily require expert testimony in all

cases. See, e.g., Greater Hall Temple Church of God v. Southern Mut. Church Ins.

Co., 820 F. App’x 915, 922–23 (11th Cir. 2020) (holding that the Eleventh Circuit’s

unpublished opinion in Nix v. State Farm Fire & Casualty Co., 444 F. App’x 388

(11th Cir. 2011), should not be “read as requiring expert testimony to prove

causation” where there is relevant, admissible lay testimony on the issue of

causation). Indeed, Nix and other cases support the general rule of thumb that lay

testimony can prove causation where a lay witness has sufficient personal

knowledge of the relevant damage based on personal observation. See, e.g., id.;

Nix, 444 F. App’x at 390; Southpoint Condo. Ass’n, Inc. v. Lexington Ins. Co., No.

19-CV-61365, 2020 WL 3581611, at *4 (S.D. Fla. July 1, 2020); Brown v. State

Farm Fire & Cas. Co., 342 F. Supp. 3d 1234, 1246, 1249 (N.D. Ala. 2018).

In this case, expert testimony is not required. Mr. Miles observed water in

the crawlspace on account of the flooding event, and stated in a letter that he

observed a “sag” in the kitchen floor and an inability to open a closet door on account

of the flooding event. Doc. 27-1 at 32, 54; Doc. 28-2 at 28–29. It will be for the

jury to assess this lay evidence, based on Mr. Miles’ personal observations from the

time of the flooding event (see Fed. R. Evid. 701), assess State Farm’s contrary

expert evidence, and then determine the weight and credibility of the parties’

conflicting evidence and testimony. See, e.g., Seamon v. Remington Arms Co.,

LLC, 813 F.3d 983, 988–90 (11th Cir. 2016) (“The weight to be given to admissible

expert testimony is a matter for the jury.”).

B. The Mileses’ alleged failure to comply with their post-loss duties

Nor is State Farm entitled to summary judgment based on the Mileses’ alleged

failure to comply with their post-loss duties. The relevant insurance policy required

that the Mileses had certain duties after loss, including to “cooperate with [State

Farm] in the investigation of the claim,” “protect the property from further damage

or loss,” “make reasonable and necessary temporary repairs required to protect the

property,” and “exhibit the damaged property” as “often as [State Farm] reasonably

require[s].” Doc. 27-3 at 29.

State Farm argues that Mr. Miles breached these post-loss duties by, among

other things, selling cabinets he had replaced, moving countertops outside, removing

ductwork without permission, hiring electricians to replace wiring and an electrical

panel, and hiring a company to perform structural repairs on the foundation of the

house. Doc. 26 at 28–30; Doc. 44 at 2–3; see supra Part II.A.

However, Mr. Miles testified in his deposition that a State Farm agent told

him to “do whatever it took to get [the] house dried out,” and that he proceeded

accordingly to avoid further damage. Doc. 27-1 at 42; see, e.g., Doc. 27-1 at 17,

39, 43.

State Farm again is correct that, in some cases, the court can grant summary

judgment based on an insured’s breach of post-loss duties. See, e.g., Pittman v.

State Farm Fire & Cas. Co., 868 F. Supp. 2d 1335, 1347–50 (M.D. Ala. 2012), aff’d,

519 F. App’x 656 (11th Cir. 2013). But those cases appear limited to situations

where the undisputed record evidence shows such a breach of post-loss duties. See,

e.g., Griffin v. State Farm Cas. Co., No. 5:22-CV-00332-MHH, 2023 WL 2533059,

at *2 (N.D. Ala. March 15, 2023) (“The [plaintiffs] did not appear for the scheduled

examinations under oath and did not produce the documents that State Farm

requested,” both of which were required by the post-loss duties in their insurance

policy). Here, the facts are not so clear-cut. Whether Mr. Miles’ conduct

constituted a breach of—or compliance with—his post-loss duties is a question that

will require factual determinations based on the weighing of the evidence, and that

is a question for the jury.

III. Conclusion

For the reasons stated above, Defendant State Farm’s summary judgment

motion (Doc. 25) is DENIED IN PART.

The court SETS this case for a telephone status conference on Wednesday,

September 20, 2023, at 1:00 PM. Ahead of that status conference, counsel are

ORDERED to meet and confer regarding potential case resolution and trial

scheduling.

DONE and ORDERED this September 6, 2023.

AE A. DANELLA

UNITED STATES MAGISTRATE JUDGE

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