The Supreme Court of Delaware has decided that the Superior court properly granted summary judgment to an insurer regarding a collapsed pedestrian bridge located at a homeowners' residence because the earth movement exclusion in the homeowners' insurance policy unambiguously applied to the bridge and because the anticoncurrent causation clause contained in the policy also applied. The case is Monzo v. Nationwide Prop. & Cas. Ins. Co., No. 199, 2020, 2021 Del. LEXIS 100 (Mar. 11, 2021)
In 2011, Eric and Dana Monzo purchased a homeowners insurance policy issued by Nationwide Property & Casualty Co. (Nationwide). The policy contained standard water damage and earth movement exclusion with the option of water backup coverage. At the time of the purchase, Nationwide hired a company to do an inspection of the property. The report described the property including two pedestrian bridges crossing a stream. After reviewing the report, Nationwide required the Monzos to sign a document acknowledging that they did not purchase flood insurance. The Monzos signed the document, but were under the impression that the election applied only to the buildings on the property and not other structures on the property.
July 2017 brought heavy storms, including one thunderstorm which destroyed a pedestrian bridge and retaining wall on the Monzo's property, near their residence. A pair of reports prepared after the storm indicated that several factors contributed to the damage, including water backups from drainage systems, scouring of supporting earth embankments, heavy rain, and tree debris. The property owners filed a claim with Nationwide, seeking coverage under their homeowner's policy.
Nationwide denied coverage for the damage, and the Monzos filed suit in the Delaware Superior Court. Nationwide filed for summary judgment, arguing that the policy excluded coverage for water damage and earth movement and there was no disputing that both of those excluded perils contributed to the loss. Nationwide also argued that coverage did not apply because the policy contained an Anti-Concurrent Causation Clause that would defeat coverage if excluded and covered perils combined to cause the loss. The court granted summary judgment for Nationwide, holding that the earth movement and water damage exclusions in the policy applied to the damage. The Monzos argued that discovery was incomplete, and that summary judgment was inappropriate because there were disputed facts about whether the policy covered the claim. The court granted Nationwide's motion for summary judgment.
The Monzos appealed, arguing that the Superior Court erred by granting summary judgment too early in the discovery process, misinterpreting the property insurance policy, and denying a motion for postjudgment relief.
The Court here affirmed the Superior Court's holding that Nationwide was entitled to summary judgment regarding the collapsed bridge, reversed the holding that Nationwide was entitled to summary judgment in the matter of the retaining wall, and affirmed the denial of the postjudgment motion.
Editor's Note: The acknowledgement that the Monzos signed in this case included a note that stated "Everyone lives in a flood zone – it is just a question of whether you live in a low, moderate, or high risk area. Nearly 25 percent of all flood claims are for properties located in lower-risk flood areas or those property locations where flooding is not expected. With climate change increasing the severity of storms and continuing to change the scope of flood zones, we can expect to see more and more claims in locations that were not previously considered flood zones.