Aetna Casualty & Surety Co. v. Yates, 21792.
| Decision Date | 30 April 1965 |
| Docket Number | No. 21792.,21792. |
| Citation | 344 F.2d 939 |
| Parties | The AETNA CASUALTY AND SURETY COMPANY, Appellant, v. Harold C. YATES and Eleanor Catherine Yates, Appellees. |
| Court | U.S. Court of Appeals — Fifth Circuit |
George Chase, Waco, Tex., Naman, Howell, Smith & Chase, Waco, Tex., for appellant.
Frank B. McGregor, Jack Woods, Waco, Tex., for appellees.
Before TUTTLE, Chief Judge, and BROWN and FRIENDLY,* Circuit Judges.
Mr. and Mrs. Yates, citizens of Texas, brought this action in a Texas court against The Aetna Casualty and Surety Co., a Connecticut corporation, to recover for damage to their home amounting to $15,900, under a Homeowners All Risk Form of property insurance issued by Aetna. The latter removed to the District Court for the Western District of Texas. The issues of coverage and of amount of damage were tried to a jury which found for Aetna on the former issue but, as instructed by the judge, also reported as to the cost of placing the house in its undamaged condition, which they determined to be $7,000. Holding that Aetna was liable as a matter of law, the court entered judgment for the plaintiffs for $7,000, plus $800 which was stipulated to be their increased living expenses during the repair of their home.
The description of the policy as "All Risk" is rather a misnomer since it contains fourteen lettered exclusions, many of these covering a considerable number of separate items. The lettered exclusions are followed by exclusions from the exclusions. Decision requires a threading of this maze.
There is little dispute as to the facts: In June, 1963, the plaintiffs discovered that the joists, sills and subflooring of their home were almost completely rotted away. The cause, as the evidence of both parties showed, was that the "crawl space" under the house was inadequately supplied with vents. Contact between air trapped in the crawl space and the subfloors and sills, which had been chilled by air conditioning, produced condensation of moisture and consequent rotting.
When plaintiffs turned to their All Risk policy, they found this disheartening exclusion:
Plaintiffs' loss could be said to be "caused" by the defective construction of the house, arguably an "inherent vice"; it was a "deterioration," although perhaps not "caused" by deterioration; it surely was caused by "rot"; the rot almost certainly had been caused by "fungi"; and "dampness of atmosphere" had produced the condition in which the fungi could grow and do their work. Undaunted by this, plaintiffs read on and took hope when they came to the following:
"* * * Exclusions i, j, and k shall not apply to ensuing loss caused by collapse of building, water damage, or breakage of glass which constitutes a part of the building, provided such losses would otherwise be covered under this policy."1
Plaintiffs say that since the loss was caused by the condensation of moist...
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