Bates v. Phenix Mut. Fire Ins. Co.

Decision Date13 February 2008
Docket NumberNo. 2007–177.,2007–177.
Citation943 A.2d 750,156 N.H. 719
CourtNew Hampshire Supreme Court
Parties Joseph BATES v. PHENIX MUTUAL FIRE INSURANCE COMPANY.

Bragdon & Berkson, P.C., of Keene (H. Neil Berkson and Kelly E. Dowd, on the brief, and Mr. Berkson orally), for the plaintiff.

Aten Clayton & Eaton, PLLC, of Littleton (Keith Aten, on the brief and orally), for the defendant.

BRODERICK, C.J.

The plaintiff, Joseph Bates, appeals an order of the Superior Court (Arnold, J.) granting summary judgment to the defendant, Phenix Mutual Fire Insurance Company (Phenix Mutual). We affirm.

The following facts are undisputed. Route 123 is a state route that descends into the center of Alstead. Warren Brook runs parallel to Route 123 in this section. Cooper Hill Road runs perpendicular to, and connects to, Route 123. Cooper Hill Road runs over Warren Brook, with Warren Brook passing under the road by way of a culvert.

In October 2005, southwestern New Hampshire experienced unprecedented rainfalls within a short period of time. When the heavy rains fell, the increased volume in Warren Brook overwhelmed the culvert at Cooper Hill Road, and the area immediately uphill from the road filled with an extraordinary volume of water. The elevated Cooper Hill Road began to act as a temporary dam, holding back increasing amounts of water. The water eventually burst through the road near the area of the culvert, releasing a surge of water into the downstream valley. This surge of water damaged the plaintiff's real and personal property located on Forest Road.

The plaintiff's properties were insured by Phenix Mutual. Phenix Mutual denied coverage under the policy and the plaintiff brought a declaratory judgment action, asserting that the damage to his properties was "directly caused by the explosion of the road and that the explosion occurred as a result of the pressure of water." Phenix Mutual moved for summary judgment, arguing that the policy precludes coverage because the loss was proximately caused by flood, not by explosion. The plaintiff filed a cross-motion for summary judgment. The trial court granted Phenix Mutual's summary judgment motion, ruling that the collapse of the road was not an "explosion," and, regardless of whether the term "explosion" applies to the facts of this case, the damage to the plaintiff's property was caused entirely by water, an excluded cause, and was not proximately caused by the "explosion."

On appeal, the plaintiff argues that the trial court erred: (1) in holding that the failure of the roadway was not an explosion under the provisions of the policy; (2) in finding that the loss was not subject to the ensuing loss provision; and (3) in finding that the water exclusion in the insurance policy applied to his loss.

"In reviewing a grant of summary judgment, we look at the affidavits and other evidence, and all inferences properly drawn therefrom, in the light most favorable to the non-moving party." Palmer v. Nan King Restaurant, 147 N.H. 681, 682–83, 798 A.2d 583 (2002). "If our review of that evidence discloses no genuine issue of material fact, and if the moving party is entitled to judgment as a matter of law, we will affirm the grant of summary judgment." Id. at 683, 798 A.2d 583. "We consider a disputed fact ‘material’ for purposes of summary judgment if it affects the outcome of the litigation under the applicable substantive law." Id. "Our review of the trial court's application of the law to the facts is de novo ." Id.

Under the insurance policy, Phenix Mutual agreed to pay for certain enumerated "covered causes of loss." The policy defines "explosion," a covered cause of loss, as

including the explosion of gases or fuel within the furnace of any fired vessel or within the flues or passages through which the gases of combustion pass. This cause of loss does not include loss or damage by:
a. Rupture, bursting or operation of pressure relief devices; or
b. Rupture or bursting due to expansion or swelling of the contents of any building or structure, caused by or resulting from water.

Under "exclusions," the policy states:

1. We will not pay for loss or damage caused directly or indirectly by any of the following. Such loss or damage is excluded regardless of any other cause or event that contributes concurrently or in any sequence to the loss.
....
g. Water
(1) Flood, surface water, waves, tides, tidal waves, overflow of any body of water, or their spray, all whether driven by wind or not;
(2) Mudslide or mudflow;
(3) Water that backs up or overflows from a sewer, drain or sump; or
(4) Water under the ground surface pressing on, or flowing or seeping through:
(a) Foundations, walls, floors or paved surfaces;
(b) Basements, whether paved or not; or
(c) Doors, windows or other openings.
But if Water, as described in g. (1) through (4) above, results in fire, explosion or sprinkler leakage, we will pay for the loss or damage caused by that fire, explosion or sprinkler leakage.

"The interpretation of insurance policy language is a question of law for this court to decide. The fundamental goal of interpreting an insurance policy, as in all contracts, is to carry out the intent of the contracting parties. To discern the parties' intent, we first examine the language of the contract itself." Tech–Built 153 v. Va. Surety Co., 153 N.H. 371, 373, 898 A.2d 1007 (2006) (quotation and citations omitted). "In interpreting policy language, we look to the plain and ordinary meaning of the policy's words in context. We construe the terms of the policy as would a reasonable person in the position of the insured based upon more than a casual reading of the policy as a whole." Broom v. Continental Cas. Co., 152 N.H. 749, 753, 887 A.2d 1128 (2005) (citation omitted). "Policy terms are construed objectively, and where the terms of a policy are clear and unambiguous, we accord the language its natural and ordinary meaning. We need not examine the parties' reasonable expectations of coverage when a policy is clear and unambiguous; absent ambiguity, our search for the parties' intent is limited to the words of the policy." Oliva v. Vt. Mut. Ins. Co., 150 N.H. 563, 566, 842 A.2d...

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