Bradley v. Allstate Ins. Co.
| Decision Date | 20 September 2010 |
| Docket Number | No. 09-30035.,09-30035. |
| Citation | 620 F.3d 509 |
| Parties | Felton BRADLEY; Lucille Bradley, Plaintiffs-Appellants, v. ALLSTATE INSURANCE COMPANY, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Fifth Circuit |
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Paul C. Miniclier (argued), Hoy Robert Hughes, Jeanne Louis O'Boyle, Law Office of Paul C. Miniclier, New Orleans, LA, for Plaintiff-Appellants.
James L. Donovan, Jr., Donovan & Lawler, Metairie, LA, Richard L. Fenton (argued), Sonnenschein, Nath & Rosenthal, L.L.P., Chicago, IL, for Defendant-Appellee.
Appeal from the United States District Court for the Eastern District of Louisiana.
ON PETITION FOR PANEL REHEARING AND PETITION FOR REHEARING EN BANC.
Before HIGGINBOTHAM and STEWART, Circuit Judges, and ENGELHARDT * , District Judge.
The original opinion in this case was issued by the panel on May 11, 2010. No active judge of this court having requested a poll (Fed. R.App. P. 35; 5th Cir. R. 35), the petition for rehearing en banc is DENIED. The petition for panel rehearing is GRANTED to the extent that we VACATE our previous opinion (606 F.3d 215 (5th Cir.2010)) and replace it with the following. In all other respects, the petition for panel rehearing is DENIED.
OPINIONThis appeal involves an insurance dispute arising from the total destruction of Felton and Lucille Bradley's home as a result of flood and wind damage suffered during Hurricane Katrina. The Bradleys' homeowners policy with Allstate Insurance Company carried a dwelling limit of $105,600. The Bradleys have received $105,139.06 in total insurance payments for their dwelling-$41,339.06 under their Allstate homeowners policy and $63,800 from their flood insurance policy. The Bradleys filed suit against Allstate, alleging that they were entitled to the full limits under their homeowners policy and additional payments for loss of personal property, additional living expenses, mental and physical distress, and Allstate's bad faith. The district court determined that, despite the total loss provision of the homeowners policy, the Bradleys were only entitled to the actual cash value of their home. The district court found that the actual cash value of the home prior to its destruction was less than the total amount they received under their homeowners and flood policies, and any further recovery by the Bradleys would amount to a double recovery. The district court further held that the Bradleys had not advanced any evidence in support of their other claims. The district court awarded the Bradleys some relief as to additional living expenses, but granted summary judgment in favor of Allstate on all other claims. We AFFIRM in part and VACATE and REMAND in part.
This appeal presents the following issues: (1) whether the total loss or actual cash value provision of the policy controls; (2) the proper definition of actual cash value under Louisiana law; (3) how to determine whether the insured has received a double recovery, i.e., collected insurance proceeds in excess of actual losses; and (4) whether the district court erred by granting summary judgment on the Bradleys' claims for loss of personal property, additional living expenses, mental and physical distress, and bad faith.
Prior to Hurricane Katrina, the Bradleys owned and resided at a house located at 2637 Tennessee Street, New Orleans, Louisiana. The property was insured under a homeowners policy issued by Allstate and a separate flood policy issued by Fidelity National Insurance Company. Like many homeowners policies, the Bradleys' homeowners policy specifically excluded flood damage. The homeowners policy contained coverage limits of $105,600 for the dwelling, $73,920 for the contents, and $10,560 for other structures.
Hurricane Katrina destroyed the Bradleys' home in August 2005. A few badly damaged concrete blocks were the only structural component of the house left on the property. The Bradleys notified Allstate of their loss and filed a claim on September 1, 2005. Allstate first sent an engineer to inspect and adjust the loss on December 22, 2005. The engineer's report concluded that “the structure has been destroyed from a combination of hurricane winds and flooding.” On two later occasions, Allstate again sent engineers to adjust the claim. On January 5, 2006, one of those Allstate adjusters concluded that “the dwelling is unlivable due to Catastrophic Wind Damage.”
Allstate ultimately paid $41,339.06 for structural damage and $10,632 for contents under the homeowners policy. From their flood insurance, the Bradleys received the policy limits of $63,800 for structural damage and $6,200 for home contents. Thus, the total payment to the Bradleys for structural damage to their home under both policies was $105,139.06.
Allstate subsequently performed a retroactive analysis that appraised the pre-storm market value of the Bradleys' home at $85,000. At deposition, Mr. Bradley testified that the pre-storm value of the home was between $85,000 and $95,000, and Mrs. Bradley testified that the pre-storm value was in the neighborhood of $97,000. An expert hired by the Bradleys estimated the cost to rebuild the home at $265,427.
To date, the Bradleys have not rebuilt their Tennessee Street house, although Mr. Bradley stated at deposition that he intends to rebuild. In order to benefit from government assistance through the Road Home program, the Bradleys attested that they will rebuild and return to the property. The Bradleys did purchase another home in New Orleans East for $134,500, but they have not designated that home as a replacement property.
On May 30, 2007, the Bradleys filed suit against Allstate in Louisiana state court; Allstate removed the case to federal court based upon diversity jurisdiction. The Bradleys claimed that Allstate breached the insurance contract, acted negligently, and acted in bad faith. They further alleged that under the Louisiana's Value Policy Law (VPL), they were entitled to the full policy limits from Allstate, without deduction or offset. The complaint specifically sought to recover: (1) the policy limits under their homeowners insurance, because their home was rendered a total loss; (2) additional recovery for loss of their personal property; (3) additional living expenses (ALE); (4) compensation for mental anguish and emotional distress related to Allstate's handling of their homeowners claim for structural damage; and (5) damages for Allstate's alleged bad faith pursuant to La.Rev.Stat. §§ 22:1220 and 22:658. 1
Through a series of orders addressing multiple motions for partial summary judgment, motions to reconsider, motions in limine, and sua sponte granting summary judgment, the district court awarded the Bradleys an amount less than they claimed for ALE and granted summary judgment in favor of Allstate on all other claims. The court held that the Bradleys were only entitled to the actual cash value (ACV) of their home, which was less than the amount they received under their homeowners and flood policies combined. On the VPL claims, the court found that although the Bradleys “allege that the property was damaged by wind and flood and that the home is a total loss, there is no allegation that the total loss was caused by wind or any other peril covered under the homeowners policy.” The court also dismissed the Bradleys' claims for loss of personal property for failure to introduce evidence of ownership or the value of the items claimed. The mental and emotional distress claims were rejected for failure to advance any evidence of mental anguish or emotional distress. With regard to the Bradleys' bad faith claims, the court found that Allstate had fully paid the Bradleys' claims under the policy and therefore there was no “valid, underlying, substantive claim.”
The Bradleys filed this appeal, arguing that the district court erred in granting summary judgment. The Bradleys contend that summary judgment was improper because: (1) the district court ignored the plain language of the insurance contract providing for the payment of policy limits in the event of a total loss; (2) used the wrong measure of value to determine their scope of recovery; (3) improperly allowed Allstate to offset its payments with the Bradleys' recovery from their flood insurance; (4) failed to consider the weight of the evidence regarding lost personal property and ALE; and (5) wrongly dismissed the Bradleys' bad faith, mental anguish, and emotional distress claims.
“This court reviews a district court's grant of summary judgment de novo.” Breaux v. Halliburton Energy Servs., 562 F.3d 358, 364 (5th Cir.2009). We also review de novo the district court's interpretation of state law and give no deference to its determinations of state law issues. See Salve Regina Coll. v. Russell, 499 U.S. 225, 239-40, 111 S.Ct. 1217, 113 L.Ed.2d 190 (1991). Summary judgment is appropriate when “the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to a judgment as a matter of law.” Fed.R.Civ.P. 56(c). All the facts and evidence must be taken in the light most favorable to the non-movant. Breaux, 562 F.3d at 364.
Summary judgment is also proper if the party opposing the motion fails to establish an essential element of his case. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The non-moving party must do more than simply deny the allegations raised by the moving party. See Donaghey v. Ocean Drilling & Exploration Co., 974 F.2d 646, 649 (5th Cir.1992). Rather, the nonmovant must come forward with competent evidence, such as affidavits or depositions, to buttress his claims. Id.
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