Eaglestein v. Pacific Nat. Fire Ins. Co.

• Decision Date: 03 February 1964
• Docket Number: No. 23920,23920
• Citation: 377 S.W.2d 540
• Parties: Max A. EAGLESTEIN and Mildred Eaglestein, Appellants, v. PACIFIC NATIONAL FIRE INSURANCE COMPANY, a Corporation, Respondent.
• Court: Missouri Court of Appeals

Page 540

377 S.W.2d 540

Max A. EAGLESTEIN and Mildred Eaglestein, Appellants, v. PACIFIC NATIONAL FIRE INSURANCE COMPANY, a Corporation, Respondent.

No. 23920.

Kansas City Court of Appeals, Missouri.

Feb. 3, 1964.

Terrance W. Imes, Kansas City, for appellants.

Knipmeyer, McCann & Millett, Glenn E. McCann and Joseph H. Moore, Kansas City, for respondent.

MAUGHMER, Commissioner.

This is a suit on an insurance policy covering a dwelling house. The facts are not in substantial dispute and only one question is presented by the appeal. Plaintiffs had a verdict for $3,000. The court set aside the verdict and entered judgment for the defendants. Plaintiffs have appealed.

Max A. and Mildred Eaglestein, plaintiffs, were owners of a one-family dwelling house located at 1244 West 64th Street Terrace, Kansas City, Missouri. It is undisputed that Pacific National Insurance Company, defendant, carried the insurance coverage on the property, which was in full force and effect from May 1, 1957 until May 1, 1960.

We set out the two particularly pertinent provisions of the policy, the construction and application of which are required by this lawsuit and will be decisive as to the result:

'SECTION I--COVERAGE.

'THIS POLICY INSURES AGAINST ALL RISKS OF PHYSICAL LOSS EXCEPT AS HEREINAFTER EXCLUDED, to the described property, subject to the provisions of this form and of the policy to which this form is attached including endorsements thereon.

'SECTION II--EXCLUSIONS

'THIS POLICY DOES NOT INSURE AGAINST LOSS----

'(A) By termites or other insects; wear and tear, deterioration; smog; smoke from agricultural smudging or industrial operations; rust, wet or dry rot; mould; mechanical break-down; settling, cracking, shrinkage, or expansion of pavements, foundations, walls, floor, or ceilings; unless loss by fire, smoke (other than smoke from agricultural smudging or industrial operations), explosion, landslide, collapse, water damage, or glass breakage ensues, and this Company shall then be liable only for such ensuing loss.' (Italics added).

It is plaintiffs' contention that their evidence shows there was a 'collapse' of the walls within the meaning of the policy prior to May 1, 1960, and the court erred in setting aside the verdict and entering judgment for defendant company. It is defendant's position that plaintiffs' evidence shows not a 'collapse', but rather a 'settling, cracking, shrinkage or expansion' of the foundation and walls which type of casualty is specifically exempted from coverage and therefore the court properly entered judgment for defendant and against plaintiffs.

The defendnat offered no evidence at the trial. We review and summarize the evidence as presented by plaintiffs. The insured dwelling was built in 1953-54. It is one-story ranch type with full basement and attached garage. The front is stone and brick veneer and the other sides frame construction. Mr. Eaglestein said that in 1956 he observed a 'little settlement' on the southwest and on part of the north side of the house. He employed the Kniepfel Construction Company to underpin the house on three sides and said they 'bored for piers about every four or five feet, filled them with concrete reinforced with steel, we leveled the house up completely and sat the house back down on these new footings which was supported by piers'. He stated that early in April, 1960, he noticed both vertical and horizontal cracks in the north and west walls. Mr. Kniepfel came again and these walls were shored up with heavy timbers. Mr. Eaglestein testified that the bulges from these cracks kept increasing, the concrete blocks began cracking and dirt came in through the cracks and on the floor. He called the insurance company. An adjuster came but the company did not accept or assume liability. In the fall of 1960, the cracks became wider and were variously described as being one-eighth or one-fourth inch in width. (The policy lapsed May 1, 1960). In March, 1961 plaintiffs employed the Bell Construction Company to repair these walls. Bell's bid for this job was $3,260, which plaintiffs paid.

Mr. Leon Maslan, who qualified as an architect and engineer, testified. He described the soil in Kansas City as predominantly clay strata. He said that during and immediately after the drought years of 1956-57, 'we had a considerable amount of damage to houses and small buildings in Kansas City due to settlement which was actually a result of this clay subsoil shrinking from the lack of water. * * * Then the rains come and it expands and shrinks again as it dries'. Mr. Maslan said plaintiffs' dwelling was built on this clay soil. He examined plaintiffs' house in April, 1960, and found horizontal cracks in the 'joints of the blocks' in the southwest corner and in the north wall on the west side. He was unable to determine if the walls were broken clear through. He said that once a concrete block wall is cracked it will not heal itself, that if not repaired the situation will become progressively worse 'until the upper portion slides off of the bottom portion and then it will collapse'. It was Mr. Maslan's opinion that the walls here bulged inward because of hydrostatic pressure which he defined as 'pressure which is caused by the presence of water'.

Plaintiffs' legal position on appeal, as we understand it, is not that there was an actual de facto collapse, but rather, as stated by their counsel in his opening statement 'there was a condition of impending collapse'. The policy covered and insured against 'collapse' but squarely excluded 'settling, cracking, shrinkage or expansion of pavement, foundations, walls, floor or ceilings'. Plaintiff insist that these two provisions are inconsistent, each with the other, and are ambiguous. They then ask us to apply the well known rule of construction that when one provision, or two or more provisions of an insurance contract are reasonably susceptible of two meanings, preference will be given to the interpretation most favorable to the insured. They urge further that where there is an ambiguity, judicial construction will grant, rather than deny, coverage. There is no doubt that such is the law. Giokaris v. Kincaid, Mo., 331 S.W.2d 633, 639, 86 A.L.R.2d 925; Utchen v. American Casualty Co. of Reading, Pennsylvania, Mo.App., 356 S.W.2d 102, 104. However, it is also true, absent ambiguities or phraseology reasonably susceptible of different interpretations or meanings, that courts should enforce the plain provisions of contracts, including contracts of insurance. Winston v. Hartford Fire Ins. Co., Mo.App., 317 S.W.2d 23, 26. As stated in 44 C.J.S. Insurance Sec. 290 p. 1139, 'The courts may resort to construction, in the usual sense, of a contract of insurance only when the language of the contract, in its ordinary meaning, is indefinite, ambiguous, or equivocal'.

Counsel for both sides state that the appellate courts of Missouri have never ruled on the precise question here presented and we find no such rulings. Our courts have not considered the applicability of a 'collapse' provision in an insurance policy under a state of facts similar to those before us. Appellate courts in other jurisdictions have considered the question and have reached almost completely opposite conclusions.

In Jenkins v. United States Fire Ins. Co., 185 Kan. 665, 347 P.2d 417, the policy insured against 14. 'Collapse of building(s) or any part thereof'. There was an exemption 'For loss caused directly or indirectly by earthquake, backing up of sewers or drains, or by flood, * * *'. It will be noted these policy provisions are somewhat different from ours where 'settling, cracking, shrinkage or expansion' are specifically excluded. However, in the Kansas case the evidence showed a 'settling, cracking and breaking' of the walls. The Kansas court said the 'basic issue involved was whether appellant could recover for an alleged settling, cracking and breaking of the wall * * * of the basement of a dwelling insured under * * * a policy * * * insuring her against all direct loss to the property caused by 'collapse of building(s) or any part thereof.'' The court reversed a judgment for defendant and remanded for new trial, saying:

'Boiled down and stripped of all excess verbiage the gist of appellee's position on this point is that there was no coverage under the collapse clause of the policy until the basement walls fell into a flattened wreck or distorted state.

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'* * * we believe the clause 'collapse of building or any part thereof' as used in the involved insurance contract is to be interpreted as comprehending that, if brought about by unusual and extraordinary circumstances which the parties to that agreement could not normally expect or foresee on the date of its execution, the settling, falling, cracking, bulging or breaking of the insured building or any part thereof in such manner as to materially impair the basic structure or substantial integrity of the building is to be...