Grannemann v. Columbia Ins. Group

• Decision Date: 22 October 1996
• Docket Number: No. WD,WD
• Citation: 931 S.W.2d 502
• Parties: H. Neal GRANNEMANN, Appellant, v. COLUMBIA INSURANCE GROUP, Respondent. 52523.
• Court: Missouri Court of Appeals

Page 502

931 S.W.2d 502

H. Neal GRANNEMANN, Appellant, v. COLUMBIA INSURANCE GROUP, Respondent.

No. WD 52523.

Missouri Court of Appeals Western District.

Oct. 22, 1996.

J. Christopher Spangler, Sedalia, for appellant.

James T. Buckley, Sedalia, for respondent.

HANNA, Presiding Judge.

Plaintiff, H. Neal Grannemann, appeals from an order of the circuit court granting summary judgment in favor of Columbia Insurance Group and denying plaintiff's motion for summary judgment. The case involves rental property, which was vacant for more than 30 consecutive days before it was damaged by vandalism. The parties contest which of two exclusionary paragraphs in plaintiff's insurance policy is applicable, whether the defendant waived its right to raise the exclusionary clause that it argues denies coverage, and whether the unoccupancy exclusion of the policy was rendered inoperable by the enforcement of city ordinances requiring the insured to vacate the premises.

The parties stipulated to the underlying facts. Plaintiff owns a piece of rental property in Springfield, Missouri, which was insured by Columbia. In the fall of 1993, the City of Springfield found the property to be in violation of one or more of the city's ordinances regulating habitable structures. By a letter dated September 16, 1993, the utilities were disconnected and occupancy of the building was prohibited until the property was brought into compliance with the city's ordinances.

On January 28, 1994, while the insurance policy was in force, the property was vandalized. At that time, the repairs to the property were continuing, but not yet completed. Thus, the city had not granted permission for re-occupancy, and no person or tenant had lived on the property since September 16, 1993. During this period of time, the property was equipped with heating and cooling equipment, electrical outlets, sinks, toilets, light fixtures, a kitchen stove and a refrigerator.

Plaintiff filed a claim with Columbia for the damage caused by the vandalism to his property. Columbia denied "the vandalism claim based on the exclusion that the building was vacant more than 30 consecutive days prior to this loss." Plaintiff filed suit, and both parties moved for summary judgment. The trial court granted Columbia's motion and denied the plaintiff's motion. Plaintiff appeals.

Appellate review of the propriety of summary judgment is essentially de novo. ITT Commercial Fin. Corp. v. Mid-America Marine Supply Corp., 854 S.W.2d 371, 376 (Mo. banc 1993). The record is viewed in the light most favorable to the party against whom summary judgment was entered, and that party is afforded all reasonable inferences which may be drawn from the evidence. Id. Summary judgment will be affirmed on appeal if the reviewing court determines that no genuine issues of material fact exist and that the movant has a right to judgment as a matter of law. General Motors Corp. v. City of Kansas City, 895 S.W.2d 59, 61 (Mo.App.1995), cert. denied. 516 U.S. 909, 116 S.Ct. 277, 133 L.Ed.2d 197 (1995).

Plaintiff argues that the trial court erred in denying coverage based upon the unoccupancy exclusion because: 1) the policy specifically grants permission for unoccupancy of the building; and 2) Columbia waived and/or was estopped from raising the unoccupancy exclusion because it denied plaintiff's claim before trial solely on the basis of the "vacancy" exclusion.

The two exclusionary clauses of the insurance policy at issue provide:

CONDITIONS APPLICABLE TO SECTION I:

17. Vacancy, Unoccupancy and Increase of Hazard.

(a) This Company shall not be liable for loss occurring while a described building, whether intended for occupancy by owner or tenant is vacant beyond a period of sixty consecutive days. "Vacant" or "Vacancy" means containing no contents pertaining to operations or activities customary to occupancy of the building, but a building in process of construction shall not be deemed vacant.

(b) Permission is granted for unoccupancy.

(Emphasis added.)

SECTION I--GENERAL BUILDING FORM:

H. VANDALISM OR MALICIOUS MISCHIEF, meaning only the willful and malicious damage to or destruction of the property covered. This company shall not be liable for loss:

5. If the building(s) had been vacant or unoccupied beyond a period of 30 consecutive days immediately preceding the loss, whether or not such a period commenced prior to the inception date of this policy.

(Emphasis added.)

Section I affords property damage coverage for the property. The General Conditions Form, which provides conditions relating to both property and liability (Section II) coverage is introduced with the following language: "Additional Conditions or modifications of the following Conditions may appear in the specific coverage sections."

Plaintiff relies on paragraph 17(b), which grants permission for unoccupancy. This paragraph follows the provision which denies coverage if the premises are vacant for 60 consecutive days. He argues that this provision, which grants permission for unoccupancy, should also be applicable to the occupancy provisions of paragraph H.

Paragraph 17 of Section I, Vacancy, Unoccupancy and Increase of Hazard, states that Columbia will not be liable for loss which occurs while the insured building is vacant for a period beyond 60 consecutive days. The policy defines "vacant" or "vacancy" as "containing no contents pertaining to operations or activities customary to occupancy of the building, but a building in process of construction shall not be deemed vacant." It does not refer to or define occupancy.

This court has similarly defined "vacant" as meaning empty, without inanimate objects, deprived of contents. Alcock v. Farmers Mut. Fire Ins. Co., 591 S.W.2d 126, 128 (Mo.App.1979). A thing is vacant when there is nothing in it, when it is abandoned and not used for any purpose. Id. The stipulated facts show that the property here had a stove and refrigerator. Other than those items, the house was vacant. However, we do not decide whether a stove or refrigerator renders the property not vacant.

Paragraph 17(b) is part of the General Conditions section and relates to all losses to the insured property, which are listed as fire, lightning, windstorm or hail, explosion, smoke, aircraft or vehicles, riot and vandalism or malicious mischief. It denies coverage for all perils of the insured premises if they remain vacant for a period beyond 60 consecutive days. Conversely, coverage remains intact if the property is vacant up to 60 consecutive days, even if it is unoccupied. Paragraph 17(b) does not create an ambiguity. It is intended to make clear that unoccupancy will not deny coverage under this particular section.

The General Conditions Form is introduced by the provision that states: "[a]dditional [c]onditions or modifications of the following [c]onditions may appear in the specific coverage sections." Therefore, each specific peril insured against, including vandalism or malicious mischief, may be modified or limited in its respective, specific section. The permission allowing unoccupancy in paragraph 17 therefore is not applicable to the specific sections where the perils insured against are set forth.

The perils insured against include specific coverage for vandalism or malicious mischief. Subparagraph 5 limits coverage for such losses if the building has been vacant or unoccupied for a period of 30 consecutive days immediately prior to the loss. ¹ The term "occupancy" refers to human habitation and refers to the use of property as a customary and usual place of habitation to which return is contemplated after temporary absence. Id. (citing Bledsoe v. Farm Bureau Mut. Ins. Co., 341 S.W.2d 626 (Mo.App.1960)).

The parties have stipulated that the plaintiff's loss was occasioned by acts of vandalism, and that the property was unoccupied for more than 30 consecutive days prior to the loss. The specific coverage for vandalism and malicious mischief provides that Columbia shall not be liable in certain specific instances, one of which is if the premises have been vacant or unoccupied for a period of 30 consecutive days before the loss. In this case, the plaintiff's rental property was unoccupied on the date of loss, January 28, 1994, and had been unoccupied for over four months. The unoccupancy exclusion was properly applied to the plaintiff's claim.

The plaintiff also claims that, because Columbia denied plaintiff's original claim based on the "vaca...