Nationwide Agribusiness Ins. Co. v. Heidler

• Decision Date: 21 October 2019
• Docket Number: CASE NO. CA2018-07-004,CASE NO. CA2018-09-012,CASE NO. CA2018-09-015,CASE NO. CA2018-06-003
• Parties: NATIONWIDE AGRIBUSINESS INSURANCE COMPANY, et al., Appellants/Cross-Appellees, v. JONATHAN W. HEIDLER, et al., Appellees/Cross-Appellants.
• Court: Ohio Court of Appeals

2019 Ohio 4311

NATIONWIDE AGRIBUSINESS INSURANCE COMPANY, et al., Appellants/Cross-Appellees, v. JONATHAN W. HEIDLER, et al., Appellees/Cross-Appellants.

CASE NO. CA2018-06-003

CASE NO. CA2018-07-004

CASE NO. CA2018-09-012

CASE NO. CA2018-09-015

COURT OF APPEALS TWELFTH APPELLATE DISTRICT OF OHIO CLINTON COUNTY

October 21, 2019

OPINION

CIVIL APPEAL FROM CLINTON COUNTY COURT OF COMMON PLEAS

Case Nos. CVH 20140532 & CVH 16000190

Subashi, Wildermuth & Justice, Nicholas E. Subashi, Tabitha Justice, Jerome Rolfes, The Greene Town Center, 5 Chestnut Street, Suite 230, Dayton, Ohio 45440, for appellants/cross-appellees, Nationwide Agribusiness Insurance Company and Nationwide Mutual Fire Insurance Company

Lane Alton, Gregory D. Rankin, Thomas J. Keener, Eric S. Bravo, Two Miranova Place, Suite 220, Columbus, Ohio 43215, for appellees/cross-appellants Jonathan W. Heidler and Terri Jo Heidler

Dave Yost, Ohio Attorney General, Hilary R. Damaser, Jahan S. Karamali, Assistant Attorneys General, Executive Agencies Section, 30 East Broad Street, 26th Floor, Columbus, Ohio 43215, for appellee, State Fire Marshal Kemp, Schaeffer & Rowe Co., L.P.A., Michael N. Schaeffer, Richard G. Murray II, Scott N. Schaeffer, 88 W. Mound Street, Columbus, Ohio 43215, for appellee, Wilmington Savings Bank

Cincinnati Insurance Company, Daniel G. Taylor, Michael M. Neltner, 140 East Town Street, Suite 1015, Columbus, Ohio 43215, for plaintiff/intervenor, Cincinnati Insurance Company

S. POWELL, J.

{¶ 1} Appellants/cross-appellees, Nationwide Agribusiness Insurance Company and Nationwide Mutual Fire Insurance Company ("Nationwide"), and appellees/cross-appellants, Jonathan W. Heidler and Terri Jo Heidler (collectively, the "Heidlers"), appeal from a judgment entered in the Clinton County Court of Common Pleas in this declaratory judgment action arising out of Nationwide's denial of insurance coverage to the Heidlers for damage caused by a fire to the Heidlers' property located in Washington Court House, Ohio.¹ For the reasons outlined below, we dismiss the appeal with respect to Nationwide's first assignment of error for lack of a final appealable order and reverse and remand on Nationwide's second assignment of error so that the trial court may provide its basis for the amount of attorney fees awarded to the Heidlers. Nationwide's five "conditional" cross-assignments of error are also dismissed as this court's decision renders those conditioned cross-assignments of error moot. In all other respects, the trial court's judgment is affirmed.

The Insurance Policies

{¶ 2} The Heidlers own property located at 259 Plano Road in Washington Court House, Ohio. There is no dispute that Nationwide had issued a farmowners insurancepolicy to Mr. Heidler that insured the Plano Road property. There is also no dispute that Nationwide had issued an automobile insurance policy to Mr. Heidler that insured his vehicle. It is also undisputed that the Plano Road property was mortgaged to appellee, Wilmington Savings Bank, and subject to two mortgages that totaled over $1,000,000. The record indicates that the farmowners insurance policy includes $595,400 in coverage for the Heidlers' home and $416,780 in personal property coverage. Both insurance policies contained provisions that excluded coverage for losses that were caused purposely with the intent to cause the loss.

The Fire on the Heidlers' Property

{¶ 3} During the early morning hours of May 6, 2014, a fire destroyed the Heidlers' home located on their Plano Road property. The fire also destroyed Mr. Heidler's vehicle. Pursuant to the two insurance policies discussed above, the Heidlers' submitted a claim to Nationwide alleging losses resulting from the fire totaling over $1,000,000. Several months later, on November 12, 2014, Nationwide filed a complaint seeking a declaratory judgment finding the losses caused to the Heidlers' home and Mr. Heidler's vehicle were not "covered" losses under either insurance policy. Nationwide also alleged a breach of contract claim. The complaint named both the Heidlers and Wilmington Savings Bank as defendants.² The following is a summary of the facts alleged in Nationwide's complaint.

Facts Alleged in Nationwide's Complaint

{¶ 4} After receiving notice of the fire, Nationwide began a claim investigation to determine its potential liability under the two insurance policies at issue. In the course ofthis investigation, Nationwide learned that an individual named Ronald Howland had been living in a tack room in a barn on the Heidlers' property. Howland was an alleged employee of the Heidlers who had moved into the barn only a few weeks prior to the fire that destroyed the Heidlers' home. Nationwide's complaint further alleged that Mr. Heidler had known Howland for nearly 20 years and "knew that Howland had been in prison for theft-related misconduct on more than one occasion."

{¶ 5} Nationwide alleged that Howland had told investigators that he woke up to the sound of breaking glass and observed flames coming through the roof of the Heidlers' home. Nationwide alleged that Howland, upon seeing the Heidlers' home on fire, made his way to a neighboring home where Mr. Heidler's parents resided on the Plano Road property. Once there, Mr. Heidler's parents called 9-1-1. The fire department was then dispatched to the scene. The fire, however, had by that time completely engulfed the Heidlers' home destroying both the home and all of its contents within. The fire also destroyed Mr. Heidler's vehicle.

{¶ 6} The Heidler family was not at home at the time of the fire. Rather, as alleged by Nationwide in its complaint, the Heidlers' were out of town on an "anniversary trip" in Tennessee. Prior to leaving for this trip, Mr. Heidler had instructed Howland to refinish the hardwood floors in the Heidlers' home. This required the use of multiple flammable liquids, which Nationwide claimed "provided a viable explanation for why such chemicals were present in the Heidler residence at the time of the fire." Howland, however, had completed refinishing the hardwood floors several hours before the fire started. Howland had also shut off and unplugged any heaters used to dry the newly refinished floor. Therefore, according to Nationwide's complaint, Howland "has been unable to offer any explanation for how the fire could have started."

{¶ 7} Nationwide's claim investigation included the hiring of a certified fire investigator, Thomas Bensen, to determine the cause and origin of the fire. Nationwide alleged that it had also reviewed documents, including financial records, income tax returns, bank records, and cell phone records, as well as interviewed several individuals with potential knowledge of the fire as part of its claim investigation. This included Mr. Heidler. Following the conclusion of its claim investigation, and upon receiving a report from Bensen outlining his findings regarding the cause and origin of the fire, Nationwide concluded that the fire had been intentionally set by Howland.

{¶ 8} As alleged by Nationwide in its complaint, this was because:

(1) There were two "points of origin" for the fire, one in the living room area where the floors were being refinished and one in the bedroom area where items related to the refinishing were being stored. According to Nationwide's complaint, this is known to be "suspicious" in the context of fire investigations "because it shows that there were two separate fires that occurred at approximately the same time, indicating that the fire was set deliberately;"

(2) There was a distinctive "pour pattern" on the floor where the fire originated. This, as Nationwide alleged, indicates that an "accelerant" was used to start the fire; and

(3) The accelerant or flammable liquid that was used to start the fire caused "unusual fire damage below the sub-floor of the property, which could not be explained by the refinishing process."

{¶ 9} Nationwide also alleged the following in regard to the Heidlers' potential motive for setting fire to their home:

(1) The Heidlers' home and many of the rental properties Mr. Heidler owned were "substantially mortgaged;"

(2) Mr. Heidler's income from the rental properties "appears to have been equal to or less than his monthly expenses;"

(3) Financial and banking records indicate that the Heidlers"may have been living beyond their means, had little to no cash on hand, and/or were often overdrawn on their accounts;" and

(4) Mr. Heidler's admission that he was "behind on his payments to the mortgage company and that he was in a 'workout' arrangement with the bank."

{¶ 10} Nationwide further alleged the following in regard to several strange events leading up to the fire:

(1) Mr. Heidler had recently "auctioned off his prized collection of 'uninsured' guns in advance of the fire;"

(2) Mr. Heidler had also held a large garage sale just before the fire that raised more than $3,000; and

(3) Mr. Heidler had discontinued services from the previously operational working fire and security alarm system on the property.

{¶ 11} This was in addition to the fact that Mr. Heidler had been involved in a number of other fires and insurance claims prior to the fire at issue. Specifically, as Nationwide alleged in its complaint:

[Mr. Heidler] has an extensive record or history of numerous fires and insurance claims over the last 15 years, including a "total loss" insurance claim in 2004. In the 2004 incident, the residential dwelling and the nearby barn structures on the same piece of property at 259 Plano Road were completely destroyed in a fire. A prior insurance company fully compensated [Mr. Heidler] for that loss.

Proceedings After Nationwide's Filed its Complaint

{¶ 12} On December 22, 2014, the Heidlers filed an answer and counterclaim against Nationwide alleging a breach of contract and a breach of the duty to act in good faith.³ The Heidlers also alleged that Nationwide had engaged in conduct that resulted in"spoliation of evidence." Approximately three...