Urse v. Maryland Casualty Co.

• Decision Date: 16 February 1945
• Docket Number: Civ. A. No. 27-P.
• Court: U.S. District Court — Northern District of West Virginia
• Parties: URSE et al. v. MARYLAND CASUALTY CO.

58 F. Supp. 897

URSE et al. v. MARYLAND CASUALTY CO.

Civ. A. No. 27-P.

District Court, N. D. West Virginia.

February 16, 1945.

Ward Lanham, of Fairmont, W. Va., for plaintiff.

C. Brooks Deveny, of Fairmont, W. Va., for defendant.

HARRY E. WATKINS, District Judge.

John Urse, Joseph Morrone and William Reese, plaintiffs, are owners of Eastland Bowling Lanes, in Fairmont, West Virginia. They carried an insurance policy with Maryland Casualty Company, defendant, insuring their bowling alley against certain types of water damage. Suit was instituted in the state court by plaintiffs on this insurance policy to recover $13,000 damages, and by reason of diversity of citizenship, the action was removed to this court, where it was tried by the court in lieu of a jury. Defendant claims that the loss is not covered by the insurance policy. On this single issue the case has been submitted for decision upon the policy of insurance and the following agreed statement of facts.

"On Sunday, June 7, 1942, about 7:00 o'clock p.m., William Reese, one of the plaintiffs in this action, closed the Eastland Bowling Lanes for the purpose of taking the boys who were employed at the bowling alley for a ride, returning about 8:00 p.m. While he was away from the bowling alley there was an unusually and extremely hard storm, which was in the nature of a cloudburst, during which about two inches of rain fell. When Reese returned he found about eight or nine inches of rain in the bowling alley.

"The Eastland Bowling Lanes is located in the basement of the Eastland Theater Building, which is situated on Morgantown Avenue in the City of Fairmont, Marion County, West Virginia; the land on which the building is located is several feet below the level of Morgantown Avenue and is lower than the surrounding property; the land to the rear and east of the property slopes toward the Eastland Bowling Lanes for a distance of several hundred feet, causing the water which fell in this rain to flow into the low point surrounding the Eastland building; that the surface drains or storm sewers which are located about 40 feet to the rear of the building were not sufficient in size to carry away this water, consequently a large pool of water collected on both sides of the building, at a depth of 26 to 28 inches above the ground level.

"The water from this pool entered the inside of the building by seepage through the cement block walls and around the basement walls and doors, which were warped; and the water was bubbling up and running out of the commode in the women's rest room.

"None of the underground water supply mains or Fire Hydrants were broken or damaged at the time.

"It is understood that the plaintiffs and the defendant are not, by this agreement as to facts, agreeing as to the amount of damage done, and it is agreed that evidence of the amount of damage will be submitted to the Court by all parties, if necessary."

Among other things, the policy insures the bowling alley against "all direct loss and damage caused solely by the accidental discharge, leakage or overflow of water or steam from within the following source or sources: * * * rain or snow admitted directly to the interior of the building through defective roofs, leaders or spouting, or by open or defective doors, windows, show windows, sky-lights, transoms or ventilators", except as otherwise provided in the policy.

First, defendant says that the damage was not caused by rain admitted directly to the interior of the building through defective roofs, leaders or spouting, or by open or defective doors, windows, show windows, sky-lights, transoms, or ventilators, but was from a pool of water which had accumulated around the building; that the damage was caused solely by accumulated surface water entering the building by seepage through the cement basement walls, the doors, and by backing up through the commode; that a large pool of water in the low point surrounding the building is not one of the "sources" enumerated in the policy; and that the intent is clear that the water must originate from some defective appliance or installation as a source of rain admitted directly to the interior of the building. Water damage is defined in the policy as "the accidental discharge, leakage or overflow of water, * * * rain * * * from systems, tanks, appliances and parts of buildings insured against as sources of loss * * *". Defendant cites the case of Poole v. Sun Underwriters Ins. Co., 1937, 65 S.D. 422, 274 N.W. 658, 660, wherein the court said: "To us it is quite clear that the heavy rain which fell, after it reached the ground, was no longer rain, but became water and falls within the classification of waters which is known as surface water, and therefore under the terms of the policy the damage caused to the automobile was included under paragraph C-3, as defined by paragraph K, which covers the peril known as `water damage.'"

Secondly, defendant says that if the court should hold that the water came from a source covered by the policy, then the loss is specifically excluded by the following provision in the policy: "This company shall not be liable for loss or damage caused directly or indirectly, (a) by seepage, leakage or influx of water through building walls, foundations, lowest basement floors, sidewalks or sidewalk lights; or (b) by floods, inundation, backing up of sewers or drains, or the influx of tide, rising or surface waters; * * *".

Since the insurance contract was made in West Virginia we first look to the courts of that state for the law on this subject. We find that the Supreme Court of Appeals of West Virginia has clearly stated the general rule of construction of insurance contracts as follows: "In numerous cases, this Court has adopted and maintained as a cardinal rule of construction that clauses in insurance contracts should be construed liberally to the insured. (Citing numerous cases.) This rule of...