Wyatt v. Northwestern Mutual Insurance Co. of Seattle
| Decision Date | 07 October 1969 |
| Docket Number | No. 4-69 Civ. 186.,4-69 Civ. 186. |
| Citation | 304 F. Supp. 781 |
| Parties | Richard L. WYATT and Marie G. Wyatt, Plaintiffs, v. NORTHWESTERN MUTUAL INSURANCE CO. OF SEATTLE, Defendant and Third-Party Plaintiff, v. J. A. DANENS AND SON, INC., Third-Party Defendant and Fourth-Party Plaintiff, v. POPPLER-CARDARELLE, INC., Fourth-Party Defendant. |
| Court | U.S. District Court — District of Minnesota |
Robins, Davis & Lyons, by James L. Fetterly, Minneapolis, Minn., for plaintiffs.
Mordaunt, Walstad, Cousineau & McGuire, by Harold J. W. Sweet, Minneapolis, Minn., for defendant.
Meagher, Geer, Markham & Anderson, by Wm. Robert Nelson, Minneapolis, Minn., for third-party defendant.
Richards, Montgomery, Cobb & Bassford, by Nathan A. Cobb, Minneapolis, Minn., for fourth-party defendant.
This matter is before the court on defendant's motion for summary judgment asserting that there is no genuine issue of material fact as to the assertions made in plaintiff's complaint. Diverse citizenship and appropriate amount in controversy are present.
Plaintiffs, homeowners in Minnesota, allege that they purchased from defendant insurance company, a foreign corporation, what is known as an all risk homeowners' insurance policy; that while said policy was in force plaintiffs' home was damaged under circumstances within the coverage of the policy; that plaintiffs have suffered damage in the amount of $30,000. Defendant's answer admits the issuance of an insurance policy to plaintiffs but asserts an exclusion contained therein to the effect that the Company is not liable:
"* * * for loss caused by, resulting from, contributed to or aggravated by any earth movement, including but not limited to earthquake, landslide, mud flow, earth sinking, rising or shifting; unless loss by fire or explosion ensues, and this Company shall then be liable only for such ensuing loss * * *."
In due course after commencement of this action defendant served a third-party complaint upon J. A. Danens and Son, Inc. alleging subrogation rights and claiming that damage to plaintiffs' home, if any, was caused by the negligence of third-party defendant and/or its agents in excavating contiguous property adjacent to plaintiffs' home, thereby causing removal of lateral support and the "earth movement" which caused plaintiffs' damages. Following service of the third-party complaint, J. A. Danens and Son served a fourth-party complaint upon Poppler-Cardarelle, Inc. alleging that if there was fault or negligence or violation of an ordinance on the part of anyone, such was attributable to fourth-party defendant who employed third-party defendant to do excavating work on the contiguous property and who directed and instructed as to the manner and place of excavation. Both third-party and fourth-party defendants have filed answers herein denying culpability.
Plaintiffs take the position that the exclusionary language above quoted was designed and intended to exclude from coverage damage from natural causes and natural phenomena; i.e., earthquakes, landslides, mud flow and other similar occurrences but that where the proximate and efficient cause of damage definitely is the action of a third-party, this exclusion does not apply even though the actions of such third-party may incidentally have caused some "earth movement."
Plaintiffs assert that the reason for the insertion of the exclusionary clause above quoted in all risk insurance policies is to relieve the insurer from occasional major disasters which are almost impossible to predict and thus to insure against. There are earthquakes or floods which cause a major catastrophe and wreak damage to everyone in a large area rather than one individual policyholder. When such happens, the very basis upon which insurance companies operate is said to be destroyed. When damage is so widespread no longer can insurance companies spread the risk and offset a few or the average percentage of losses by many premiums. Looking at the special exclusionary clause in the policy here in question, it seems to cover situations where one single event could adversely affect a large number of policyholders. Besides the particular clause which is before this court the insurer also excludes floods, tidal waves, a back up of water below the surface, changes in temperature and changes in the law. All of these are phenomena likely to affect great numbers of people when th...
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