PORTLAND, Ore. (Legal Newsline) - The Oregon Supreme Court has reversed the judgment of two lower courts in a case that questions the definition of a "roof" within the context of a homeowner's insurance policy.
Plaintiffs Beth and Tim Dewsnup say they sustained losses due to water damage while their roof was undergoing repair. Although their insurance policy generally excludes coverage for water damage, they contended that an exception to that exclusion applied.
The trial court ruled otherwise on the Farmer's Insurance Company of Oregon's motion for summary judgment, and the Oregon Court of Appeals affirmed.
The appeals court reasoned that the exception to the water damage exclusion did not apply because, at the time of the loss, the Dewsnups' roof was not a "roof" within the meaning of the policy.
In particular, the court held that a "roof," by its ordinary definition, is permanent, and because the plaintiffs' roof was undergoing repair at the time of the loss, no permanent roof was in place to which the exception could apply.
The plaintiff, Tim Dewsnup, is a contractor and took it upon himself to repair the roof.
But on the first night of the roof repair project, a storm came through the area. Rising winds caused part of the polyethylene sheeting to loosen and eventually blow away.
The man tried to replace the sheeting but, in doing so, fell off of the house, taking one or more of the plastic sheets with him to the ground and injuring himself.
Because he was injured and unable to secure the sheets over the now-exposed areas of the plywood sublayer, rain began to enter the home through the joints in the sublayer.
The rain caused water damage to the plaintiffs' personal property inside the home, for which plaintiffs filed an insurance claim. Farmers denied the claim on the ground that water damage was excluded under the Dewsnups' policy.
The plaintiffs then filed a lawsuit in the trial court, alleging breach of contract. In response, Farmers moved for summary judgment, claiming that the plaintiffs' insurance policy excluded loss resulting from water damage.
The defendant reasoned that water damage is generally excluded except when a windstorm or hail creates an opening in a roof. The insurance company contended that because the polyethylene "tarp" was not a "roof," the policy did not cover the Dewsnups' water damage.
The trial court granted the defendant's summary judgment motion. Rather than doing so on the grounds set forth by the defendant, the court interpreted the plaintiffs' insurance policy to cover only the "dwelling" described in the policy declarations; that is, a dwelling of "frame" construction with a "wood shingle or shake" roof.
According to the trial court, at the moment plaintiffs removed the wood shakes, the building was no longer the "dwelling" insured under the policy. As a result, coverage was not merely excluded under the circumstances; coverage simply did not exist. The trial court accordingly entered judgment in Farmers' favor.
However, the appeals court rejected the trial court's conclusion that, by removing the wood shakes, the entire structure was no longer insured under the policy. The court reasoned that no plausible interpretation of the insurance policy supported such a conclusion.
The appeals court further reasoned that the policy declarations should not be construed as "condition(s) of coverage."
Nevertheless, the appeals court affirmed the trial court's judgment, holding that "in no reasonable sense would the sheet of plastic constitute (a) roof."
Justice Rives Kistler, who authored the Court's opinion, said because the appeals court found its definition of "roof" dispositive, it did not address the defendant's alternative grounds for affirming the trial court's grant of summary judgment.
The insurance company argues that a "roof," by its plain meaning, must be permanent.
The Court disagreed in its opinion filed late last week, "No roof is permanent. When a roof is sufficiently durable to serve the functional purposes described above, it is still a 'roof' within the ordinary understanding of that term, even if it is not necessarily permanent."
A roof, it said, should be sufficiently durable to meet its intended purpose: to cover and protect a building against weather-related risks that reasonably may be anticipated.
The remaining issue, Kistler wrote, is whether no reasonable trier of fact could find that the plaintiffs' roof came within that definition.
The record showed that the plaintiffs' "roof," at the time of the storm, did not solely consist of a plastic tarp, as the insurance company argued. Rather, it consisted of a plywood sublayer, a thick polyethylene covering, and a system of staples, roof tacks and wooden bats to secure the roof components in place.
Also, in the plaintiffs' expert's opinion, the polyethylene sheeting was secured to the plywood sublayer in such a way that it "would have been adequate to protect the home for one or two years if necessary..."
The expert further described the roof construction as "functionally permanent."
The Court wrote, "Taking that evidence as true, as we must on review of defendant's motion for summary judgment, we conclude that a reasonable trier of fact could find that plaintiffs' roof was sufficiently durable to meet its intended purpose, which was to provide protection from the elements while plaintiffs undertook the roof repair work that the policy expressly authorized."
The defendant's remaining arguments can be reduced to "factual disagreements" with the plaintiffs' expert's opinion, the Court said.
The Court, in its decision, ordered that the case be remanded to the circuit court for further proceedings.
"We conclude that the trial court erred when it granted defendant's motion for summary judgment. It goes without saying that, on remand, the question whether plaintiffs' roof constituted a roof within the meaning of the policy will present a factual issue for the jury," Kistler wrote.
"The same is true of the question whether the workmanship was either faulty or defective. We hold only that, on this record, the grounds that defendant has raised do not provide a basis for granting summary judgment in its favor."
From Legal Newsline: Reach Jessica Karmasek by e-mail at email@example.com.