Anderson v. Am. Family Ins. Co.
350 F. Supp. 3d 1295
| M.D. Ga. | 2018Background
- Anderson's house suffered a covered water-loss (burst pipe, Jan 2014); AFIC paid >$146,000 for repairs. Anderson later sued claiming AFIC failed to compensate for "diminished value" (stigma) post-repair.
- Anderson sold the house in Aug 2016 for $348,000 (with minor seller concessions); there is no evidence buyers referenced the 2014 loss as affecting the sale.
- AFIC acknowledges policies cover diminished value and that insureds are entitled to an assessment, but moved for summary judgment arguing Anderson lacks admissible evidence that stigma reduced his home's market value.
- Anderson relied principally on (a) his own deposition statement that he "believes" the home lost value, and (b) expert Dr. John Kilpatrick, whom plaintiffs have used in mass-appraisal diminished-value work.
- The court found Anderson's lay statement lacked the required foundation for a causation/value opinion and that Kilpatrick offered no admissible post-repair diminished-value appraisal for Anderson (his report largely described class-methodology and a secondary 2016-sales comparison, not a reliable post-repair valuation).
- Court granted AFIC's summary judgment motion, dismissing Anderson's claims with prejudice; class-certification and Daubert motions were moot.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether insurer's duty to assess prevents resolution on the merits | Anderson says Mabry entitles him to assessment and precludes summary judgment | AFIC admits duty to assess but says assessment unnecessary if plaintiff cannot show diminished value as a matter of law | Court: Mabry does not bar deciding merits; if plaintiff lacks evidence of diminished value, no assessment is required |
| Whether Anderson produced admissible evidence that stigma diminished his home's value | Anderson points to his own testimony that he "believes" the home lost value | AFIC argues the lay statement lacks foundation and federal evidentiary standards bar it | Court: Lay testimony inadmissible for causation/value without foundation; Anderson's statement insufficient |
| Whether Kilpatrick provided a reliable, individual diminished-value opinion for Anderson | Anderson claims Kilpatrick concluded 13% post-repair diminution for the Anderson home | AFIC contends Kilpatrick's report is class-oriented, speculative, and contains no supported post-repair diminished-value appraisal for Anderson | Court: Kilpatrick did not produce a supported post-repair diminished-value appraisal for Anderson; his report discusses what he would do for a class and a secondary 2016-sales metric that he disavows as his basis—insufficient to create genuine issue |
| Whether the 2016 sale price supports diminished value at time of loss | Anderson points to a modeled ~13% gap between expected and actual 2016 sale price | AFIC argues many alternative explanations exist and Kilpatrick’s 2016 analysis is not a post-repair valuation tied to stigma at time of loss | Court: 2016 sale data, standing alone and without reliable causal analysis to Jan 2014 stigma, does not establish diminished value at time of loss |
Key Cases Cited
- State Farm Mut. Auto. Ins. Co. v. Mabry, 274 Ga. 498, 556 S.E.2d 114 (Ga. 2001) (insurer must assess diminished value when it denies coverage for that element of loss)
- Royal Capital Dev. LLC v. Md. Cas. Co., 291 Ga. 262, 728 S.E.2d 234 (Ga. 2012) (homeowners policies cover diminished value absent an effective exclusion; diminished value for fully repaired real property is "unusual")
- John Thurmond & Assocs., Inc. v. Kennedy, 284 Ga. 469, 668 S.E.2d 666 (Ga. 2008) (discussion of diminished value concept and stigma)