Cheetham v. Southern Oak Insurance Co., 114 So. 3d 257

Cheethams filed an all-risk homeowners policy claim with Southern Oak after water damage to their home; insurer denied citing Water Damage exclusion A.3. b.
Policy provides Section I Perils Insured Against, with an exception to the deterioration rule for accidental discharge from within a plumbing system on the residence premises.
Water Damage exclusion A.3 defines water-related losses excluded, including backups through sewers or drains and water below ground; the exclusion differentiates from the plumbing-system discharge exception.
Evidence showed a pipe under the residence premises deteriorated, causing debris to block it, leading to waste water backflow into the residence.
Trial court granted a directed verdict for Southern Oak, applying the exclusion; Cheethams appealed, seeking reversal and remand.
The court ultimately held the policy was not ambiguous and that A.3.b did not apply, reversing and remanding for further proceedings.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Is the all-risk policy ambiguous regarding coverage for deterioration-caused discharge within a plumbing system and the exclusion for water damage?	Cheethams argue the exception to deterioration covers accidental discharge from within the plumbing system, making A.3.b inapplicable.	Southern Oak argues the policy language is unambiguous and A.3. Water Damage excludes the claimed loss.	Policy not ambiguous; A.3.b not applicable.
Does the exclusion apply when a pipe within the residence plumbing deteriorates and causes in-system backflow into the residence?	Cheethams contend the backflow results from deteriorated pipe inside the plumbing system, which is covered under the exception.	Southern Oak maintains the water damage exclusion covers such in-situ backflow as originating outside the plumbing system.	Loss is covered under the policy, not barred by A.3.
Should the directed verdict for the insurer be sustained given the policy interpretation?	Cheethams rely on the coverage afforded by the exception for deteriorated plumbing within the residence premises.	Southern Oak asserts the exclusion language controls and the claim falls outside coverage.	Dismissal reversed and remanded for further proceedings.

Fayad v. Clarendon Nat’l Ins. Co., 899 So.2d 1082 (Fla. 2005) (issue of whether loss comes within an exclusionary clause is a question of law)
Diaz v. Impex of Doral, Inc., 7 So.3d 591 (Fla. 3d DCA 2009) (de novo review of directed verdict on coverage questions)
State Farm Mut. Auto. Ins. Co. v. Parrish, 873 So.2d 547 (Fla. 5th DCA 2004) (interpretation of insurance contracts is a question of law)
Liberty Mut. Ins. Co. v. Weiss, 790 So.2d 475 (Fla. 3d DCA 2001) (ambiguous exclusionary clauses construed against insurer)
Old Dominion Ins. Co. v. Elysee, Inc., 601 So.2d 1245 (Fla. 1st DCA 1992) (sewer/drain meaning and location in relation to insured premises)