Dennis Probus v. Allstate Insurance Co. D/B/A Allstate Indemnity Co., 2020 CA 001067

Dennis and Rebecca Probus owned a vacation residence insured by Allstate and visited in Sept. 2018; they left the water on (not running).
On Nov. 7, 2018, Mr. Probus discovered extensive water and mold damage and traced the source to a cracked plastic nut on a toilet water-supply line that was spraying water.
The Probuses reported the claim to Allstate in mid-November 2018; an Allstate adjuster inspected the property on Jan. 14, 2019 and denied coverage.
The Probuses sued Allstate on Dec. 12, 2019, alleging breach of contract and improper investigation/handling.
Allstate moved for summary judgment, arguing the policy excludes loss from continuous or repeated seepage/leakage "over a period of weeks, months, or years" and separately excludes mold unless it is the direct result of a covered water loss.
The trial court granted summary judgment for Allstate; the Court of Appeals affirmed, concluding the record showed water intrusion for a period of weeks and therefore the water and attendant mold damages were excluded.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the timing of discovery (Nov. 1 v. Nov. 7) creates a material fact as to whether the water intrusion occurred "over a period of weeks."	Probus: billing record and discovery timing create a factual dispute that water intrusion may have been less than "weeks," so exclusion may not apply.	Allstate: deposition shows water had been present "four weeks or better," so timing dispute is immaterial.	Held: Immaterial — record shows water intrusion lasted weeks; exclusion applies.
Whether the efficient/proximate cause of damage was a discrete rupture (covered) or a "leak/seepage" (excluded).	Probus: damage resulted from a discrete rupture of a plastic nut releasing water, not ongoing seepage; therefore loss should be covered.	Allstate: the escape of water from the cracked nut produced continuous leakage that fits the policy's seepage/leakage exclusion; contract interpretation is legal.	Held: Court treats the event as a leak/seepage under ordinary meaning; exclusion applies as a matter of law.
Whether mold remediation is covered despite the mold exclusion.	Probus: mold was the direct and proximate result of the rupture and so should be covered.	Allstate: policy excludes mold generally and only covers mold remediation when it follows a covered water loss; here the underlying water loss is excluded.	Held: Mold remediation not covered because mold resulted from a non-covered water loss.

Reynolds v. Travelers Indem. Co. of Am., 233 S.W.3d 197 (Ky. App. 2007) (interpreting "period of weeks, months, or years" exclusion for water leakage).
Smith v. Higgins, 819 S.W.2d 710 (Ky. 1991) (cited by appellants but dealt with MVRA and was distinguished).
Kemper Nat’l Ins. Cos. v. Heaven Hill Distilleries, Inc., 82 S.W.3d 869 (Ky. 2002) (ambiguities in coverage exclusions are construed against the insurer).
Nelson v. Ecklar, 588 S.W.3d 872 (Ky. App. 2019) (contract construction reviewed de novo).
Motorists Mut. Ins. Co. v. RSJ, Inc., 926 S.W.2d 679 (Ky. App. 1996) (ambiguous insurance exclusions resolved in favor of insured).