Murray v. Auto-Owners Ins. Co.
2015 Ohio 3295
Ohio Ct. App.2015Background
- James T. Murray purchased a single-family home insured by Auto-Owners; tenants (the Doughtys) occupied it under a land contract from May 2010 and vacated in November 2011. Murray obtained the Auto-Owners policy after purchase.
- After tenants vacated, Murray discovered basement water intrusion at the north foundation wall; excavation revealed a fractured footing drain tile plugged with mud. Contractor Kevon Aldridge repaired/cleaned the tile and opined on likely causes (manufacturing defect, inadequate installation, or earlier heavy-equipment damage).
- Murray sued Auto-Owners claiming coverage for tile damage, ensuing water damage, and other tenant-caused malicious damage. Parties filed cross-motions for summary judgment; trial court granted Auto-Owners summary judgment on all claims.
- Trial court grounds: (1) tile fracture predated Murray’s ownership / policy period (so loss did not occur during policy), (2) policy exclusion for water below ground (subsurface water) bars coverage for basement seepage, and (3) exclusion for faulty/inadequate maintenance bars losses from failure to discover/repair preexisting tile damage.
- On appeal, the Sixth District affirmed in part and reversed in part: it affirmed summary judgment as to tile damage and subsurface water claims, but reversed and remanded as to Murray’s claims alleging tenant misconduct unrelated to the tile/water damage (those claims survive for further proceedings).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Auto-Owners waived or improperly raised a new ground for summary judgment in its reply (loss occurred before policy) | Murray: new argument in reply was improper and should be barred; it was not pleaded as an affirmative defense | Auto-Owners: argument relied on record evidence (Aldridge affidavit filed by Murray); proof a loss must occur in the policy period is element of plaintiff’s claim, not an affirmative defense | Court: No prejudice; Auto-Owners could rely on record evidence; argument permissible; assignment not well-taken |
| Whether the drainage-tile damage (and resulting loss) occurred before policy period | Murray: disputed timing; contractor opinion uncertain as to absolute timing; some damage could have occurred later or from tenant conduct | Auto-Owners: Aldridge’s inspection/opinion supports conclusion damage preexisted Murray’s ownership and thus predated policy period | Court: Reasonable minds can only conclude tile damage predated Murray’s purchase; Murray failed to produce specific contrary facts; summary judgment affirmed on this point |
| Whether subsurface water exclusion bars coverage for basement seepage and water damage (including vandalism/malicious mischief claims) | Murray: part of water damage resulted from tenants’ malicious or negligent failure to notify/mitigate, so some coverage should remain | Auto-Owners: policy unambiguously excludes water below the surface for Coverages A, B, C; exclusion applies even where vandalism/malicious mischief is listed as a covered peril | Court: Exclusion is clear and unambiguous; subsurface water damage excluded under A, B, and C including malicious-mischief variant under C; summary judgment for insurer affirmed on water seepage claims |
| Whether claims for tenant misconduct unrelated to the tile/water damage survive | Murray: tenant misconduct caused other damage (e.g., removal of fence, removal of range knobs) and should be adjudicated | Auto-Owners: argued all asserted losses derived from excluded tile/subsurface water damage | Court: Plaintiff alleged some tenant-conduct claims wholly unrelated to tile/water damage; those claims were reversed and remanded for further proceedings (but cannot recover for damages that are directly/indirectly from tile/subsurface water damage) |
Key Cases Cited
- Grafton v. Ohio Edison Co., 77 Ohio St.3d 102 (standard of review for summary judgment is de novo)
- Dresher v. Burt, 75 Ohio St.3d 280 (party moving for summary judgment bears initial burden; nonmoving party must produce specific facts)
- Kelly v. Med. Life Ins. Co., 31 Ohio St.3d 130 (insurance contracts construed as whole; plain meaning controls)
- Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216 (ambiguous policy language construed against insurer; clear language controls)
- Lane v. Grange Mut. Cos., 45 Ohio St.3d 63 (policies susceptible to more than one interpretation construed in favor of insured)
- Chicago Title Ins. Co. v. Huntington Natl. Bank, 87 Ohio St.3d 270 (insured bears burden to prove coverage and loss under policy)