National Grange Mutual Insurance v. Elegant Slumming, Inc., 59 A.3d 928

Elegant Slumming, a jewelry store, sued after its insurer, National Grange Mutual Insurance Company (NGM), denied a $141,640 loss claim for missing jewelry under a property insurance policy.
Packages containing valuable jewelry arrived June 24, 2010, signed for by Killebrew and placed under the wrap desk, then allegedly not inventoried two days later.
Killebrew later testified he disposed of trash near the wrap desk, inadvertently throwing away the two boxes; the boxes have never been found.
The policy exclusion bars coverage for missing property when there is no physical evidence showing what happened to it.
The Superior Court granted Elegant Slumming summary judgment and awarded $141,640 plus $50,443.50 in attorney’s fees; NGM appeals.
The Delaware Supreme Court held that testimonial evidence alone cannot satisfy the policy’s physical-evidence requirement and that physical evidentiary items (invoices, receipts, and photographs) together with testimony show what happened, supporting coverage; there was no abuse of discretion in the attorney’s-fees award.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Does the policy require physical evidence, or is testimonial evidence alone enough?	Elegant Slumming argues there is sufficient physical evidence.	NGM contends only physical evidence satisfies the exclusion.	Testimonial alone is insufficient; physical evidence is required.
Did Elegant Slumming present adequate physical evidence beyond testimony to trigger coverage?	Elegant Slumming presented invoices, shipping receipts, and photographs showing the scene and proximity of trash.	NGM argues absence of physical evidence bars recovery.	Yes, physical evidence plus testimony shows what happened, so exclusion does not apply.
Was the attorney’s-fees award reasonable under 18 Del. C. § 4102?	Fees were reasonably incurred and properly awarded.	Fees were excessive or unsupported.	No abuse of discretion; fees are reasonable.

Westcom Corp. v. Greater New York Mut. Ins. Co., 41 A.D.3d 224 (N.Y. App. Div. 2007) (physical-evidence requirement not satisfied by mere testimony)
C.T.S.C. Boston, Inc. v. Continental Ins. Co., 25 Fed. Appx. 320 (6th Cir. 2001) (insurer must show lack of physical evidence to bar coverage)
General Motors Corp. v. Cox, 304 A.2d 55 (Del. 1973) (exclusive burden on insurer to prove exclusions apply)