New Hampshire Insurance v. RRK, Inc.
230 W. Va. 52
W. Va.2012Background
- RRK owned a moored barge and two strings of docks on the Ohio River in Huntington, WV, insured under New Hampshire’s commercial marine policy.
- RRK relied on assurances from Insurance Systems (agent of New Hampshire) that the barge and contents would be covered, despite not reading the mailed policy.
- The initial 17-page fax to RRK stated coverage forms but did not list wear-and-tear exclusions or the barge/contents specifically.
- The mailed policy included a wear-and-tear exclusion not present in the fax; in 2008 RRK’s coverage was discussed and the barge was allegedly to be added, but the mailed policy again omitted the barge. A wear-and-tear exclusion remained in the mailed versions.
- Barge sank on Feb. 23, 2009; New Hampshire denied the claim on wear-and-tear grounds, RRK sued for coverage; the circuit court granted partial summary judgment finding barge/contents were covered and that renewal policy was mailed/received, but held there was a fact question on the wear-and-tear exclusion.
- On appeal, the West Virginia Supreme Court affirmed the coverage and mailing findings, reversed the wear-and-tear exclusion ruling, and remanded for proceedings consistent with the opinion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether barge and contents are covered under the policy. | RRK relied on insurer’s agent assurances creating reasonable coverage. | Exclusion terms and policy language control; wear-and-tear exclusion may preclude coverage. | Yes, barge and contents are covered under the policy as a matter of reasonable expectations. |
| Whether wear-and-tear exclusion is valid as applied to RRK. | Exclusion was not present in the pre-issuance fax; RRK reasonably relied on that version. | Wear-and-tear exclusion is conspicuous and enforceable in the mailed policy. | Summary judgment precluded; genuine fact question about the exclusion’s enforceability; remand for fact-finding. |
| Whether the renewal policy was mailed to and received by RRK. | RRK never read but received the renewal policy; deposition supports receipt. | Policy was mailed and received; read or not, receipt establishes mailing. | No genuine issue of material fact; renewal policy was mailed to and received by RRK. |
Key Cases Cited
- Keller v. First National Bank, 184 W.Va. 681 (1991) (reasonable-expectations doctrine when exclusions are conspicuous yet relied upon in error)
- Romano v. New England Mut. Life Ins. Co., 178 W.Va. 523 (1987) (promotional materials conflicting with policy; materials may govern where relied upon)
- National Mutual Ins. Co. v. McMahon & Sons, Inc., 177 W.Va. 734 (1987) (reasonable expectations doctrine for insureds regarding ambiguous terms)
- Luikart v. Valley Brook Concrete & Supply, Inc., 216 W.Va. 748 (2005) (expansion of reasonable expectations to policy representations vs. written terms)
- Potesta v. United States Fidelity & Guaranty Co., 202 W.Va. 308 (1998) (limits of reasonable-expectations doctrine in insurance)