North Carolina Farm Bureau Mutual Insurance v. Sadler ex rel. Sadler, 711 S.E.2d 114

Sadler owned a home in Swan Quarter, NC insured under a limited-peril Farm Bureau policy; mold damage claim denied for lack of coverage under policy; Sadler invoked appraisal provisions and designated appraisers; umpire appointed; appraisal process produced a final award of $162,500 as wind damage but Farm Bureau paid $31,561.39 (not cashed).
Farm Bureau's appraiser and the umpire concluded damages resulted from wind, water, and mold, with the appraisal award stating wind as cause; Sadler contested the award and sought court relief.
The trial court granted partial summary judgment for Sadler on breach of contract for $150,500, prompting Farm Bureau to appeal; appellate court affirmed, then Supreme Court granted discretionary review.
The policy limits and exclusions circumscribe coverage for mold and water damage, and the appraisal process is limited to amount of loss, not coverage or causation; material factual issues about causation and coverage remained unresolved.
Supreme Court reverses the appellate ruling and remands for proceedings consistent with the opinion, holding that summary judgment was improper because factual questions about wind-causation and fungi coverage must be resolved by trier of fact.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether summary judgment on breach of contract was proper	Sadler: appraisal determines loss amount; contract supports recovery	Farm Bureau: appraisal seeks loss amount; policy exclusions limit coverage	Summary judgment improper; factual issues remain
Whether the appraisal process can resolve coverage or causation	Appraisal determines loss amount within policy	Appraisal cannot interpret coverage or causation	Appraisal limited to amount of loss; coverage issues for trial court
Whether damages directly caused by wind and mold fall within policy exclusions	Wind-caused damages may be covered if within policy	Mold and related damages may be excluded or limited	Material factual questions about causation and coverage required trial court consideration

Fid. Bankers Life Ins. Co. v. Dortch, 318 N.C. 378 (N.C. 1986) (insurance policy interpretation and appraisal limits; appraisal does not determine coverage)
Thomasville Chair Co. v. United Furn. Workers of Am., 233 N.C. 46 (N.C. 1950) (appraisal scope limited to loss amount; coverage questions remain)
Markham v. Nationwide Mut. Fire Ins. Co., 125 N.C. App. 443 (N.C. App. 1997) (causation and coverage issues reserved for trial)
Wood v. Mich. Millers Mut. Fire Ins. Co., 245 N.C. 383 (N.C. 1957) (duty to instruct on legal applicability of policy terms)
Dendy v. Watkins, 288 N.C. 447 (N.C. 1975) (Rule 56 standard; necessity of factual inquiry)