North Glenn Homeowners Association v. State Farm Fire & Casualty Company, 854 N.W.2d 67

North Glenn HOA submitted a hail claim in 2009 (paid). Some damage remained unrepaired.
A March 22, 2011 storm prompted a second claim for wind and hail; State Farm inspected and concluded hail damage was from 2009 (not covered) and wind damage was below deductible.
North Glenn demanded appraisal in November 2011; State Farm agreed to appraise wind but refused appraisal of hail.
North Glenn sued for declaratory relief and breach and moved to compel appraisal; the district court ordered appraisal and the court of appeals reviewed that order.
The district court’s order compelled appraisers to evaluate the loss and, implicitly, causation; it reserved coverage questions for later judicial determination.

Issue	North Glenn's Argument	State Farm's Argument	Held
Whether the court of appeals has jurisdiction over an interlocutory appeal of the order compelling appraisal	The interlocutory appeal should be allowed because the order affects substantial rights and affects the case’s progress	The appeal is interlocutory and State Farm did not obtain supreme-court permission, so the appellate court lacks jurisdiction	Court found the order interlocutory but affecting substantial rights; granted interlocutory appeal because resolution serves justice
Whether appraisers may determine causation and whether appraisal must occur before coverage is decided	Appraisal clause requires appraisers to determine amount of loss, which necessarily includes causation; appraisal can proceed before coverage is litigated	Appraisers lack authority to decide causation/coverage; court should decide there is no covered loss and deny appraisal (and appraisal should be limited to wind only)	Appraisers may consider causation as part of determining the amount of loss; appraisal may proceed before judicial coverage determination; coverage remains judicially reviewable after appraisal

Van Sloun v. Agans Bros., Inc., 778 N.W.2d 174 (Iowa 2010) (standard of review and nature of declaratory actions)
Cent. Life Ins. Co. v. Aetna Cas. & Sur. Co., 466 N.W.2d 257 (Iowa 1991) (appraisal clauses are valid supplementary dispute mechanisms)
Quade v. Secura Ins., 814 N.W.2d 703 (Minn. 2012) (appraisal of ‘‘amount of loss’’ necessarily may include causation; coverage remains for courts)
State Farm Lloyds v. Johnson, 290 S.W.3d 886 (Tex. 2009) (appraisers must consider causation, at least initially, as part of appraisal)
Terra Indus., Inc. v. Commonwealth Ins. Co., 981 F. Supp. 581 (N.D. Iowa 1997) (where appraisal is demanded before suit, completion of appraisal can be a precondition to further suit)