Thomas Dickson v. American Bankers Insurance Co.
2014 U.S. App. LEXIS 237
| 8th Cir. | 2014Background
- Thomas and Sherri Dickson's Bismarck property was flooded in spring 2011; they spent $49,771.70 to remove flood-deposited, non‑owned debris and sought reimbursement under their Standard Flood Insurance Policy (SFIP) issued by American Bankers (a WYO insurer).
- Adjuster prepared a proof of loss form that omitted the debris‑removal claim; the Dicksons signed and submitted a sworn proof of loss asserting other damage (to house and contents) but did not include debris removal.
- American Bankers denied coverage for debris removal, pointing to the SFIP "Property Not Covered" language excluding land/trees and the "Other Coverages" provisions; it also informed the Dicksons they had one year from denial to file suit.
- Dicksons sued for a declaratory judgment that the SFIP covered removal of non‑owned debris; district court granted summary judgment to Dicksons, finding coverage and applying estoppel due to insurer misconduct.
- On appeal, the Eighth Circuit reviewed de novo, focused on SFIP's strict proof‑of‑loss requirement (condition precedent), and considered whether estoppel/affirmative misconduct could excuse noncompliance.
- The Eighth Circuit reversed: the Dicksons failed to file a proof of loss for the debris‑removal claim, and American Bankers did not engage in affirmative misconduct sufficient to bar invocation of the proof‑of‑loss defense.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the SFIP cover removal of non‑owned debris deposited on insured land? | Dickson: SFIP's "Other Coverages" language provides coverage for removal of non‑owned debris on insured property. | American Bankers: SFIP excludes land, trees, shrubs, etc.; debris removal from land is not covered. | Court did not need to decide coverage on merits because procedural bar (no proof of loss) foreclosed recovery. |
| Can insurer be estopped from enforcing SFIP's proof‑of‑loss requirement due to adjuster misconduct? | Dickson: insurer engaged in affirmative misconduct (omitted the claim from prepared proof, denial before submission, misleading statements) so estoppel applies. | American Bankers: WYO insurers are fiscal agents of the U.S.; estoppel cannot be used to force federal payment beyond appropriation; no affirmative misconduct here. | Court: estoppel unavailable; Dicksons failed to show affirmative misconduct sufficient to overcome the strict proof‑of‑loss requirement. |
Key Cases Cited
- Gunter v. Farmers Ins. Co., Inc., 736 F.3d 768 (8th Cir. 2013) (proof‑of‑loss is a strict condition precedent; amounts listed control recovery)
- Mancini v. Redland Ins. Co., 248 F.3d 729 (8th Cir. 2001) (estoppel cannot compel payment from federal treasury; proof‑of‑loss limits recovery)
- DeCosta v. Allstate Ins. Co., 730 F.3d 76 (1st Cir. 2013) (insured must file additional proof of loss to claim amounts not listed)
- Wright v. Allstate Ins. Co., 415 F.3d 384 (5th Cir. 2005) (WYO insurers' federal‑agency role limits estoppel against them)
- Gowland v. Aetna, 143 F.3d 951 (5th Cir. 1998) (similar restrictions on estoppel against WYO insurers)
- Grissom v. Liberty Mut. Fire Ins. Co., 678 F.3d 397 (5th Cir. 2012) (FEMA presumed to indemnify WYO litigation absent notice)
- Office of Pers. Mgmt. v. Richmond, 496 U.S. 414 (1990) (estoppel cannot be used to expand federal payment beyond congressional appropriation)