IN THE CIRCUIT COURT OF RAY COUNTY, MISSOURI AT RICHMOND
FILED MAY 17 2004
ARNOLD D. RARDON and CAROLE RARDON
1589 Southeast Price Drive Polo, Missouri 64671,
Plaintiffs,
v.
FARMBUREAU INSURANCE COMPANY,
Serve: Scott Lakin Director of Insurance Room 530
301 West High Street Jefferson City, MO 65101 Defendant,
Case No. 04cv103594)
CAROLINE CONNER RAY CO. CIRCUIT CLERK
PETITION
COME NOW plaintiffs Arnold D. Rardon and Carole Rardon and for their petition against defendant Farm Bureau Insurance Company state as follows:
1. Plaintiffs are residents of Caldwell County, Missouri.
2. Defendant is and was at all times herein mentioned a foreign insurance company with its home office in Des Moines, Iowa, but doing business and authorized to sue and be sued in the State of Missouri. Defendant maintains an office for its usual and customary business in Richmond, Ray County, Missouri.
On or about March 15, 2003, for and in consideration of a stipulated premium, defendant issued a policy of insurance to plaintiffs with a policy period of twelve (12) months which provided that:
A. Defendant would pay plaintiffs up to a limit of One Hundred Thousand Dollars ($100,000) for the loss or damage to their residence directly or indirectly caused by water which had escaped from plumbing, and
B. Defendant would pay plaintiffs up to a limit of Seventy-Five Thousand Dollars ($75,000) for loss or damage to plaintiffs' personal property directly or indirectly caused by water which had escaped from plumbing, and
C. Defendant would pay plaintiffs for up to twelve (12) months of additional living expenses occasioned by a covered loss.
3. A true and correct copy of said insurance policy is incorporated herein and made a part hereof by reference.
4. Said policy of insurance was continuously in full force and effect from the time of its issuance to the date of said occurrence.
5. That on or about May 11, 2003, plaintiffs suffered a loss and damage to their residence and their personal property directly and indirectly as a result of water which had escaped from a broken water line in their residence.
6. Plaintiffs in all respects complied with the terms and conditions of the above-described policy, and on or about the 22nd day of September, 2003, submitted their proof of loss to defendant for the above-described loss to their residence and damage to their personal property.
7. Under the terms and provisions of the policy defendant became obligated to pay plaintiffs for the loss sixty (60) days after plaintiffs submitted their proof ofloss, to-wit: on November 22, 2003, but defendant has failed and refused and still fails and refuses to pay plaintiffs despite plaintiffs' demand.
8. Since defendant became obligated to pay plaintiffs on November 22, 2003, plaintiffs are entitled to interest on said amount at the rate of nine percent (9%) per annum from and after November 22,2003.
9. That as a result of the loss to plaintiffs' residence and personal property plaintiffs were forced to move from their residence and incur additional living expenses.
10. That as a result of defendant's delay and denial of plaintiffs' claim plaintiffs' resi.dence and property has further deteriorated as a result of the loss.
11. Defendant's refusal to pay the loss sustained by plaintiffs is vexatious and without reasonable cause or excuse and is in violation of the provisions of said policy of insurance; thus plaintiffs are entitled to damages in the amount of twenty percent (20%) of the first One Thousand Five Hundred Dollars ($1,500) due and owing plaintiffs and ten percent (10%) of the remaining amount due and owing plaintiffs plus a reasonable attorney's fee.
WHEREFORE, plaintiffs pray judgment against defendant:
1. In the amount of plaintiffs' loss to their residence and personal property and the amount of their additional living expenses,
2. For interest on plaintiffs' demand of September 22, 2003, at the rate of nine percent (9%) per annum from November 22,2003,
3. For vexatious penalties of twenty percent (20%) of the first One Thousand Five Hundred Dollars ($1,500) ofthe amount due and owing plaintiffs and ten percent (10%) of the remaining amount due and owing plaintiffs,
4. For a reasonable attorney's fee, and
5. For their costs herein expended, and for such further relief as may be just
FARRELL D. HOCKEMEIER, ATTORNEY FOR PLAINTIFFS
(DEFENDANT FARM BUREAUS RESPONSE AND COUNTERCLAIM -10 pages)
IN THE CIRCUIT COURT OF RAY COUNTY, MISSOURI AT RICHMOND Case No. 04CVl03594
Plaintiff,
ARNOLD D. RARDON and CAROLE RARDON, VS.
FARM BUREAU TOWN AND COUNTRY INSURANCE COMPANY OF MISSOURI
Defendant.
DEFENDANT'S ANSWER TO PLAINTIFFS' FIRST AMENDED PETITION AND COUNTERCLAIM FOR DECLARATORY JUDGMENT:
COMES NOW Defendant Farm Bureau Town and Country Insurance Company of
Missouri, by and through its undersigned counsel, and hereby submits its Answers to Plaintiffs'
First Amended Petition, to-wit:
1. Defendant admits the allegations set forth in Paragraph 1 of Plaintiffs' First Amended Petition.
2. Defendant admits the allegations set forth in Paragraph 2 of Plaintiffs' First Amended Petition.
3. Defendant denies the allegations set forth in Paragraph 3 of Plaintiffs' First Amended Petition, including each and every subpart thereof.
4. Defendant lacks sufficient information and knowledge to either admit or deny the allegations set forth in Paragraph 4 of Plaintiffs' First Amended Petition, and therefore denies the same.
5. Defendant denies the allegations set forth in Paragraph 5 of Plaintiffs' First Amended Petition.
6. Defendant lacks sufficient information and knowledge to either admit or deny the
allegations set forth in Paragraph 6 of Plaintiffs' First Amended Petition, and therefore denies the same.
7. Defendant denies the allegations set forth in Paragraph 7 of Plaintiffs' First Amended Petition.
8. Defendant denies the allegations set forth in Paragraph 8 of Plaintiffs' First Amended Petition.
9. Defendant denies the allegations set forth in Paragraph 9 of Plaintiffs' First Amended Petition.
10. Defendant denies the allegations set forth in Paragraph 10 of Plaintiffs' First Amended Petition.
11. Defendant denies the allegations set forth in Paragraph 11 of Plaintiffs' First Amended Petition.
12. Defendant denies the allegations set forth in Paragraph 12 of Plaintiffs' First Amended Petition.
13. Except as hereinbefore specifically and expressly admitted, Defendant denies all allegations of Plaintiffs' First Amended Petition.
AFFIRMATIVE DEFENSES
14. In further answer and by way of affirmative defense, Defendant states that Plaintiffs have failed to state a claim upon which relief can be granted against Defendant, and should therefore be dismissed.
15. In further answer and by way of affirmative defense, Defendant states that Plaintiffs are barred from recovery herein against Defendant in that all necessary precedent terms and conditions of the subject insurance policy have not been fulfilled by Plaintiffs.
16. In further answer and by way of affirmative defense, Defendant states that there is no coverage under the subject insurance policy for the alleged loss and damages caused by mold because such loss and damages are excluded by the following policy language:
GENERAL EXCLUSIONS - APPLICABLE TO ALL LEVELS OF PROTECTION
We will not pay for loss or damage caused directly or indirectly by any of the following. Such loss or damage is excluded regardless or any other causes or events that contribute concurrently or in any other sequence to the loss.
1. Wear and tear; marring or scratching; deterioration, inherent vice; latent or inherent defect; mechanical breakdown; rust; mold; wet or dry rot; contamination, or the actual, alleged, or threatened discharge, dispersal, seepage, migration, release, or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids, or gases, waste materials, or other irritants, contaminants, or pollutants into or upon the land, the atmosphere, any water course or body of water, or a dwelling or other structure; smog; smoke from agricultural smudging or industrial operations; setting, cracking, shrinkage, bulging, or expansion of pavement, patios, foundations, walls, floors, ceilings, or swimming pools; birds, vermin, rodents, insects, or domestic or wild animals.
If because of any of these, water escapes from a plumbing, heating, or airconditioning system or household appliance, we cover loss caused by the water. We also cover the cost of tearing out and replacing any part of a dwelling or other structure necessary to repair the system or appliance. We do not cover loss to the system or appliance from which this water escaped.
3. Continuous or repeated seepage or leakage of water or steam, which is obvious and or visible, from within a plumbing, heating, or air-conditioning system or from within a household appliance which occurs over a period of weeks, months, or years.
10. Neglect of any insured to use all reasonable means to protect covered property at and after the time of loss or when property is threatened by an insured peril.
Also:
This policy does not cover any loss otherwise excluded regardless of whether one or more of the following directly or indirectly cause, contribute to, or aggravate the loss; or occur before, at the same time, or after the loss of any other cause of the loss:
1. Conduct, act, failure to act, or decision of any person, group, organization, or governmental body whether intentional, wrongful, negligent, or without fault.
2. Defect, weakness, inadequacy, fault, or unsoundness in:
b. Design, specifications, workmanship, construction, grading compaction.
c. Materials used in construction or repair, or
d. Maintenance of any property (including land, structures, or improvements of any kind) whether on or off the insured premises.
However, coverage is provided for loss resulting from items (1.) and (2.) unless the resulting loss is itself a loss not insured by this policy.
17. In further answer and by way of affirmative defense, Defendant states that there is no coverage under the subject insurance policy for the alleged loss and damages caused by the mold because Plaintiffs failed to comply with the conditions of the subject insurance policy, as set forth in the following policy language:
CONDITIONS - SECTION I
1. WHAT YOU MUST IN CASE OF LOSS If a covered loss occurs the insured must:
a. Give us immediate written notice. In case of theft, also notify the police.
In case of Credit Card, Fund Transfer Card, and Check Forgery Coverage, also notify the issuer of the card or bank.
b: Protect the property from further damage, making necessary and reasonable repairs to protect the property, and keep records of the cost of repairs.
d. Send to us, within 60 days after loss, the above list and a proof of loss signed and sworn to by the insured, including:
(1) The time and cause ofloss.
(2) The interest of the insured and all other in the property. (3) All debts or liens on the property.
(4) Other policies covering the loss.
(5) Changes in title, use, occupancy, or possession of the property, and (6) If required, any plans and specifications of the damaged dwelling, or other structures or fixtures.
18. In further answer and by way of affirmative defense, Defendant states that Plaintiffs are barred from recovery herein against Defendant in that Plaintiffs have failed to mitigate their damages.
19. In further answer and by way of affirmative defense, Defendant states that Plaintiffs' claims should be barred because of the doctrines of waiver and estoppel.
20. In further answer and by way of affirmative defense, Defendant states that if Plaintiffs were injured and/or damaged as alleged, which is specifically denied, then the same was directly caused or was directly contributed to be caused by the fault of Plaintiffs, whose fault should be compared.
21. In further answer and by way of affirmative defense, Defendant hereby reserves and does not waive its right to assert any other defenses or rights it may have under the subject insurance policy or in law or in equity.
22. In further answer and by way of affirmative defense, Defendant hereby reserves
the right to assert any additional defenses that may be learned through the course of discovery.
WHEREFORE, having fully answered and pled its affirmative defenses to Plaintiffs' First Amended Petition, Defendant prays that all claims pending against Defendant in Plaintiffs' First Amended Petition be dismissed with costs to Plaintiffs, and for such other and further relief as this Court deems just and proper under the circumstances.
DEFENDANT'S COUNTERCLAIM FOR DECLARATORY JUDGMENT
COMES NOW Defendant Farm Bureau Town and Country Insurance Company of Missouri, by and through undersigned counsel, and for its Counterclaim for Declaratory Judgment does hereby state:
1. Defendant incorporates by reference the allegations of Paragraphs 1 and 2 of
Plaintiffs' First Amended Petition as though fully set forth herein.
2. Jurisdiction and venue are proper in this Court.
3. An actual controversy exists between Plaintiffs and Defendant and pursuant to Rule 87 of the Missouri Rules of Civil Procedure, this Court has the power to declare the rights and obligations of the parties, to adjudicate the final rights of all parties, and to give such other and further relief as may be necessary and proper.
4. Defendant issued to Plaintiffs a policy of homeowners insurance (number PRO
0014680) with effective dates of March 15,2003 to March 15,2004 which covered specified losses to Plaintiffs' residence (hereinafter the "Policy"). A true and accurate copy of the Policy is attached hereto as Exhibit A.
5. Prior to May 11, 2003, Plaintiffs noticed mold on one of the walls at the back of cabinets located in the kitchen of their residence (hereinafter the "Mold").
6. Prior to May 11, 2003, Plaintiffs scrubbed and bleached the Mold.
7. At all relevant times, to the extent that the Mold was visible, it was only visible when the kitchen cabinet doors were open.
8. On or about May 11, 2003, Plaintiffs noticed a water leak in the shower located in a bathroom of their residence (hereinafter the "Leak"). 9. The bathroom where the Leak was is located directly next to the kitchen where the Mold was.
10. On June 11,2003, Defendant received notice from Plaintiffs of the Leak. Plaintiffs provided no notice of the Mold.
11. On June 12, 2003, Melvin Hicks, one of Defendant's claim adjustors, went to Plaintiffs' residence to inspect the Leak. Mr. Hicks believed that the Leak resulted from the failure of the cement which held two pipes together.
12. During Mr. Hicks' inspection, Plaintiffs made no mention or reference to the Mold and Mr. Hicks conducted no inspection in the kitchen.
13. On June 16, 2003, Mr. Hicks issued payment in the amount of $439.18, such sum representing the cost of repairing the damaged area of the bathroom caused by the Leak, exclusive of the cost of repairing the pipe. Plaintiffs refused such payment.
14. Plaintiffs first advised Defendant ofthe Mold on June 25, 2003.
15. Plaintiffs moved out oftheir residence in late June 2003 and their residence has been
unoccupied since.
16. On September 19, 2003, Plaintiffs provided a Proof of Loss to Defendant whereby
they sought insurance benefits under the Policy for damages caused by the Leak and Mold.
17. Since being notified of the claim, Defendant has investigated the claim.
18. There is no coverage under the Policy for the loss and damages allegedly caused by the Mold because such loss and damages are excluded by the following language set forth in the Policy:
GENERAL EXCLUSIONS - APPLICABLE TO ALL LEVELS OF PROTECTION
We will not pay for loss or damage caused directly or indirectly by any of the following. Such loss or damage is excluded regardless or any other causes or events that contribute concurrently or in any other sequence to the loss.
1. Wear and tear; marring or scratching; deterioration, inherent vice; latent or inherent defect; mechanical breakdown; rust; mold; wet or dry rot; contamination, or the actual, alleged, or threatened discharge, dispersal, seepage, migration, release, or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids, or gases, waste materials, or other irritants, contaminants, or pollutants into or upon the land, the atmosphere, any water course or body of water, or a dwelling or other structure; smog; smoke from agricultural smudging or industrial operations; setting, cracking, shrinkage, bulging, or expansion of pavement, patios, foundations, walls, floors, ceilings, or swimming pools; birds, vermin, rodents, insects, or domestic or wild animals.
If because of any of these, water escapes from a plumbing, heating, or airconditioning system or household appliance, we cover loss caused by the water. We also cover the cost of tearing out and replacing any part of a dwelling or other structure necessary to repair the system or appliance. We do not cover loss to the system or appliance from which this water escaped.
3. Continuous or repeated seepage or leakage of water or steam, which is obvious and or visible, from within a plumbing, heating, or air-conditioning system or from within a household appliance which occurs over a period of weeks, months, or years.
10. Neglect of any insured to use all reasonable means to protect covered property at and after the time of loss or when property is threatened by an insured peril.
Also:
This policy does not cover any loss otherwise excluded regardless of whether one or more of the following directly or indirectly cause, contribute to, or aggravate the loss; or occur before, at the same time, or after the loss of any other cause of the loss:
1. Conduct, act, failure to act, or decision of any person, group, organization, or governmental body whether intentional, wrongful, negligent, or without fault.
2. Defect, weakness, inadequacy, fault, or unsoundness in:
b. Design, specifications, workmanship, construction, grading compaction.
c. Materials used in construction or repair, or
d. Maintenance of any property (including land, structures, or improvements of any kind) whether on or off the insured premises. However, coverage is provided for loss resulting from items (1.) and (2.) unless the resulting loss is itself a loss not insured by this policy.
19. There is no coverage under the Policy for the loss and damages allegedly caused
by the Mold because Plaintiffs failed to comply with the conditions as set forth in the following
language of the Policy:
CONDITIONS - SECTION I
1. WHAT YOU MUST IN CASE OF LOSS If a covered loss occurs the insured must:
a. Give us immediate written notice. In case of theft, also notify the police. In case of Credit Card, Fund Transfer Card, and Check Forgery Coverage, also notify the issuer of the card or bank.
b. Protect the property from further damage, making necessary and reasonable repairs to protect the property, and keep records of the cost of repairs.
d. Send to us, within 60 days after loss, the above list and a proof of loss signed and sworn to by the insured, including:
(1) The time and cause ofloss.
(2) The interest of the insured and all other in the property. (3) All debts or liens on the property.
(4) Other policies covering the loss.
(5) Changes in title, use, occupancy, or possession ofthe property, and (6) If required, any plans and specifications of the damaged dwelling, or other structures or fixtures.
20. Defendant has complied with all necessary precedent terms and conditions of the Policy.
21. Defendant is reserving and preserving any and all rights and defenses under the
Policy or in the law or in equity.
WHEREFORE, Defendant prays as follows on its Counterclaim for Declaratory Judgment:
(a) that this Court determine and adjudicate the rights and obligations of the parties hereto and find and adjudicate that Plaintiffs are not entitled to coverage under the Policy for their claim for alleged loss and damages caused by the Mold because their claim is specifically excluded under one or more of the General Exclusions of the Policy which are specifically set forth in Defendant's Counterclaim for Declaratory Judgment;
(b) that this Court determine and adjudicate the rights and obligations of the parties hereto and find and adjudicate that Plaintiffs are not entitled to coverage under the Policy for their claim for alleged loss and damages caused by the Mold because Plaintiffs failed to comply with the Conditions of the Policy which are specifically set forth in Defendant's Counterclaim for Declaratory Judgment; and
(c) for such other and further relief that the law and equity may require and that this Court may deem just and appropriate under the circumstances.
DEMAND FOR TRIAL BY JURY
22. Defendant demands a trial by jury on all issues so triable.
David R. Buchanan
Dennis J. Cassidy BROWN & JAMES, P.C. 1900 City Center Square 1100 Main
Kansas City, Missouri 64105-2153 Telephone: (816) 472-0800 Facsimile: (816) 421-1183
ATTORNEYS FOR DEFENDANT