United States District Court, N.D. Alabama, Western Division
MEMORANDUM OF OPINION
Crawford Nixon (“Plaintiff”) filed this action
against Defendant Nationwide Mutual Insurance Company
(“Nationwide”), alleging that Nationwide breached
its flood insurance contract with Plaintiff by denying
Plaintiff's claim for benefits under the policy. Before
this Court is Nationwide's Motion for Summary Judgment
(Doc. 62), which has been fully briefed by the parties and is
ripe for review. As explained more fully herein,
Nationwide's motion is due to be granted.
federal government developed the National Flood Insurance
Program (“NFIP”) to establish a nationwide
partnership with private insurance companies to provide flood
insurance. See generally 42 U.S.C. § 4001
(outlining the congressional findings and declaration of
purpose for the NFIP). The program is administered by the
Federal Emergency Management Agency (“FEMA”).
Id. § 4011(a). Each policy issued under the
NFIP contains identical language, as the policy is a codified
federal regulation. 44 C.F.R. pt. 61 app. A(2). The policy is
also subject “[t]o the [National Flood Insurance Act of
1968], the Amendments thereto, and the Regulations issued
under the Act.” Id. § 61.4.
issued a flood insurance policy to Plaintiff and his father
under the NFIP for a single-family home located in
Tuscaloosa, Alabama. The home is situated several hundred
feet from the Black Warrior River, and the structure is
elevated by pilings. Around April 14, 2014, heavy rain caused
the Black Warrior River to rise and flood the surrounding
area. The floodwater came within several feet of
the flood event did not cause physical water damage to the
house, as the water receded, Plaintiff discovered that it had
caused changes to the earth between the house and the river.
Specifically, the flood created an eight-to-ten-foot vertical
drop along the river side of Plaintiff's property. The
remainder of the embankment between the vertical drop and the
river sloped toward the river. The flood event also resulted
in a large crack in the ground on the east side of the house,
which continued under the slab. Plaintiff noticed that the
piling supporting the northeast corner of the structure had
shifted, the slab had cracks running through it, and the deck
had begun to separate from the house.
the flood, Plaintiff's father contacted their local
agent, who visited the property and notified Nationwide of
the loss on April 15, 2014. An independent engineer retained
by Nationwide inspected the property on April 21, 2014. His
initial report concluded that the embankment had saturated
with water from the flood and had sloughed down the hill,
which caused the displacement of the foundation piling and
the void beneath the slab. Relying on this report, Nationwide
denied Plaintiff's claim on May 8, 2014, on the basis
that earth movement, a peril that is excluded from coverage
under the policy, caused the damage to the home.
father retained Forest J. Wilson (“Wilson”), a
local geotechnical engineer, to evaluate the property and to
suggest a course of action to stabilize the embankment and
prevent it from failing under the house. Wilson disagreed
with the conclusions made by Nationwide's engineer about
the cause of the soil displacement around Plaintiff's
home. Wilson opined that “the flood water penetrated
sand seams in the river bank and created weak zones, ”
which caused the embankment to collapse as the river returned
to normal levels. (Doc. 64-8 at 6.) He further observed that
“[t]he collapsed river bank directly north of the house
has resulted in movement of the embankment beneath the
residence” and recommended that Plaintiff stabilize the
embankment by excavating loose soil and “constructing a
rock buttress.” (Id. at 6, 7.)
father employed JFJ Excavating, LLC (“JFJ
Excavating”) to stabilize the embankment, at a cost of
$57, 050. JFJ Excavating estimated that another $119, 000 of
work would be necessary to complete the stabilization. As a
result, Plaintiff and his father considered relocating the
home further back from the river because it would be
“safer in the long run” and “more cost
efficient.” JFJ Excavating prepared a new “home
pad” on the property for a total cost of $44, 191.55.
Plaintiff's father also obtained two bids to move the
structure to the new pad, but the house has not been
relocated. Plaintiff hired a carpenter to repair the deck,
but no other work has been performed on the home. Plaintiff
continues to reside there.
that the damage to the home was covered under the policy,
Plaintiff appealed Nationwide's denial of his claim for
benefits to FEMA on July 7, 2014. As part of his appeal,
Plaintiff submitted Wilson's report and photographs of
the property. Plaintiff also included a proof of loss form,
which the local agent had prepared and sent to
Plaintiff's father for his signature. Plaintiff's
father signed the form and returned it to the agency, but
another individual dated the form July 3, 2014. The proof of
loss claimed damages in the amount of $129, 000.
affirmed Nationwide's denial of Plaintiff's claim on
August 6, 2014, determining that the reports from Wilson and
the independent engineer hired by Nationwide demonstrated
that earth movement, rather than floodwaters, directly caused
the damage. Nationwide informed Plaintiff in a letter dated
January 9, 2015, that it would “stand by [its]
previous claim denial letter of May 8, 2014, ” and
“den[ied] further payment” because the proof of
loss was submitted to FEMA, rather than to Nationwide, and
was received more than sixty days after the loss. Plaintiff
then filed the instant action on January 29, 2015.
Standard of Review
judgment is appropriate upon a showing “that there is
no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed.R.Civ.P.
56(a). A genuine issue of material fact exists if the record
contains sufficient evidence for a reasonable jury to return
a verdict in favor of the nonmoving party. McCormick v.
City of Fort Lauderdale, 333 F.3d 1234, 1243 (11th Cir.
2003) (quoting Chapman v. AI Transp., 229 F.3d 1012,
1023 (11th Cir. 2000)). A fact is material if, under the
substantive law of the claim, the fact's existence
“affect[s] the outcome of the case.”
Chapman, 229 F.3d at 1023. However, the
interpretation of the terms of an insurance policy is a
question of law for this Court to decide. Carneiro Da
Cunha v. Standard Fire Ins. Co./Aetna Flood Ins.
Program, 129 F.3d 581, 584 (11th Cir. 1997).