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Haman Inc v. Chubb Custom Insurance Co.

United States District Court, N.D. Alabama, Southern Division

August 6, 2019

HAMAN, INC., Plaintiff,
v.
CHUBB CUSTOM INSURANCE COMPANY, Defendant.

          MEMORANDUM OPINION

          KARON OWEN BOWDRE, CHIEF UNITED STATES DISTRICT JUDGE

         This insurance dispute comes before the court on Plaintiff Haman, Inc.'s “motion for specific performance to enforce the insurance policy's appraisal process provisions.” (Doc. 33). Haman asserts that its commercial property insurance carrier, Defendant Chubb Custom Insurance Company, must submit to the appraisal process of Haman's claims for fire damage and storm damage to its hotel. For the following reasons, the court will deny Haman's motion.

         I. STANDARD OF REVIEW

         In Count One of its amended complaint, Haman brings a claim for specific performance against Chubb to submit to appraisal of two of Haman's insurance claims. In its motion for specific performance, relying on evidentiary exhibits, Haman asks the court to compel the same performance: Chubb's submittal to appraisal. So, Haman's motion for specific performance is really a motion for summary judgment in which Haman asks the court to enter judgment for Haman on Count One. So the court will treat the motion for specific performance as a motion for summary judgment.

         A trial court can resolve a claim on summary judgment only when the moving party establishes two essential elements: (1) no genuine disputes of material fact exist; and (2) the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a).

         Under the first element of the moving party's summary judgment burden, “‘[g]enuine disputes [of material fact] are those in which the evidence is such that a reasonable jury could return a verdict for the non-movant.'” Evans v. Books-A-Million, 762 F.3d 1288, 1294 (11th Cir. 2014) (emphasis added) (quoting Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742 (11th Cir. 1996)). And when considering whether any genuine disputes of material fact exist, the court must view the evidence in the record in the light most favorable to the non-moving party and draw reasonable inferences in favor of the non-moving party. White v. Beltram Edge Tool Supply, Inc., 789 F.3d 1188, 1191 (11th Cir. 2015).

         II. BACKGROUND

         1. The Commercial Property Insurance Policy Appraisal Provision

         Chubb issued to Haman a commercial property insurance policy that covered certain damages to Haman's hotel. The insurance policy contained an appraisal provision. The appraisal provision provided that if the insurer and the insured disagreed on “the value of the property or the amount of loss” for a claim, then either party could demand an appraisal of the loss. (Doc. 33-1 at 3). If a party demanded appraisal, then each party would select its own competent and impartial appraiser to state separately the value of the loss. And if the appraisers could not agree on the value of the loss, then an umpire selected by the appraisers would decide.

         2. The Fire Claim

         On March 22, 2014, a fire damaged Haman's hotel. Haman submitted a claim to Chubb for the fire damage. Chubb investigated Haman's claim and, according to Haman, valued the loss from fire damage at $523, 477.01. But Haman also investigated the damage and valued its loss at $1, 679, 975.33. So the parties dispute the amount of loss from fire damage; they do not dispute the cause of the fire or that the insurance policy covers the fire damage.

         Because of the dispute over the amount of loss caused by the fire, the parties initially agreed to invoke the appraisal provision of the insurance policy. But then Chubb refused to proceed with appraisal after Haman selected Charles Howarth as its appraiser because, according to Chubb, Mr. Howarth is not impartial. Chubb asserts that Mr. Howarth had a financial interest in the outcome of the appraisal because Haman paid Mr. Howarth an hourly fee and agreed that his fee “[would] not exceed thirty percent (30%) of the additional settlement awarded to [Haman], and additionally, should the process produce no additional settlement then no fee will be due.” (Doc. 38-3 at 2). So Chubb contends that Mr. Howarth has incentive to advocate for an increased damage amount for Haman because the higher the damage amount, the higher the cap on his fee.

         3. The Storm Claim

         Then, on April 28, 2014, a storm caused additional damage to Haman's hotel. Haman submitted a claim to Chubb for the damage and asserted that the storm caused $1, 595, 608.00 worth of ...


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