United States District Court, W.D. Kentucky, Owensboro Division
MEMORANDUM OPINION AND ORDER
JOSEPH H. McKINLEY, Jr., Chief District Judge.
This matter is before the Court on Plaintiff State Automobile Property & Casualty Company's ("State Auto") Motion for Summary Judgment or Alternatively Partial Summary Judgment [DN 53] and Motion to Exclude the Testimony of Charles Howarth [DN 52]. Fully briefed, these matters are ripe for decision.
This case arises out of a fire on June 15, 2010 that substantially damaged a church building ("Building") located at 892 Bethel Church Road in Beaver Dam, Kentucky. Mr. Darrell Blacklock ("Defendant") held an insurance policy ("Policy") with State Auto covering the Building. State Auto does not dispute that the Policy required it to pay Defendant as a result of the fire. However, by this action, State Auto seeks a declaration as to the amounts owed under the policy.
As to coverage for the Building, the Policy entitled Defendant to be paid either the "actual cash value" ("ACV") or the replacement cost value ("RCV") of the property. On August 12, 2010, Defendant submitted a Proof of Loss that claimed an ACV for the Building of $40, 000. After receiving Defendant's Proof of Loss, Plaintiff conducted an arson investigation in order to determine whether it owed coverage for the Building and ultimately determined it owed coverage. On May 19, 2011, State Auto's adjuster, Mr. Jack Dickens, received an email from Defendant inquiring as to when he would receive a "proposal on the Church building and the contents." [Email: Request for Proposal, DN 53-4, at 1]. That proposal was communicated to the Defendant in some manner but the record is not entirely clear how. An examination of the exhibit at DN 53-5 reveals that Mr. Blacklock already had the proposed actual cash value figure of $48, 358.17 when he emailed Mr. Dickens on May 22, 2011 at 6:03 PM, asking how much more money would there be if the congregation decided to rebuild. In response to that inquiry, Mr. Dickens sent the following email on May 23, 2011, at 4:35 AM:
Darrell, total amount of replacement cost coverage available is $112, 923.62 less actual cash value of $48, 358.17 or an additional amount of $64, 565.45 available. The replacement cost coverage is subject to policy conditions and requirements. You can move forward on debris removal using the lowest bidder. When this work is completed I will need a signed statement from the contractor indicating it has been done. Thanks, Jack
[Email: Proposed ACV, DN 53-5, at 1]. Defendant had another inquiry asking whether the church had to be rebuilt on the same site in order to get the remaining $64, 565.45. He was told by Mr. Dickens that the church could be rebuilt on another location. Later that afternoon, the Defendant emailed Mr. Dickens the following:
we've looked at your preliminary figures and we accept those as the undisputed amount. As you know there will probably be more questions along the way as we decide if we're going to rebuild or etc.
How soon should we expect those amounts?
[Email May 23-Acceptance, DN 53-7, at 1]. State Auto sent payment to Defendant on May 31, 2011 in the amount of $48, 358.17 for the ACV related to the Building. Defendant subsequently cashed the check received from Plaintiff. On August 12, 2011, Defendant submitted an Amended Proof of Loss statement to Plaintiff indicating an ACV of the Building to be at $209, 465.50. Defendant arrived at the new ACV following an estimate prepared by the Howarth Group, Inc.
In addition to the $48, 358.17 paid for the Building, Plaintiff sent checks for Business Personal Property, Debris Removal, and Extra Expenses, which are amounts also covered under the Policy. Defendant also submitted a claim related to Business Income, but Plaintiff denied coverage for this claim. Based on the briefing for this case, Defendant maintains that State Auto owes him additional ...