Vacant Buildings And Homes And Insurance

Structures owners in Weatherford, Aledo, Azle, Peaster, Hudson Oaks, Willow Park, Cresson, Mineral Wells, Millsap, Brock, Peaster, Springtown, and other places in Texas should know how insurance works when it comes to structures that are not “always” occupied.
The Houston Court of Appeals [1 Dist], decided a case in 1992, styled, Balram R. Jerry v. Kentucky Central Insurance Company. This case dealt with the trial court’s ruling in favor of the Kentucky Central Insurance Company (Kentucky). Here is some background.
In November 1985, Jerry and his wife, Valerie, moved to Utah for employment reasons. They retained ownership of their house in Harris County (the property). In April 1986, Valerie returned to the property and discovered it broken into and vandalized. Most of their property was taken or damaged. Six months later, Valerie’s parents visited the property and discovered it destroyed by fire. On November 11, 1986, Jerry reported the fire to Kentucky.
Kentucky sent a notice cancelling the policy because the property had been vacated. By the terms of the policy, Kentucky was not liable if the house was vacant for more than 90 days. The policy provided, however, that a “building in the course of construction shall not be deemed to be vacant.”
In discussing this case, the court said the term”vacant” means an entire abandonment, deprived of contents, empty, that is, without contents of substantial utility.
The Jerry’s gave Kentucky’s investigator, Lamb, a statement saying they left for Utah in 1985, that they had cut-off the utilities, and that the house was not occupied by anyone from the time they left for Utah through the time the fire occurred in October 1986. A letter dated February 1987, was introduced into evidence wherein Jerry stated, “Everything of value was taken when the house was burglarized.”
Valerie’s brother, testified that in March or April 1986, he went to the property to cut the grass. A man fixing the house let him in. While there, he saw living room furniture, a folded out sofa, wicker furniture, a bedroom suite, show cases, lumber, and building materials. He also stated that a portion of the bathroom floor had been repaired.
A repairman testified that he had been performing general repairs and was last on the property two to three weeks before the fire. He testified the house was furnished and had a bedroom suite, a living room sofa, end tables, a dining room table with chairs, pictures on the walls, and clothes. He had also stored building materials in the house.
Lamb testified that in his investigation, he found the home contained no refrigerator, stove, pots and pans, or light meter. There was no evidence of furniture in the master bedroom or living room. He saw an unburned mattress in the yard of the home, indicating that it had been abandoned before the fire. He testified that neighbors told him the doors of the house had been open for months before the fire.
For this appeals court to reverse the decision of the trial court, there had to be no evidence of probative force giving credence to the evidence favorable to the finding of the trial court.
This court looked at Webster’s Third New International Dictionary, for the definition of “repair” and it is defined as “to restore by replacing a part or putting together what is torn or broken.” Blacks Law Dictionary defined “construction” as the act of putting parts together to form a complete integrated object, or as the “creation of something new, as distinguished from the repair or improvement of something already existing.”
This court then ruled in Kentucky’s favor saying, “The record supports the finding that the repairman was engaged in restoring the damaged property or in ‘repair,’ rather than creating something new, as one engaged in ‘construction.'”
Here the court focused on the “construction” issue as it relates to the insurance policy and found that since there was no construction based on the definition of that word that the house was vacant and thus no coverage. An experienced Insurance Law Attorney needs to be involved in these types of cases early so as to best advise a client how to proceed with a claim. It appears the attorney for Jerry focused on the “construction” language in the insurance policy instead of focusing on it “and” the the vacancy issue. Maybe it would have made a differrence.