Claims Denial And Experts

Fortunately, most insurance claims do not require expert testimony to prove a claim.  However, in those situations where an expert is required, a 2021 opinion from the Southern District of Texas, Houston Division, is a good case for guidance on experts.  The opinion is styled, Roy P. Labourdette Jr. v. State Farm Lloyds.

In this case, State Farm insured Roy’s home.  Roy had made a claim for hail storm damage to State Farm and State Farm denied the claim and asserted the damage to Roy’s roof was the result of wear, tear, and deterioration, rather than a covered cause of loss.  Roy filed a lawsuit in State Court and State Farm had the case removed to Federal Court.

Roy had hired an expert roofer to testify about the roof damage.  State Farm in response filed papers with the Court to have the testimony of the expert excluded.  After considering the motion and response from Roy, this Court denied State Farms motion.  The Court then explained it’s ruling.

The Federal Rule of Evidence, 702 provides:

A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if:

(a) the expert’s scientific, technical, or specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue;

(b) the testimony is based on sufficient facts or data;

(c) the testimony is the product of reliable principles and methods; and

(d) the expert has reliably applied the principles and methods to the facts of the case.

The United States Supreme Court has clarified that it is the Court’s gatekeeping role to determine an expert’s proffered testimony is in conformity with Rule 702.  This was made clear in the 1993, opinion, Daubert v. Merrell Dow Pharm., Inc. and the 1999, opinion, Kumho Tire Co., Ltd. v. Carmichael.  An expert is to “employ in the courtroom the same level of intellectual rigor that characterizes the practice of an expert in the relevant field.”

Foy’s expert is Roy Neal, a roofing contractor.  State Farm argues that Neal’s primary basis for his causation conclusion is a “drive through” of Roy’s neighborhood from which Neal concluded many of Roy’s neighbors had recently replaced their roofs.  According to State Farm, this is an unreliable methodology that leaves too large an analytical gap between the data and conclusions.

Contrary to State Farm’s characterization of the drive through as the “primary basis” for Neal’s opinion., Neal’s expert report indicates multiple bases for his conclusions.  In addition to driving through Roy’s neighborhood, Neal inspected Roy’s roof personally, spoke to Roy and his wife about their own roof and what they noticed concerning neighbors getting new roofs, reviewed photographs of the roof from the State Farm claim file, learned from Roy’s roofer that had personally replaced other roofs in the neighborhood, and reviewed weather data for the area on the date of the hail storm.  Neal’s own observations of what he believed to be new roofs in Roy’s neighborhood was not the only basis for his conclusion that Roy’s roof had been damaged by hail.  Instead, it was one piece of evidence, among others, that led to his conclusion.

State Farm also complains that Neal failed to physically inspect essential areas of the home, thus relying only on photographs for his conclusions.  State Farm also argues that Neal ignored alternative causes for the damage to the roof, such as defecting flashing, or wear, tear, and deterioration, and failed to take into account that the roof was 26 years old already.

Even though it may have been preferable for Neal to have been able to inspect the complete roof, State Farm’s concern that Neal’s conclusions depend only on photographs is misplaced, and State Farm does not contend that the areas Neal did inspect did not fairly represent the rest of the roof.

Neal’s expert report and deposition indicates that he did consider alternative causes of damages to Roy’s roof, but rejected them.  Neal apparently counted a high number of hailstone strikes in his test areas of the roof and explains in his report that age of the roof “will always be a significant consideration factor in determining if the roof can be repaired  or requires replacement.”  Neal testified that the roof was “aged,” “depreciated,” and “deteriorated,” and opined that these were different than “wear and tear.”  This may be a difficult position to take, but whether it is credible is a matter for rigorous cross-examination and jury determination, not exclusion.

In sum, State Farm’s complaints about Neal’s opinions and conclusions go to the weight the jury will give them at trial, not to their admissibility.

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