Summary Judgment – Issue of Material Fact

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WI Court of Appeals – District I

Case Name: Park Meadows Homes Association, Inc. v. American Family Mutual Insurance Company

Case No.: 2018AP1484

Officials: Brash, P.J., Brennan and Dugan, JJ.

Focus: Summary Judgment – Issue of Material Fact

Park Meadows Homes Association, Inc., (Park Meadows) appeals from a February 14, 2017 order that stayed its lawsuit against its insurer, American Family Mutual Insurance Company (American Family), and compelled Park Meadows to have its loss appraised pursuant to a policy provision allowing either party to “make written demand for an appraisal of the loss.” Park Meadows had sued for breach of contract and bad faith after disagreeing with American Family about the extent of property damage caused by an August 2014 hail and wind storm. Park Meadows submitted reports from two consulting firms stating—without providing an estimated cost—that as a result of the storm, total roof replacement was needed for all insured structures: twenty-nine residential buildings, one pool house, and one shed. American Family’s assessment was that the total amount of the loss was $100,628.30, which included replacing some shingles on some buildings. Following the trial court’s order and a stipulation by the parties that the appraisal panel was authorized to address the scope and cause of the damage, the panel issued a binding award to Park Meadows, determining that the loss amount for the claim was $145,725.35. American Family timely paid the balance owed.

Following the appraisal, when the litigation resumed, the trial court denied Park Meadows’ motion for reconsideration and granted American Family’s motion for summary judgment, concluding that American Family had not breached the contract and that without a breach there was no basis for a bad faith claim. Park Meadows also appeals those orders. Under the unambiguous language of the policy that binds the parties, American Family’s right to appraisal is triggered by a disagreement “on the amount of loss.” The trial court found that Park Meadows did not provide American Family an “amount of loss” at any time prior to filing suit, and that finding is not disputed on appeal. Under applicable case law from our supreme court, the only circumstance under which an insurer is precluded from invoking its appraisal right under the policy after the insured sues over its claim is when it delays invoking the right despite having “ample opportunity” to do so prior to the commencement of the suit. Because the policy gives American Family the right to appraisal only after it has received an “amount of loss” from its insured, and because Park Meadows did not provide an amount of loss prior to commencing the suit, American Family did not have the opportunity to invoke its right. Therefore, we conclude it was not barred from doing so after the commencement of the lawsuit.

We also conclude that Park Meadows has not identified any genuine issues of material fact and that summary judgment was properly granted. We affirm.

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Derek A Hawkins is trademark corporate counsel for Harley-Davidson. Hawkins oversees the prosecution and maintenance of the Harley-Davidson’s international trademark portfolio in emerging markets.