RVOS Farm Mutual Insurance Co. not liable for hurricane damages, appellate court finds

By Dee Thompson | Nov 30, 2017

BEAUMONT – The Court of Appeals of the 9th District of Texas at Beaumont affirmed a judgment in favor of an insurance company in a case involving damages to a home from Hurricane Ike.

After the jury returned the verdict against them, the homeowners appealed the verdict from the 75th District Court of Liberty County.

According to the memorandum opinion filed Nov. 16, “On appeal, the Ilers [the homeowners] argue that the trial court erred in allowing the jury to interpret an exclusionary clause in an insurance policy and that the trial court erred in denying appellants’ motion for judgment notwithstanding the verdict because they conclusively established their damages and attorney’s fees. Alternatively, the Ilers argue that charge error requires a new trial.”

James C. Iler and Linda Iler sued RVOS Farm Mutual Insurance Co. after RVOS denied their claim for damages to their home caused by Hurricane Ike in 2008. They alleged breach of contract, breach of duty of good faith and fair dealing and violations of certain sections of the Texas Insurance Code. 

The Ilers filed a plaintiffs’ motion for construction of provision of contract on Sept. 24, 2015, asking the trial court to rule on language in the insurance contract regarding exclusions of coverage. The argument centered on whether the policy covered an opening in a wall where water came in and caused damage, specifically how the opening was formed. 

The Ilers’ home contained French doors and there was damage to the home’s interiors even though the doors were closed during the hurricane. As noted in the opinion, “According to Linda, she latched the French doors before the hurricane hit because she knew there would be strong wind, and the doors did not open as a result of the storm. Linda testified that she believed either the wind blew causing the doors to bulge and allowing water to go in or that the weather stripping was blown away or damaged allowing water to get in.”

The disputed language of the policy states: “We do not cover loss caused by windstorm, hurricane or hail to: the interior of a covered building or to personal property contained in a covered building unless direct force of wind or hail makes an opening in a roof or wall and rain enters through this opening and causes the damage,” the opinion states.

The words “wind makes an opening in the wall” should include separations between a door and frame caused by wind, the Ilers argued. RVOS responded that “...neither the definition of wall nor the definition of door in the Merriam-Webster dictionary supports the Ilers’ contention that a door is considered part of a wall, neither definition references the other, and the definition of wall does not state that it includes windows and doorways as part of the wall,” according to the opinion.

The Ilers argued at trial that the court was wrong to deny their motion for judgment notwithstanding the verdict, as they had conclusively established their damages and attorney’s fees. The appellate court agreed with RVOS that there was a clear question for the jury as to whether the language of the exclusion was ambiguous or not.

Another issue concerned the instructions received by the jury. The Ilers instructed the jury to construe the language of the policy their way, but the appellate court found that to be incorrect, noting, “Because the relevant words in the insurance policy were to be given their ordinary meaning, as the jury was instructed, the instruction was correctly refused ... We affirm the trial court’s judgment,” the opinion states.

The case was heard by Chief Justice Steve McKeithen, Justice Charles Kreger, and Justice Leanne Johnson.

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