Stone Creek Condominium Owners Association, Inc. ("Stone Creek"), 1 suffered a hail loss in 2016 for which it filed a claim with its real estate insurance company, Charter Oak Fire Insurance Company ("Charter"). The charter was inspected and payment was made in accordance with its estimate. The charter determined that four of the twenty buildings had been damaged, although no damage was noted on any of the roofs.
In 2017, Stone Creek hired a contractor to replace the roofs on During inspection, the contractor reported extensive hail damage to the roof and other parts of the building that are not included in the 2016 estimate.About a year later, Stone Creek hired a public adjuster who originally requested a sixty-day extension with the charter for the two-year archive according to policies to resolve any outstanding issues identified by hail damage.The Charter granted the original request. Stone Crick's public adjuster requested a further extension to allow for a reconsideration. The charter's adjuster replied and recommended to the public adjuster that there had been 1
[T] here is no way for us to reconsider what damage was there at that time. The association should report a new claim and use the hail date that was closest to the date of the contractor's inspection.
After an exchange of estimates by the public adjuster and the charter, Stone Creek required assessment. The charter's response advised Stone Creek that they were willing to evaluate pricing issues and whether additional undamaged roof surfaces would need to be replaced to complete the repairs approved by the charter, but it would not consider coverage issues related to "matching" or causation in the assessment process. Instead of responding, Stone Creek responded to the lawsuit. Stone Creek's trial included an explanatory court action alleging that the charter was violated by the policy by not allowing the assessment panel to determine the amount of the loss. The Charter argued that it does not violate the policy by refusing to participate in evaluation because (a) there was a dispute about the cause of the damage and (b) the evaluation process was limited to resolving disputes about the size of the loss. Stone Creek, in turn, claimed that the charter violated the policy because the evaluation panel could determine causation.
The Court of Justice agreed with the statute that the evaluation provision limited the panel to determining the size of the loss and did not include the resolution of coverage disputes. including whether damage to Stone Crick's roof was caused by a hailstorm during the coverage period, and that it is a contentious issue for a jury to decide at trial. The court further concluded that the jury would also need to consider whether the charter credibly raised disputes over coverage in response to Stone Crick's invocation of the appraisal provision. In particular, the jury would need to consider whether the charter raised a dispute over coverage to question the alleged loss date. In other words, the jury would need to consider whether the charter waived each date for the challenge of loss due to its setting instruction to "report a new claim and use the hail date that was closest to the date of the contractor's inspection."
1 Stone Creek Condominium Owners Association, Inc. v. Charter Oak Fire Ins. Co. 3: 19-cv-862, 2021 WL 354180 (W.D. Wis. 2 February 2021).