United States District Court, D. Minnesota
St. Panteleimon Russian Orthodox Church, Inc., Plaintiff,
Church Mutual Insurance Company, Defendant.
Ross M. Hussey, Udoibok, Tupa & Hussey, PLLP, The Grain Exchange, Minneapolis, MN., for Plaintiff.
Christian A. Preus and Henry Pfutzenreuter, Meagher & Geer, PLLP, Minneapolis, MN., for Defendant.
MEMORANDUM OPINION AND ORDER
SUSAN RICHARD NELSON, District Judge.
This matter is before the Court on Defendant Church Mutual Insurance Company's Motion for Summary Judgment [Doc. No. 25]. For the reasons stated below, the Court grants Defendant's Motion.
A. The Parties and the Insurance Policy
Plaintiff St. Panteleimon Russian Orthodox Church, Inc. is a Minnesota nonprofit corporation that owns real property located at 2210 Franklin Avenue South, Minneapolis, Minnesota 55414 (the "Property"). (Compl. [Doc. No. 1] ¶ 5.) Defendant Church Mutual Insurance Company is a mutual insurance company incorporated in, and with its principal place of business located in, the State of Wisconsin. (See id. ¶¶ 2, 5; Answer [Doc. No. 5] ¶¶ 2, 5.) In January 2011, Defendant issued to Plaintiff an insurance policy with a property coverage limit of $1, 046, 500, effective February 2, 2011 through February 2, 2014. (Bednarski Aff. [Doc. No. 29], Ex. 1 at 2.) The Policy provides coverage for loss "caused by or resulting from any Covered Cause of Loss, " (id., Ex. 1 at 4), which is defined to mean "risks of direct physical loss unless the loss is: 1. Excluded under Exclusions; or 2. Limited under Limitations, " (id., Ex. 1 at 5). In the event that a covered loss occurs, the Policy provides Defendant with several options for payment, including paying "the cost of repairing or replacing the lost or damaged property." ( Id., Ex. 1 at 21.)
This coverage is subject to certain conditions. (See id., Ex. 1 at 20.) For example, under the "Valuation" condition, Defendant will not pay more for a loss than "[t]he amount [Plaintiff] actually spen[t] that is necessary to repair or replace the lost or damaged property." ( Id., Ex. 1 at 23.) And, in the event of loss or damage, Plaintiff must send to Defendant "a signed, sworn proof of loss containing the information [Defendant] request[s] to investigate the claim." ( Id., Ex. 1 at 21.) In addition, if Defendant and Plaintiff "disagree on the value of the property or the amount of the loss, " either party may demand an appraisal. ( Id., Ex. 1 at 20.)
B. The Loss and the Initial Inspections and Estimates
On March 19, 2010, there was a wind storm at the Property. (See Mayhew Aff. [Doc. No. 31], Ex. 1 at 2.) According to Defendant, wind is not an excluded cause of loss and is, therefore, covered under the Policy. (Def.'s Mem. of Law in Supp. of Summ. J. [Doc. No. 27] ("Def.'s SJ Mem.") at 4; see Bednarski Aff., Ex. 1, at 5-8.) Therefore, when Plaintiff sought coverage for damage caused by the storm, Defendant hired an outside professional insurance adjuster, Bill Berscheid, to investigate the claim and calculate the amount of the loss. (See Bednarski Aff., Ex. 6 at 4.) As part of his investigation, Mr. Berscheid retained Stephen Mayhew, a Senior Associate Engineer with Wiss, Janney, Elstner Associates, Inc., who has approximately two decades of engineering experience involving wood structures, to render a professional opinion as to the scope of damage caused to the Property by the wind storm. (See Mayhew Aff. [Doc. No. 31], Ex. 1 at 1; id., Ex. 3.)
Meanwhile, Plaintiff hired Michael DuPont, a general contractor and owner of United Exteriors Midwest, Inc., who has approximately thirty-five years of experience in the construction industry, to fix the roof of the church. (See Preus Aff. [Doc. No. 28], Ex. 1 (Alekseyenko Dep. 32:5-13, 35:4-25); id., Ex. 2 (DuPont Dep. 18:1-5, 21:16-22:8).) Plaintiff designated Mr. DuPont as its representative for purposes of its insurance claim, (see Bednarski Aff., Ex. 7), and Mr. DuPont sent letters to Mr. Berscheid on April 20 and April 24, 2012, estimating the insurance claim at $66, 320.37 and $64, 565.00, respectively, (Bednarksi Aff., ¶ 4 & Ex. 2; Hussey Aff. [Doc. No. 36] ¶ 1 & Ex. 3).
Thereafter, Mr. Mayhew performed site inspections of the Property on May 17 and May 29, 2012. (Mayhew Aff., Ex. 1 at 2.) Based on the site inspections and his review of the weather data for March 19, 2012, Mr. Mayhew concluded in his June 2012 report that an ornamental, onion-shaped dome (the "Dome") had fallen from the church's roof as a result of the wind storm. ( Id., Ex. 1 at 4.) Other than the damage to the Dome and two roof rafters, he found "[n]o other structural damage... due to the wind event." (Id.) However, he did note that the Dome had impacted a metal chain-link fence, and that approximately six ceiling tiles had incurred water damage as a result of the Dome falling. ( Id., Ex. 1 at 1-2.) Mr. Bersheid then prepared an estimate of the cost to repair this damage. His estimate, completed in September 2012, was $77, 633.81. (See id., Ex. 6 at 8.) Mr. Berscheid provided this estimate to Thomas Elert, a Senior Project Manager and Estimator for Legacy Services Corporation who has approximately thirty years of experience estimating the cost of construction projects. (See Elert Aff. [Doc. No. 30] ¶ 1 & Ex. 2.) Mr. Elert agreed that the repair work could be completed for that amount. (See id. ¶ 2.)
Mr. DuPont disputed Mr. Mayhew's findings and, at Mr. DuPont's request, another engineer was hired to conduct an inspection of the Property. (See Bednarski Aff., Exs. 2, 3, 6, 8.) That engineer, Gene Bolgrean, wrote a letter to Mr. DuPont in March 2013 stating that, based on his "cursory visual observation, " he "recommend[ed] that the existing conditions be more thoroughly investigated." ( Id., Ex. 3; see id., Ex. 4.) Defendant disagreed with the need for further ...