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PHILADELPHIA, July 12 – A Pa. Federal judge has ruled that questions of fact existed concerning occupancy of a home at the time of a burst water pipe, precluding summary judgment for the insurer in a coverage action related to the loss.
Economy Premier Assurance Co. removed a coverage suit filed by homeowners Joseph and Robin Jugan in Pa. state court seeking coverage for water damage after a frozen pipe burst in their home while they were away for an extended period of time. The insurer denied the claim, relying on an exclusion from coverage any damage from frozen pipes in an unoccupied home. There is an exception to the freezing exclusion if reasonable care is used to heat or drain the pipes during any period of non-occupancy. The Jugans claimed they took reasonable care to avoid freezing pipes while they were gone.
In response to the insurer’s motion for summary judgment, Judge Jeffrey L. Schmehl found that the homeowners did not use reasonable care to safeguard the pipes in their absence, and therefore that the Freezing Exclusion applied. He also ruled, however, that there is a question of fact as to whether the home was unoccupied prior to the loss, affecting whether the Jugans could recover for contents damage. The judge found the term “unoccupied” undefined in the policy, and therefore subject to several interpretations. The Judge believe this left the occupancy issue open for the jury to decide:
“If the jury concludes that the house was not ‘unoccupied’ at the time of the loss, the occupancy exclusion will not apply and plaintiffs would be entitled to recover the value of their contents under Coverage C. If, however, the jury were to find that the house was ‘unoccupied’, the burden would shift to plaintiffs to show that they used reasonable care to maintain heat in the house. Since the Court has already concluded that plaintiffs did not use reasonable care to maintain heat, the exclusion would apply and plaintiff could not recover the value of their contents under Coverage C of the Policy.”
Joseph Jugan, et al. v. Economy Premier Assurance Co., No. 15-4272, E.D. Pa.; 2016 U.S. Dist. LEXIS 87876
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