Burrell v. Allstate Property and Casualty Insurance Company et al
ORDER granting 56 Motion to Lift Stay. Parties to contact Magistrate Judge to proceed with case as set forth herein. Signed by District Judge Carlton W. Reeves on 06/09/2015. (AC)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
CAUSE NO. 3:13-CV-493-CWR-FKB
CAUSE NO. 3:14-CV-791-CWR-FKB
ALLSTATE PROPERTY AND
CASUALTY INSURANCE COMPANY;
SOUTHERN PROPERTY; RICHARD
GILLY; KERRI STEGER; JOHN AND
JANE DOES A-H
Before the Court is the plaintiff’s motion to lift stay. Docket No. 56. The matter is fully
briefed and ready for adjudication.
Factual and Procedural History
As explained in prior Orders, Sharon Burrell alleges that Allstate has underpaid her fire
insurance claim. She says her home was totally destroyed and her claim merits recovery of the
policy limits. Allstate disagrees; its assessment and payout were obviously lower than the limits.
The Court had stayed the case so the parties could complete the appraisal required by the
policy. Because that has now been completed, Burrell wants to proceed with her suit. Allstate
responds that the completion of the appraisal clause renders the case moot, as Burrell is bound by
the appraisal award. The appraisal award was for approximately 60% of the policy limits.
Burrell has advanced two different legal theories against Allstate.1 Each will be discussed
This discussion distinguishes legal theories from causes of action.
Burrell had earlier invoked Munn v. Nat’l Fire Ins. Co. of Hartford, 115 So. 2d 54 (Miss.
1959). See Docket No. 16, at 6.2 That case held that “an appraisal is presumptively correct, but . .
. the court may set aside the appraisal where the award is so grossly inadequate or excessive as to
amount to a fraud in effect, although fraud is not charged, or where the appraisers were without
authority, or where there is a mistake of fact or to prevent injustice.” Munn, 115 So. 2d at 58
Allstate now argues that the appraisal award means “there is nothing left to litigate in this
case.” Docket No. 60, at 4. The argument treats the appraisal award as if it were an arbitration
award – already litigated and essentially final. Munn, however, holds otherwise. “The report of
appraisers fixing the amount of a fire loss is not an arbitration and award,” the Mississippi
Supreme Court concluded. Munn, 115 So. 2d at 56 (citation omitted). Otto Munn was entitled to
challenge the appraisal in court.
Allstate also contends that the appraisal award is binding under Boler-Phillips Body
Shop, Inc. v. Employers Mut. Cas. Co., 251 F. App’x 912, 915 (5th Cir. 2007) (unpublished). But
Boler-Phillips did not acknowledge or cite to Munn. Other, published Fifth Circuit cases (with
presumably better briefing from the parties than may have occurred in Boler-Phillips), recognize
that an insured may challenge appraisal awards in court. See Mitchell v. Aetna Cas. & Sur. Co.,
579 F.2d 342, 350 (5th Cir. 1978).
The undersigned concludes that this matter is now a classic Munn case. The parties must
proceed to resolve whether the appraisal award is so grossly inadequate to the fire loss as to
Of course, when she articulated it, no appraisal had been conducted despite the plain language of the parties’
constitute a fraud, whether there was a mistake of fact in the appraisal, or whether accepting the
appraisal would sanction an injustice.
Mississippi Code § 83-13-5
During the hearing on Allstate’s motion to compel appraisal, Burrell added her second
theory of the case: “that she was not bound by the appraisal policy because its application would
violate her rights under Mississippi Code § 83-13-5.” Docket No. 43, at 2; see also Home Ins.
Co. v. Greene, 229 So. 2d 576, 578 (Miss. 1969). Because Burrell had not raised this theory until
the argument, Allstate had not had a fair opportunity to develop a response and the theory was
not properly before the Court. The Court overruled Burrell’s timely objections and ordered her to
complete the appraisal process. Id.
It is true that in its ruling, the Court wrote that “Burrell may reurge her statutory
argument at an appropriate time.” Id. at 3. She simply never found an appropriate way in which
to present this theory.3
Within two weeks of the Order compelling the appraisal, an aggrieved Burrell attempted
to circumvent this Court’s authority by filing a second lawsuit against Allstate, this time
containing her argument under Mississippi Code § 83-13-5. The result was to present her
statutory theory to a different District Judge, contrary to the rule against claim-splitting. That
attempt was later unwound and Burrell II was dismissed with prejudice. See Docket No. 51, at 3.
The procedural history of this case is of import. The Amended Complaint, which did not include this theory, was
filed in Copiah County Circuit Court on July 29, 2013. The action was then removed to this Court on August 13,
2013. The Magistrate Judge held the Case Management Conference on November 5, 2013, resulting in the entry of
the Case Management Order, Docket No. 6, which set forth various deadlines including December 5, 2013, as the
date by which the parties could amend their pleadings. Defendants filed various motions including a motion to
compel appraisal on December 4, 2013. Docket Nos. 9 and 11. The court held a hearing on that motion more than
nine months later on September 29, 2014, within the discovery deadline which had been extended twice. It was
during the hearing on the motion to compel appraisal that Plaintiff mentioned for the first time this second theory. At
no time after removal did Plaintiff seek to amend her pleadings. She only brought her statutory theory in Burrell II.
As a result, Burrell no longer has this statutory argument available to her. This theory
was dismissed with Burrell II and cannot be resuscitated now.
The stay is lifted so that Burrell can proceed with her Munn claim. Within 10 days, the
parties shall contact the Magistrate Judge’s chambers for a new scheduling order.
SO ORDERED, this the 9th day of June, 2015.
s/ Carlton W. Reeves
UNITED STATES DISTRICT JUDGE
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