Ward v. Horace Mann Insurance Company

Filing 52

ORDER granting 20 Motion for Summary Judgment. Signed by Judge James C. Fox on 11/17/2008. Copies served. (Edwards, S.)

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UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NORTH CAROLINA EASTERN DIVISION NO. 4107-CV-76-F BURMEY PAUL WARD, JR., and MARCELLA DUNCAN WARD, Plaintiffs, v. HORACE MANN INSURANCE COMPANY, Defendant. ) ) ) ) ) ) ) ) ) ) ORDER This matter is before the court upon motion for summary judgment [DE-201 filed by Defendant Horace Mann Insurance Company ("Horace Mann"). Plaintiffs Burmey Paul Ward Jr. ("Burmey") and Marcella Duncan Ward ("Marcella") have filed what appears to be identical responses [DE-48; DE-491 to the motion for summary judgment. Therein, Plaintiffs move to strike any references to the reports and findings of Sandy Kromenacker, although they did not file a separate motion to strike with supporting memoranda. Horace Mann filed a response to the motion to strike [DE-511 but no reply to the Plaintiffs' responses. These motions are now ripe for disposition. I. PROCEDURAL AND FACTUAL HISTORY In 2003 and 2004, Plaintiffs owned a homeowner's insurance policy, Policy # 32-000773482, covering their property at 2825 Rough and Ready Road in Chadboum, North Carolina. A. 2003 Fire The property served as Plaintiffs' principal residence until a fire in March 2003, allegedly caused by electrical problems, forced them to move to a temporary location pending repairs. Following the fire, Plaintiffs hired a public adjuster who represented them in presenting their damages claim for contents, structure, and additional living expenses under the insurance policy. The public adjuster and the Horace Mann adjuster agreed that Plaintiffs should receive payment for structure damage in the amount of $67,749.41, contents damage in the amount of $33,196.74, and damages for additional living expenses in the amount of $6,000.00. Plaintiffs subsequently filed a complaint with the Department of Insurance, because they felt the house should have been declared a total loss. In July 2003, Plaintiffs filed a Petition for Chapter 7 Bankruptcy. After receiving payment from Horace Mann for the 2003 loss, however, Plaintiffs used the proceeds to pay off the mortgage on the property. Plaintiffs did not pursue the bankruptcy and it subsequently was dismissed. Still, Plaintiffs had no funds remaining for the repair of the structure, and as a result, no repairs were made except for the removal of some sheet rock in the utility room and kitchen area of the structure sometime in the spring of 2004. The structure remained opened to the elements after the 2003 fire and had mold growing in the house. Also, a restoration company known as Country Clean both cleaned and stored Plaintiffs' contents from the 2003 fire, but Plaintiffs did not recover the contents. B. 2004 Fire On May 27,2004, just four days before the insurance policy covering the Plaintiffs' property at Rough and Ready Road was due to renew, another fire broke out at Plaintiffs property. Burmey worked as a long-distance driver of a tractorltrailer, owned by him, and delivered produce to Florida and other areas. On the day of the fire, he left the apartment where he lived with his wife, and drove his car to the insured property. Burmey left the car under the carport and picked up his tractorltrailer to make a run to Florida. Burmey contends he left the property at 2:30PM. At approximately 4:30PM, a fire was reported at the Plaintiffs' property. Despite efforts by the local fire department, the residence substantially was destroyed. C. Investigation of 2004 Fire and examinations under oath Following the fire, Horace Mann hired Sandy Kromenacker, someone Horace Mann refers to as a "fire origin and cause expert," to investigate and determine the cause of the fire. Based on Kromenacker's findings regarding the cause ofthe fire, Horace Mann decided to move forward with the investigation of the Plaintiffs' claim. Horace Mann first sent Plaintiffs two letters dated June 1, 2004, and July 13, 2004, explaining Plaintiffs' responsibilities in the event of a loss, as outlined in their insurance policy. In those letters, Horace Mann also stated that it had been unable to contact the Plaintiffs since

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