analysis, the motion of Hartford will be granted in part and
denied in part.
In their complaint, the plaintiffs contend that an outside wall
of their house collapsed. See Defendants' Exhibit A, Plaintiffs'
Complaint at 10. The loss involved the "[o]utside wall of the
first floor, including the basement — on the side in the
rear of house [sic] collapsed." See Defendants' Exhibit D,
Plaintiffs' Answers to Hartford's Interrogatories, ¶ 5. The
plaintiffs assert that the loss of the collapsed wall is covered
under their Hartford Homeowners Policy. The policy, no. 55 RB
932355, was in effect between March 27, 1996 and March 27, 1997.
See Defendants' Exhibit B, Homeowners Policy.
In order to qualify for policy coverage, several conditions
must be met. First, the loss incurred must be provided for in the
policy. Possible restrictions may limit the insured's ability to
recover the incurred loss. See Defendants' Exhibit B, Homeowners
Policy, Section 1 — Property Coverages, Additional
Coverages, ¶ 8 at 5 of 18. Second, the loss must occur during
the policy period. For instance, if a deterioration problem
occurred prior to the effective date of a policy, an insurer
would not be held liable for ongoing damage that began before the
insurer's policy period. See Defendants' Exhibit B, Homeowners
Policy, Section I and II — Conditions, ¶ 1 at 17 of 18.
Third, the policy requires suit to be started within one year
after the date of the loss. See Defendants' Exhibit B, Homeowners
Policy, Section I — Conditions, ¶ 8 at 11 of 18.
Plaintiffs filed their complaint here on October 8, 1997.
After receiving notice of the October 1996 loss, Hartford
employed an engineer, Nicholas S. Colanzi, M.S.C.E., P.E., to
inspect the plaintiffs property. Mr. Colanzi's December 18, 1996
report provided that "the damage to the Bostick dwelling is the
direct result of long term water infiltration and differential
earth movement which has occurred over time (years)." See
Defendants' Exhibit H, The Defendants' Expert Report at 4. He
further opined that the collapse of the wall could not causally
be related in any way to any single occurrence or sudden event of
weather-related or other phenomena. Id. The defendants further
contend that because the plaintiffs' property was located in the
Logan section of Philadelphia, an area that has experienced
problems with its houses, including settlement, unevenness of the
ground, drainage problems and wet basements, the plaintiffs were
aware of such problems as early as 1991 or 1992. See Defendants'
Exhibit C, Adrienne Bostick's Deposition at 49-50. Based on their
expert's testimony and evidence of similar area damage, Hartford
rejected the Bosticks' claim in a letter dated March 12, 1997,
asserting that the loss to the Bosticks' home was not covered by
the policy. See Defendants' Exhibit J, Letter from Hartford
Insurance Denying Coverage.
Significantly, however, the plaintiffs' expert, Kenneth P.
Creech, P.E., who is a professional engineer, examined the
property and opined in his November 13, 1998 report that "[o]n
October 8, 1996, the rear section of the subject property
collapsed" and "the cause of the collapse was failure of the
mortar in the brick wall due to hidden water damage." See
Defendants' Exhibit I, Plaintiffs' Expert Report at 1-2. He
further concluded that the cause of the failure was not related
to sinking, rising, or shifting of the earth at the time of the
collapse. Id. Because the policy insures against hidden decay,
the plaintiffs contend that the homeowners policy covers the loss
The defendants request that summary judgment be entered in
their favor. The plaintiffs are Pennsylvania citizens. The
defendants are foreign corporations with their principle places
of business in Connecticut. The amount in controversy exceeds
$75,000 exclusive of interests and costs. Diversity of
citizenship exists and jurisdiction is founded upon 28 U.S.C. § 1332.
II. Standard for Summary Judgment
Rule 56(c) of the Federal Rules of Civil Procedure provides
that "if the pleadings, depositions, answers to interrogatories,
and admissions of file, together with the affidavits, if any,
show that there is no genuine issue as to any material fact and
that the moving party is entitled to a judgment as a matter of
law," then a motion for summary judgment may be granted.
The moving party has the initial burden of illustrating for the
court the absence of a genuine issue of material fact. See
Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91
L.Ed.2d 265 (1986); Adickes v. S.H. Kress & Co., 398 U.S. 144,
159-161, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). The movant can
satisfy this burden by "pointing out to the district court that
there is an absence of evidence to support the nonmoving party's
case;" the movant is not required to produce affidavits or other
evidence to establish that there are no genuine issues of
material fact. Celotex, 477 U.S. at 323-325, 106 S.Ct. 2548.
Once the moving party has made a proper motion for summary
judgment, the burden switches to the nonmoving party. Under Rule
[w]hen a motion for summary judgment is made and supported as
provided in this rule, an adverse party may not rest upon the
mere allegations or denials of the adverse party's pleading, but
the adverse party's response, by affidavits or as otherwise
provided in this rule, must set forth specific facts showing
that there is a genuine issue for trial. If the adverse party
does not so respond, summary judgment, if appropriate, shall
be entered against the adverse party.
Hence, the non-moving party "must do more than simply show that
there is some metaphysical doubt as to the material facts."
Matsushita Electric Industries Co. v. Zenith Radio Co.,
475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). A party opposing
the motion must come forward with specific facts. Id. Before a
court will find that a dispute about a material fact is genuine
there must be sufficient evidence upon which a reasonable jury
could return a verdict for the non-moving party. Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91
L.Ed.2d 202 (1986). Thus, the moving party is entitled to summary
judgment, as a matter of law, when the "non-moving party has
failed to make a sufficient showing on an essential element of
her case with respect to which she has the burden of proof."
Celotex, 477 U.S. at 323, 106 S.Ct. 2548.
The defendants have presented several alternative grounds upon
which summary judgment may be granted based upon restrictions
within the policy which may limit the plaintiffs' ability to
recover for damages suffered. The defendants first assert that
the plaintiffs' claimed loss is excluded from recovery under
policy conditions. Second, the defendants contend that the loss,
which began as early as January, 1996, occurred well before the
effective date of the homeowners policy. Third, the defendants
insist that because the plaintiffs failed to file suit within one
year from the date of loss, the claim is time-barred.
A. Additional Coverage for Collapse
The plaintiffs' homeowners policy does not "insure for
loss . . . [i]nvolving collapse, other than as provided in
Additional Coverage 8. . . ." See Defendants' Exhibit B,
Homeowners Policy Section I — Perils Insured Against,
Coverage A, ¶ 1 at 6 of 18. Additional Coverage 8 provides
coverage for collapse of a building or a part of a building
caused by certain named perils. The additional coverage for
collapse in the policy states, inter alia:
Collapse. We insure for direct physical loss to covered property
involving collapse of a building or any part of a building caused
only by one or more of the following:
a. Perils Insured Against in COVERAGE C — PERSONAL PROPERTY.
These perils apply to covered buildings and personal property
for loss insured by this additional coverage;
b. Hidden decay; . . . [L]oss to an awning . . . foundation,
retaining wall . . . is not included under items b., e., d.,
e., and f. unless the loss is a direct result of a collapse
of a building.
Defendants' Exhibit B, Homeowners Policy, Section I —
Property Coverages, Additional Coverages, ¶ 8 at 5 of 18.