A brewery and restaurant owner of a venue destroyed by fire has largely won its legal action against an insurance company.
Abbey Ridge, the owners of the premises in the Shawnee National Park in Jackson County, sued Addison Insurance Company after the latter refused to pay out extra for personal damages and structural losses linked to an extension of the brewery.
But a federal magistrate judge granted summary judgment to the venue owners, ruling that it is owed at least $460,000 and possibly more. Magistrate Judge Mark Beatty ruled against Abbey Ridge in its claim for further damages over the insurance company’s alleged “unreasonable and vexatious” delay in paying out.
The issue under consideration by the U.S. District Court for the Southern District of Illinois turned, to a large degree, on whether an addition to the building was new construction or renovation.
This distinction was crucial as the defendant, who had its cross motion for summary judgment, argued that it was merely an add to the existing structure and therefore not covered under the policy. There was also discussion over when the work on the building began, a factor that would also influence the amount of the payout.
According to background in the ruling, during the early hours of Feb. 1, 2017, a fire broke out at the Abbey Bridge Brewery in Pomana. It destroyed both the original building, and the expansion, which was to have included a new reception area and event center. Work had been ongoing on the structure since just prior to October 2016.
The plaintiff in this case had taken out extra insurance less than two months before the devastating fire.
Abbey Ridge submitted a fire claim, including $360,000 for the damages to the new building. The defendant paid $150,000 under the “builder’s risk” provision of the policy, but denied any extra amount. Addison also denied a further claim for just over $300,000 for loss of personal property.
The plaintiff, through its surveyor, argued that the “structure being built at the time of a fire was an entirely new building which was to be adjoined to an existing building.” This ran counter to the defendant’s claim that “[t]he addition to the main building, despite containing ‘all the components of a stand-alone structure,’ was in fact not a stand-alone structure.”
Judge Beatty, in his ruling, stated he had to consider whether “the new building/addition qualifies as a new building for purposes of coverage.
He concluded, “(T)he new building/addition qualifies as a “newly constructed or acquired $210,948.07 inbuilding.” In addition, Beatty found that Abbey Ridge is entitled to a “business personal property” pay out of $250,000, bringing the total to just over $460,000,
The judge noted that Abbey Ridge was seeking more than that total, plus pre-judgment interest and costs. This will be the subject if Plaintiff seeks an amount in excess of $460,948.07, plus pre-judgment interest and costs. This issue will be the subject of further motions and argument.
On the claim that the insurance company was “vexatious and unreasonable,” Beatty ruled in favor of the defendant, finding that there was “clear bona fide dispute” over the policy provisions.