Eleventh Circuit Affirms Jury Verdict on Covered Property Loss

    The Eleventh Circuit affirmed the district court’s denial of a motion for a new trial after the jury determined the insurer owed policy benefits for hurricane damage to the insured’s property. AM Grand Court Lakes LLC v. Rockhill Ins. Co., 2023 U.S. App. 13902 (11th Cir. June 5, 2023).

    AM Grand owned a group of buildings that were operated as an assisted living facility. The facility comprised five buildings, each of which was five stories tall. Hurricane Irma caused damage to the property. AM Grand hired a public aduster, Five  Star Claims Adjustoing, to assist with its claim. Five Star concluded that the roofs of all five buildings had been damaged in the hurricane and needed to be replaced. The estimated cost was approximately $1,200,000 to replace all the roofs. 

    A claim was submitted to AM Grand’s insurer, Rockhill Insurance Company. Rockhill hired an independent adjuster, Engle Martin, to review AM Grand’s claim and determine the extent of the damage and to estimate the cost to repair the damage. Engle Martin determined that the only damage from the storm was to a portion of the roof of Building D. Engle Martin found some evidence of water damage inside other buildings, but concluded this water damage occurred before Hurricane Irma. Although severe deterioration of parts of Building B’s roof were observed, Engle Martin concluded this was the result of wear and tear before Hurriane Irma. Engle Martin estimated it would cost approximately $149,000 to repair the portions of Building D’s roof that had been damaged in the hurricane.

    Based on this estimate and the cost of the temporary repairs that AM Grand had already completed for Building D, Rockhill determined that AM Grand sustained a loss of $235,556.80 due to the hurricane. Because this amount was less than the policy’s hurricane deductible, Rockhill concluded that it owed nothing under the policy. 

   Thereafter, AM Grand conducted a further inspection in which it was determined that the roofs of all five buildings suffered “catastrophic failure due to Hurricane Irma” and needed to be replaced. Further, water had permeated the walls of the buildings due to the roof damage.

    AM Grand sued and the case went to trial. The primary dispute was the extent of damage from Hurricane Irma. AM Grand asked the jury to award $15,112,500, an amount equal to the policy limits. If the jury concluded that only the roofs were damaged by the storm, however, AM Grand asked alternatively for the jury to find that it sustained a loss of approximately $1,200,000, representing the cost to replace all the roofs based on the estimate from its public adjuster. 

    In contract, Rockhill argued the property sustained minimal damage from Hurricane Irma. It maintained that only a portion of the roof of Building D was damaged by the hurricane. Rockhill offered no evidence about the cost to repair or rebuild if the hurricane damaged the interior of any of the buildings. 

    The jury found that Rockhill breached the policy. It determined that AM Grand’s covered damages resulting from Hurricane Irma were $9,280,000. After subtracting the deductible and making other adjustments, the district court entered a judgment in AM Grand’s favor in the amount of $8,753,594.61, plus pre-judgment and post-judgment interest. 

    The issue on appeal was whether the district court abused its discretion when it denied Rockhill’s motion for a new trial. Rockhill argued the district court’s denial of the motion was in err because the damages awarded by the jury were excessive. 

    At trial, the parties presented conflicting evidence on the extent of the damage. The jury could have found that the damage fell somehwere between damage to a part of the roof of Building D (as Rockhill claimed) and damage to the roofs and interiors of every building (as AM Grand claimed). If the jury made findings about the extent of the damage to each building, then based on the evidence about the cost of rebuilding Building B and repairing Building D’s roof, the jury could have calculated AM Grand’s loss from the hurricane to be between $8,035,556 and $15,835.556. The jury’s finding that AM Gran’ds loss was $9,280,000 was well within this range. Therefore, the district court’s judgment was affirmed.