Stankova v. Metro. Prop. & Cas. Ins. Co.

Plaintiff filed suit against Metropolitan after the insurance company denied coverage for the loss of her home. After a wildfire swept through Northern Arizona in 2011, flooding and mudslides in the area destroyed plaintiff's house. Plaintiff had a homeowner’s policy with Metropolitan which covered direct loss caused by fire but excluded coverage for loss caused by either water damage or earth movement, including mudslides. Under the Appleman definition of direct and proximate cause as adopted by Arizona, it is possible that the fire directly caused plaintiff's loss in “an unbroken sequence and connection between” the wildfire and the destruction of the house. In this case, a reasonable factfinder could conclude that the destruction of the house was caused by the fire, which likely caused the mudslide, “the operation and influence of which could not be avoided.” Therefore, although an efficient proximate cause analysis is not appropriate under Arizona law, the court need not apply that doctrine in order to find that the damage here could have been directly and proximately caused by the wildfire. The court concluded that the district court erred in determining that, under Arizona law, Metropolitan was entitled to summary judgment because there is a triable issue as to whether the fire directly caused the destruction of plaintiff's home. Accordingly, the court reversed and remanded. View "Stankova v. Metro. Prop. & Cas. Ins. Co." on Justia Law