Farm Bureau Mutual Insurance Company of Arkansas, Inc. v. Cedric Jackson and Joyce Jackson

 Annotate this Case
Download PDF
DIVISION IV  CA07­182  November 7, 2007  FARM BUREAU MUTUAL  INSURANCE COMPANY OF  ARKANSAS, INC.  APPELLANT  v.  CEDRIC JACKSON and  JOYCE JACKSON  APPELLEES  AN APPEAL FROM DREW COUNTY  CIRCUIT COURT  [No. CIV2004­222­4]  HONORABLE DON EDWARD GLOVER,  CIRCUIT JUDGE  AFFIRMED AS MODIFIED  This is an appeal from a judgment entered on a jury verdict in favor of the insureds,  appellees Cedric Jackson and Joyce Jackson, against the insurer of their double­wide mobile  home, Farm Bureau Mutual Insurance Company of Arkansas, Inc., for damage caused by a  storm in April 2004. On appeal, Farm Bureau argues that the trial court erred in refusing to  direct a verdict because there was no substantial evidence to establish the home’s actual cash  value or that the damages resulted from a covered event. It also argues that the trial court  erred  in  refusing  to  reduce  the  verdict  to  the  policy  limits  and  to  give  it  credit  for  the  deductible,  the  value  of  the  damaged  home,  and  the  amount  paid  in  settlement  by  a  codefendant before trial. We affirm with modifications.  In April 2001, the Jacksons purchased the mobile home, which was manufactured by  Redman Homes, Inc., in 1999, from Betsy Thompson at Drew Plaza Mobile Homes, Inc., for $58,000. They paid $4,000 down and financed the balance by signing a promissory note  to a bank on November 1, 2001. In May 2001, they moved the home to Lake Village. It took  several weeks for the installer to put the home’s two sides together. For a period of time after  the installation, the Jacksons discovered problems with the dishwasher, the doors and floors,  some wallboard and plumbing items, a chair rail, the ceiling, a furnace switch, a commode,  the refrigerator, a bedroom light, and the front door latch. According to the Jacksons, Drew  and Redman Homes fixed those problems by mid­2002.  Farm Bureau issued an insurance policy on the home with a limit on the dwelling of  $54,000 and a $250 deductible. The policy covered damage to the interior of the home that  was caused by windstorm if the building was first damaged by “the direct force of wind or  hail, creating an opening through which the rain, snow, sand, sleet or dust enters.” It set forth  the following measure of damages if a covered loss occurred:  Our limit of liability for loss will not exceed the least of the following amounts:  (1) the actual cash value of the property at the time of the loss; or  (2) the amount necessary to repair the property to its condition immediately  prior to the loss. Repairs using new materials will be subject to deduction for  depreciation; or  (3) the amount for which the damaged or destroyed property can be replaced  with property of like kind quality and condition using common construction  materials and methods where functionally equivalent to and less costly than  obsolete,  antique  or  custom  construction  materials  and  methods.  At  our  option, we may make a cash settlement and take all or part of the damaged  property at its appraised or agreed value.  (4) The limits of liability under this policy. 2  The  policy  defined  “actual  cash  value”  as  “replacement  cost  new  less  depreciation.”  “Depreciation” was stated to mean “reduction in value of property based on age, condition  and obsolescence of the property at the time of loss.”  In April 2004, a violent storm, with heavy wind and rain, occurred while Mrs. Jackson  was at home and Mr. Jackson was driving home. The storm shook the mobile home and  scared Mrs. Jackson so badly that she got into a closet. Mr. Jackson had to pull his car to the  side of the road. During the storm, water began pouring from the cathedral ceiling and down  the walls of the mobile home. Farm Bureau’s adjuster, Keith Erwin, inspected the home on  May 11, 2004, and told Mr. Jackson that the source of the problem was not the storm, but  improper installation, and instructed him to contact the dealer. The Jacksons obtained no  relief from the dealer, and the home continued to leak every time it rained. Mold grew all  over the walls and ceiling, and the particle­board floors were ruined. Many other parts of the  home were also damaged.  The Jacksons sued Betsy Thompson, Drew, and Redman Homes in the Drew County  Circuit  Court  on  December  9,  2004,  alleging  breach  of  warranties,  breach  of  contract,  products  liability,  and  fraud.  They  later  added  Mary  Thompson  and  Farm  Bureau  as  defendants. The Jacksons asserted that, if the mobile home was not damaged as a result of  the facts underlying the warranty, contract, products­liability, and fraud claims, the damage  was caused by wind, rain, lightning, or other acts of God covered by the insurance contract  issued by Farm Bureau. After the Jacksons settled their dispute with Redman Homes for  $10,000, the court dismissed those claims with prejudice. 3  At trial, Keith Carpenter, a carpenter, testified that the home was ruined when he  inspected it for the Jacksons in October 2004. He estimated that it would cost $58,000 to  repair it. He believed that the water had come into the home because the galvanized sheeting  was not properly placed on the roof’s ridge line cap during setup. Calling it an installation  issue, he said that the home’s two halves were not tied together properly. He acknowledged  that he had no information as to whether the house leaked before April 2004 and admitted  that a windstorm could have caused the leak.  Mrs. Jackson testified that Drew made all of the repairs that the Jacksons requested  right after they bought the home and that everything was fixed by June 2002. She said that,  before the storm, the home did not leak. Now, she said, it was “worth nothing.” Mr. Jackson  also said that the house did not leak before the April 2004 storm. He stated: “Today the  house is worth nothing to me. Probably $5,000.00.” He said that he guessed that the storm  had torn the ridge cap apart.  Mr. Erwin testified that, when he inspected the house, he saw shingles that had staple  holes, which compromised their integrity, as well as gaps between the home’s two halves and  between the shingles and the flashing. He opined that the problems were not wind­related.  He stated that Mr. Jackson told him that he had had problems with the home since he bought  it. Mr. Erwin conceded, however, that he had not seen the roof before the storm.  At the conclusion of the trial, Farm Bureau moved for directed verdict on the ground  that there was no evidence that wind created an opening for the rain to come into the home.  The trial court denied that motion. Farm Bureau also objected to some of the  Jacksons’ 4  proposed instructions, including those addressing the home’s actual cash value, arguing that  there was no proof on that issue. The trial court agreed. The jury returned a verdict in the  amount of $55,000 for the Jacksons.  Farm Bureau  requested  a  reduction  of  the  verdict  by  $10,000,  the  amount  of  the  settlement between the Jacksons and Redman Homes. In an order filed on October 10, 2006,  the circuit court denied this request and stated:  Our Supreme Court has held that, where the jury is informed of the amount of  the  pre­trial  settlement  and  subsequently  awards  damages  against  the  remaining  defendants in a general verdict, it is presumed that the damages assessed by the jury  are in addition to the amount already paid by the settling tortfeasor. Bingham v. City  of Jonesboro, 89 Ark. App. 120 (2005). . . .  Further, the Court acknowledges that this is a case of multiple defendants but  do  [sic]  not  find  this  to  be  a  joint  tortfeasors  situation.  Whereas,  it  is  clear  that  separate  defendant,  Farm Bureau  Mutual  Insurance  Company’s,  liability  is  based  upon  contract  for  damages  sustained  for  its  breach,  the  circumstances  for  the  settlement as to separate defendant, Redm[a]n Homes, Inc., are not known. However,  the  jury’s  verdict  was  very  clear  and  the  Court  opine[s]  that  it  is  precluded  from  looking behind the motive of the jury unless there is some indication that extraneous  information was considered which is not supported by evidence in this case.  The  court  entered  a  judgment  of  $55,000  on  the  verdict,  plus  a  12%  penalty  of  $6,600,  attorney’s fees of $20,533.33, and costs of $320.17, making a total judgment of $82,453.50,  on October 27, 2006.  On October 28, 2006, Farm Bureau moved for judgment notwithstanding the verdict  on the grounds that there was no evidence from which a reasonable juror could conclude that  wind caused the damage to the mobile home and that there was substantial evidence that  defects in the manufacture or installation of the mobile home caused the harm. Farm Bureau  also argued, in the alternative, that the amount of the judgment was excessive because its 5  policy limit was $54,000 and it was given no credit for the $250 deductible, its previous  payment of $50, or the mobile home’s $10,000 value after the loss. The trial court did not  rule on this motion. On December 6, 2006, Farm Bureau filed a notice of appeal from the  judgment and the denial of its motion for judgment notwithstanding the verdict.  I. Whether there was substantial evidence that the windstorm caused the damage  In its first point on appeal, Farm Bureau argues that the trial court erred in refusing  to direct a verdict because there was no substantial evidence — only speculation — that the  damage  to  the  home  was  the  result  of  a  covered  event.  Farm  Bureau  contends  that  the  Jacksons’ testimony that the storm must have caused the leak because they experienced no  noticeable leakage until afterward was inadequate to withstand a directed­verdict motion. We  disagree.  A directed­verdict motion is a challenge to the sufficiency of the evidence. King v.  Powell, 85 Ark. App. 212, 148 S.W.3d 792 (2004). When reviewing the denial of a motion  for a directed verdict, we determine whether the jury’s verdict is supported by substantial  evidence. Id. Substantial evidence is evidence that is of sufficient force and character that  it will, with reasonable certainty, compel a conclusion one way or the other, without having  to resort to speculation or conjecture. Id. When determining the sufficiency of the evidence,  we review the evidence and all reasonable inferences arising therefrom in the light most  favorable to the party on whose behalf judgment was entered. Id. A motion for a directed  verdict should be denied when there is a conflict in the evidence or when the evidence is  such  that  fair­minded  people  might  reach  different  conclusions.  Id.  Under  those 6  circumstances, a jury question is presented and a directed verdict is inappropriate. Id. It is  not our province to try issues of fact; we simply examine the record to determine if there is  substantial evidence to support the jury verdict. Id.  Mrs. Jackson testified that the mobile home did not leak until the storm in April 2004,  which was strong enough to send her hiding in a closet. She said: “[W]e had a big rain storm  and it rained real bad, the wind blew real badly and it shook the trailer a lot while it was  raining and thundering and blowing  real  heavy. The mobile home started to leak at that  time.” She said that, since that storm, the mobile home leaks every time it rains. Mr. Jackson  testified that the storm was so intense that it shook his car and that he had to stop on the side  of the road because he could not see to drive. He stated that, when he arrived home, the  mobile home was leaking; before that, it did not leak. Mr. Jackson also testified that there  was no prior water damage to the roof or the walls and that they had had no problem with  the roof’s ridge cap before the storm.  Although the Jacksons did not testify that they actually saw the windstorm tear up the  roof,  their  testimony  was  sufficient  to  reasonably  infer  that  it  did.  The  law  makes  no  distinction between direct evidence of a fact and circumstances from which a fact can be  inferred. Reed v. Smith Steel, Inc., 77 Ark. App. 110, 78 S.W.3d 118 (2002). Circumstantial  evidence does not directly prove the existence of a fact, but gives rise to a logical inference  that it exists. Id. A fact is established by circumstantial evidence when its existence can be  fairly and reasonably inferred from other facts proved in the case. Id. A well­connected train  of circumstances is as cogent of the existence of a fact as an array of direct evidence and 7  frequently outweighs opposing direct testimony;  any issue of fact in controversy can be  established  by  circumstantial  evidence  when  the  circumstances  adduced  are  such  that  reasonable minds might draw different conclusions. Id.  II. Whether the verdict was excessive  Farm Bureau also argues that the trial court erred in refusing to reduce the verdict to  the amount of the policy limits, less the deductible, and in refusing to give credit for the  value of the mobile home after the loss. It points out that its policy had a limit of $54,000,  subject to a $250 deductible, and that it paid $50 for the damages in 2004. It also states that  there is “no dispute” that the home was valued at $5,000 after the loss. It argues that, if the  Jacksons  are  entitled  to  recover  for  the  loss  under  the  policy,  the  maximum  amount  recoverable would be $48,700.  The Jacksons acknowledge that the policy had a limit of $54,000 and concede that the  judgment should be reduced to reflect that. We agree. We also believe that the jury verdict  must be reduced by $50 that Farm Bureau paid. We do not, however, agree that the judgment  should be further reduced by the $250 deductible nor $5000.  Farm Bureau has failed to  establish that the Jackson’s total damages were less than $54,250 and so are not  entitled to  a reduction of the verdict by the $250 deductible.  Likewise, Farm Bureau is wrong in stating  that there was no dispute that the mobile home had a value of $5000 after the storm — Mrs.  Jackson stated at trial that the house was worth nothing to her. While damages must not be  left to speculation and conjecture, Dawson v. Temps Plus, Inc., 337 Ark. 247, 987 S.W.2d  722 (1999), they may be approximated. Morton v. Park View Apartments, 315 Ark. 400, 868 8  S.W.2d 448 (1993). A damage figure will be upheld if an amount approximating that figure  can be ascertained from the evidence. See Taylor v. Green Mem’l Baptist Church, 5 Ark.  App. 101, 633 S.W.2d 48 (1982). Accordingly, we reduce the judgment to $53,950.  III. Whether there was sufficient evidence of the mobile home’s actual cash value  In its third point, Farm Bureau argues that the trial court erred in refusing to direct a  verdict or grant a new trial because there was no substantial evidence of the actual cash value  of the mobile home immediately before the loss. Farm Bureau’s limit of liability was stated  in the contract to be the least of the cost of repairs, the cost of replacement, the actual cash  value of the property at the time of the loss, or the limits of liability under the policy. It  argues that one could not assume that the home did not depreciate after it was purchased.  Farm Bureau did not, however, include this argument in its motion for directed verdict  or otherwise develop it at trial. Rule 50(a) requires that a party moving for a directed verdict  state specific grounds in order to bring the issue to the trial court’s attention. See Thomas v.  Olson,  364  Ark.  444,  220  S.W.3d  627  (2005).  Failure  to  comply  with  the  requirements  enumerated in Rule 50(a) is a sufficient basis for denial of a motion for directed verdict and  for affirmance on appeal. Id. Requiring specific grounds in a motion for directed verdict is  especially necessary when a case involves multiple issues. Id. Also, an appellant may not  change the grounds for objection on appeal but is limited by the scope and nature of the  objections and arguments presented at trial. McCoy v. Montgomery, __ Ark. __, __ S.W.3d  __ (June 21, 2007). Because this issue was not preserved for appeal, we do not address it.  IV. Whether Farm Bureau should be credited with the $10,000 paid by Redman Homes 9  Farm Bureau argues in its fourth point that the trial court erred in failing to give it  credit for the $10,000 paid in settlement by Redman Homes. The jury was advised that the  Jacksons had received $10,000 in settlement from the mobile home’s manufacturer. The  Jacksons’ attorney informed the jury of this fact in his opening statement, and the court also  told the jury about the settlement. In tort cases, when a jury is informed of the amount of a  pretrial settlement and subsequently awards damages against the remaining defendants in a  general verdict, it is presumed that the damages assessed by the jury are in addition to the  amount already paid by the settling tortfeasor. Bingham v. City of Jonesboro, 89 Ark. App.  120, 201 S.W.3d 1 (2005). If the jury’s verdict is rendered on a general verdict form, it is an  indivisible entity or, in other words, a finding upon the whole case. Hyden v. Highcouch,  Inc., 353 Ark. 609, 110 S.W.3d 760 (2003). Where a general jury verdict is used, the court  will not speculate on what the jury found. Id.  The Jacksons sued Farm Bureau for breach of contract. They sued Drew and Redman  Homes for breach of contract, breach of warranty, various products­liability statutes, and  fraud.  There  is  no  way  to  know  whether  the  jury  considered  Redman  Homes’  $10,000  payment  to  the  Jacksons  as  compensation  for  the  contract  or  tort  claims.  In  light  of  the  information given to the jury, it is logical to presume that the jury took the prior payment into  account in making its award. See Bingham v. City of Jonesboro, supra.  Affirmed as modified.  ROBBINS and VAUGHT, JJ., agree. 10 

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.