SHELLANE WILLIAMS, Plaintiff-Appellant, vs. PEKIN INSURANCE COMPANY, Defendant-Appellee.
Annotate this Case
Download PDF
IN THE COURT OF APPEALS OF IOWA
No. 9-822 / 09-0799
Filed December 17, 2009
SHELLANE WILLIAMS,
Plaintiff-Appellant,
vs.
PEKIN INSURANCE COMPANY,
Defendant-Appellee.
________________________________________________________________
Appeal from the Iowa District Court for Polk County, Eliza J. Ovrom,
Judge.
Plaintiff appeals the district court’s order granting summary judgment to
the defendant insurance company in this declaratory judgment action on whether
there was coverage under her insurance policy. AFFIRMED.
Thomas J. Duff of Duff Law Firm, P.L.C., Des Moines, for appellant.
Kevin M. Reynolds and Karin J. Derry of Whitfield & Eddy, P.L.C., Des
Moines, for appellee.
Considered by Eisenhauer, P.J., Potterfield, J., and Mahan, S.J.*
*Senior judge assigned by order pursuant to Iowa Code section 602.9206 (2009).
2
MAHAN, S.J.
I.
Background Facts & Proceedings
Shellane Williams has a homeowner’s insurance policy with Pekin
Insurance Company for her home in Dakota City, Iowa.
On June 26, 2005,
Williams made a claim on her policy for flooding in her basement caused by a
backed-up sewer. She had coverage under an endorsement for “Water Back-up
of Sewers or Drains,” which provided, “The Limit of Liability for any one loss is
$5000.” Pekin paid Williams $5000 under this endorsement.
Williams pumped the water and sewage out of the basement and used
fans to dry the area. She cleaned the floor and walls with bleach and water. In
late 2006, Williams noticed mold on the walls of the basement.
On July 26, 2007, Williams filed a claim with Pekin for mold damage in her
home. David Wolter, a claims adjuster, personally inspected Williams’s home.
Pekin denied the claim under the language of the endorsement for “Limited
Fungi, Wet or Dry Rot, or Bacteria Coverage.”
This endorsement denies
coverage for loss:
Caused by constant or repeated seepage or leakage of
water or the presence of condensation of humidity, moisture or
vapor, over a period of weeks, months or years unless such
seepage or leakage of water or the presence or condensation of
humidity, moisture or vapor and the resulting damage is unknown
to all “insureds” and is hidden within the walls or ceilings or beneath
the floors or above the ceilings of a structure.
(Emphasis added). Pekin claimed the presence of water in Williams’s basement
was not unknown to her because she had made a claim for the flooding of her
basement in 2005.
3
On January 7, 2008, Williams had her home inspected by Lowell Leemkuil
of Sherlock Home Inspectors, Inc.1 Leemkuil found Williams’s problems were
caused by “[w]ater backup into the house from the sewage system.” He found
“[m]old was located on the walls, hidden inside the basement wall, on the ceiling,
and on the framing, joists, and sub floor.” Leemkuil recommended the home
should be treated by professional mold remediators and that the “whole house
including the main floor and basement should be considered contaminated.”
Williams filed a petition for a declaratory judgment against Pekin seeking
coverage for the mold damage to her home. Pekin filed a motion for summary
judgment, asserting there was no coverage under the policy for Williams’s
damages. The district court granted the motion for summary judgment. The
court determined the policy required “that both the source and the resulting
damage be unknown to the insured.” (Emphasis added). The court concluded:
It is undisputed that plaintiff was aware of the flooding in her
basement in June 2005. This was the cause of mold in her
basement in late 2006. While the mold may have been hidden, the
source was known to plaintiff. Therefore, the damage to plaintiff’s
home from the hidden mold is not covered under the Endorsement
HO-504 concerning Limited Fungi, Wet or Dry Rot, or Bacterial
Coverage.
Williams appeals the district court’s decision granting summary judgment to
Pekin.
II.
1
Standard of Review
In the meantime, on August 21, 2007, the basement had again flooded due to a backup of the sewer line. Williams received $5000 under the “Water Back-up of Sewers or
Drains” endorsement in her policy with Pekin. After this second incident, the walls in the
basement were removed except for the load-bearing wall.
4
We review the district court’s ruling on a motion for summary judgment for
the correction of errors at law. See Iowa R. App. P. 6.907. Summary judgment
is appropriate only when there are no genuine issues of material fact and the
moving party is entitled to judgment as a matter of law. Iowa R. Civ. P. 1.981(3);
Kistler v. City of Perry, 719 N.W.2d 804, 805 (Iowa 2006). A court should view
the record in the light most favorable to the non-moving party. Kern v. Palmer
Coll. of Chiropractic, 757 N.W.2d 651, 657 (Iowa 2008). In determining whether
there is a genuine issue of material fact, the court affords the non-moving party
every legitimate inference the record will bear. Id.
III.
Merits
The construction and interpretation of an insurance policy is a question of
law for the court to determine. Essex Ins. Co. v. Fieldhouse, Inc., 506 N.W.2d
772, 775 (Iowa 1993). If there is no fact question, and the only conflict concerns
the legal consequences flowing from the undisputed facts, such as in the
construction and interpretation of an insurance policy, summary judgment is
appropriate. Grinnell Mut. Reins. Co. v. Jungling, 654 N.W.2d 530, 535 (Iowa
2002).
We interpret an insurance policy by looking at the meaning of the words
used in the policy, and we construe the policy to determine its legal effect.
American Family Life Ins. Co. v. Corrigan, 697 N.W.2d 108, 111 (Iowa 2005). If
a policy is susceptible to more than one interpretation it is ambiguous, and we
must construe the meaning of the terms. First Newton Nat’l Bank v. Gen. Cas.
Co., 426 N.W.2d 618, 628 (Iowa 1988). Our construction of ambiguous terms is
5
in the light most favorable to the insured, because insurance policies are
contracts of adhesion.
Id.
“[W]hen an insurer has affirmatively expressed
coverage through broad promises, it assumes a duty to define any limitations or
exclusionary clauses in clear and explicit terms.”
Grinnell Mut. Reins., 654
N.W.2d at 536.
Williams contends the district court improperly required her to show the
seepage or leakage of water, and the presence of humidity, moisture or vapor,
and the resulting damage was unknown to her. Williams argues that although
she was aware of the seepage or leakage of water into her basement, she is still
entitled to coverage because she was unaware of the presence of humidity,
moisture, or vapor in her home, and was unaware of the resulting mold damage.
We determine the district court did not err in its interpretation of the
homeowner’s policy. The court determined the policy required a homeowner to
show: (1) water seepage or leakage or the presence of humidity, moisture or
vapor is unknown to the homeowner; and (2) the resulting damage is unknown
and the damage is hidden within the walls, ceiling, or floors. As the district court
found, the language of the policy “clearly requires that both the source and the
resulting damage be unknown to the insured.”
Williams does not dispute she was aware of the flooding in her basement
in June 2005 caused by a backed-up sewer pipe. Furthermore, it is clear the
mold damage was caused by the flooding from this event.
The report by
Leemkuil states Williams’s problems were caused by “[w]ater backup into the
house from the sewage system.” Thus, the “resulting damage,” the mold in the
6
home, was the result of an event not unknown to Williams. She is not claiming
the humidity, moisture, or vapor in the home was caused by an unknown event;
she concedes the humidity, moisture, or vapor was caused by the flooding.
We conclude the district court did not err in concluding the policy requires
the “resulting damage” and the cause of the damage be unknown to the
homeowner.
In this case, the cause of the damage was not unknown to
Williams.
Because of our decision on this issue, we do not address a separate issue
concerning whether there could be any recovery beyond the limit of liability of
$5000 in the “Water Back-up of Sewers or Drains” endorsement.
We affirm the decision of the district court.
AFFIRMED.
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.
