{ "id": 9381274, "name": "CERTAIN UNDERWRITERS AT LLOYD'S LONDON, Plaintiff v. JOHN V. HOGAN and SYLVIA A. HOGAN, Defendants; AND JOHN V. HOGAN and SYLVIA A. HOGAN, Third Party Plaintiffs v. BEAM, COOPER, GAINEY & ASSOCIATES T/A NXS, CORPORATION, NXS, CORPORATION; and BEAM COOPER, GAINEY & ASSOCIATES, Third Party Defendants", "name_abbreviation": "Certain Underwriters at Lloyd's London v. Hogan", "decision_date": "2001-12-18", "docket_number": "No. COA00-1319", "first_page": "715", "last_page": "721", "citations": [ { "type": "official", "cite": "147 N.C. App. 715" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "524 S.E.2d 558", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2000, "pin_cites": [ { "page": "563" } ], "opinion_index": 0 }, { "cite": "351 N.C. 293", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 1155833 ], "year": 2000, "pin_cites": [ { "page": "299-300" } ], "opinion_index": 0, "case_paths": [ "/nc/351/0293-01" ] }, { "cite": "544 S.E.2d 609", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2001, "pin_cites": [ { "page": "612" } ], "opinion_index": 0 }, { "cite": "143 N.C. App. 67", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 11433081 ], "year": 2001, "pin_cites": [ { "page": "69" } ], "opinion_index": 0, "case_paths": [ "/nc-app/143/0067-01" ] }, { "cite": "246 S.E.2d 773", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1978, "pin_cites": [ { "page": "777" }, { "page": "777" } ], "opinion_index": 0 }, { "cite": "295 N.C. 500", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8564714 ], "weight": 2, "year": 1978, "pin_cites": [ { "page": "505" }, { "page": "505-06" } ], "opinion_index": 0, "case_paths": [ "/nc/295/0500-01" ] }, { "cite": "348 S.E.2d 794", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1986, "pin_cites": [ { "page": "796" } ], "opinion_index": 0 }, { "cite": "318 N.C. 378", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4736888 ], "year": 1986, "pin_cites": [ { "page": "380" } ], "opinion_index": 0, "case_paths": [ "/nc/318/0378-01" ] }, { "cite": "343 S.E.2d 430", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1986, "pin_cites": [ { "page": "432" } ], "opinion_index": 0 }, { "cite": "80 N.C. App. 643", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8525351 ], "year": 1986, "pin_cites": [ { "page": "647" } ], "opinion_index": 0, "case_paths": [ "/nc-app/80/0643-01" ] }, { "cite": "544 S.E.2d 783", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2000, "opinion_index": 0 }, { "cite": "352 N.C. 590", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 685003, 685101, 684884, 685111, 685081 ], "year": 2000, "opinion_index": 0, "case_paths": [ "/nc/352/0590-05", "/nc/352/0590-02", "/nc/352/0590-01", "/nc/352/0590-03", "/nc/352/0590-04" ] }, { "cite": "530 S.E.2d 93", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2000, "pin_cites": [ { "page": "94-95" } ], "opinion_index": 0 }, { "cite": "138 N.C. App. 530", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 11080676 ], "year": 2000, "pin_cites": [ { "page": "532" } ], "opinion_index": 0, "case_paths": [ "/nc-app/138/0530-01" ] }, { "cite": "502 S.E.2d 648", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1998, "pin_cites": [ { "page": "650", "parenthetical": "quoting N.C. R. Civ. P. 56(c). \"The party moving for summary judgment bears the burden of establishing the lack of any triable issue, and may meet this burden by (1) proving that an essential element of the opposing party's claim is nonexistent; (2" }, { "page": "650" } ], "opinion_index": 0 }, { "cite": "130 N.C. App. 292", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 11466929 ], "weight": 2, "year": 1998, "pin_cites": [ { "page": "294", "parenthetical": "quoting N.C. R. Civ. P. 56(c). \"The party moving for summary judgment bears the burden of establishing the lack of any triable issue, and may meet this burden by (1) proving that an essential element of the opposing party's claim is nonexistent; (2" }, { "page": "294" } ], "opinion_index": 0, "case_paths": [ "/nc-app/130/0292-01" ] } ], "analysis": { "cardinality": 668, "char_count": 15198, "ocr_confidence": 0.771, "pagerank": { "raw": 2.934542146119474e-07, "percentile": 0.8476189152340542 }, "sha256": "37cc01c41b5b9962b26d2c33174b87b5fd1c264860b07b728d8736744dbf68e8", "simhash": "1:9f4f658620270467", "word_count": 2415 }, "last_updated": "2023-07-14T20:07:10.251034+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges GREENE and THOMAS concur." ], "parties": [ "CERTAIN UNDERWRITERS AT LLOYD\u2019S LONDON, Plaintiff v. JOHN V. HOGAN and SYLVIA A. HOGAN, Defendants AND JOHN V. HOGAN and SYLVIA A. HOGAN, Third Party Plaintiffs v. BEAM, COOPER, GAINEY & ASSOCIATES T/A NXS, CORPORATION, NXS, CORPORATION; and BEAM COOPER, GAINEY & ASSOCIATES, Third Party Defendants" ], "opinions": [ { "text": "CAMPBELL, Judge.\nJohn and Sylvia Hogan (\u201cdefendants\u201d or \u201cthe Hogans\u201d) appeal from an award of summary judgment for Certain Underwriters at Lloyd\u2019s London (\u201cLloyd\u2019s\u201d) on the question of whether defendants have presented sufficient documentation under the terms of their insurance policy with Lloyd\u2019s to entitle defendants to recover for the loss of rents resulting from their condominium being damaged and unfit to live in. Having found no error of law, we affirm the ruling of the trial court.\nDefendants are the owners of Condominium Unit 803 at Shell Island Resort Hotel in Wrightsville Beach, North Carolina. Defendants purchased Lloyd\u2019s insurance policy number 20982 (\u201cthe policy\u201d) to insure their condominium. Coverage B of the policy provides up to $4,000.00 of loss of use coverage, which includes coverage for loss of rents. It is undisputed that the Hogans\u2019 policy was in effect from 30 December 1995 to 30 December 1996, during which time their claim arose.\nOn 6 September 1996, Hurricane Fran struck the coast of North Carolina, inflicting extensive damage on Shell Island Resort Hotel. As a result of this damage, defendants\u2019 condominium was condemned for repairs from 6 September 1996 to 7 August 1997. Consequently, the Hogans filed a claim under the policy seeking recovery for loss of rents during the time their condominium was being repaired.\nIn support of their loss of rents claim, defendants submitted a copy of the property management agreement between defendants and MHI Recovery Management, Inc. (\u201cMHI\u201d), setting forth the manner in which defendants\u2019 condominium was rented prior to being damaged. Similar to the manner in which hotel rooms are rented, MHI maintained a reservations desk at Shell Island Resort which took advance and walk-in reservations, and at the time the guests arrived they were assigned (i.e., \u201crented\u201d) a condominium unit. MHI rented the condominium units at Shell Island Resort on a rotating basis, whereby the units with the lowest year-to-date gross rental revenue would be rented first. This rental scheme was designed to ensure that all units were rented on an equal basis.\nIn support of their claim, defendants also submitted a statement from MHI detailing the manner in which the condominiums at Shell Island Resort were rented, a lost business report from Shell Island Resort detailing the reservations that were canceled as a result of the damage to the condominium units and the actual monetary losses associated with the cancellations, and a rental history of defendants\u2019 condominium showing the yearly rental revenues received by defendants from 1994-1996.\nOn 28 January 1997, Lloyd\u2019s denied defendants\u2019 loss of rents claim on the ground that defendants had failed to provide a written rental contract with a bona fide third-party tenant who intended personally to occupy defendants\u2019 condominium for a specific term.\nFollowing further demands by defendants for payment, Lloyd\u2019s filed the instant declaratory judgment action seeking a declaration that defendants have not provided sufficient documentation under the loss of rents provision to warrant recovery on their claim. Defendants answered and filed a counterclaim against plaintiff for breach of contract, contending that the property management agreement with MHI was sufficient documentation to support defendants\u2019 loss of rents claim. Defendants\u2019 counterclaim further contended that plaintiff was vicariously liable for the actions of the insurance broker who procured defendants\u2019 policy. In addition, defendants filed a third-party complaint against the insurance broker, alleging breach of contract, breach of fiduciary duty, negligent misrepresentation, and unfair and deceptive trade practices.\nDefendants filed a motion for summary judgment on Lloyd\u2019s declaratory judgment action. Lloyd\u2019s responded by filing a summary judgment motion of its own. Following a hearing on the motions, the trial court granted summary judgment in favor of Lloyd\u2019s. The trial court\u2019s summary judgment order was specifically limited to the issue of whether defendants had presented the documents required for recovery under the policy\u2019s loss of rents provision. The trial court\u2019s order did not in any way affect defendants\u2019 counterclaims or third-party complaint. The trial court\u2019s order was properly certified for immediate appellate review pursuant to Rule 54(b) of the North Carolina Rules of Civil Procedure, thereby making our review of this interlocutory order appropriate.\nBy their sole assignment of error, the Hogans contend that in awarding summary judgment for Lloyd\u2019s, the trial court erroneously construed the provisions of the policy. The Hogans argue that the policy\u2019s loss of rents provision is ambiguous as to whether an actual rental contract with a third-party tenant who intends to personally occupy the condominium is a requirement for coverage under the provision. The Hogans contend that this ambiguity should be resolved in favor of coverage and that the provision should be interpreted in a manner that allows defendants\u2019 property management agreement with MHI to suffice as proof of loss of rents under the provision. We disagree.\n\u201cA party seeking a declaratory judgment may properly be granted summary judgment \u2018if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that any party is entitled to a judgment as a matter of law.\u2019 \u201d Nationwide Mut. Fire Ins. Co. v. Grady, 130 N.C. App. 292, 294, 502 S.E.2d 648, 650 (1998) (quoting N.C. R. Civ. P. 56(c). \u201cThe party moving for summary judgment bears the burden of establishing the lack of any triable issue, and may meet this burden by (1) proving that an essential element of the opposing party\u2019s claim is nonexistent; (2) showing through discovery that the opposing party cannot produce evidence to support an essential element; or (3) showing that the opposing party cannot surmount an affirmative defense.\u201d N.C. Farm Bureau Mut. Ins. Co. v. Mizell, 138 N.C. App. 530, 532, 530 S.E.2d 93, 94-95, disc. review denied, 352 N.C. 590, 544 S.E.2d 783 (2000). The construction and application of insurance policy provisions to undisputed facts is a question of law, properly committed to the province of the trial judge for a summary judgment determination. Nationwide, 130 N.C. App. at 294, 502 S.E.2d at 650; Walsh v. National Indemnity Co., 80 N.C. App. 643, 647, 343 S.E.2d 430, 432 (1986). Therefore, in the instant case, if the policy\u2019s loss of rents provision requires defendants to submit a written rental contract with a third-party tenant who personally intends to occupy defendants\u2019 condominium, summary judgment in favor of Lloyd\u2019s was proper.\nWe begin by noting several well-settled principles governing the construction of insurance policies. \u201c[A]n insurance policy is a contract and its provisions govern the rights and duties of the parties thereto,\u201d Fidelity Bankers Life Ins. Co. v. Dortch, 318 N.C. 378, 380, 348 S.E.2d 794, 796 (1986), and \u201c[a]s with all contracts, the goal of construction is to arrive at the intent of the parties when the policy was issued.\u201d Woods v. Insurance Co., 295 N.C. 500, 505, 246 S.E.2d 773, 777 (1978). \u201cThe parties\u2019 intent may be derived from the language employed in the policy.\u201d Rouse v. Williams Realty Bldg. Co., 143 N.C. App. 67, 69, 544 S.E.2d 609, 612 (2001). In determining the meaning of the language used in an insurance policy, the following general rules of construction apply:\nWhere a policy defines a term, that definition is to be used. If no definition is given, non-technical words are to be given their meaning in ordinary speech, unless the context clearly indicates another meaning was intended. The various terms of the policy are to be harmoniously construed, and if possible, every word and every provision is to be given effect. If, however, the meaning of words or the effect of provisions is uncertain or capable of several reasonable interpretations, the doubts will be resolved against the insurance company and in favor of the policyholder. Whereas, if the meaning of the policy is clear and only one reasonable interpretation exists, the courts must enforce the contract as written; they may not, under the guise of construing an ambiguous term, rewrite the contract or impose liabilities on the parties not bargained for and found therein.\nWoods, 295 N.C. at 505-06, 246 S.E.2d at 777; see also Gaston County Dyeing Machine Co. v. Northfield Ins. Co., 351 N.C. 293, 299-300, 524 S.E.2d 558, 563 (2000). We apply these principles to the insurance policy in the instant case.\nThe Lloyd\u2019s policy issued to defendants contains the following relevant coverage provision:\nCOVERAGE B \u2014 LOSS OF USE\n2. LOSS OF RENTS. If a loss caused by a PERIL INSURED AGAINST makes that part of the insured premises rented to others (under a \u201crental contract\u201d) NOT FIT TO LIVE IN, we cover your actual loss of rents, less any expenses that do NOT continue while that part of the insured premises is not fit to live in. Loss payment will be limited to the lesser of:\nA. the SHORTEST TIME required to repair or replace the part of the premises rented or held for rental;\nB. NET RENTAL PROCEEDS that would be payable to you had the premises been occupied in accordance with \u201crental contract.\u201d\nThe \u201crental contract\u201d for the insured premises must be:\nA. WRITTEN;\nB. made with a BONA FIDE THIRD PARTY TENANT (Tenant must intend to personally occupy insured premises);\nC. for a SPECIFIC TERM (Specific term does not include any renewal term contained in any \u201crental contract\u201d unless tenant has given actual written notice of intent to exercise its rights under the renewal term prior to occurrence of loss.).\nWe DO NOT cover any loss or expense due to cancellation of a \u201crental contract\u201d.\nDefendants contend that the language used in the loss of rents provision is ambiguous and should be construed in their favor. While they concede that the provision purports to require that the condominium actually be rented under a written rental contract with a third-party tenant who intends to personally occupy it for a specific term, defendants argue that the language in the loss payment clause clearly contemplates that defendants are entitled to payment when the property is \u201cheld for rental,\u201d even in the absence of an actual written rental contract. Defining \u201cheld for rental\u201d to mean maintaining possession of something which is available for use in return for payment, defendants contend that the property management agreement with MHI indicates the condominium was available for use in return for payment, and is therefore sufficient documentation of loss of rents under the provision.\nLloyd\u2019s contends that the loss of rents provision is not ambiguous because the coverage section clearly requires that the condominium be rented to others under a \u201crental contract,\u201d which is expressly defined as a written contract with a third-party tenant who intends to occupy the condominium for a specific term. According to Lloyd\u2019s, absent a \u201crental contract\u201d as defined in the provision, defendants are not entitled to coverage, and any alleged ambiguity created by the provision limiting the amount of loss payment is irrelevant because defendants have not met the coverage requirements.\nHaving considered the arguments of both sides, the trial court concluded that any ambiguity in the phrase \u201cheld for rental\u201d did not affect the meaning of \u201crental contract,\u201d which was clearly defined and set forth four times in the provision. Finding that the documents defendants had presented Lloyd\u2019s did not constitute a contract with a third-party tenant who intended to personally occupy the condominium, the trial court granted summary judgment for Lloyds. We agree with the trial court\u2019s decision, but differ slightly with the trial court\u2019s reasoning in reaching our decision.\nThe coverage clause of the loss of rents provision at issue clearly and unambiguously rests coverage on whether the condominium is \u201crented to others (under a \u2018rental contract\u2019),\u201d and expressly defines \u201crental contract\u201d as a written contract with a tenant who personally intends to occupy the condominium. The alleged ambiguity arises by operation of the loss payment clause which limits payment to \u201cthe SHORTEST TIME required to repair or replace the part of the condominium rented or \u2018held for rental.\u2019 \u201d However, following well-settled principles of construction of insurance policies, and in light of the express definition of \u201crental contract,\u201d the phrase \u201cheld for rental\u201d in the loss payment clause is to be interpreted in context and construed in a manner that gives proper meaning and effect to the provision as a whole. The phrase \u201cheld for rental\u201d cannot be given a meaning that conflicts with the express definition of \u201crental contract.\u201d Therefore, we conclude that the provision requires the condominium be rented, or \u201cheld for rental,\u201d pursuant to a written rental contract with a tenant who actually occupies or intends to personally occupy the condominium. The phrase \u201cheld for rental\u201d merely indicates that the condominium need not actually be occupied by a tenant at the time it is rendered unfit to live in, but that coverage will be provided if the damage to the condominium prevents future tenants under a \u201crental contract\u201d from occupying the condominium. Any other interpretation of the phrase \u201cheld for rental\u201d would contradict the express definition of \u201crental contract\u201d contained in the policy. We refuse to interpret the policy in that manner.\nIn sum, we conclude that the loss of rents provision is not ambiguous and the trial court did not err in awarding summary judgment for Lloyd\u2019s. The trial court is affirmed.\nAffirmed.\nJudges GREENE and THOMAS concur.\n. Therefore, defendants\u2019 counterclaims and third party claims are not before us on this appeal.", "type": "majority", "author": "CAMPBELL, Judge." } ], "attorneys": [ "Johnson & Lambeth, by Robert White Johnson, for plaintiff-appellee.", "Jennifer L. Umbaugh, for defendant-appellants." ], "corrections": "", "head_matter": "CERTAIN UNDERWRITERS AT LLOYD\u2019S LONDON, Plaintiff v. JOHN V. HOGAN and SYLVIA A. HOGAN, Defendants AND JOHN V. HOGAN and SYLVIA A. HOGAN, Third Party Plaintiffs v. BEAM, COOPER, GAINEY & ASSOCIATES T/A NXS, CORPORATION, NXS, CORPORATION; and BEAM COOPER, GAINEY & ASSOCIATES, Third Party Defendants\nNo. COA00-1319\n(Filed 18 December 2001)\nInsurance\u2014 condominium \u2014 loss of rents \u2014 sufficiency of documentation\nThe trial court did not err in a declaratory judgment action by granting summary judgment in favor of plaintiff on the issue of whether defendants have presented sufficient documentation under the terms of their insurance policy with plaintiff to entitle defendants to recover for the loss of rents resulting from their condominium being damaged and unfit to live in, because the policy was not ambiguous and its loss of rents provision requires defendants to submit a written rental contract with a third-party tenant who actually occupies or personally intends to occupy defendant\u2019s condominium.\nAppeal by defendants from judgment entered 2 October 2000 by Judge Anthony M. Brannon in New Hanover County Superior Court. Heard in the Court of Appeals 18 September 2001.\nJohnson & Lambeth, by Robert White Johnson, for plaintiff-appellee.\nJennifer L. Umbaugh, for defendant-appellants." }, "file_name": "0715-01", "first_page_order": 745, "last_page_order": 751 }