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Gahnney v. State Farm Insurance Co.

July 27, 1999

KWESI GAHNNEY AND MANGOWA GAHNNEY,
PLAINTIFFS,
V.
STATE FARM INSURANCE CO., JOHN DOE, AND ABC CORP.,
DEFENDANTS.



The opinion of the court was delivered by: Irenas, District Judge:

HONORABLE JOSEPH E. IRENAS

OPINION

Kwesi and Mangowa Gahnney ("plaintiffs") entered into a homeowners insurance contract with the defendant State Farm Insurance Company ("State Farm") on August 27, 1995. The plaintiffs allege that State Farm failed to honor the terms of the insurance contract when it refused to reimburse the plaintiffs for the full amount of the damages caused to the their residence as a result of snow and ice from a 1996 winter storm. Before this Court is State Farm's motion for summary judgment, pursuant to Federal Rules of Civil Procedure 56(c). For the reasons set forth below, State Farm's motion for summary judgment is granted.

I. FACTS AND PROCEDURE

The plaintiffs are the owners and residents of 81 Bunning Drive in Voorhees, New Jersey. On August 27, 1995, defendant State Farm issued the plaintiffs an insurance policy, #30-BB-0283-4, which covers, inter alia, water damage to the plaintiffs' Voorhees residence. *fn1 The policy expired on August 27, 1996. During the winter of 1995-96, the heavy weight of the ice and snowfall caused damages to the plaintiffs' premises.

In January of 1996, the plaintiffs began to notice the damaging effects of the storm when water began leaking through their skylight, the windows of the master bedroom, the French doors and the family room. In May of 1996, the plaintiffs realized the full extent of the water damages when the snow completely melted. It was not until July of 1996, that the plaintiffs contend that they realized the full extent of the soot damages.

Plaintiffs claim that the full extent of the general damages include: roof repair, gutter, facet board behind gutter, front porch roof, siding repairs, water damages (living room, foyer, office, family room, master bedroom, master bathroom), and soot damages (living room, foyer, dining room, downstairs hall, office, family room, upstairs hall, kitchen, master bedroom, master bathroom, and all three remaining bedrooms).

On July 16, 1996, the plaintiffs hired Messers Remmey ("Remmey") of Remmey Adjustment Company to advise and assist in the adjustment of the plaintiffs' claim. The plaintiffs assert that they gave State Farm notice of their claim on the same day when Remmey allegedly faxed the plaintiffs' claim request to State Farm representative Carl Hafer ("Agent Hafer"). State Farm disagrees and alleges that the plaintiffs did not report the damages until September 30, 1996.

On October 9, 1996, Agent Hafer and Remmey inspected the plaintiffs' home. As a result of the inspection, State Farm offered the plaintiffs a total replacement cost of $3,270 and an actual cash value of $2,686. *fn2 According to State Farm, Remmey told the plaintiffs that the damage estimate was fair and that they should accept the offer. On February 10, 1997, the plaintiffs ended their relationship with Remmey on the grounds that he failed to do his job adequately and failed to conduct an independent estimate of the damages to their home.

On March 11, 1997, the plaintiffs submitted to State Farm a damage estimate calculated by Mark Woodruff ("Woodruff") of Metro Public Adjusters, Inc. ("Metro"). Woodruff estimated the damages to the plaintiffs' home at $23,906.72. Plaintiffs allege that following the Woodruff estimate, on March 20, 1997, Agent Hafer increased the amount of his damage estimate. However, the actual amount of the new estimate is unknown because Agent Hafer was fired before the plaintiffs received notice of the new award. The plaintiffs' claim was then assigned to Mr. Garcia ("Agent Garcia") of State Farm.

On or about April 11, 1997, the plaintiffs requested an appraisal. *fn3 However, State Farm requested a chance to re-inspect the premises before resorting to an appraisal. On May 13, 1997, State Farm's Agent Garcia and Kevin Rogers met with Mrs. Gahnney and Woodruff to re-inspect the damages. State Farm did not increase its offer, choosing instead to maintain the initial estimate of a total replacement cost of $3,270 and an actual cash value of $2,686. Unsatisfied with the outcome, the plaintiffs and State Farm commenced the independent appraisal.

G. Michael Murphy and Alan Burke were the independent appraisers appointed by State Farm and the plaintiffs, respectively. On August 5, 1997, the independent appraisers agreed to a total replacement cost of $4,716.22 and an actual cash value of $3,984.68. On August 27, 1997, State Farm sent a check to the plaintiffs in the amount of the $3,984.68. The plaintiffs contend that the appraisal award became known to them on September 4, 1997, when it was forwarded by Metro. The plaintiffs did not cash the check because it was significantly less than Metro's estimate of $23,906.72.

On August 7, 1998, the plaintiffs filed a complaint in the Superior Court of New Jersey and on October 9, 1998, State Farm filed a notice of removal, pursuant to 28 U.S.C. ยงยง 1446, 1441, and 1332. On May 13, 1999, State Farm filed the ...


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