Central Baptist Church of Albany, Georgia, suffered roof damage during a hailstorm in 2014. Its insurance carrier, Church Mutual Insurance, determined that the roof had only minor damage that could be repaired. It offered $2,300 for the work. After the deductible, the payout amounted to just $1,303.
The church objected, providing contractor estimates of about $1.4 million to replace the roofs on the sprawling, three-winged church building.
The congregation sued the insurer and years later, after a second storm and extensive litigation, a jury awarded $1.7 million against Church Mutual. The insurer appealed and, this week, the U.S. 11th Circuit Court of Appeals upheld the jury verdict and found that the trial court had not erred in allowing the award.
“Finding no basis to revisit the evidentiary ruling and no error in the court’s denial of post-trial relief, we affirm the judgment based on the jury’s verdict,” the appeal court judges wrote in the July 21 opinion.
A key issue in the appeal was Church Mutual’s argument that the house of worship had never mentioned that, after Hurricane Michael in 2018, it had obtained another roof replacement bid of $718,469 – well below the first estimate. The church was at that time insured by AmTrust North America and the church filed a claim on the wind damage. Failing to disclose that to Church Mutual during the litigation amounted to material misrepresentation, Church Mutual’s attorneys contended.
The church’s lawyers explained that the original, Church Mutual insurance policy stipulated repair and replacement of “comparable kind and quality.” Since much of the church roof material was asbestos and was no longer manufactured, contractors had estimated the cost of a replacement using slate, an expensive material.
But the later estimate, after Hurricane Michael, was not for comparable-type roofing material, the court explained.
Also, Church Mutual’s legal team made a crucial mistake by not fully objecting to the trial court’s exclusion of evidence of the Baptists’ alleged misrepresentation, effectively barring that defense on appeal, the 11th Circuit judges noted. The trial judge had found that the insurer had not shown that the church’s omission of the second claim was a misrepresentation.
“In sum, the record shows an intent by the insurance company to abandon the misrepresentation defense,” appellate Judge Frederico Moreno wrote in the opinon. “Accordingly, the issue is not preserved for appeal, and we may not opine on the court’s decision to exclude evidence of the alleged misrepresentation.”
The jury arrived at the $1.7 million figure after hearing testimony from a contractor who noted that plans for tariffs on steel and oil had significantly raised the cost of building materials and repairs. Church Mutual withdrew an objection to that assertion during the trial.
“After benefiting from oral argument, we find no error in the district court’s rulings and affirm the jury’s verdict,” the appeals court noted.
The full opinion can be seen here.
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