                                                                          FILED
                                                                      Oct 16 2018, 8:50 am

                                                                          CLERK
                                                                      Indiana Supreme Court
                                                                         Court of Appeals
                                                                           and Tax Court




ATTORNEY FOR APPELLANT                                     ATTORNEYS FOR APPELLEE
Stephen C. Wheeler                                         Thomas M. Beeman
Smith Fisher Maas Howard & Lloyd,                          Beeman Law
P.C.                                                       Anderson, Indiana
Indianapolis, Indiana



                                             IN THE
    COURT OF APPEALS OF INDIANA

Berkshire Hathaway Homestate                               October 16, 2018
Insurance Company,                                         Court of Appeals Case No.
Appellant-Defendant,                                       18A-PL-446
                                                           Appeal from the Madison Circuit
        v.                                                 Court
                                                           The Honorable David A. Happe,
Christina Basham d/b/a Basham                              Judge
Family, L.P.,                                              The Honorable Kevin M. Eads,
Appellee-Plaintiff,                                        Magistrate
                                                           Trial Court Cause No.
                                                           48C04-1704-PL-38
Voldico, LLC, Andrew Vollmer,
Standard Agencies, Inc., and
Carol J. Jenkinson,
Defendants.




Najam, Judge.


Court of Appeals of Indiana | Opinion 18A-PL-446 | October 16, 2018                           Page 1 of 11
                                         Statement of the Case
[1]   Berkshire Hathaway Homestate Insurance Company (“Berkshire Hathaway”)

      appeals the trial court’s denial of its motion for partial summary judgment and

      grant of summary judgment for Christina Basham d/b/a Basham Family, L.P.

      (“Basham”) on Basham’s complaint, which alleged that Berkshire Hathaway

      had wrongfully denied insurance coverage on a detached garage.1 Berkshire

      Hathaway raises one issue for our review, namely, whether the trial court erred

      when it denied its motion for summary judgment and entered summary

      judgment for Basham.2


[2]   We affirm.


                                   Facts and Procedural History
[3]   Basham owns fifteen rental properties. Basham obtained an insurance policy

      from Berkshire Hathaway to cover the rental properties, which was effective

      from November 17, 2016, until November 17, 2017. The insurance policy

      provided, in relevant part, as follows:


               A. Coverage




      1
        Voldico, LLC; Andrew Vollmer; Standard Agencies, Inc.; and Carol J. Jenkinson, named defendants
      below, do not participate in this appeal.
      2
        Basham cross appeals and asserts that the trial court erred when it concluded that the insurance policy was
      ambiguous. However, because we must determine whether the contract was ambiguous in order to address
      Berkshire Hathaway’s claim, we need not separately address Basham’s contention on cross-appeal.



      Court of Appeals of Indiana | Opinion 18A-PL-446 | October 16, 2018                              Page 2 of 11
                   [Berkshire Hathaway] will pay for direct physical loss of or
                   damage to Covered Property at the premises described in the
                   Declarations caused by or resulting from any Covered Cause
                   of Loss.


                   1. Covered Property


                       Covered Property, as used in this Coverage Part, means
                       the type of property described in this section, A.1., and
                       limited in A.2, Property Not Covered, if a Limit of
                       Insurance is shown in the Declarations for that type of
                       property.


                       a. Building, meaning the building or structure described in
                       the Declarations, including:


                       (1) Completed additions[.]


      Appellant’s App. Vol. II at 24 (bold removed). The insurance policy also

      contained a section entitled “Property Not Covered,” which described various

      items or categories of items that were not covered by the insurance policy.


[4]   Berkshire Hathaway issued one insurance policy to cover all fifteen properties.

      In addition, Berkshire Hathaway issued declarations for each individual

      property. One of the covered properties is located in Elwood. The declarations

      for that property provided a description of the premises and the coverage

      provided. Under the “Description of Premises,” the declarations identified the

      premises as “Premises Number: 15[,] Building Number: 1[.]” Id. at 23. The

      declarations also included an address of 800 N. 13th St., Elwood, IN 46036,


      Court of Appeals of Indiana | Opinion 18A-PL-446 | October 16, 2018          Page 3 of 11
      and it listed the occupancy as “RENTAL DWELLINGS–OTHER THAN

      STUDENT HOUSING.” Id.


[5]   The premises in Elwood included a house and a detached garage. On

      December 30, 2016, a fire burned down the garage and greatly damaged the

      house. Basham filed a claim with Berkshire Hathaway for the damages.

      Berkshire Hathaway paid for the damage to the house, but it denied Basham’s

      claim for damage to the detached garage. In particular, Berkshire Hathaway

      stated that “the detached garage does not meet the definition of Covered

      Property, as outlined by the Policy. The garage was not specifically insured on

      the Policy. The Policy only applies to Covered Property.” Id. at 157.


[6]   On April 25, 2017, Basham filed a complaint against Berkshire Hathaway in

      which she alleged that Berkshire Hathaway had wrongfully denied insurance

      coverage on the detached garage. Thereafter, on July 17, Basham filed a

      motion for partial summary judgment.3 In that motion, Basham alleged that

      the insurance policy was unambiguous and covered the garage. In the

      alternative, Basham contended that, even if the policy was ambiguous, the

      ambiguous policy should be construed in her favor to cover the garage.


[7]   In response, Berkshire Hathaway asserted that the detached garage was not

      covered under the policy because the garage was not a completed addition.




      3
        Basham also included separate claims against other defendants in her complaint. But her motion for
      partial summary judgment was limited to her claims against Berkshire Hathaway.

      Court of Appeals of Indiana | Opinion 18A-PL-446 | October 16, 2018                           Page 4 of 11
      Further, Berkshire Hathaway filed a counter motion for summary judgment in

      which it contended that the policy was unambiguous and did not cover the

      detached garage. In support of their respective motions for summary judgment,

      both parties designated the insurance policy and declarations as evidence. After

      a hearing on the cross motions for summary judgment, the trial court concluded

      that the insurance policy was ambiguous and interpreted the policy in Basham’s

      favor. Accordingly, the court determined that the detached garage was covered

      by the policy, entered summary judgment for Basham, and denied Berkshire

      Hathaway’s motion for summary judgment. This interlocutory appeal ensued.


                                      Discussion and Decision
[8]   Berkshire Hathaway contends that the trial court erred when it denied Berkshire

      Hathaway’s motion for summary judgment and entered summary judgment for

      Basham. Our standard of review is clear. The Indiana Supreme Court has

      explained that


              [w]e review summary judgment de novo, applying the same
              standard as the trial court: “Drawing all reasonable inferences in
              favor of . . . the non-moving parties, summary judgment is
              appropriate ‘if the designated evidentiary matter shows that there
              is no genuine issue as to any material fact and that the moving
              party is entitled to judgment as a matter of law.’” Williams v.
              Tharp, 914 N.E.2d 756, 761 (Ind. 2009) (quoting T.R. 56(C)). “A
              fact is ‘material’ if its resolution would affect the outcome of the
              case, and an issue is ‘genuine’ if a trier of fact is required to
              resolve the parties’ differing accounts of the truth, or if the
              undisputed material facts support conflicting reasonable
              inferences.” Id. (internal citations omitted).


      Court of Appeals of Indiana | Opinion 18A-PL-446 | October 16, 2018       Page 5 of 11
               The initial burden is on the summary-judgment movant to
               “demonstrate [ ] the absence of any genuine issue of fact as to a
               determinative issue,” at which point the burden shifts to the non-
               movant to “come forward with contrary evidence” showing an
               issue for the trier of fact. Id. at 761-62 (internal quotation marks
               and substitution omitted). And “[a]lthough the non-moving
               party has the burden on appeal of persuading us that the grant of
               summary judgment was erroneous, we carefully assess the trial
               court’s decision to ensure that he was not improperly denied his
               day in court.” McSwane v. Bloomington Hosp. & Healthcare Sys.,
               916 N.E.2d 906, 909-10 (Ind. 2009) (internal quotation marks
               omitted).


       Hughley v. State, 15 N.E.3d 1000, 1003 (Ind. 2014) (omission and some

       alterations original to Hughley). “‘The fact that the parties have filed cross-

       motions for summary judgment does not alter our standard of review, as we

       consider each motion separately to determine whether the moving party is

       entitled to judgment as a matter of law.’” SCI Propane, LLC v. Frederick, 39

       N.E.3d 675, 677 (Ind. 2015) (quoting Reed v. Reid, 980 N.E.2d 277, 285 (Ind.

       2012)).


[9]    Here, the trial court entered findings of fact and conclusions thereon in its

       summary judgment order. While such findings and conclusions are not

       required in a summary judgment and do not alter our standard of review, they

       are helpful on appeal for us to understand the reasoning of the trial court. See

       Knighten v. E. Chicago Hous. Auth., 45 N.E.3d 788, 791 (Ind. 2015).


[10]   Both parties agree that coverage under the insurance policy is limited to

       Covered Property. But, on appeal, the parties dispute whether the detached

       Court of Appeals of Indiana | Opinion 18A-PL-446 | October 16, 2018        Page 6 of 11
       garage was “Covered Property” under the terms of the policy. “The

       interpretation of an insurance policy is primarily a question of law for the court,

       and it is therefore a question which is particularly suited for summary

       judgment.” Wagner v. Yates, 912 N.E.2d 805, 808 (Ind. 2009).


[11]   It is well settled that


               [i]nsurance polices are governed by the same rules of
               construction as other contracts. . . . When interpreting an
               insurance policy, our goal is to ascertain and enforce the parties’
               intent as manifested in the insurance contract. We construe the
               insurance policy as a whole and consider all of the provisions of
               the contract and not just the individual words, phrases or
               paragraphs.


       Am. Access Cas. Co. v. Cincinnati Ins. Co., 103 N.E.3d 644, 649 (Ind. Ct. App.

       2018) (internal citations omitted).


[12]   “‘Policy terms are interpreted from the perspective of an ordinary policyholder

       of average intelligence. If reasonably intelligent persons may honestly differ as

       to the meaning of the policy language, the policy is ambiguous.’” Thomson Inc.

       v. Ins. Co. of N. Am., 11 N.E.3d 982, 993 (Ind. Ct. App. 2014) (quoting Gasser v.

       Downing, 967 N.E.2d 1085, 1087 (Ind. Ct. App. 2012)). “‘However, an

       ambiguity does not exist merely because the parties proffer differing

       interpretations of the policy language.’” Id. (quoting Buckeye State Mut. Ins. Co.

       v. Carfield, 914 N.E.2d 315, 318 (Ind. Ct. App. 2009)).




       Court of Appeals of Indiana | Opinion 18A-PL-446 | October 16, 2018           Page 7 of 11
[13]   The insurance policy provided that Berkshire Hathaway “will pay for direct

       physical loss of or damage to Covered Property at the premises described in the

       Declarations caused by or resulting from any Covered Cause of Loss.”

       Appellant’s App. Vol. II at 24. The policy further defined Covered Property, in

       relevant part, as the “Building, meaning the building or structure described in

       the Declarations” plus any “completed additions[.]” Id. (bold removed). Thus,

       we must determine whether the detached garage is covered under the policy as

       the “Building” or as a “completed addition.” We first address whether the

       detached garage is covered as the “Building.”


[14]   The insurance policy explicitly defines the Building as “the building or structure

       described in the Declarations.” Id. And the declarations for the property at

       issue describe the premises as “Premises Number: 15[,] Building Number:

       1[.]” Id. at 23. It further describes the occupancy as “RENTAL

       DWELLINGS–OTHER THAN STUDENT HOUSING[.]” Id.4 Based on the

       policy’s use of “the building or structure” in the singular, the declarations

       reference to building number 1, and the fact that the declarations page

       specifically describes the category of occupancy as “rental dwellings,” it is clear

       that the only building described in the declarations is the residential building.

       And, under the plain language of the insurance policy, only the “building or

       structure described in the Declarations” is covered as the “Building.” Id.



       4
         The contract also included a section titled “Property Not Covered,” which contained a lengthy list of
       specific items or categories of items that were not covered by the policy. There is no dispute that that section
       of the policy did not specifically exclude detached garages.

       Court of Appeals of Indiana | Opinion 18A-PL-446 | October 16, 2018                                 Page 8 of 11
       Because the garage is not the building or structure described in the declarations,

       it is not covered under the policy as the “Building.”


[15]   Still, Basham contends that the detached garage is covered under the policy as

       the “Building” because it is a building located at the address provided in the

       declarations. But the insurance policy is clear. It does not say that it covers any

       building at the address. Rather, the insurance policy only covers “Covered

       Property” at the premises, which is “the building or structure described in the

       Declarations.” Id. (emphasis added). And, again, the declarations describe the

       residential dwelling, not the garage. However, our conclusion that the detached

       garage is not covered as the “Building” does not end our inquiry. We must also

       consider whether the detached garage is a completed addition under the policy.


[16]   The insurance policy does not define the term “completed addition,” although a

       term is not ambiguous simply because it is not defined. See Thompson Inc., 11

       N.E.3d at 993. Berkshire Hathaway asserts that the detached garage is not a

       completed addition because it is not physically attached to the house. To

       support its contention, Berkshire Hathaway relies on the definition of

       “addition” found in Merriam-Webster’s online dictionary, which defines an

       “addition” as “a part added (as to a building or residential section).” Merriam-

       Webster, https://www.merriam-webster.com/dictionary/addition (last visited

       October 2, 2018). Based on that definition and the fact that “[t]he term

       ‘completed additions’ is listed under the term ‘building’” in the insurance

       policy, Berkshire Hathaway contends that any completed addition must be

       physically attached to the building in order to be insured as “Covered

       Court of Appeals of Indiana | Opinion 18A-PL-446 | October 16, 2018        Page 9 of 11
       Property.” Appellant’s Br. at 19. And because the garage is not physically

       attached to the house, Berkshire Hathaway asserts that the insurance policy is

       unambiguous and does not cover the garage.


[17]   We cannot agree that the term “completed addition” under the policy can only

       mean that a garage must be physically attached to the building to be insured.

       While an addition can be defined as “a part added” to a building, Merriam-

       Webster, supra, that term can also be defined as an “annex.” Black’s Law

       Dictionary 46 (10th ed. 2014). And an “annex” is “a subsidiary supplementary

       structure either part of or separate from a main structure.” Webster’s Third New

       Int’l Dictionary 87 (2002) (emphasis added).


[18]   We conclude that the term “completed addition” does not have a single

       meaning. As Berkshire Hathaway suggests, a “completed addition” can refer to

       a structure that is physically attached to a building. But that term can also refer

       to a supplementary structure that is separate from a building. Thus, Berkshire

       Hathaway’s reliance on one definition to the exclusion of another is misplaced.

       An ordinary policy holder of average intelligence could interpret the term

       “completed addition” to mean either an attached or separate structure. See

       Thomson Inc., 11 N.E.3d at 993. Because reasonably intelligent people may

       honestly differ as to the meaning of “completed addition,” that term is

       ambiguous. See id.


[19]   It is well settled that where there is an ambiguity, “insurance policies are to be

       construed strictly against the insurer.” Id. Because the term “completed


       Court of Appeals of Indiana | Opinion 18A-PL-446 | October 16, 2018       Page 10 of 11
       addition” is ambiguous, we strictly construe it against Berkshire Hathaway.

       Thus, the detached garage is covered under the insurance policy, and the trial

       court did not err when it entered summary judgment for Basham and when it

       denied Berkshire Hathaway’s motion for summary judgment. We therefore

       affirm the trial court.


[20]   Affirmed.


       Crone, J., and Pyle, J., concur.




       Court of Appeals of Indiana | Opinion 18A-PL-446 | October 16, 2018   Page 11 of 11
