                      United States Court of Appeals
                           FOR THE EIGHTH CIRCUIT
                                   ___________

                                   No. 00-1655
                                   ___________

Bruce Oakley, Inc.,                 *
                                    *
                  Appellee,         *
                                    * Appeal from the United States
           v.                       * District Court for the
                                    * Eastern District of Arkansas.
Farmland Mutual Insurance Company, *
                                    *
                  Appellant.        *
                               ___________

                             Submitted: January 8, 2001

                                  Filed: April 11, 2001
                                   ___________

Before HANSEN and HEANEY, Circuit Judges, and WEBBER1, District Judge.
                           ___________

HEANEY, Circuit Judge.

       Bruce Oakley, through his corporation Oakley, Inc. (Oakley), stored soybeans
from the 1992 harvest in a 500,000 bushel storage bin located in Morrilton, Arkansas.
In February, 1993, Oakley’s employees began to unload the storage bin and noticed
that some of the beans were charred and blackened. The issue before us is whether


      1
        The Honorable E. Richard Webber, United States District Judge, for the Eastern
District of Missouri, sitting by designation.
Oakley’s Farmland Mutual Insurance policy covers the damage to the beans caused by
fire and/or heat. The district court2 granted summary judgment in favor of Oakley and
awarded him $256,630.90 for the loss of the beans, pre- and post-judgment interest, as
well as attorneys’ fees and costs amounting to $52,988.13. We affirm.

       We review the district court's grant of summary judgment de novo, and will
affirm if the evidence, viewed in the light most favorable to Farmland Mutual
Insurance, shows that there is no genuine issue of material fact and that Oakley is
entitled to judgment as a matter of law. See Austin v. Minnesota Mining and Mfg. Co.,
193 F.3d 992, 994 (8th Cir.1999).

      The Farmland Mutual Insurance policy provision in question explains that:

          b. We will not pay for loss, damage, or expense caused by,
             resulting from, contributed to or aggravated by the following
             causes, except that ensuing fire is covered unless otherwise
             excluded:
             ...

             (2)             Wear and tear; deterioration; rust corrosion, or
                             erosion; wet or dry rot; mold; inherent vice;
                             latent defect.

        The record shows that several people observed the blackened beans amidst heat,
smoke, and steam. Oakley and his employees stated that some of the beans had stuck
together in cones, requiring them to break the formations apart with rods to allow the
heat to be released through the trapdoors at the bottom of the bin. As they worked,
they hit hot spots that had to cool before being manipulated with the rods. According
to the record, the hot spots glowed like charcoal and were orange. Witnesses testified

      2
        The Honorable George Howard, Jr., United States District Court Judge for the
District of Arkansas, Western Division.

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that there was a smoke odor and a pungent soy sauce odor in the bin. No one
witnessed flames coming from the beans.

       Dr. Richard Meronuck, a doctor of plant pathology, testified that the beans in
Oakley’s bin had been unaerated and moist, allowing mold to form. As the mold grew,
the moisture content of the beans increased, which generated heat and allowed a
different, higher-temperature, higher-moisture fungus to grow. Ultimately the
temperature likely rose to a point where autoxidation occurred in the beans, causing the
beans to burn.

       Dr. Meronuck testified that when beans reach 170 to 215 degrees Fahrenheit
they begin to give off a smoky vapor, and at 300 degrees Fahrenheit fire becomes a
distinct possibility if there is oxygen present in the hot spot. He explained that the
temperature of the beans on the surface of the barge (where they had been placed)
ranged from 47 to 67 degrees Fahrenheit a month after the blackened beans were first
noticed. He stated that “[n]one of the soybeans from the samples examined had the
pitting and fissures typically found in fire-burned soybeans.” Dr. Meronuck also noted
that the glowing orange beans that the men had seen likely were burning as a result of
the presence of oxygen in the bin.

       The issue before us is whether the “ensuing fire” exception to the exclusions is
applicable here, and if not, whether Oakley can recover under the policy by some other
means. The insurance policy does not define fire. The Oxford English Dictionary,
Second Edition, defines fire as “the natural agency or active principle operative in
combustion; popularly conceived as a substance visible in the form of flame or of ruddy
glow or incandescence.” The 1997 American Heritage College Dictionary defines fire
as “[a] chemical change that releases heat and light and is accompanied by flame.”
Webster’s 1984 New World Dictionary of the American Language defines fire as “the
active principle of burning, characterized by the heat and light of combustion.” The


                                           3
1997 McGraw-Hill Encyclopedia of Science and Technology defines the term as “[a]
rapid but persistent chemical reaction accompanied by the emission of light and heat.”

       The witnesses’ testimony reveals that, according to at least two of the cited
definitions, they observed fire: there was smoke, heat, and orange light. Consequently,
Oakley may recover under the “ensuing fire” exception to the exclusions, as the policy
should be interpreted in a manner most favorable to the insured.

        In the alternative, Oakley need not rely on the “ensuing fire” exception to
recover. Heat damaged the beans, and heat was not explicitly listed as one of the
policy exclusions. In Glens Falls Ins. Co. v. Linwood Elevator, a persuasive case with
facts strikingly similar to this one, the court explained “[i]f the nearest efficient cause
of the loss is one of the perils insured against, the courts look no further” in determining
whether the damage is covered by the policy. 130 So.2d 262, 270 (Miss. 1961). The
court continued, “[i]n such cases the insurer is not to be relieved from responsibility by
showing that the property was brought within the peril insured against by a cause not
mentioned in the contract.” Id. As applied here, if the insurance company failed to
articulate whether heat damage is insured where there may have also been fire damage,
the policy should be interpreted in favor of the insured. Oakley may therefore recover
under the policy.

       The court below determined that:

         it is undisputed that the heat within the bin was initiated through the
         presence of mold and that as that spontaneous process continued,
         sufficient heat was generated to cause the oils and other volatile
         substances within the bean pod matter to vaporize. Defendant
         argues that since mold was the cause that set the chain of events in
         motion, then the loss is excluded under the policy. Plaintiff counters
         that even the evidence offered by defendant shows that the damage



                                             4
          was caused by resulting heat which is not excluded under the all risk
          policy.3

       Under Arkansas law, insurance policy provisions should be interpreted in favor
of the insured, and exclusions are to be strictly construed against the insurer with all
reasonable doubts in favor of the insured. Columbia Ins. Co. v. Baker, 108 F.3d 148,
149 (8th Cir. 1997). The burden is on the insurer to prove that the loss arose from a
cause excluded by the policy. United States Fire Ins. Co. v. Reynolds, 667 S.W.2d
664, 667 (Ark. App. 1984). There is nothing in the policy that excludes coverage of
damage to beans due to heat; the insurance company should have explicitly listed heat
damage as an exclusion if it was inclined to deny coverage for such damage. The
district court properly awarded Oakley damages, pre- and post-judgment interest, and
attorneys’ fees. For the reasons cited above, we affirm the district court’s granting of
summary judgement to Oakley.

      A true copy.

              Attest.

                  CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.




      3
       Bruce Oakley, Inc. v. Farmland Mutual Ins. Co., No. LR-C-97-524, slip op. at
8 (Feb. 17, 1998).

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