[Cite as Estate of Heintzelman v. Air Experts, Inc., 2011-Ohio-5242.]


                                        COURT OF APPEALS
                                    DELAWARE COUNTY, OHIO
                                    FIFTH APPELLATE DISTRICT




THE ESTATE OF JEFFREY                               :       JUDGES:
HEINTZELMAN, ET AL.                                 :       Hon. Sheila G. Farmer, P.J.
                                                    :       Hon. John W. Wise, J.
        Plaintiffs-Appellants                       :       Hon. Julie A. Edwards, J.
                                                    :
-vs-                                                :
                                                    :
AIR EXPERTS, INC., ET AL.                           :       Case No. 11CAE050043
                                                    :
        Defendants-Appellees                        :       OPINION




CHARACTER OF PROCEEDING:                                    Appeal from the Court of Common
                                                            Pleas, Case No. 04CVH-04-233



JUDGMENT:                                                   Affirmed




DATE OF JUDGMENT:                                           October 10, 2011




APPEARANCES:

For Plaintiffs-Appellants                                   For Defendant-Appellees

CHARLES H. COOPER, JR.                                      BRUCE A. CURRY
REX H. ELLIOTT                                              8000 Ravine's Edge Court, #103
2175 Riverside Drive                                        Columbus, OH 43235
Columbus, OH 43221
Delaware County, Case No. 11CAE050043                                                     2


Farmer, J.

       {¶1}   In August of 1999, Jeffrey and Margaret Heintzelman hired Tom Martel,

dba Martel Heating and Cooling, to install an attic air conditioner in their home. The air

conditioner never worked properly. Mr. Martel attempted to fix the problem, but was

unsuccessful.

       {¶2}   In 2001, the Heintzelmans hired Air Experts, Inc. to fix the air conditioner.

Air Experts was unable to repair the unit and the problems continued.

       {¶3}   On July 15, 2002, Mr. Heintzelman went to the attic to examine leaking

from the air conditioner. Mr. Heintzelman was electrocuted by an unprotected outlet

providing power to the condensation pump leading to the air conditioner. The outlet had

been installed by Mr. Martel.

       {¶4}   At the time of the installation of the air conditioner, Mr. Martel was insured

under a commercial insurance policy issued by appellee, American Family Insurance,

Policy No. 34-X03305-01. The policy was in effect from May 18, 1999 to May 18, 2000,

with a limit of $500,000.00.

       {¶5}   On December 10, 2002, appellant, the Estate of Jeffrey K. Heintzelman,

together with Mrs. Heintzelman, filed a complaint against Mr. Martel and Air Experts,

claiming wrongful death and negligent infliction of serious emotional distress (Case No.

02CVH-12-712). Appellee defended Mr. Martel in the lawsuit. On March 16, 2003,

appellant dismissed the action without prejudice.

       {¶6}   On December 4, 2003, appellee filed a declaratory judgment action (Case

No. 03CVH-12-896), seeking a judgment that it did not have a duty to indemnify Mr.

Martel for any damages awarded in the case. Appellee did not join appellant as a party

nor did appellant seek to intervene.
Delaware County, Case No. 11CAE050043                                                     3


       {¶7}      On March 4, 2004, appellee filed a motion for default judgment based

upon Mr. Martel's failure to answer or otherwise defend the action. The trial court

granted the motion on March 10, 2004. In March of 2007, Mr. Martel filed a motion to

vacate the default judgment. By judgment entry filed March 12, 2007, the trial court

denied the motion, finding the motion was untimely filed.

       {¶8}      On April 9, 2004, appellants again filed a complaint against Mr. Martel and

Air Experts (Case No. 04CVH-04-233). A jury trial commenced on February 28, 2005.

The jury found in favor of appellant, awarding the estate $1,014,186.00 and Mrs.

Heintzelman $2,650,000.00 on her emotional distress claim.             The award to Mrs.

Heintzelman was subsequently reversed by this court. See, Estate of Heintzelman v.

Air   Experts,     Inc.,   Delaware   App.   No.   2005-CAPE-08-0054,     2006-Ohio-4832,

(hereinafter "Heintzelman I").

       {¶9}      On May 10, 2005, while the appeal was pending, appellant filed a

supplemental complaint against appellee, claiming appellee must indemnify Mr. Martel

(Case No. 04CVH-04-233). Appellee filed a motion for summary judgment on October

6, 2005, claiming in part that appellant could not collaterally attack the default judgment

in favor of appellee and against Mr. Martel, and Mr. Martel was not entitled to coverage

under the insurance policy. The trial court stayed the case pending the outcome of the

appeal.

       {¶10} On August 23, 2006, Mr. Martel filed a separate complaint against

appellee, claiming fraud and misrepresentation regarding coverage under the policy and

over the default judgment in the declaratory judgment action (Case No. 06CVH-08-761).
Delaware County, Case No. 11CAE050043                                                  4


      {¶11} On December 15, 2006, appellee filed a motion to dismiss Mr. Martel's

complaint, claiming res judicata because of the declaratory judgment decision in Case

No. 03CVH12-0896. By judgment entry filed February 1, 2007, the trial court granted

the motion. On appeal, this court reversed, finding res judicata did not apply to the

specific claims made by Mr. Martel. Martel v. American Family Insurance Company,

Delaware App. No. 07CAE020012, 2007-Ohio-4819.

      {¶12} Upon remand by this court in Heintzelman I, the trial court adjusted the

award for emotional distress to $0 (Case No. 04CVH-04-233). See, Judgment Entry

filed August 6, 2007. By separate entry filed August 6, 2007, the trial court granted

appellee's motion for summary judgment that had been stayed in Case No. 04CVH04-

0233, finding appellant was bound by the default judgment rendered against Mr. Martel

in Case No. 03CVH12-0896. On appeal, this court reversed the trial court's decision

granting appellee's motion for summary judgment, finding appellant as a judgment

creditor was not bound by the declaratory judgment because appellee had initiated the

declaratory judgment against its insured, Mr. Martel. See, Estate of Heintzelman v. Air

Experts, Inc., Delaware App. No. 07CAE090054, 2008-Ohio-4883, (hereinafter

"Heintzelman II"). The Supreme Court of Ohio affirmed the decision in Heintzelman II.

See, Estate of Heintzelman v. Air Experts, Inc., 126 Ohio St.3d 138, 2010-Ohio-3264.

      {¶13} Upon remand by this court in Heintzelman II, affirmed by the Supreme

Court of Ohio, the trial court entertained motions for summary judgment filed by

appellant and appellee on the issue of insurance coverage on the wrongful death

award. By judgment entry filed April 29, 2011, the trial court denied appellant's motion

and granted appellee's motion, finding the subject insurance policy was not in effect at
Delaware County, Case No. 11CAE050043                                                5


the time of appellant's death, appellee had not waived its defense of no coverage, and

the doctrine of estoppel did not apply.

       {¶14} Appellant filed an appeal and this matter is now before this court for

consideration. Assignment of error is as follows:

                                            I

       {¶15} "THE TRIAL COURT ERRED WHEN IT DENIED APPELLANT'S MOTION

FOR    SUMMARY        JUDGMENT        AGAINST       AMERICAN   FAMILY    REGARDING

COVERAGE UNDER AMERICAN FAMILY'S INSURANCE POLICY AND INSTEAD

GRANTED AMERICAN FAMILY'S MOTION FOR SUMMARY JUDGMENT."

                                            I

       {¶16} Appellant claims the trial court erred in granting summary judgment to

appellee. Specifically, appellant claims the trial court erred in finding there was no

coverage under the subject policy as the "occurrence" that caused bodily injury took

place in the "coverage territory" and the property damage occurred during the policy

period. We disagree.

       {¶17} Summary Judgment motions are to be resolved in light of the dictates of

Civ.R. 56. Said rule was reaffirmed by the Supreme Court of Ohio in State ex rel.

Zimmerman v. Tompkins, 75 Ohio St.3d 447, 448, 1996-Ohio-211:

       {¶18} "Civ.R. 56(C) provides that before summary judgment may be granted, it

must be determined that (1) no genuine issue as to any material fact remains to be

litigated, (2) the moving party is entitled to judgment as a matter of law, and (3) it

appears from the evidence that reasonable minds can come to but one conclusion, and

viewing such evidence most strongly in favor of the nonmoving party, that conclusion is
Delaware County, Case No. 11CAE050043                                                  6

adverse to the party against whom the motion for summary judgment is made. State

ex. rel. Parsons v. Fleming (1994), 68 Ohio St.3d 509, 511, 628 N.E.2d 1377, 1379,

citing Temple v. Wean United, Inc. (1977), 50 Ohio St.2d 317, 327, 4 O.O3d 466, 472,

364 N.E.2d 267, 274."

      {¶19} As an appellate court reviewing summary judgment motions, we must

stand in the shoes of the trial court and review summary judgments on the same

standard and evidence as the trial court. Smiddy v. The Wedding Party, Inc. (1987), 30

Ohio St.3d 35.

      {¶20} "An insurance policy is a contract and the relationship between the insurer

and the insured is purely contractual in nature. Nationwide Mut. Ins. Co. v. Marsh

(1984), 15 Ohio St.3d 107, 109, 15 OBR 261, 262, 472 N.E.2d 1061, 1062.              The

interpretation and construction of insurance policies is a matter of law to be determined

by the court using rules of construction and interpretation applicable to contracts

generally. Gomolka v. State Auto. Mut. Ins. Co. 1982), 70 Ohio St.2d 166, 167-168, 24

O.O.3d 274, 275-276, 436 N.E.2d 1347, 1348-1349; Value City, Inc. v. Integrity Ins. Co.

(1986), 30 Ohio App.3d 274, 276, 30 OBR 472, 474, 508 N.E.2d 184, 186. In insurance

policies, as in other contracts, words and phrases are to be given their plain and

ordinary meaning unless there is something in the contract which would indicate a

contrary intention. Olmstead v. Lumbermen's Mut. Ins. Co. (1970), 22 Ohio St.2d 212,

216, 51 O.O.2d 285, 288, 259 N.E.2d 123, 126. Where the provisions of an insurance

policy are clear and unambiguous, courts may not indulge themselves in enlarging the

contract by implication in order to embrace an object distinct from that contemplated by

the parties. Gomolka, supra, 70 Ohio St.2d at 168, 24 O.O.3d at 276, 436 N.E.2d at
Delaware County, Case No. 11CAE050043                                                    7


1348.      However, where the provisions of a contract of insurance are reasonably

susceptible of more than one interpretation, they will be construed strictly against the

insurer and liberally in favor of the insured. King v. Nationwide Ins. Co. (1988), 35 Ohio

St.3d 208, 519 N.E.2d 1380, paragraph one of the syllabus." Nationwide Insurance

Company v. Tobler (1992), 80 Ohio App.3d 560, 563-564.

        {¶21} In its brief at 3-4, appellant sets forth undisputed facts. Although appellee

did not accept these facts, appellee presented undisputed facts in its motion for

summary judgment consistent with appellant's.        Appellant's undisputed facts are as

follows:

        {¶22} "1. Jeff and Margie Heintzelman lived in a house on Berlin Station Road in

Delaware, Ohio. [TR. 328.]

        {¶23} "2. In August of 1999, the Heintzelmans hired Martel to install a central air

conditioning unit in their home. [TR. 338]. The unit was installed by mid-September,

1999. [TR. 340.]

        {¶24} "3. When the unit was turned on it leaked water. As a result, Martel was

called back to the Heintzelmans' property in the fall of 1999. [Amer. Fam. MSJ, p. 3.]

        {¶25} "4. The unit Martel installed leaked through the ceiling, causing property

damage [TR. 344], and Martel offered to paint the ceiling where the leaks had damaged

the Heintzelmans' property. [TR. 781.]

        {¶26} "5. The recurrent leaks that began in 1999 caused a loss of use of the

HVAC unit. Between the time it was installed and the time of Jeff Heintzelman's death,

the Heintzelmans were able to use the HVAC unit only sporadically due to the leaks.

[TR. 347-348.]
Delaware County, Case No. 11CAE050043                                                       8


       {¶27} "6. A Delaware County jury found that Jeff Heintzelman was killed on July

15, 2002 as a result of Martel's negligent installation of the unit when Mr. Heintzelman

went to the attic to once again examine the HVAC unit.

       {¶28} "7. American Family issued insurance policy no. 34 X03305-01 to Tom

Martel d/b/a Martel Heating & Cooling. See Exhibit A. The policy was in effect during

the period May 18, 1999 to May 18, 2000.

       {¶29} "8. Property damage occurred between May 1999 and May 2000. [Amer.

Fam. MSJ, p. 3.]

       {¶30} "9. The Estate filed suit against Tom Martel on December 10, 2002.

       {¶31} "10. American Family immediately retained counsel for Martel and began

defending him. American Family did not issue a 'Reservation of Rights' letter until June

30, 2003.

       {¶32} "11. The 'Reservation of Rights' American Family issued to Tom Martel

misstated a key provision of Martel's insurance policy."

       {¶33} The coverages at issue are contained in the 1999-2000 commercial

general liability policy. The pertinent parts of the policy are as follows:

       {¶34} "COVERAGE A BODILY INJURY AND PROPERTY DAMAGE LIABILITY

       {¶35} "1. Insuring Agreement

       {¶36} "a. We will pay those sums that the insured becomes legally obligated to

pay as damages because of 'bodily injury' or 'property damage' to which this insurance

applies.

       {¶37} "b. This insurance applies to 'bodily injury' and 'property damage' only if:
Delaware County, Case No. 11CAE050043                                                      9


       {¶38} "(1) The 'bodily injury' or 'property damage' is caused by an 'occurrence'

that takes place in the 'coverage territory'; and

       {¶39} "(2) The 'bodily injury' or 'property damage' occurs during the policy

period." See, Commercial General Liability Coverage Form CG 00 01 07 98, Section I.

       {¶40} "Bodily injury" and "property damage" are defined in the insurance policy

as follows:

       {¶41} "3. 'Bodily injury' means bodily injury, sickness or disease sustained by a

person, including death resulting from any of these at any time.

       {¶42} "17. 'Property damage' means:

       {¶43} "a. Physical injury to tangible property, including all resulting loss of use of

that property. All such loss of use shall be deemed to occur at the time of the physical

injury that cause it; or

       {¶44} "b. Loss of use of tangible property that is not physically injured. All such

loss of use shall be deemed to occur at the time of the 'occurrence' that caused it."

See, Commercial General Liability Coverage Form CG 00 01 07 98, Section V.

       {¶45} Appellant argues although the bodily injury did not occur during the policy

period, the damage to the property was ongoing from 1999 until 2002, the time of Mr.

Heintzelman's death. Appellee takes the alternative position, arguing the bodily injury

occurred outside the policy period and appellant did not assert a property damage claim

against Mr. Martel at trial.

       {¶46} Although the April 9, 2004 complaint generally pled property damages, the

judgment entry on the verdict was for wrongful death and compensatory damages only:
Delaware County, Case No. 11CAE050043                                                   10


       {¶47} "The Court hereby enters judgment on the jury's verdict against defendant

Martel Heating & Cooling and in favor of the Estate of Jeffrey K. Heintzelman on the

Estate's wrongful death claim in the amount of $1,014.186.00, and in favor of plaintiff

Margaret Heintzelman on her claim for negligent infliction of emotional distress in the

amount of $2,650,000.00. The total amount of the verdict against Martel Heating &

Cooling is $3,664,186.00. The jury further returned a verdict in favor of Air Experts, Inc.

on plaintiffs' claims, and the jury concluded that there was no comparative negligence

on the part of Mr. Heintzelman."

       {¶48} The verdict forms filed March 7, 2005 limited the damages award to

appellant's wrongful death claim and Mrs. Heintzelman's emotional distress claim.

       {¶49} Appellant artfully argues because the insurance policy coverage reads

"[t]his insurance applies to 'bodily injury' and 'property damage' and then speaks of "

'bodily injury' or 'property damage'," the estate is covered for bodily injury because the

property damage occurred within the policy period. (Emphasis added.) In other words,

because this case involves both bodily injury and property damage, the policy provides

coverage "if either bodily injury or property damage is caused by an occurrence within

the coverage territory and if either bodily injury or property damage occurs during the

policy period." (Emphasis sic.) Appellant's Brief at 6. Appellant argues this position

despite the fact that no amount was awarded for property damage and admittedly, the

bodily injury occurred outside the policy period.

       {¶50} We view this argument as creative, but not within the plain reading and

understanding of the insurance policy. The word "or" is "used as a functional word to

indicate an alternative." Webster's Ninth New Collegiate Dictionary (1991) 829. As
Delaware County, Case No. 11CAE050043                                                  11


used in the insurance contract, it is a conjunction i.e., a word that joins together

sentences and phrases.

       {¶51} Using this grammatical definition, the coverage section would then read:

"bodily injury occurs during the policy period" and "property damage occurs during the

policy period." We cannot accept any other interpretation in applying the plain reading

of the policy.

       {¶52} We find support for our interpretation in Ruffin v. Sawchyn (1991), 75 Ohio

App.3d 511, and Wells v. Westfield Insurance Co., Columbiana App. Nos. 99 CO 7 and

99 CO 12, 2001-Ohio-3172. In both cases, the policy language was nearly identical to

the policy language sub judice. The courts found no coverage because although the

negligence occurred during the policy period, the bodily injury occurred outside the

coverage period.          Our brethren concluded the policy language was clear and

unambiguous.

       {¶53} Given that the insurance contract is unambiguous, the facts are

undisputed, and the jury verdict related only to bodily injury claims, we concur with the

trial court's analysis.

       {¶54} Appellant further argues appellee has waived its right to deny coverage

because appellee continued to defend Mr. Martel in the underlying action despite

issuing a "Reservation of Rights" letter. We disagree with this argument.

       {¶55} A "reservation of rights is a notice given by the insurer that it will defend

the suit, but reserves all rights it has based on noncoverage under the policy." Motorists

Mutual Insurance Company v. Trainor (1973), 33 Ohio St.2d 41, 45. By providing such

a letter, an insurance company "reserves" its right "to deny coverage at a later date
Delaware County, Case No. 11CAE050043                                                  12

based on the terms of the policy." Mastellone v. Lightning Rod Mutual Insurance Co.,

175 Ohio App.3d 23, 2008-Ohio-311, fn. 7.

       {¶56} Appellant argues to issue such a letter and then continue to defend is

misleading and therefore the "no coverage defense" is waived. Appellant does not cite

to any case law supporting this argument that flies in the face of encouraging insurers to

defend their insureds in cases involving questionable coverage. Appellee's actions in

this case were not misleading as Mr. Martel acknowledged that appellee consistently

advanced its denial of coverage. Martel depo. at 67-68.

       {¶57} Appellant also argues because of an error in the Reservation of Rights

letter, appellee should be estopped from denying coverage. There is no showing that

Mr. Martel relied on the error. In fact, Mr. Martel does not remember seeing the letter.

Martel depo. at 72, 115. We concur with the trial court in its April 29, 2011 judgment

entry that no evidence was presented to establish the error induced anyone "to change

its position with respect to the coverage issue."

       {¶58} Upon review, we find the trial court did not err in granting summary

judgment to appellee.

       {¶59} The sole assignment of error is denied.
Delaware County, Case No. 11CAE050043                                          13


      {¶60} The judgment of the Court of Common Pleas of Delaware County, Oho is

hereby affirmed.

By Farmer, P.J.

Wise, J. and

Edwards, J. concur.




                                        _s/ Sheila G. Farmer__________________



                                        _s/ John W. Wise__________________



                                        _s/ Julie A. Edwards________________

                                                    JUDGES


SGF/sg 906
[Cite as Estate of Heintzelman v. Air Experts, Inc., 2011-Ohio-5242.]


                  IN THE COURT OF APPEALS FOR DELAWARE COUNTY, OHIO

                                    FIFTH APPELLATE DISTRICT




THE ESTATE OF JEFFREY                                   :
HEINTZELMAN, ET AL.                                     :
                                                        :
        Plaintiffs-Appellants                           :
                                                        :
-vs-                                                    :               JUDGMENT ENTRY
                                                        :
AIR EXPERTS, INC., ET AL.                               :
                                                        :
        Defendants-Appellees                            :               CASE NO. 11CAE050043




        For the reasons stated in our accompanying Memorandum-Opinion, the

judgment of the Court of Common Pleas of Delaware County, Ohio is affirmed. Costs to

appellant.




                                                        s/ Sheila G. Farmer__________________



                                                         _s/ John W. Wise__________________



                                                        _s/ Julie A. Edwards________________

                                                                          JUDGES
