Naugler v. Elite Insurance Company, 2022 NSSM 34

SMALL CLAIMS COURT OF NOVA SCOTIA Citation: Naugler v. Elite Insurance Company , 2022 NSSM 34 Date: 202205 09 Docket: SCCH 509818 Registry: Halifax BetweeL Eric Marshal Naugler and Pauline Elizabeth Naugler Claimants -and- Elite Insurance Company Defendant Adjudicator : Eric K. Slone Heard : Via Zoom in Halifax, Nova Scotia on March 30 and April 5, 2022 Appearances : For the Claimants, self- represented For the Defendant, Danette Cashman, counsel [ 1 ] The Claimants own a year 2000 Jayco “5 th Wheel” trailer which they have owned for about 15 years.

They keep it parked at a boat club on Myra Rd. in Porter’s Lake, Nova Scotia. Although at one time they travelled with it, in recent years it has been used solely as a seasonal cottage. It is not used during the colder months, in part because the road servicing the trailer sites is not plowed. As such, the Claimants go through a process of “winterizing” it in or about October of each year.

They do not typically open it up again until the spring. [ 2 ] The trailer is insured with the Defendant Elite Insurance Company through Aviva Insurance, under a specialized policy for these types of trailers and RV’s. [ 3 ] This claim arises as a result of what the Claimants contend was accidental damage allowing water to infiltrate the trailer, causing the kinds of harm that water is known to do. [ 4 ] The Defendant denied the claim contending that the demonstrated damage to the trailer was as a result of long-term water infiltration, which is excluded by the policy.

[ 5 ] The chronology of relevant events begins in October 2020 when Mr. Naugler says he personally got the trailer ready for winter, which included placing a tarpaulin over the roof and securing it with bungee cords. This tarp was supposed to give some added protection to the roof. He believes the roof was otherwise watertight. [ 6 ] Sometime in February 2021 the Claimants’ adult son drove by the site and discovered that the tarp had blown off, presumably in heavy winds at some indeterminate time after October 2020. He did a cursory inspection of the exterior and did not notice any obvious damage.

He was not able to go inside at that time to look for interior damage. [ 7 ] It was not until sometime in May that the Claimants first came to open up the trailer for the season and discovered what they saw as water damage in various places in the interior. [ 8 ] The Claimants’ theory is that during the presumed wind event that blew off the tarp, either the tarp itself or one of the cords caught the TV antenna mast, creating a crack where water could and did enter. [ 9 ] The Claimants reported the matter to Aviva which opened up a claim.

On June 8, 2021, an appraiser employed by Canavans Central Appraisals, Craig Melanson, came to do an inspection on behalf of the insurer. His inspection included the following statement: Vehicle Inspected 06/08 at the owners camp site reviewed issues with owner related to falling ceiling panels rear wall soft panels mold and stains related to water penetrating interior of unit, wall and ceiling areas exceeding 49 plus moisture readings. Inspected roof and it appeared to be well maintained with sealant and some patch tape installed on seams.

Damage to ceiling extends across the entire area of the interior affecting all ceiling panels, including bedroom area, rear wall of living room also has been affected. It appears that a leak is present somewhere in the roof area but there are no signs of damage to the roof membrane that are visible. Evidence of seam resealing are present with both repair tape and sealant. The unit is extensively damage[d] from a long term exposure to water causing the wood ceiling trusses and wall studs, insulation to become rotten allowing the ceiling panels to become detached. Damages exceed trailer values.

Extensive dismantling of interior would have to be done in order to determine the areas in which water is entering the unit. Degree of deterioration indicates a long exposure to water damage. [ 10 ] He concluded that it would cost more than $17,000.00 to repair all of the water damage, whereas the trailer was only worth $11,750.00. In accordance with well-understood insurance principles, this amounts to a “total write off” which would limit recovery (assuming the claim was allowed) to the lower amount. [ 11 ] Mr. Melanson testified in this hearing. He outlined his long experience as a field appraiser.

Most of his work is on behalf of insurance companies. He estimates that he sees 20-25 trailers per year, the majority of which are for water damage. [ 12 ] He testified that he spent between 1.5 and 2 hours inspecting the Claimants’ trailer. He examined seams, seals, the exterior, roof membrane, windows, doors, and the walls and ceiling inside. He made extensive use of a moisture meter to measure the moisture content of the interior. He took photographs which show wood panels on the ceiling and some walls delaminating or warping or stained by water.

He noticed a small area of black mould. [ 13 ] His conclusion was that the extent of the water damage pointed to long-term exposure to water - most likely over several years. [ 14 ] Mr. Melanson found the trailer to be well-maintained, but he was critical of the extensive use of tape, intended as a short-term fix, rather than proper sealant. [ 15 ] He did not believe that the blowing off of a tarp could have caused the type of damage observed. He did not see any major damage near the TV antenna that could have accounted for extensive water penetration. [ 16 ] On the basis of Mr.

Melanson’s findings, the Defendant denied the claim. As I will outline in more detail later, the policy language is quite clear that coverage would only apply for a discrete “event” causing water damage, as opposed to long term water

infiltration. [ 17 ] The Claimants sought out their own opinion from Perry Butler of PJ’s RV & Auto Repairs, who submitted a report dated August 12, 2021: Damage to roof area appears to have been caused by winter cover being blown off during one or more winter storm's in 2020-2021. The cover appears to have caught the tv mast, lifting it up breaking the seal allowing water to come into the ceiling area. The winter cover also hooked the corner of the air conditioner doing some damage that may have resulted in water coming into the ceiling area near the air conditioner outlet in the living room area.

Upon close examination a small tear in the roof membrane of approx. 2-2.5 inches near the main roof vent in the living room was also found this is possibly where most of the water came in, trapping water in the insulation and trailing to the rear area of the RV and down the rear walls, causing damage to the wall panels, and migrating into the floor area of the large slide on the entrance side of the unit causing swelling of the floor area. All seals were well maintained and there was evidence of ongoing maintenance by the owner.

At the front of the RV near the end cap there was also a small tear in the roof membrane that also may have been caused by the winter roof cover being blown off. All of the tears and breaks in the roof have been temporarily repaired with sealant for the time being. [ 18 ] Mr. Butler also testified in support of his report. [ 19 ] He has 11 years’ experience with RV’s, doing repairs and maintenance. He has worked “a few times” for insurance companies but mostly works for owners. [ 20 ] He testified that he found a significant breach near the TV antenna that could have caused significant water incursion.

He provided photos which purport to show this damage. [ 21 ] Mr. Butler’s estimate to repair all of the water damage was $9,575.95. Factual findings [ 22 ] It is first necessary to determine what happened before considering whether there ought to be any coverage under the policy. [ 23 ] I am satisfied that there was some damage done to the roof, more likely than not caused by the blowing off of the tarp. I am also satisfied that this more likely than not led to some water entering the trailer.

It is well known that when water enters a structure it can spread extensively as it finds its level. [ 24 ] However, I find it more likely than not that there was already moisture accumulating in the trailer. I accept the evidence of Mr. Melanson that the high moisture readings suggest that water had been inside the ceiling and walls saturating the wood for a significant period of time. [ 25 ] I find it significant that both Mr. Melanson and Mr. Butler described water damage as being extremely common with RV’s and trailers. Mr.

Butler testified that 50% of his business is doing repairs related to water damage. [ 26 ] As such, there is merit in both theories, and this is not an “all-or-nothing” proposition. The policy coverage

[ 27 ] The important terms of the policy are these: “Specified perils” [includes]: 9 ...water damage ... caused by ... d. water which enters your unit through an opening which has been created suddenly by a peril not otherwise excluded. “Loss or damage not insured” [includes]: 20. wear and tear, deterioration .... “Nor do we insure loss or damage:” ... 24. caused by ... wet or dry rot, or fungi or spores.

This exclusion applies whether or not there are one or more other causes or events (whether covered or not) that contribute concurrently or in any sequence to the occasioning of the loss or damage. 26. occurring after your unit has, to your knowledge, been vacant for more than 30 consecutive days. 42. caused directly or indirectly by continuous or repeated seepage or leakage of water.

This exclusion applies whether or not there are one or more other causes or events (whether covered or not) that contribute concurrently or in any sequence to the occasioning of the loss or damage. 44. caused directly or indirectly by water except as defined in Specified Perils. [ 28 ] The meaning of these provisions is fairly clear. The coverage applies to water damage that occurs as a result of a sudden event, such as a windstorm. It does not apply to water incursion that results from inadequate maintenance, or that has occurred as a result of gradual and continuous leakage.

There is no coverage for mould. [ 29 ] I have struggled with the meaning of the provision denying coverage after the unit has been “vacant for more than 30 consecutive days .” This insurance policy is specific to recreational vehicles. It seems inconsistent with that overall purpose to say that there is no coverage when the unit is used seasonally and incurs damage during the off-season. That would defeat the reasonable expectation of the insured party. I find that this exclusion is ambiguous and that applying it as the insurer contends would largely defeat the entire purpose of the policy.

It must mean something else, and less. [ 30 ] In the case here, the damage to the interior of the unit has been caused by more than one event. There had been a certain amount of damage caused by the sudden wind event blowing off the tarp and snagging the antenna. I also find that it has been accumulating moisture, likely for years.

Even the small amount of mould found cannot be traced to the more recent sudden event, as mould does not grow that quickly, especially in cold conditions. [ 31 ] Under the circumstances, difficult as it may be, I have to apportion the interior damage between the covered and the non- covered events. Having listened carefully to the evidence, I find that the covered damage accounts for one-third of the total damage. Damages [ 32 ] I have no reason to dispute the damage assessment given by Mr. Butler. Although Mr.

Melanson’s estimate is higher, he conceded that he was restricted by the fact that he had no ability to open up any of the walls, unlike Mr. Butler, and therefore he made some assumptions and erred on the side of caution.

[ 33 ] I find that the Claimants are entitled to recover one-third of the $9,575.95 figure quoted by Mr. Butler. That comes to $3,192.00. [ 34 ] I should note that the Claimants have also claimed for a couple of other items not included in Mr. Butler’s estimate. They claim $423.93 for window blinds that they say were damaged by water and by mould. [ 35 ] I am not satisfied that this damage occurred as a result of the sudden water leak.

The presence of mould suggests otherwise, and moreover, mould damage is excluded under the policy. [ 36 ] The Claimants also seek to recover $780.00 for their lot rental for the 2021 season, which they say was wasted because they were not able to enjoy that season because of the condition of their unit. [ 37 ] I do not consider this sum recoverable under any provision of the policy.

The 2021 season was not lost as a result of anything that the Defendant did or did not do. [ 38 ] I will allow the Claimants their cost of issuing the claim in the amount of $199.35. [ 39 ] In the result the Claimants will have a judgment for $3,192.00 plus $199.35, for a total of $3,391.35. Eric K. Slone, Adjudicator