Law School Case Brief
State Farm Fire & Cas. Co. v. Bongen - 925 P.2d 1042 (Alaska 1996)
Until the insurance companies added the lead-in clause, courts often limited the earth movement exclusion to natural disasters, due to the doctrine of ejusdem generis. Ejusdem generis, a doctrine which the court has applied in previous cases, essentially states that a general term, when modified by specific terms, will be interpreted in light of those specific terms, absent a clear indication to the contrary. Courts interpreting the lead-in clause have read it as providing a clear indication that the earth movement exclusion is not intended to be limited to losses caused by natural disasters.
A home owned by Jerome and Elizabeth Bongen was destroyed by a mudslide. After their insurer denied coverage, the Bongens sued. They claimed that under the "efficient proximate cause" rule, their loss was covered under the policy because the mudslide was caused by negligent electric line construction, which was a covered event. On cross-motions for partial summary judgment, the superior court held that a provision in the Bongens' insurance policy excluding from coverage any loss resulting from earth movement, regardless of the cause, was unenforceable. Defendant insurer appealed.
Was the earth movement exclusion in the insurance policy of the Bongens enforceable?
The court reversed the grant of summary judgment for the Bongens, holding that where damage to an insured's property was caused by both a covered and an excluded event, coverage could be expressly precluded by language in the policy, and that the parties could contract out of the "efficient proximate cause" doctrine without violating public policy. The court held that the exclusion was not ambiguous, and that earth movement, as that term was used in the policy, encompassed both natural phenomena and human processes.
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