The insured sustained hail damage to soft metal fixtures on the roof of a large commercial building. The insured sought over $2,600,000 for exterior and interior repairs, extra-contractual vexatious refusal to pay penalties, attorney’s fees, and pre- and post-judgment interest. The carrier disputed the extent of damage and did not issue payment because the amount of covered loss and damage in the insurers estimates did not exceed the applicable policy deductible. The carrier’s engineer opined that all other claimed loss and damage to the commercial building was either excluded and/or limited by the commercial insurance policy. Prior to the court’s grant of summary judgment, Alexa successfully excluded the insured’s engineer’s report, testimony, and opinions via a Daubert motion. Alexa obtained several favorable admissions during the engineer’s expert deposition demonstrating his opinions and report were not based on sufficient facts or data, were not based on accepted methodologies reliably applied to the facts of the case and were generally unreliable and inadmissible. After the court excluded the insured’s sole engineer and causation expert, Alexa moved for summary judgment on the basis that the insured could not establish any direct physical loss or damage to the property and, therefore a breach of the insurance policy contract, the uncontroverted facts proved the amount of covered loss and damage did not exceed the applicable deductible, and the uncontroverted material facts proved all other claimed loss and damage was either excluded and/or limited under the unambiguous insurance policy contract.
The court adopted Alexa’s argument, in full, finding the insured could not present admissible evidence at trial that the roof sustained any direct physical loss or damage, and the amount of covered loss and damage did not exceed the applicable policy deductible. The court held that since the insured had no competent evidence to prove the damage claims the insurance carrier did not breach the insurance policy as a matter of law and, because the breach of contract claim failed, the insured’s vexatious refusal to pay claim also failed as a matter of law. This decision highlights the need for insurers to vigorously challenge the insured’s alleged experts in federal court when there is no sound basis for the opinions being expressed by the alleged experts.