A federal appeals court has reinstated a jury verdict supporting an insurer’s denial of a restaurant’s fire claim because it had not been provided requested financial documents, overturning a lower court’s ruling.

Charese Foreman, owner of Resie’s Chicken & Waffle Restaurant in Houston, which is now closed, obtained an insurance policy from Acceptance Indemnity Co., a unit of Raleigh, North Carolina-based IAT Insurance Group, for $100,000 covering commercial property damage, general liability, liquor liability and equipment breakdown, according to Friday’s ruling by the 5th U.S. Circuit Court of Appeals in New Orleans in Charese Foreman; Resie’s Chicken & Waffles Restaurant v. Acceptance Indemnity Co.; IAT Group Investigative Services Unit.

Provisions of the policy included that the restaurant must permit the insurer to examine the restaurant’s books and records and cooperate in its investigation and settlement of claims, the ruling said.

A fire occurred less than six months after Resie’s opened, and the Houston Fire Department concluded it was an electrical fire. The insurer denied the restaurant’s claim on the basis the fire was the result of arson, not an accidental loss; Resie’s had failed to maintain a working smoke alarm and it had failed to provide requested financial information on numerous occasions, according to the ruling.

Resie’s filed suit against Acceptance, charging breach of contract, among other claims. A jury in U.S. District Court in Houston rejected Acceptance’s arson and smoke detector defenses, but found Resie’s had failed to provide requested financial information, which was prejudicial to the insurer.

The District Court entered judgment as a matter of law for Resie’s, awarding it the amount due under the policy, a “prompt pay” penalty under state law, attorneys fees and court costs. It later amended the judgment to award $125,000 in attorneys fees to Resie’s and Ms. Foreman.

A three-judge appeals court panel unanimously held the District Court had erred in granting judgment to Resie’s on the breach of contract claim.

“We find sufficient evidence to reinstate the jury’s verdict that Resie’s breached the contract by failing to provide requested financial information and that this breach prejudiced” Acceptance, the panel said, in remanding the case with instructions to reinstate the jury’s verdict.