State high court sides with deli in dispute with insurer
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The Nebraska Supreme Court on Friday largely overturned a lower court and held an insurer must pay extra expenses associated with a business that moved to a renovated facility after a fire.
Old Mill Bulk Foods is a deli/grocery store that operated in a rented building in Valentine, Nebraska, according to the ruling by the Nebraska Supreme Court in North Star Mutual Insurance Co. v. Jerry Miller and David Miller, doing business as Old Mill Bulk Foods.
in July 2018, a fire destroyed its premises and Old Mill decided to renovate another building in which to relocate its business. It sought $159,878, in addition to other reimbursements, from its insurer, Cottonwood, Minnesota-based North Star Mutual Insurance Co., under its policy’s extra expense provision, according to the decision.
North Star denied coverage, and a district court ruled in the insurer’s favor, except for $4,600 for a walk-in cooler. It also held that Old Mill was entitled to only $5,000 of its request for $33,797 in attorneys fees.
The state high court ruled in a unanimous decision that the retailer was entitled to extra expense coverage under its policy.
“Concluding that the policy is ambiguous and therefore construing it in favor of Old Mill, we determine as a matter of law that the ‘Extra Expense’ provision of the Policy provides coverage for costs associated with electrical improvements, plumbing improvements, structural improvements, and materials associated with those improvements that were done to the replacement premises,” it said.
The court, which affirmed the award for the walk-in cooler, remanded the issue of the attorneys fees back to the trial court in light of its extra expense holding.
Attorneys in the case did not respond to requests for comment.
