Merrimack Mutual Fire Ins. Co. vs. Gloria Batts

This appeal involves a dispute between a homeowner and her insurance company regarding the damages to her house caused by the tornado that struck Nashville on April 16, 1998. When they could not agree on the amount of the loss, both parties invoked the insurance policy's provision for the appointment of appraisers. After the parties' two appraisers could not agree on the amount of the loss, the two appraisers selected a third appraiser who eventually agreed with the homeowner's appraiser regarding the amount of the loss. The insurance company filed suit in the Chancery Court for Davidson County, seeking a declaratory judgment that it was required to pay the homeowner less than one-half of the amount of the loss calculated by the two appraisers. Both parties filed motions for partial summary judgment. The trial court granted the insurance company's motion, concluding that the insurance policy's appraisal clause was not an agreement for binding arbitration and that the appraisers had not been empowered to determine whether parts of the claimed damage had been caused by a peril covered by the policy. The homeowner takes issue with both of the trial court's legal conclusions on this appeal. We have determined that the trial court interpreted the insurance policy correctly and, therefore, that the trial court properly concluded that the insurance company was entitled to a judgment as a matter of law.