Hansen v. CIGNA Insurance

3 Ohio App. Unrep. 46
CourtOhio Court of Appeals
DecidedMay 24, 1990
DocketCase No. CA 11766, CA 11994
StatusPublished

This text of 3 Ohio App. Unrep. 46 (Hansen v. CIGNA Insurance) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hansen v. CIGNA Insurance, 3 Ohio App. Unrep. 46 (Ohio Ct. App. 1990).

Opinion

Per Curiam.

This appeal is a consolidation of two appeals by Thomas A. Hansen and Susan A. Hansen. The Hansens appealed a Montgomery County Court of Common Pleas July 18, 1989, order sustaining CIGNA's motion for judgment on the pleadings on its CrossApplicationfor an Order Confirming [the] Arbitrator's Award. The Hansens also appealed the Kettering Municipal Court's December 6,1989; order sustaining the defendant’s motion for reconsideration or, in the alternative, motion for summary judgment. This order,in effect, dismissed the Hansens' complaint in the municipal court. The appeals were consolidated pursuant to this court's January 29, 1990, decision and entry.

On February 22, 1989, the Hansens filed a complaint in the Montgomery Court of Common Pleas which alleged that they entered into a "Home Warranty Agreement" with CIGNA Insurance Company, hereinafter CIGNA. The complaint alleged that a dispute arose wherein the Hansens claimed that the mortar used in building their house contained too much sand and that the dispute was submitted to arbitration pursuant to the agreement on November 3, 1988. The complaint alleged that the arbitrator's written decision varied from his statements at the hearing and that the arbitrator's actions evidenced "partiality or corruption *** and [misconduct in stating his decision at the hearing and then fraudulently issuing an award the [47]*47reverse of [sic] his decision." The Hansens prayed that the court order the arbitrator to correct his award to reflect his oral decision or, in the alternative, that the court vacate the award.

Attached to the Hansen's complaint were ten exhibits indicating that on September 21,1977, Thomas and Susan Hansen signed a document entitled "Limited Warranty Home Warranty Agreement." (Exhibit A.) The front page of the document shows that the Hansens purchased a home built by Swango Homes, Inc. The following seven pages of the document outline the terms of the agreement. Page four of the agreement states in pertinent part, as follows:

"LIMITED WARRANTY

"Coverage During First Year. For one year, beginning on the commencement date filled in on page 1, the Builder warrants that the home will be free from defects due to noncompliance with the Approved Standards and from major construction defects.

"A 'major constructiondefect' is actual damage to the load-bearing portion of the home (including damage due to subsidence* expansion or lateral movement of soil from causes other than flood or earthquake) which affects its load-bearing function and which vitally affects (or is imminently likely to produce a vital effect on) the use of the home for residential purposes.

"Coverage For Up to One Year. The Builder warrants that all appliances, fixtures and items of equipment will be free from defects due to noncompliance with the Approved Standards for one year or for the term of the manufacturer's written warranty (if a manufacturer's written warranty is assigned to you by the Builder), whichever is less.

"Coverage During Second Year. During the second year after the commencement date, the Builder continues to warrant that the home will be free from major construction defects and that the plumbing, electrical, heating, and cooling systems will perform according to the Approved Standards, unless their failure is the result of a defect in an appliance, fixture, or item of equipment ***."

Pages five through seven of the agreement state* in pertinent part, as follows:

"INSURANCE COVERAGE

"Scope of Insurance Coverage. The insuror, subject to a one time $50.00 deductible, will meet all the Builder's obligations under this warranty as set forth in this agreement if, after completion of arbitration, the Builder for any reason fails to meet them. The insuror will directly insure against major construction defects for and additional eight years (beginning two years after, and ending ten years after, the appropriate commencement date). The total liability of the insuror during the ten years covered by this agreement is limited to the purchase price filled in on page 1.

It* * *

"HOW TO MAKE A WARRANTY CLAIM

* *

"Demand for Dispute Settlement. If you and the Builder disagree concerning the warranty obligations under this agreement (or he does not respond to your complaint), you may request informal dispute settlement concerning your claim mailing the 'Demand for Dispute Settlement' form (see back page) to the Local HOW Council. You may also request informal dispute settlement by submitting a letter specifically requesting dispute settlement and identifying yourself, the Builder, the home, the defects claimed and the remedies sought.

"Conciliation and Arbitration. HOW provides for conciliation and for nonbinding arbitration conducted by the American Arbitration Association under its Expedited Home Construction Arbitration Rules (or by another approved organization). No fee or deposit is required. No arbitration decision may call for performance beyond the scope of the warranty provided in this agreement.

"After it receives your 'Demand for Dispute Settlement' form, the Local HOW Council will assign a conciliator, who will attempt to work out a voluntary conciliation agreement between you and the Builder as to the settlement of your claim. After you have attempted conciliation, you may demand arbitration of any unresolved warranty dispute between you and the Builder.

"HOW TO MAKE AN INSURANCE CLAIM

"If a claim arises under the warranty and the Builder cannot or will not cooperate in HOW dispute settlement procedures, the Local HOW Council will contact the insuror and the insuror will (if it disputes the claim) take the place of the Builder in the dispute settlementprocedures and perform as directed by the decision.

"If the Builder cooperates in HOW dispute settlement procedures, but fails to perform as directed within the time specified, you should notify your Local HOW Council, which will arrange with the insuror for performance of the warranty obligations under the decision.

[48]*48"If a claim arises with respect to the direct insurance against the major construction defects during the third through tenth years after the commencement date(s) of this agreement, you should notify your Local HOW Council, which will arrange with the insuror to investigate the claim. If the insuror disputes the claim, you may request arbitration. The insuror has agreed to be bound by the arbitrator's decision, subject to the following paragraph. Prerequisite to Payment by Insuror. The insuror will not pay a claim until you have completed arbitration and accepted the decision (unless the insuror chooses not to dispute the claim), and have signed and delivered a release of all rights you may have against the insuror arising out of the specific claim, and, in the case of a claim arising under the first two years' coverage, until you have signed and delivered to your Local HOW Council an assignment to the insuror of your claim against the Builder." (Emphasis added.)

Exhibit B is a document dated September 18,1987, signed by Thomas and Susan Hansen, entitled "Demand for Dispute Settlement." The document stated, in pertinent part, as follows:

Free access — add to your briefcase to read the full text and ask questions with AI

Cite This Page — Counsel Stack

Bluebook (online)
3 Ohio App. Unrep. 46, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hansen-v-cigna-insurance-ohioctapp-1990.