Hudson Enterprises, Inc., doing business as River Valley Marina Plaintiff- Appellant
Certain Underwriters at Lloyd's London Insurance Companies, Subscribing to Policy #10NCG01559 and Agreement Numbers NPPI1011456 and NPPI09112456 Defendant-Appellee
Submitted: April 5, 2017
from United States District Court for the Eastern District of
Arkansas - Little Rock
GRUENDER, MURPHY, and KELLY, Circuit Judges.
MURPHY, Circuit Judge.
night of April 30, 2011 a storm generated strong winds and
left seven inches of rain in the Little Maumelle River basin.
The River Valley Marina lost five of its docks to the storm.
The docks were covered by an insurance policy issued by
Certain Underwriters at Llyod's London Insurance
Companies (Underwriters) which excluded losses "caused
directly or indirectly" by flood. Underwriters denied
coverage based on the flood exclusion. The marina then filed
this action against Underwriters, alleging that they breached
the policy. The district court granted Underwriters summary
judgment after concluding that the docks were lost to flood.
Hudson appeals, and we affirm.
Debra Hudson own Hudson Enterprises, which operates the River
Valley Marina. The marina owns eight docks on the north bank
of the Little Maumelle River in Little Rock, Arkansas. The
Little Maumelle River runs west to east until it converges
with the Arkansas River. The marina is located approximately
two miles above the Little Maumelle's confluence with the
night of April 30, 2011 approximately seven inches of rain
fell in the Little Maumelle watershed. Several area residents
testified that the river rose at least three feet above its
normal levels and exceeded its banks in some places. Photos
indicate that there was standing water in the parking lot
near one of the marina's docks the next day. The rain
also greatly increased the speed of the river's current.
In addition to rain, the storm brought with it high winds
that tore down tree branches near the marina.
marina lost five of its eight docks to the storm. The three
docks that survived the storm were located upstream from the
docks that were swept away. The marina was covered by an
insurance policy issued by Underwriters. After the storm, the
marina contacted Underwriters to obtain compensation for the
loss. Its policy insured the marina against "direct
physical loss of or damage to" its eight docks. The
policy contained an exclusion, however, which stated:
We will not pay for loss or damage caused directly or
indirectly by any of the following. Such loss or damage is
excluded regardless of any other cause or event that
contributes concurrently or in any sequence to the loss.
These exclusions apply whether or not the loss event results
in widespread damage affecting a substantial area, or remains
localized - even when restricted to the insured premises. . .
4. Water - (a) Flood, surface water, waves, tides, tidal
waves, overflow of any body of water, or their spray, all
whether driven by wind or not; . . . .
days after the storm, Underwriters sent an adjuster to take
photographs of the marina and talk to the Hudsons. Mr. Hudson
told the adjuster that the "[t]he velocity of that
water" caused the damage to the docks. Underwriters
denied coverage after finding that the loss was caused by
"a flash flood that occurred on the Little Maumelle
River following heavy rains." The Hudsons later came to
believe, however, that a utility pole caused their loss when
it fell onto the docks as a result of the storm's high
Enterprises (Hudson) filed this action against Underwriters
in state court. Underwriters removed the case to federal
court. During discovery, Hudson served an interrogatory on
Underwriters that stated, "In the course of your
investigation of the facts and circumstances forming the
basis for the claim for benefits tendered by Plaintiff . . .
did you obtain any expert opinion relating to your
determination to deny payment of such claim?"
Underwriters answered on November 16, 2015 by stating
"discovery is ongoing and [Underwriters] have not yet
made a determination as to whether an expert witness may
testify at trial." The answer then indicated "[i]f
Underwriters decide to have a testifying expert, Underwriters
will identify said expert(s) in accordance with the Federal
Rules of Civil Procedure."
district court entered a case scheduling order which required
Underwriters to "identify all expert witnesses and
produce their opinions by 27 January 2016." Underwriters
disclosed their civil engineering expert to Hudson on January
27, 2016. The expert concluded that the flash flood was the
sole cause of Hudson's loss and rejected Hudson's
utility pole hypothesis. Hudson objected to Underwriters'
expert and asked that his opinions be stricken because the
expert had been disclosed too late and because Underwriters
had not supplemented their interrogatory answer after
retaining him. At the hearing on Hudson's motion to
strike, counsel for Underwriters stated ...