With the Presidential election merely weeks away and fresh off the second Presidential debate, I turn this week to a political battleground. Numerous states such as California and Illinois are shoe-ins for President Obama, while other states such as Texas and Georgia are locks for Governor Romney. Consequently, both candidates spend most of their efforts on “swing states.” Among those swing states, Florida and Ohio, have the most delegates and seem to be receiving the most attention. Because I have already reviewed Florida total loss case law, I found fitting to spend my time this week looking at Ohio.
Once again, we find ourselves in a state where the total loss definitions come from fire losses. The original case dates back to 1900. The Ohio Supreme Court realized that, “[t]his is the first case in this court presenting the question as to what is a total loss.”1
Interpreting the policy with state statutes, the Court reasoned,
It seems to be agreed that it is not necessary, to constitute a total loss, that all the material composing the building should be destroyed. It is sufficient, though some parts of it remain standing, that the building has lost its identity and specific character as a building; the insurance not being upon the material composing the building, but upon the building as such. When the loss by fire is such that its character as a building is destroyed, and it remains simply as a mass of ruins, parts of which may remain standing, but of no value in repairing or rebuilding the structure, though something might be realized for the material by removing it, the loss is regarded as total.
In an effort to provide more clarity, the Court went on to hold,
A building loses its identity and specific character when it has been so far destroyed by fire that it can no longer be called a building, and the portions that remain cannot be utilized to advantage in rebuilding it. That something might be realized out of portions that remain, for other purposes, is not material. As to what will constitute a total loss in a given case must, within the meaning of the statute, necessarily be, to a great extent, a question of fact for the jury to determine under proper instructions from the court. What remaining parts could be made available in rebuilding can only be determined by exercising a sound discretion in the light of the evidence.
What we have here is a “composite test,” as it blends the reasonable person test (where the courts look to see if a reasonable person, who is uninsured, would use the remaining portions of the building to rebuild) with the identity test (where the courts look to see if the identity of the building has been lost).
1 Pennsylvania Fire Ins. Co. v. Drackett, 63 Ohio St. 41, 44 W.L.B. 71 (1900).
