Burden on Insureds to Prove Exception to Exclusion in Property Policy

February 24, 2021 / Writing and Speaking

By Don R. Sampen, published, Chicago Daily Law Bulletin, February 23, 2021

The 5th District Appellate Court recently held that insureds have the burden of establishing an exception to an exclusion in a property insurance policy, and because they failed to meet their burden, the insurer had no obligation to provide coverage for water pipe leaks caused by frozen plumbing.

The case is Wells v. State Farm Fire & Casualty Insurance Co., 2021 IL App (5th) 190460 (Jan. 4). The insureds, members of the Wells family, were represented by Sanders & Associates of Marion. Brandon & Schmidt of Carbondale represented the insurer, State Farm.

State Farm’s property policy covered a warehouse building located in Marion owned by members of the Wells family. The heating system at one time included a furnace and a heat pump. But on at least three occasions prior to the incident giving rise to the coverage dispute, the building’s water pipes burst while the furnace and heat pump were both in operation. One of the plaintiffs testified that these incidents led him to believe that the furnace was a dangerous way to prevent freezing in cold weather.

In 2010, the building’s heat pump was stolen and never replaced, even though State Farm paid the replacement costs for the pump. No evidence existed that the plaintiffs did anything thereafter to repair or replace the building’s heating system.

In February 2011, however, during a period of below freezing weather, the plaintiffs cordoned off a 400-square-foot area where the building’s water pipes were exposed and set up three space heaters to prevent the pipes from freezing. Nonetheless, a few days later the pipes burst, and the plaintiffs submitted a claim to State Farm for the loss.

The State Farm policy generally covered damage to the building due to accidental loss. It contained an exclusion, however, for loss caused by water leaking from plumbing caused by freezing “unless … you do your best to maintain heat in the building.” Based on the exclusion, State Farm denied coverage, and the plaintiffs filed this suit for breach of contract, bad faith and other remedies.

Following a bench trial, the trial court concluded that the exclusion applied and entered judgment for State Farm. The plaintiffs then appealed.


In an opinion by Justice Mark M. Boie, the 5th District affirmed. He initially addressed the burden of proof. While the trial court placed the burden on State Farm to establish that the plaintiffs had not done their “best,” Boie said that was error.

Observing that the “do your best” language actually served as an exception to the no-coverage-for-leakage exclusion, Boie said that no Illinois state court had actually decided the allocation of the burden in these circumstances. He then relied on a 7th U.S. Circuit Court of Appeals case, Santa’s Best Craft, LLC v. St. Paul Fire & Marine Insurance Co., 611 F.3d 339 (7th Cir. 2010), and several out-of-state cases in defining the “majority view” that the insured has the burden of proving up an exception to an exclusion.

Boie then turned to the meaning of the “do your best” language itself and found again that no Illinois case had interpreted that language. Out-of-state case law, however, had construed the phrase as requiring the insured to use “reasonable efforts” to comply with the policy’s requirement. He also applied a “manifest weight of the evidence” standard in evaluating the correctness of the trial court’s findings.

Ultimately Boie agreed with the trial court that the plaintiffs had not used their “reasonable” or “best” efforts. He relied on evidence that the plaintiffs knew the heating system in the building was inadequate; they made no effort to repair it even though they had years to do so before the pipes froze in 2011; and the plaintiffs’ own expert could not determine whether the space heaters overloaded the building’s circuits, causing the breaker to trip during freezing weather.

In addition, Boie found that the space heaters were not sufficient to heat the whole building; they should not have been used more than a day or two; and even if all three were working at the time of the freezing temperatures, they may not have been sufficient to keep the pipes from freezing in any event.

The court therefore affirmed the judgment in favor of State Farm.

Key point

The insured has the burden to prove up an exception to an exclusion.

  • Chicago

    Illinois 60603

    10 South LaSalle Street

    Chicago, Illinois 60603

    T: 312.855.1010 TF: 800.826.3505 F: 312.606.7777 Office Managing Partner: Dennis D. Fitzpatrick

  • New York

    New York 10005

    28 Liberty Street 39th Floor

    New York, New York 10005

    T: 212.805.3900 TF: 800.826.3505 F: 212.805.3939 Office Managing Partner: Carl M. Perri

  • Mission Viejo

    California 92691

    27285 Las Ramblas

    Suite 200

    Mission Viejo, California 92691

    T: 949.260.3100 TF: 800.826.3505 F: 949.260.3190 Office Managing Partner: Ian R. Feldman

  • Florham Park

    New Jersey 07932

    100 Campus Drive

    Florham Park, New Jersey 07932

    T: 973.410.4130 TF: 800.826.3505 F: 973.410.4169 Office Managing Partner: Carl M. Perri

  • Michigan City

    Indiana 46360

    200 Commerce Square

    Michigan City, Indiana 46360

    T: 219.262.6106 TF: 800.826.3505 F: 312.606.7777 Office Managing Partners: Paige M. Neel, Kimbley A. Kearney

  • Appleton

    Wisconsin 54914

    4650 W. Spencer Street

    Appleton, Wisconsin 54914

    T: 920.560.4658 TF: 800.826.3505 F: 920.968.4650 Office Managing Partner:

  • Stamford

    Connecticut 06902

    68 Southfield Avenue

    2 Stamford Landing Suite 100

    Stamford, Connecticut 06902

    T: 203.921.0303 TF: 800.826.3505 F: 212.805.3939 Office Managing Partner: Matthew J. Van Dusen

  • Tampa

    Florida 33609

    4830 West Kennedy Boulevard, One Urban Center

    Suite 600

    Tampa, Florida 33609

    T: 813.509.2578 TF: 800.826.3505 F: 312.606.7777 Office Managing Partner: Dennis D. Fitzpatrick

  • San Francisco

    California 94111

    100 Pine Street

    Suite 1250

    San Francisco, California 94111

    T: 415.287.2744 TF: 800.826.3505 F: 949.260.3190 Office Managing Partner: Ian R. Feldman

  • Houston

    Texas 77019

    2929 Allen Parkway

    American General Center, Suite 200

    Houston, Texas 77019

    T: 346.229.4612 TF: 800.826.3505 F: 312.606.7777 Office Managing Partner: Ramy P. Elmasri

  • Dallas

    Texas 75201

    325 N. Saint Paul Street

    Suite 3100

    Dallas, Texas 75201

    T: 469.942.8635 TF: 800.826.3505 F: 312.606.7777 Office Managing Partner: Ramy P. Elmasri

  • Boca Raton

    Florida 33434

    7777 Glades Road

    Suite 405

    Boca Raton, Florida 33434

    T: 561.765.5305 TF: 800.826.3505 F: 312.606.7777 Office Managing Partner: Dennis D. Fitzpatrick