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A House Must Be a Home under a Homeowner’s Insurance Policy Excluding Coverage for Unoccupied Dwellings

Khoshmukhamedov, et. al. v. State Farm Fire and Casualty Company
Case No. 12-cv-0820-AW (U.S. District Court for the District of Maryland)

by Joel M. Celso, Summer Associate
Semmes, Bowen & Semmes (

The primary issue in this action was whether a house owned by Plaintiffs Khoshmukhamedov and Issaeva was “unoccupied” under the terms of the homeowner’s insurance policy when water pipes burst and flooded it. In this opinion authored by Judge Williams Jr., the U.S. District Court granted summary judgment to the Defendant, State Farm Fire and Casualty Company (“State Farm”).

Plaintiffs were Russian citizens who resided in Maryland. In 2005, the Plaintiffs purchased a new home in Potomac, Maryland, which they insured with State Farm. Plaintiff Khoshmukhamedov managed a business headquartered in Switzerland, which supplied raw materials for the aluminum industry. The company had employees in Switzerland and Russia, and primarily supplied an aluminum factory in Tajikistan. The international nature of the business required frequent travel from Khoshmukhamedov. Further, his visa restrictions prevented him from staying in the United States for more than 180 consecutive days.

At the end of October, 2008, the Plaintiffs left the United States with the intent of returning to Maryland in February 2009. The Plaintiffs arranged for their friend and translator, Mikhail Immerman (“Immerman”), and their neighbor, Khushi Kalotra (“Kalotra”), to look after the house while they were gone. Upon leaving, the Plaintiffs had their cable television and telephone services shut off; and they instructed Immerman to have the electricity shut off. The Plaintiffs intended to leave the house unheated and prevent the electric water pump from supplying water to the house’s piping. Immerman contacted Potomac Electric Power Company (“PEPCO”) to shut off the electricity, but the water pump continued to operate throughout the winter. At some point, the water pipes in the house froze and burst. Kalotra discovered the damage on February 6, 2009. Acting as the Plaintiffs’ representative, Immerman contacted State Farm to file a claim. Upon learning that the Plaintiffs had not been at the home since October, State Farm denied the claim on the grounds that the home was “unoccupied” at the time of the damage. Plaintiffs sued State Farm, seeking declaratory judgment on the insurance policy and alleging breach of contract. Both parties moved for summary judgment.

In considering the motions, Judge Williams Jr. examined the language of the insurance policy which explicitly stated that losses due to freezing of plumbing would not be insured if the dwelling was “unoccupied.” The Plaintiffs argued that the term was ambiguous and should be construed against State Farm, who drafted it. The Court rejected this argument, relying on Agricultural Insurance Co. of Watertown, N.Y. v. Hamilton, 33 A. 429, 429 (1895), where the Maryland Court of Appeals stated that a house is unoccupied when it “ceases to be a place of actual abode, --a place really occupied as a residence or habitation.” Because the Plaintiffs had not resided in the house for approximately four (4) months when the pipes burst, and had made the house impossible to live in by turning off the cable, telephone, heat, and electricity, Judge Williams Jr. determined that the house was “unoccupied.”

The Plaintiffs raised other arguments in an attempt to stave off summary judgment. First, they claimed that the house never became unoccupied because they intended to return in February 2009. In rejecting the argument, the Court again relied on the Court of Appeal’s assertion in Hamilton that “occupancy of a particular place as a dwelling is not a matter of intention at all, but purely one of fact.” Id. at 431. Finally, in a last ditch effort, the Plaintiffs argued that the house had remained “occupied” because they had left substantial personal property there. Again, the Court looked to the Hamilton court, and noted that it had cited, in approval, cases from other jurisdictions where courts had found that houses were unoccupied despite the fact that personal property had been left inside them. Id.

The Court concluded that there was no factual dispute between the parties, and the case could be decided as a matter of law since the Maryland Court of Appeals had provided a clear interpretation of the term at issue. Because the homeowner’s insurance policy excluded coverage of “unoccupied” homes, the Court granted State Farm’s motion for summary judgment.