State ex rel. State Fire & Tornado Fund of the North Dakota Insurance Department v. North Dakota State University

Summary

The North Dakota Supreme Court affirmed summary judgment denying North Dakota State University's claims for insurance coverage for water damage caused by a severe rainstorm. The court held that the water remained excluded flood or surface water despite flowing through man-made structures, and that the efficient proximate cause doctrine did not apply because the damage resulted from a single continuous event. The court also addressed whether the evidence regarding damage to underground steam lines created a genuine issue of material fact.

Holdings

1. Water derived from the rainstorm that accumulated on the ground and then flowed through man-made structures remained surface water because it did not form a defined body of water or follow a defined watercourse. The policies' surface-water exclusions therefore precluded coverage as a matter of law.
2. The efficient proximate cause doctrine did not apply because the undisputed facts established a single continuous cause—excluded surface water—rather than two independent or distinct perils.
3. The evidence did not create a genuine issue of material fact. At most, it suggested that subterranean moisture and surface water may have been concurrent causes, and a covered concurrent cause is insufficient under North Dakota's efficient proximate cause doctrine.

Questions Presented

1. Whether the water that damaged NDSU's steam tunnel, heating plant, and Industrial Agriculture and Computer Center constituted surface water excluded by the insurers' policies.
2. Whether the efficient proximate cause doctrine required a factfinder to determine whether a covered peril, rather than excluded surface water, caused the damage to the steam tunnel, heating plant, and Industrial Agriculture and Computer Center.
3. Whether a genuine issue of material fact existed concerning whether subterranean moisture was the efficient proximate cause of damage to the direct buried steam line.

Disposition

affirmed