Legal Issues

Arson Committed By or On Behalf of The Insured

An insurer may defend an action based upon arson, even if that exclusion is not contained in the policy itself. See: Powell v. Merrimack Mutual Fire Ins. Co.,80 F.R.D. 431 (N.D. Ga. 1978); J.B. Smith v. Federated Mutual Ins. Co., 124 Ga. App. 693 (1971). In order for the Insurer to establish a prima facie case of arson for the purpose of denying coverage under a fire policy, the Defendant must show by a preponderance of the evidence, all three of the following items: (1) That the fire is a result of arson, that is, the intentional setting of the fire, absent any circumstances showing cause by accident or neglect, but that it was intentionally and deliberately set by the act of some person with the intent to cause the destruction of the property; (2) Motive on the part of the Insureds to set the fire; and (3) Direct evidence implicating the Insureds, or unexplained surrounding circumstantial evidence implicating the Insureds. See: Southern Trust Ins. Co. v. Braner, 169 Ga. App. 567 (1984); Allstate Ins. Co. v. Talbot, 198 Ga. App. 190 (1990).

Intentional burning of property may be shown by evidence aimed at demonstrating the improbability that the fire had resulted from accidental or natural causes. See:  Jackson v. State, 157 Ga. App. 580 (1981); 5 Am. Jur. 2d, Arson & Related Offenses, § 49.

By the very clandestine nature of the act, intentional burning is generally incapable of direct proof. It may therefore be proved by the preponderance of circumstantial evidence, which proof of intentional burning, ample motive to burn, and unexplained circumstances surrounding the fire. See: Boone v. Royal Indem. Co., 460 F.2d 26 (10^th Cir. 1972); Carpenter v. Union Soc. Of Centon, Ltd., 284 F.2d 155 (4^th Cir. 1960); Miele v. Boston Ins. Co., 288 F.2d 178 (8^th Cir. 1961) Cora Publishing, Inc. v. Continental Cas. Co., 619 F.2d 482 (5^th Cir. 1980).

Accordingly, the insurance company may rely solely upon circumstantial evidence to prove the policyholder’s involvement or connection with the fire. See: Fortson v. Cotton States Mut. Ins. Co., 168 Ga. App. 155 (1983).

Among the ways motive may be inferred would be presentation by the Insurer that the Insured had experienced substantial financial distress. See: Southern Trust Ins. Co. v. Braner, 169 Ga. App. 567 (1984).

The Insurer is not required to establish that the Insureds personally set fire to their property in order to establish its defense and prevail on the question of arson. See: Don Burton, Inc. v. Aetna, 575 F.2d 702 (9^th Cir. 1978); Cora Pub.Inc. v. Continental Cas. Co., Supra.