Charles Cranfield, individually v. State Farm Fire & Casualty Company

NOT RECOMMENDED FOR PUBLICATION
File Name: 20a0167n.06
No. 19-3004
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
CHARLES CRANFIELD, individually and on behalf
of all other Ohio residents similarly situated,
Plaintiff-Appellant,
v.
STATE FARM FIRE & CASUALTY COMPANY,
Defendant-Appellee.
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ON APPEAL FROM THE
UNITED STATES DISTRICT
COURT FOR THE
NORTHERN DISTRICT OF
OHIO
BEFORE: SUTTON, NALBANDIAN, and READLER, Circuit Judges.
PER CURIAM. Charles Cranfield purchased a State Farm insurance policy that provided
for “actual cash value” coverage for damage to his home. The policy and related documents
defined “actual cash value” as the “repair or replacement cost of the damaged part of the property
less depreciation and deductible.” The documents in turn defined the term “depreciation” as the
“decrease in the value of property over a period of time due to wear, tear, condition, and
obsolescence.” No further definition was provided.
When a storm damaged Cranfield’s home, he filed a claim with State Farm. An adjuster
estimated the total cost to repair Cranfield’s home as well as how much the home had depreciated
since its original construction. State Farm and Cranfield agreed that State Farm could make
deductions from Cranfield’s recovery amount to reflect the depreciated value of the material used
to construct the home. But they disagreed whether the policy also allowed for deductions for the
depreciated value of the labor costs to construct the home. Unable to resolve his dispute with State

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No. 19-3004, Cranfield v. State Farm Fire & Cas. Co.
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Farm, Cranfield filed a class action in state court on behalf of himself and all other Ohioans insured
by State Farm on similar terms. Invoking our jurisdiction under the Class Action Fairness Act, 28
U.S.C. §§ 1332(d) & 1453, State Farm removed the lawsuit to federal court.
Whether labor depreciation is properly deducted in an actual cash value insurance policy
has divided courts across the nation. Accardi v. Hartford Underwriters Ins. Co., -- S.E.2d --, 2020
WL 987541, at *3 (N.C. Feb. 28, 2020) (collecting cases). Agreeing with the majority of courts
to address the issue, the district court dismissed Cranfield’s complaint, holding that the State Farm
policy unambiguously allowed for depreciation deductions for both material and labor costs.
Cranfield appealed.
We recently resolved this issue in Perry v. Allstate Indem. Co., -- F.3d --, 2020 WL
1284960 (6th Cir. Mar. 18, 2020). In Perry, we held that an Ohio insurer may not deduct the cost
of labor depreciation pursuant to an actual cash value insurance policy that does not expressly
provide for such deductions. Id. at *4. Because Cranfield’s policy with State Farm did not
expressly provide for labor-cost depreciation deductions, Perry commands the same result here.
Ogle v. Ohio Civil Serv. Emps. Ass’n, -- F.3d --, 2020 WL 1057389, at *1 (6th Cir. Mar. 5, 2020)
(per curiam). We therefore REVERSE the judgment of the district court and REMAND for
further proceedings consistent with this opinion.

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