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North Carolina court rules on actual cash value of homes

North Carolina is one of several states that has enacted a new legal system designed to manage business litigation. The North Carolina Business Court hears cases regarding business entities in a civil court system. The process streamlines specific types of cases like contract disputes, insurance claims and financial damages related to business activities.

A case recently heard by the Business Court has established the policy standard for insurance of home construction. The court determined that the actual cash value of an insured home may include deductions for the depreciation of labor. Although several other states have ruled on this issue depending on specific situations, this was the first notably ruling in North Carolina.

The case in question regards a homeowner's claim after damage to his home due to a hailstorm. He argued his insurance policy was ambiguous regarding the cash value in contrast to the replacement cost value. The court ruled that a home's value includes the process of assembling the constituent parts.

As a result, the labor required to assemble materials may depreciate along with them, as the process is paid for and contains value that is part of the home's value. The case was brought as a class action, so homeowners in similar positions may expect insurers' versions of payouts to be upheld in the Tar Heel State.

People and organizations with matters to put before a business court always have a right to legal representation. A lawyer can help determine the laws and codes that apply to a case and prepare arguments for filings and court appearances.

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