VIRUS IN THE WIND A DIRECT LOSS

Infectious Disease	Windstorm
Swine	Farm

On January 18, 1990, Curtis O. Griess & Sons, Inc., (Griess), purchased an insurance policy from Farm Bureau Insurance Company of Nebraska for $6,364.40. The policy was to cover livestock from harm caused by named perils, including windstorm. The policy covered “physical loss to the property described in the coverage caused directly by an applicable peril ... unless the loss is excluded....” Windstorm was an included peril. Infectious disease was not listed as included or excluded.

On March 13, 1990 Clay County experienced a windstorm. The tornado travelled SW to NE towards the Griess swine operation. Within that path were several herds of pseudorabies-infected swine which had been quarantined by the state Department of Agriculture. The windstorm caused the pseudorabies to travel from the infected swine to Griess’ swine.

His swine were “Lieske Genetics” maintained for breeding. Many died but those that lived could no longer be bred and therefore had diminished value. To mitigate damages, Griess incurred $128,732 in veterinarian costs. Griess also had to refund $19,900 that had been collected from breeding gilts sold prior to the symptoms of the illness.

Farm Bureau determined that the proximate cause of the loss was pseudorabies and not windstorm. They contended also that the airborne transmission of an infectious disease is not a covered peril due to the phrase in the policy “caused directly.” Thus, coverage under the policy was denied. Griess brought suit in the District Court.

The District Court entered a summary judgement in favor of Griess and Farm Bureau appealed. The Supreme Court affirmed the decision and determined that damages to the swine herd were a direct result of windstorm because it was necessary to transport the virus. The higher court also held that veterinarian fees and other expenses incurred were also covered by the policy because Griess had a duty to protect the property from further damage.

Curtis O. Griess & Sons, Inc. v. Farm Bureau Ins. Co. of Nebraska, Supreme Court of Nebraska.

247 Neb. 526 528 N.W.2d 329, March 10, 1995.