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Penthouse Owners Ass'n, Inc. v. Certain Underwriters

United States Court of Appeals for the Fifth Circuit

July 15, 2010, Filed

No. 09-60652

Opinion

 [*384]  E. GRADY JOLLY, Circuit Judge:

This appeal arises from a claim  [**2] for insurance coverage for damage caused by Hurricane Katrina. The district court interpreted a windstorm deductible endorsement in the appellee's insurance policy to require coverage for the destruction of the insured's buildings by Katrina's storm surge. Based on principles of insurance contract interpretation, under Mississippi law, we conclude that the deductible endorsement at issue here did not render the policy ambiguous or otherwise expand coverage to include losses excluded elsewhere in the policy. Accordingly, we vacate the district court's certified orders and remand for consideration of the Underwriters' summary judgment motion.

 [*385]  I

Appellee Penthouse Owner's Association, Inc. ("Penthouse") owns a complex of condominiums in Pass Christian, Mississippi, that are insured under a Lloyd's, London ("the Underwriters") all-risk policy ("Policy") with a policy limit of $ 3,568,000. The Policy excludes water damage, including "flood, surface water, waves, tides, tidal waves, overflow of any body of water, or their spray, all whether driven by wind or not." It also contains an "anti-concurrent causation" clause (ACC clause), which states that "such [water] loss or damage is excluded  [**3] regardless of any other cause of loss or event that contributes concurrently or in any sequence to the loss." (emphasis added). In addition, the policy includes an endorsement that defines a "Windstorm or Hail Deductible" ("Windstorm Deductible"). The Deductible is set at 5%, and the endorsement states, in relevant part:

The Windstorm or Hail Deductible, as shown in the Schedule, applies to loss or damage to Covered Property caused directly or indirectly by windstorm or hail, regardless of any other cause or event that contributes concurrently or in any sequence to the loss or damage. If loss or damage from a covered weather condition other than windstorm or hail occurs, and that loss or damage would not have occurred but for the windstorm or hail, such loss or damage shall be considered to be caused by windstorm or hail and therefore part of the windstorm or hail occurrence.

. . .

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612 F.3d 383 *; 2010 U.S. App. LEXIS 14531 **

PENTHOUSE OWNERS ASSOCIATION, INC., Plaintiff - Appellee v. CERTAIN UNDERWRITERS AT LLOYDS, LONDON, Defendant - Appellant

Subsequent History: Summary judgment denied by, Motion to strike denied by, As moot Penthouse Owners Ass'n v. Certain Underwriters at Lloyd's, London, 2011 U.S. Dist. LEXIS 2792 (S.D. Miss., Jan. 11, 2011)

Prior History:  [**1] Appeal from the United States District Court for the Southern District of Mississippi.

Penthouse Owners Ass'n v. Certain Underwriters at Lloyd's, London, 2009 U.S. Dist. LEXIS 3442 (S.D. Miss., Jan. 16, 2009)Penthouse Owners Ass'n v. Certain Underwriters at Lloyd's London, 2008 U.S. Dist. LEXIS 55689 (S.D. Miss., July 21, 2008)Penthouse Owners Ass'n v. Certain Underwriters at Lloyd's, London, 2008 U.S. Dist. LEXIS 91866 (S.D. Miss., July 2, 2008)

Disposition: REVERSED, VACATED, and REMANDED.

CORE TERMS

deductible, Windstorm, coverage, endorsement, district court, insurer, hail, flood, hurricane, orders, wind, provisions, insurance policy, concurrently, contributes, sequence, losses, vacate, summary judgment, policy coverage, destroyed

Civil Procedure, Appeals, Standards of Review, De Novo Review, Questions of Fact & Law, Insurance Law, Policy Interpretation, Ambiguous Terms, Coverage Favored, Claim, Contract & Practice Issues, Exclusions, Plain Language, Evidence, Burdens of Proof, Allocation, Entire Contract, Deductibles, Governments, Courts, Judicial Precedent, General Overview