Confidential
Verdict – $0Judge
Court
L.A. Superior
Attorneys
Plaintiff
Christian J. Garris
(Law Office of Christian J. Garris)
Defendant
Julian J. Pardini
(Lewis, Brisbois, Bisgaard & Smith LLP)
Experts
Plaintiff
Luis De La Cruz
(technical)
Defendant
Brian Daly
(technical)
Facts
Nationwide issued a Golden Blanket Homeowners Policy to plaintiff Dawn Womer for the period Dec. 11, 2000 to Dec. 11, 2001. The policy insured the single-family home of plaintiff, located in Laguna Beach. The policy contained certain exclusions, including one for damage caused by dry rot. On Sep. 20, 2001, the plaintiff reported to Nationwide that a leaky tub drain had caused water damage in a bathroom and in a storage room at the insured property. Nationwide's adjuster inspected the property on Sep. 24, 2001. Based upon his inspection, he concluded that the water leaking from the shower over a period of time had resulted in mold, wet rot and dry rot to a lower floor joist, wood paneling lining from the sides of the shower, subfloor, carpet and other floor areas adjacent to the shower. The adjustor wrote to the plaintiff on Oct. 5, 2001 to advise her of Nationwide's response to her claim. In this letter, he described the damage that he had observed and informed her that the policy did not provide coverage for wet or dry rot damage, or for long-term water leaking and from water seeping through, in and around a shower enclosure. His letter also quoted the applicable policy exclusions, including those for loss caused by "mold, wet or dry rot." The adjustor then closed the file. Six months later, the plaintiff contacted the adjustor and requested that the claim be re-opened. She informed him that she had received reports indicating fungal damage to her home. Shortly thereafter, on June 12, 2002, the plaintiff provided the adjuster with copies of two reports by De La Cruz Wood Preservation Services, a company retained by the plaintiff to evaluate the damage to her house. Both reports indicated the "damage by the water conducting fungus Meriluporia (poria) incrassata." There was never any question as to the cause of the damage that De La Cruz found and, in fact, the only claim that the plaintiff made under the policy was for dry rot damage caused by Poria. After reviewing the De La Cruz reports, the adjuster called the plaintiff and advised her that damage from Poria incrassata was not covered for the reasons outlined in his letter of Oct. 5, 2001. He confirmed this in a letter dated June 17, 2002.
Result
The court found in favor of Nationwide that the exclusion for dry rot applied to the plaintiff's loss, and therefore there was no coverage for this loss. The court, taking the language as a whole and looking at the language like a layperson, within the context of the policy, concluded that a loss caused by Poria was excluded by the dry rot exclusion. After receiving the court's ruling, the defendant moved for nonsuit or alternation directed verdict on the causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing. The plaintiff responded by simply requesting a judgment in favor of Nationwide and that she would pursue an appeal. The court ruled the motion for nonsuit was moot and ordered judgment be entered in favor of Nationwide. The court added that her ruling assumed causation (that the plaintiff's loss was caused by Poria).
Other Information
The defendant moved for nonsuit or directed verdict on the causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing. The plaintiff responded by simply requesting a judgment in favor of Nationwide and that she should pursue an appeal. The court ruled the motion for nonsuit and ordered judgment be entered in favor of Natiowide. The court added that her ruling assumed causation (that the plaintiff's loss was caused by Poria).
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