[00:00:02] Speaker 02: Good morning. [00:00:02] Speaker 02: May it please the court? [00:00:03] Speaker 02: Rick Wetmore on behalf of Plaintiff Fandivert Construction. [00:00:07] Speaker 02: I'd like to reserve three minutes for rebuttal. [00:00:10] Speaker 02: This case is about the interpretation and application of an all-risk insurance policy. [00:00:16] Speaker 02: Now, as an initial matter, it's important to understand the distinction that is significant between all-risk policies and specified peril policies. [00:00:26] Speaker 02: Under an all-risk policy, the insurer assumes the risk of all causes of loss that are not specifically excluded under the policy. [00:00:36] Speaker 02: Under a specified peril policy, the insured bears that risk because only the risks identified within the policy are specifically insured against. [00:00:48] Speaker 02: As I said, this case is about an all risk policy. [00:00:52] Speaker 02: The issue under this particular policy is the distinction between damage caused generally by water, caused by rain, or caused by surface water, including the accumulation of water from any source on a roof. [00:01:08] Speaker 02: The laws of nature, insurance interpretation, and the specific language of this policy confirms that there is indeed a metaphysical transformation that occurs between rain once it lands on the surface of the earth, including artificial structures. [00:01:27] Speaker 00: The difficulty I have with your argument, Council, is the specificity of the requirement that the roof be complete before there's any coverage of rain damage. [00:01:42] Speaker 00: And that seems to me to be different from all the other cases that you've cited. [00:01:46] Speaker 00: Do you have any cases dealing with a similar rain exclusion that specifies that the roof has to be complete and lays out all the things of what it means to have a complete roof? [00:01:57] Speaker 02: not in that specific context your honor however i think that the nova case is is close in that if you look at the specificity within this policy and identifying what constitutes completion [00:02:11] Speaker 02: The paragraph immediately before that identifies that that's the second part of the test for coverage. [00:02:19] Speaker 02: And it says that there is no coverage unless there is damage from another covered cause of loss before. [00:02:27] Speaker 02: And so that that occurs before, such as a crane falling and breaking through the roof. [00:02:32] Speaker 02: That same language is included in the Nova case and the Nova policy in which the policy says specifically that there is no coverage unless there is damage to the roof from a covered cause of loss. [00:02:49] Speaker 02: And again, in the Nova case, and that is a [00:02:54] Speaker 02: Very, other than the distinction identified by the court just now, that case is very similar to the facts here. [00:03:03] Speaker 02: The court spent a significant time identifying the difference between rain and surface water and concluded unambiguously that those two things are distinctly different. [00:03:16] Speaker 02: And at the moment that the rain hits the roof and then, worse yet, accumulates, that is a distinctly different loss than rain. [00:03:27] Speaker 01: Well, when rain lands, it turns into non-rain. [00:03:31] Speaker 01: Is that your position? [00:03:32] Speaker 01: That's what it sounds like. [00:03:34] Speaker 01: But then how does this ever work if rain, sleet, ice, or snow, whether driven by wind or not, enters the interior of the covered property [00:03:44] Speaker 01: I don't understand. [00:03:45] Speaker 01: It has to land before it gets inside. [00:03:48] Speaker 01: I just don't understand your position, to be honest. [00:03:53] Speaker 02: Sure, Your Honor. [00:03:54] Speaker 02: The position is that [00:03:58] Speaker 02: under that provision, if the rain were to enter the building directly through an open window, through a hole in the roof, through any number of other examples. [00:04:10] Speaker 01: But that doesn't make sense, because it's covered if the exterior is complete, including the roof. [00:04:19] Speaker 01: So the only way that that can happen is if it gets inside the property somehow. [00:04:25] Speaker 02: Interestingly, the same issue has been discussed and identified by other courts. [00:04:34] Speaker 02: Some of the cases cited in the pleading. [00:04:38] Speaker 01: Yeah, I mean, it says the exterior is complete only when it's been constructed to a point that is fully weather resistant, and it includes roof and the roof drainage system being complete. [00:04:51] Speaker 01: But by definition, if that's complete, [00:04:55] Speaker 01: The rain can enter the interior and trigger coverage, right? [00:05:03] Speaker 01: That's what it says. [00:05:04] Speaker 01: Rain entering the interior is covered if the building is otherwise complete. [00:05:13] Speaker 02: I agree that's what the policy states, Your Honor. [00:05:16] Speaker 01: Yes. [00:05:17] Speaker 02: Correct. [00:05:17] Speaker 01: But the interest to... So if rain enters the interior and the roof is not complete, there's no coverage. [00:05:26] Speaker 02: I would submit to the court that this is not a well-drafted policy. [00:05:33] Speaker 02: It is an ambiguous policy. [00:05:35] Speaker 01: Well, what's ambiguous about that? [00:05:37] Speaker 01: If it enters the interior and the roof isn't complete, there's no coverage. [00:05:43] Speaker 01: What's ambiguous about that? [00:05:44] Speaker 02: It's when we look at the remainder of the policy and the other terms that are specifically defined that it becomes clear that this policy is ambiguous. [00:05:53] Speaker 00: The problem there, Council, is I think another way to think about it. [00:05:59] Speaker 00: The rain provision clearly says if the roof is only partially complete, it's not going to be covered. [00:06:06] Speaker 00: And if rain hits a partially complete roof, [00:06:11] Speaker 00: By your definition, that would become surface water and that provision would no longer make any sense. [00:06:16] Speaker 00: So the only way to understand the very specific provision that says there will be no rain covered until the roof is 100% complete is that if it's partially complete and the rain hits the partial roof and then comes inside, it's not covered. [00:06:34] Speaker 02: Your honor, I would I would submit that this is a little different as well in that we're talking not just about We're talking about a combination of the passage of time and the accumulation of the water I don't know if the court has had the opportunity to view the videos they have been submitted into the record we're not talking about rain that just hits the roof and then immediately trickles into into the building and [00:06:59] Speaker 02: There are, within the videos, we can see I would estimate an inch and a half, two inches of water sitting on the roof in one video. [00:07:08] Speaker 02: We can see water just pouring through level by level by level. [00:07:14] Speaker 02: So this isn't just an issue of the rain hitting the water and then hitting the roof and then trickling in. [00:07:21] Speaker 02: This is in part an accumulation of that rain with the passage of time. [00:07:28] Speaker 02: And so to the court's concern about, well, how does this rain exclusion apply? [00:07:34] Speaker 02: Again, the burden is on the insurer to draft clear and unambiguous exclusions. [00:07:44] Speaker 02: The policy specifically covers water damage. [00:07:48] Speaker 02: And it defines water damage as any loss from water except loss caused by or resulting from flood. [00:07:56] Speaker 02: In one section of the policy, the definitions identify and recognize the characterization of water damage and don't exclude it other than for flood. [00:08:08] Speaker 02: And moreover, the definition of flood specifically identifies that flood does not mean the accumulation of water from any source on a roof, any source. [00:08:20] Speaker 03: Yeah, but then like every insurance policy known to mankind, [00:08:25] Speaker 03: there is exclusions. [00:08:27] Speaker 03: And why should we forget about the exclusion when the exclusion seems to be so plainly applicable here? [00:08:35] Speaker 02: The exclusion here, though, is for rain. [00:08:39] Speaker 02: And again, this is not a situation in which the rain struck the damaged item and that the claim is for damage to the area where the rain landed. [00:08:52] Speaker 02: In this case, the rain landed, sat there, accumulated, and then eventually leaks into the building. [00:09:01] Speaker 02: At some point, there has to be a transformation from rain to surface water. [00:09:07] Speaker 02: And the cases and the authorities recognize that. [00:09:11] Speaker 02: The Washington law is very clear that ambiguities are interpreted on behalf of the insured. [00:09:27] Speaker 02: Had the insurance company wished to exclude this type of loss, they could have done so. [00:09:33] Speaker 02: It is significant that within the definition of flood, the insurer specifically states. [00:09:45] Speaker 03: Just to go back to the point you're making. [00:09:48] Speaker 03: So let's assume that the roof is incomplete. [00:09:56] Speaker 03: but because of the way it is angled. [00:10:01] Speaker 03: It takes five minutes before the rain that falls on that roof enters the building and causes damage. [00:10:13] Speaker 03: Are you saying the exclusion does not apply because it took five minutes before that rain was sufficiently high enough, the accumulation was sufficiently high enough to overcome that slight tilt? [00:10:29] Speaker 02: I'm saying that in that particular situation, the insurer could have drafted an exclusion that addressed that particular, that specific type of concern. [00:10:39] Speaker 03: So your answer to my question, I think as you said, is unless the rain goes directly into the building, the exclusion does not apply. [00:10:48] Speaker 03: I think that that, especially in light of... Even if it takes a full 10 seconds before it enters. [00:10:54] Speaker 02: I think that that is a situation in which the rain exclusion would apply. [00:11:02] Speaker 02: I think that these insurers did an incomplete way or an incomplete job in defining their exclusions. [00:11:12] Speaker 02: I'd like to look at the definition of flood, because really, that's what we're talking about here. [00:11:19] Speaker 00: We've had lots of discussion about- The definition not in exclusion. [00:11:24] Speaker 02: I'm sorry, Judge Song. [00:11:25] Speaker 00: The flood, it's a definition, but it's not connected to the rain exclusion. [00:11:33] Speaker 02: Flood is its own exclusion. [00:11:38] Speaker 02: But what's important there and significant, and really that's what we're talking about here is, as I said, I believe this is a flood situation rather than a rain situation. [00:11:50] Speaker 02: The policy defines flood. [00:11:51] Speaker 00: We have a policy that excludes flood but not rain, and then this would clarify what constitutes flood. [00:11:59] Speaker 00: We have a policy that expressly excludes rain under all these conditions. [00:12:07] Speaker 00: I guess what we keep coming back to it very clearly says that rain won't be covered until the roof is complete and it specifies that all that means all the final components have to be completely and permanently installed roof and roof drainage systems exterior walls windows doors vents and if all of those let's say everything except you know [00:12:31] Speaker 00: A mechanical and electrical system is installed. [00:12:35] Speaker 00: I mean, and it rains heavily as it would do in this area of Washington. [00:12:41] Speaker 00: There would be, presumably it would take a while for rain to get inside the system, but I don't see how it would not be excluded under this. [00:12:53] Speaker 02: Your Honor, and at the risk of sounding redundant, the insurers have the obligation to draft these exclusions. [00:13:06] Speaker 02: And remember that we interpret these policies in the aggregate. [00:13:09] Speaker 02: We look at every component. [00:13:11] Speaker 00: I don't mean to interrupt, but you wanted to reserve some of your time. [00:13:14] Speaker 00: Yes. [00:13:15] Speaker 02: And so I would like to reserve time. [00:13:16] Speaker 02: Thank you. [00:13:22] Speaker 03: Are you sure we can take judicial notice that it rains? [00:13:28] Speaker 04: Good morning. [00:13:28] Speaker 04: May it please the court. [00:13:29] Speaker 04: My name is Ian Lifer on behalf of the insurers. [00:13:32] Speaker 04: We are asking this court to affirm the district court's prantle or dismissal of Vandivert's claims. [00:13:38] Speaker 04: I'll first address the rain exclusion. [00:13:40] Speaker 04: I'll then talk about the extra contractual claims. [00:13:42] Speaker 04: And if time allowing, I will discuss the faulty inadequate construction exclusion as well. [00:13:47] Speaker 04: We're asking the court to affirm the district court's dismissal of the rain exclusion for four specific reasons, many of which were just touched upon. [00:13:54] Speaker 04: This policy or these policies do not contemplate rain and surface water as separate perils. [00:13:59] Speaker 04: In fact, surface water is not mentioned anywhere in the policies themselves. [00:14:02] Speaker 04: Vanderbilt's main argument in this case is that exceptions to exclusions create affirmative grants of coverage that override the rain exclusion. [00:14:11] Speaker 04: And what I mean by that is water damage is mentioned in the exclusions having to do with fungus, and then there's another fungus exclusion, but it's fungus, dry rot, wet rot. [00:14:21] Speaker 04: It's mentioned there and says, hey, if there is this in the resulting water damage, we will cover that to sell women at 25,000. [00:14:27] Speaker 04: Meanwhile, with flood, flood is also separately excluded. [00:14:30] Speaker 04: What it says is flood is not the accumulation of rain or accumulation of water on the roof. [00:14:36] Speaker 04: But that doesn't displace or erode the rain exclusion. [00:14:39] Speaker 04: It in fact makes it clear. [00:14:41] Speaker 04: None of the cases relied upon by either of those parties have addressed this specific factual scenario of this case. [00:14:46] Speaker 04: What I mean by that is none of them address the building under construction. [00:14:49] Speaker 04: None of them contemplate ability from the ground up. [00:14:52] Speaker 04: As such, the value of those cases are of limited effect. [00:14:56] Speaker 04: Vannevar's interpretation of the reign exclusion would erode it, as the court has already pointed out, once it reaches a point of partial completion where there's a place for the reign to land upon and then enter into the structure, which violates the very language of the exclusion itself. [00:15:11] Speaker 04: Context matters when it comes to insurance policies and trying to interpret ambiguity. [00:15:15] Speaker 04: Policy is not ambiguous just based upon the language of it. [00:15:18] Speaker 04: You also have to look at the facts of the case. [00:15:20] Speaker 04: Here, the undisputed material facts are really clear. [00:15:22] Speaker 04: The policies themselves contemplate being for a ground up construction of a new hotel in Bellevue, Washington. [00:15:29] Speaker 04: The policies are all risk policies, meaning that the peril isn't excluded, then it is covered by the policy. [00:15:35] Speaker 04: The project was incomplete and not dried in during the winter and fall of 2016. [00:15:40] Speaker 04: And it does as it does in Washington. [00:15:42] Speaker 04: It rained and it rained and it rained in September, it rained in October, it rained in November, and it rained in December. [00:15:48] Speaker 04: Once it rained, the rain landed upon the incomplete roof and made its way into the structure. [00:15:53] Speaker 04: The project was dried in, meaning weatherproof on December 21st, 2016, and there are no claims for after that date. [00:16:01] Speaker 04: The rain exclusion itself is really clear, as the court has already identified. [00:16:04] Speaker 04: The rain exclusion applies to rain or snow entering the interior of the project unless the exterior is complete. [00:16:11] Speaker 04: Then the policy goes on to explain when the exterior is complete. [00:16:14] Speaker 04: The exterior is complete when it is fully weather resistant and all final components. [00:16:20] Speaker 04: The policy goes even further. [00:16:21] Speaker 04: It tells us what those final components are. [00:16:23] Speaker 04: It tells us the roof and roof drainage system are part of those final components. [00:16:29] Speaker 04: In Washington, [00:16:30] Speaker 04: there's the doctrine known as the characterization of perils. [00:16:32] Speaker 04: And this is articulated in the Kish case. [00:16:34] Speaker 04: And in Kish, the insured in that case argued, hey, there's a flood exclusion, but it wasn't flood. [00:16:40] Speaker 04: Rain is covered under this policy. [00:16:42] Speaker 04: And so therefore, because rain is covered, there's a question of fact. [00:16:46] Speaker 04: This should go to a jury to decide whether it was rain that entered the property or flood that entered the property. [00:16:51] Speaker 04: And the Washington Supreme Court said no. [00:16:52] Speaker 04: This is a judicial question that needs to be answered by the court. [00:16:56] Speaker 04: And in this case, a reasonable insurer is going to believe [00:17:00] Speaker 04: that rain can cause a flood. [00:17:03] Speaker 04: And so raid-induced flood is not separately excluded, and there is no question of fact that needs to go to a jury. [00:17:10] Speaker 04: Similar to this, similar to Kish, the rain exclusion here contemplates rain falling as still being rain. [00:17:16] Speaker 04: And we know that based upon the final component. [00:17:19] Speaker 04: The obvious consequence of having an incomplete roof and no drainage system is that rain will fall upon the surface and have nowhere to go. [00:17:27] Speaker 04: And so therefore it must accumulate in that circumstance. [00:17:30] Speaker 04: If it accumulates, it is still rain. [00:17:33] Speaker 04: Undefined terms in Washington law are given their plain and unambiguous meaning. [00:17:37] Speaker 04: The district court here looked to the Merriam-Webster dictionary. [00:17:40] Speaker 04: There's the Eagle West case out of the western district that looked to the same definition of rain, and it held that water that has fallen can still be rain. [00:17:48] Speaker 04: It's just rain water. [00:17:50] Speaker 04: Interpretation of similar exclusions support our position as well. [00:17:54] Speaker 04: There's the Amish Court case out of the Iowa Supreme Court, and the Bradford case out of the Fifth Circuit. [00:17:59] Speaker 04: In both of those cases, rain does not damage anything midair. [00:18:03] Speaker 04: And it's discussed, as the court pointed out aptly, it cannot damage anything until it has fallen. [00:18:08] Speaker 04: And once it has fallen, then, only then can it damage something. [00:18:12] Speaker 04: Moreover, exclusions are not grants of coverage. [00:18:15] Speaker 04: So the entire argument that is premised on the [00:18:17] Speaker 04: Water damage or accumulation of water from any source as being a separate peril is not valid under the Harrison plumbing case out of the Court of Appeals. [00:18:30] Speaker 04: Water damage is distinct and defined, yes, and it says that it applies in circumstances where there's fungus, wet rod or dry rod or bacteria that result in water damage that is covered. [00:18:42] Speaker 04: Similarly, the flood exclusion once again explains there's an exception to when the flood exclusion does apply, and that's the accumulation of water. [00:18:49] Speaker 04: But neither of those displace or disrupt the rain exclusion. [00:18:51] Speaker 04: I mean, all of the exclusions have to be read together. [00:18:54] Speaker 04: And if either of them are read to limit the rain exclusion, then it would do nothing in this case. [00:18:59] Speaker 04: Vandivert offers three hypotheticals in its briefing. [00:19:01] Speaker 04: I actually think the hypotheticals are a good exercise as to demonstrate just the fallacy in its argument. [00:19:07] Speaker 04: First, Vandivert argues that damage to the exterior caused by snow or rain would be excluded. [00:19:12] Speaker 04: Well, this is plainly wrong. [00:19:13] Speaker 04: The exclusion is very clear. [00:19:14] Speaker 04: It has to be damaged to the interior. [00:19:16] Speaker 04: So that hypothetical has to, when this exclusion would apply, fails. [00:19:20] Speaker 04: The second is, is damage or snow fell through an open roof? [00:19:24] Speaker 04: but does not define open roof, that would also be excluded by this policy. [00:19:29] Speaker 04: But the issue with this is we know that it was an open roof, in fact. [00:19:31] Speaker 04: It was an open roof until the project was dried in. [00:19:33] Speaker 04: The project was dried in on December 21st, 2016. [00:19:37] Speaker 04: Afterwards, there were no more occurrences. [00:19:41] Speaker 04: The final example or the final hypothetical offered is if rain blew directly through the windows and landed directly onto the electrical cables, that would apply. [00:19:50] Speaker 04: Now the rain exclusion would apply. [00:19:52] Speaker 04: But that creates such a limited application of the rain exclusion that it would be almost impossible to enforce. [00:19:57] Speaker 04: because we'd have situations where rain entered in through an open window, it pooled to some degree, and then it touched a cable. [00:20:04] Speaker 04: Well, now, based upon their own interpretation of the policy, that's no longer rain. [00:20:08] Speaker 04: That has now changed into a different peril, even though it landed directly in the inside of the building. [00:20:13] Speaker 04: Once again, an untenable position to take. [00:20:16] Speaker 04: Vanderbilt relies upon the Nova case, once again, as it's continued to rely upon in this case. [00:20:22] Speaker 04: The holding in the First Circuit is actually really a key issue there. [00:20:25] Speaker 04: The holding in that case was the failure of the drain was the efficient approximate cause. [00:20:30] Speaker 04: It was not the surface water or rainwater distinction. [00:20:33] Speaker 04: In fact, the parties did not dispute whether or not it was or was not surface water. [00:20:37] Speaker 04: The First Circuit actually had a chance to revisit this case last year, and they ended up certifying a question to the Massachusetts Supreme Court to address the issue of surface water versus rain, whether or not those policies differentiated between the two of them. [00:20:51] Speaker 04: And those policies, it did differentiate the two of them, but once again it mentioned surface water. [00:20:57] Speaker 04: I think one of the other cases they rely upon heavily is the Paulson case out of the Wyoming Supreme Court. [00:21:02] Speaker 04: And there it says, and I think this is important for the analysis, it says, obviously there's such a thing as surface water, at least in the minds of the parties to the contract in which they used the term. [00:21:11] Speaker 04: Here surface water is not anywhere in these policies. [00:21:13] Speaker 04: And so you're importing ambiguity or alleging you can import ambiguity from looking at other language and other policies, bringing that language and inserting it into this policy. [00:21:22] Speaker 04: That's not sound contract interpretation. [00:21:25] Speaker 04: With respect to the extra contractual claims, we ask that the court affirm the district court's dismissal of those as well. [00:21:31] Speaker 04: The requisite element of damage is missing from such claims. [00:21:33] Speaker 04: As such, the court need to look no farther as far as analysis is concerned. [00:21:37] Speaker 04: The hunting case before this court a couple years ago held that as well. [00:21:41] Speaker 04: there must be a showing of damages that's related to alleged bad faith conduct for those claims to survive. [00:21:47] Speaker 04: With respect to IFCA directly, which is the Insurance Fair Conduct Act, the claim must be based upon an unreasonable denial of benefits, even if for some reason the court were to disrupt the opinion based upon the application of the rain exclusion. [00:21:58] Speaker 04: When it comes to IFCA, the claims still fail based upon the district court's ruling. [00:22:02] Speaker 04: It is at least a reasonable interpretation of this exclusion that the rain exclusion would apply in this case. [00:22:08] Speaker 04: As far as the delay claim is concerned, clumsy claim handling is not a basis for a claim. [00:22:14] Speaker 04: I represent that I don't believe it was clumsy claims handling. [00:22:18] Speaker 04: We don't have any sort of testimony indicting the process here. [00:22:21] Speaker 04: There's no expert that says what was done was in bad faith. [00:22:24] Speaker 04: There's nothing to support the timing was unreasonable based upon the specific facts of this case. [00:22:29] Speaker 04: The claim itself was reported 16 months after the losses. [00:22:31] Speaker 04: It was once the company was in receivership that the claim was reported. [00:22:35] Speaker 04: Then it took about a year for the documents to get to the insurers. [00:22:38] Speaker 04: There is some dispute about what took so long as far as the documents. [00:22:41] Speaker 04: I don't believe any of that is material. [00:22:43] Speaker 04: The main argument that they hang their briefing on is an email that was sent by an attorney for the insurers prior to suit being filed. [00:22:52] Speaker 04: And in that email he says, the second phase of the investigation has moved slowly because the receiver has moved slowly. [00:22:58] Speaker 04: The receiver is not pressuring insurers for a claim position, but we can believe that [00:23:01] Speaker 04: insurers will be able to provide a claim position to the receiver in the next two weeks. [00:23:06] Speaker 04: There's nothing that says anything was done to slow play or any nefarious act was going on here to slow play this. [00:23:12] Speaker 04: It's also important to know with respect to the bad faith claim that the parties entered into a tolling agreement allowing the special limitations to be delayed to give the chance for the insurers to investigate this claim. [00:23:22] Speaker 04: And it was always up to the insurer if they wanted to opt out of that tolling agreement. [00:23:26] Speaker 04: Eventually they did so in March of 2021 and then the suit followed. [00:23:33] Speaker 04: As far as I will talk briefly upon the faulty workmanship exclusion, the faulty workmanship exclusion was not reached to the district court. [00:23:42] Speaker 04: The district court's analysis ended at the rain exclusion. [00:23:45] Speaker 04: But we named it faulty workmanship. [00:23:49] Speaker 04: It's a bit of a misnomer. [00:23:50] Speaker 04: The exclusion itself is much broader than that. [00:23:52] Speaker 04: It says that if there's inadequate planning, development, process, construction, maintenance, then it's all excluded loss. [00:23:58] Speaker 04: Based upon the record here, there was some argument that the temporary pumps failed. [00:24:02] Speaker 04: And that is the reason that the water was able to accumulate and not displaced to the extent they rely upon the faulty pumps or inadequate pumps that would be separately excluded by these policies based upon this exclusion. [00:24:13] Speaker 04: And that becomes important somewhat also in the nature of the claim. [00:24:17] Speaker 04: There's been some [00:24:18] Speaker 04: back and forth about the dates of when the loss occurred. [00:24:20] Speaker 04: It's my understanding now that the insurance position in this case is really that it was a ubiquitous loss that started in mid-October and proceeded for the next three months until the loss was dried in. [00:24:31] Speaker 04: So to the extent that the court is going to reach that exclusion, this would fall within the purview of that. [00:24:36] Speaker 04: And we cite the cases that address that exclusion, be interpreted pretty broadly based upon the language of it as well in our brief. [00:24:42] Speaker 04: Unless the court has any questions for me, I will. [00:24:45] Speaker 01: No, thank you. [00:24:47] Speaker 04: Thank you. [00:24:48] Speaker 04: And we ask the court to affirm. [00:24:54] Speaker 00: Council, before you get started, I did want to give you an opportunity to address one question I had about your Washington state law claims. [00:25:03] Speaker 00: My understanding is that the district court found there was no showing of harm, and I couldn't see anywhere in your briefs on appeal addressing that ruling, which seems dispositive. [00:25:15] Speaker 00: Did you address that in your briefing? [00:25:17] Speaker 02: Not on the issue of harm specifically. [00:25:20] Speaker 02: Our argument is that that is a question of fact of the jury. [00:25:25] Speaker 02: The court dismissed the state law claims, the extra contractual claims, as a result of finding that there was no coverage here. [00:25:36] Speaker 02: If there is coverage, then Vandivert should be afforded the opportunity to argue damages. [00:25:44] Speaker 02: I mean, we do have... [00:25:46] Speaker 02: The causation and the harm is relative to the delay. [00:25:50] Speaker 02: There are significant evidence of damages vis-a-vis the amount of loss that... Only if there's coverage there. [00:25:57] Speaker 02: Correct. [00:25:58] Speaker 02: Okay. [00:25:58] Speaker 02: Correct. [00:26:00] Speaker 02: So I wanted to address [00:26:03] Speaker 02: the flood exclusion, because I think that this shows this exclusion shows the context by which we see that rain is not necessarily the end all be haul here in this case. [00:26:18] Speaker 02: The policy defines flood means a general and temporary condition during which the surface of normally dry land is partially or completely inundated, which arises from rain and resultant runoff. [00:26:33] Speaker 02: If it is intuitive, as the insurer argues, that rain results in a flood, why did they need to identify specifically that flood is excluded if it arises from rain? [00:26:49] Speaker 02: There would be no other reason. [00:26:53] Speaker 02: That is the true exclusion that should apply here, but it doesn't work for the insurers, because they go on to specify that flood does not mean water accumulated on a roof from whatever source. [00:27:07] Speaker 00: We understand your argument. [00:27:08] Speaker 00: Thank you, counsel. [00:27:09] Speaker 02: Thank you. [00:27:10] Speaker 02: Vandivert asks that the court overturn and remand. [00:27:14] Speaker 02: Thank you. [00:27:15] Speaker 00: This case is submitted, and we'll take a five minute recess.