FILED
NOT FOR PUBLICATION
NOV 03 2017
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
MINDEN AIR CORPORATION, No. 16-15712
Plaintiff-Appellant, DC No. 13-0592 HDM
v.
STARR INDEMNITY & LIABILITY MEMORANDUM*
COMPANY,
Defendant-Appellee.
Appeal from the United States District Court
for the District of Nevada
Howard D. McKibben, District Judge, Presiding
Argued and Submitted October 12, 2017
San Francisco, California
Before: TASHIMA and BYBEE, Circuit Judges, and LEITMAN,** District
Judge.
After its aircraft, a World War II vintage aircraft modified for fire
suppression, was damaged in a wheels-up landing, Appellant Minden Air
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The Honorable Matthew Frederick Leitman, United States District
Judge for the Eastern District of Michigan, sitting by designation.
Corporation (“Minden Air”) made a claim under an insurance policy issued by
Appellee Starr Indemnity & Liability Company (“Starr”). The policy provided
that, if the aircraft was a total loss, Minden Air would recover the insured value of
the aircraft, or $3.4 million. As defined in the policy, a total loss occurred when
the repair costs plus the salvage value equaled or exceeded the insured value of the
aircraft. In the event the parties could not agree, the policy provided that the
amount of loss would be determined by a neutral umpire based on estimates
submitted by each party’s own, independent appraiser.
The neutral umpire here determined that the amount of loss, as measured in
repair costs, was $1,871,038 – and so considerably less than $3.4 million, which
was the insured value. No evidence was submitted about the salvage value of the
aircraft. Starr paid Minden Air $1,871,038, minus the applicable deductible. The
district court therefore granted summary judgment for Starr on Minden Air’s
breach of contract and bad faith claims. Minden Air now appeals. We have
jurisdiction pursuant to 28 U.S.C. § 1291 and we affirm.
We review a grant of summary judgment de novo. Oswalt v. Resolute
Indus., Inc., 642 F.3d 856, 859 (9th Cir. 2011). “We determine, viewing the
evidence in the light most favorable to the nonmoving party, whether there are any
genuine issues of material fact and whether the district court correctly applied the
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relevant substantive law.” Id. (quoting Wallis v. Princess Cruises, Inc., 306 F.3d
827, 832 (9th Cir. 2002)).
1. The district court properly granted summary judgment in favor of
Starr on Minden Air’s breach of contract claim. Under Nevada law, terms in an
insurance policy must be viewed in their plain and ordinary sense and read in the
context of the policy as a whole. See Fourth St. Place v. Travelers Indem. Co., 270
P.3d 1235, 1239 (Nev. 2011), as modified on reh’g (May 23, 2012). A court
should not rewrite otherwise unambiguous contract provisions, or increase an
insurer’s obligations where they are intentionally and unambiguously limited by
the parties. Farmers Ins. Grp. v. Stonik ex rel. Stonik, 867 P.2d 389, 391 (Nev.
1994). Nevada recognizes that insurance contracts may delegate determinations
about the amount of loss to an appraiser, provided the appraiser does not exceed
his authority by interpreting the policy or resolving coverage disputes. See St. Paul
Fire & Marine Ins. Co. v. Wright, 629 P.2d 1202, 1202-03 (Nev. 1981).
Here, the appraisal clause delegated authority to the neutral umpire to
determine the amount of loss. Read in the context of the policy as a whole, the
plain meaning of this provision unambiguously authorized the neutral umpire to
assess the amount of loss in terms of the cost to repair the physical damage caused
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by the wheels-up landing, rather than listing only a description of that physical
damage – as Minden Air contends.
The district court correctly concluded that the neutral umpire’s repair cost
estimate was determinative of whether the aircraft was a total loss. Minden Air
failed to raise a triable issue as to whether the neutral umpire’s estimate ignored
specific costs that would have been covered under the policy. Minden Air also
failed to raise a triable issue as to whether the neutral umpire’s estimate
contemplated a repair process that would permit the aircraft to be returned to
service with regard to repairs for the damage sustained in the wheels-up landing.
No evidence was submitted about the aircraft’s salvage value. The district court
therefore correctly concluded that Minden Air failed to raise a triable issue as to
whether the wheels-up landing resulted in a total loss in light of the neutral
umpire’s binding estimate for considerably less than the insured value of the
aircraft.
Accordingly, we affirm the district court’s grant of summary judgment in
favor of Starr on Minden Air’s breach of contract claim.
2. The parties agree that if we affirm the district court on Minden Air’s
breach of contract claim, we should also affirm the district court’s grant of
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summary judgment for Starr on Minden Air’s bad faith claims. Accordingly, we
affirm the district court’s grant of summary judgment on these issues, as well.
The judgment of the district court is AFFIRMED.
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