West Coast Bancorp v. Bancinsure, Inc.

MEMORANDUM **

Upon motion for summary judgment, the district court ruled that West Coast Bancorp (Bank) was not entitled to coverage for the Fischer and BASS lawsuits under the terms of the lender liability endorsement (Endorsement) to the directors and officers policy (Basic Policy) issued by Banclnsure Inc. (Insurer). We affirm the district court’s ruling denying coverage for the Fischer lawsuit on the grounds that the Fischers were not “Borrowers” as defined in the Endorsement. We reverse the district court’s ruling that the Bank’s November 23, 1998 notice of claim regarding the potential for the BASS lawsuit did not suffice to preserve coverage.

I.

The Fischer lawsuit is not covered under the Endorsement because the Fischers were not “Borrowers.” The Endorsement defines Borrower as “any person or entity ... to which an extension of credit, or a refusal to extend credit was made or negotiated.” This language requires in plain and unambiguous terms that a Borrower is the contemplated recipient of a *113 loan, whether the loan is actually made or negotiated but ultimately refused. See North Clackamas Sch. Dist. No. 12 v. Oregon Sch. Boards Ass’n Prop. & Cas. Trust, 164 Or.App.…