Duarte & Witting, Inc. v. Universal Underwriters Insurance

MEMORANDUM ***

Duarte & Witting, Inc. and the Eghtesads appeal the district court’s grant of summary judgment in favor of Universal Underwriters Insurance Company. We have jurisdiction pursuant to 28 U.S.C. § 1291 and review de novo. Leonel v. Am. Airlines, Inc., 400 F.3d 702, 708 (9th Cir. 2005). We affirm.

Appellants argue that the district court erred by holding that the loss manifested prior to the effective date of the Universal policy. California follows the manifestation rule to determine insurer liability for first party property losses in which the losses progress over several policy periods. Prudential-LMI Com. Ins. v. Super. CL, 51 Cal.3d 674 , 274 Cal.Rptr. 387 , 798 P.2d 1230, 1246 (1990). The date of manifestation or inception of the loss occurs:

Id. at 1232. The loss manifests when appreciable damage occurs, not when the extent of the damage is known by the insured. Campanelli v. Allstate Life Ins. Co., 322 F.3d 1086, 1094 (9th Cir.2003). “[Ijnsurers whose policy terms commence after initial manifestation of the loss are not responsible for any potential claim relating to the previously discovered and manifested loss.” Prudential-LMI, 274 Cal.Rptr. 387 , 798…