A Washington appeals court recently held in Feenix Parkside LLC v. Berkley North Pacific that a broad definition of the undefined term “decay” was appropriate. Feenix, insured by Berkley, owned a building that suffered a roof collapse. Higher than normal temperatures in the attic had reduced the strength of the trusses holding up the roof. Feenix’s investigator determined that the collapse was due to gradual weakening of the trusses by water entering through the roof. Berkley denied the claim as an uncovered loss.
Feenix sued Berkley because Berkley’s policy provided additional coverage for collapse for direct physical loss or damage caused by hidden decay. Feenix argued that “decay” included gradual weakening but the trial court disagreed. The trial court granted Berkley’s motion for summary judgment and Feenix appealed. The Washington Court of Appeals held that Feenix’s interpretation of the term “decay” was reasonable, and summary judgment was inappropriate. Because the term “decay” was not defined in the policy, the Court liberally construed it to provide coverage. Therefore, “decay” meant a “gradual decline in strength or soundness” rather than a visible material decomposition as the trial court held.