Meridian Leasing, Inc. v. Associated Aviation Underwriters, Inc.

OPINION

ACKERMAN, District Judge.

In this case, the District Court, sitting in diversity, was faced with the task of interpreting the language of an all-risk insurance policy that allegedly covered damage to an aircraft engine caused by an unusual occurrence during start-up. The insurer alleged that the policy’s exclusion for wear and tear foreclosed coverage. Applying California law, the District Court found that the term “wear and tear” was ambiguous, and resolved the ambiguity by requiring that damage from wear and tear result from the normal and ordinary operation of the engine. Thus, the…