Exhibit 15
WORKING COPY

CN: 2020221232

1 The Honorable Michelle Szambelan

2 SN: 12 i 3 PC: 7

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FILED

NOV 2 3 2020

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8 Timothy W. Fitzgerald

9 SPOKANE COUNTY CLERK

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SUPERIOR COURT OF THE STATE OF WASHINGTON

FOR SPOKANE COUNTY

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16 PERRY STREET BREWING COMPANY, NO. 20-2-02212-32

17 LLC, a Washington limited liability company,

ORDER GRANTING PLAINTIFF'S

MOTION FOR PARTIAL SUMMARY

JUDGMENT RE: COVERAGE GRANT

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19 Plaintiff,

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21 v.

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23 MUTUAL OF ENUMCLAW INSURANCE

24 COMPANY, a Washington insurance

25 company,

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27 Defendant.

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30 THIS MATTER came before the Court on Plaintiffs Motion for Partial Summary

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32 Judgment Re: Coverage Grant ("Motion"). The Court has duly considered the oral argument of

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34 the parties, the files and records herein, and the below-listed pleadings, papers, declarations, and

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36 exhibits submitted by the parties:

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38 1. Plaintiffs Motion;

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40 2. Declaration ofBen Lukes;

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42 3. Declaration of John Cadagan;

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ORDER GRANTING PLAINTIFF'S MOTION FOR 600 University Street

PARTIAL SUMMARY JUDGMENT RE: COVERAGE

GRANT - 1

GORDON

TILDEN

THOMAS

CORDELL

Suite 2915

Seattle, WA 98101

206.467.6477
WORKING COPY

4. Defendant Mutual ofEnumclaw Insurance Company's Opposition to Plaintiff s

3 Motion for Partial Summary Judgment;

5. Declaration of Steven Caplow in Support of Defendant Mutual ofEnumclaw

7 Insurance Company's Opposition to Plaintiffs Motion for Partial Summary Judgment;

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9 6. Plaintiffs Reply.

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11 NOW, THEREFORE, IT IS HEREBY ORDERED as follows:

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13 1 . Plaintiffs Motion is GRANTED.

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15 2. Pursuant to CR 56, the Court enters the following undisputed facts relevant to its

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17 subsequent conclusions of law.

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19 3. Plaintiff Perry Street Brewing Company LLC ("PSBC") owns and operates a

brewery and bar with dining business with its principal place of business located at 1025 S. Perry

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23 St. # 2, Spokane, WA 99202.

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25 4. Defendant Mutual ofEnumclaw Insurance Company ("MOE") is an insurer

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27 authorized to write, sell, and issue business insurance policies in Washington to policyholders,

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29 including PSBC.

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31 5. MOE issued a businessowners policy and related endorsements ("the Policy")

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33 with Commercial Property Coverage.

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35 6. PSBC's business property includes property owned and/or leased by PSBC and

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37 used by PSBC primarily for operating a brewery and bar with dining services.

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39 7. On or about January 2020, the United States ofAmerica saw its first cases of

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41 persons infected by COVID-19, which has been designated a worldwide pandemic.

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ORDER GRANTING PLAINTIFF'S MOTION FOR

PARTIAL SUMMARY JUDGMENT RE: COVERAGE

GRANT - 2

600 University Street

Suite 2915

Seattle, WA 98101

206.467.6477

GORDON

TILDEN

THOMAS

CORDELL
WORKING COPY

8. In light ofthis pandemic, on February 29, 2020, Washington Governor Jay Inslee

3 issued Proclamation 20-5, declaring a State ofEmergency for all counties in the state of

5 Washington as the result of COVID-19.

9. Thereafter, Governor Inslee issued a series of certain proclamations and orders

9 affecting many persons and businesses in Washington, whether infected with COVID-19 or not,

1 1 requiring certain public health precautions.

10. On March 13, 2020, Governor Inslee issued Proclamation 20-1 1, "Statewide

15 Limits on Gatherings," which prohibited all gatherings of 250 people or more in all Washington

17 counties, including Spokane County.

11. On March 16, 2020, Governor Inslee issued Proclamation 20-14, "Reduction of

21 Statewide Limits on Gatherings," which prohibited all gatherings of 50 people or more in all

23 Washington counties, including Spokane County, and further prohibited gatherings of fewer

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25 people unless organizers ofthose activities complied with certain social distancing and sanitation

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27 measures. 28

29 12. Also on March 16, 2020, Governor Inslee issued Proclamation 20-13, "Statewide

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31 Limits: Food and Beverage Services, Areas of Congregation," which prohibited the onsite

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33 consumption of food and/or beverages in a public venue, including restaurants, bars, or other

similar venues in which people congregate for the consumption of food or beverages.

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37 13. By order of Governor Inslee effective October 6, 2020, for counties in "Phase

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39 Two," including Spokane County, although some indoor dining is allowed, dining and

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41 consumption of beverages are still curtailed compared to pre-pandemic. For example, restaurant

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43 table group sizes remain limited, the number of diners is capped at no more than 50 percent of

capacity, hours remain restricted, and bar counters remain closed. See

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ORDER GRANTING PLAINTIFF'S MOTION FOR

PARTIAL SUMMARY JUDGMENT RE: COVERAGE

GRANT - 3

600 University Street

Suite 2915

Seattle, WA 98101

206.467.6477

GORDON

TILDEN

THOMAS

CORDELL
WORKING COPY

1 https://www.governor.wa.gov/sites/default/files/CQVID19%20Phase%202%20and%203%20Res

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3 taurant%20and%20Tavern%20Guidance.pdf?utm medium=email&utm source=govdelivery.

14. Under the Business Income (and Extra Expense) Coverage Form of the Policy,

7 MOE promised to pay PSBC for "direct physical loss of or damage to property at premises

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9 which are described in the Declarations" "caused by or resulting from any Covered Cause of

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11 Loss."

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13 15. Whether the above undisputed facts establish coverage with the Business Income

(and Extra Expense) Coverage Form as a matter of law for "direct physical loss of or damage to"

property at premises—an issue on which PSBC bears the burden of proof—is the threshold issue

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19 for determination on PSBC's Motion under CR 56.

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21 16. Determining insurance coverage is a two-step process. First, the insured must

show that the loss falls within the scope of the policy's insured losses. Second, to avoid coverage

the insurer must show that specific policy language excludes the loss. McDonald v. State Farm

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27 Fire & Cas. Co., 1 19 Wn.2d 724, 731, 837 P.2d 1000 (1992).

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29 1 7. PSBC's Motion is directed toward the first step. It does not seek a CR 56

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31 summary judgment determination as to any exclusions of coverage or the amount ofrelief to be

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33 issued.

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35 18. The Court finds that PSBC has established that PSBC's claimed loss falls within

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37 the grant of coverage of the Business Income (and Extra Expense) Coverage Form of the Policy

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39 as a matter of law, because as a result of the proclamations and orders issued by Governor Inslee,

PSBC suffered direct physical loss of its property at premises.

19. The Policy issued by MOE does not define the terms "direct physical loss of or

damage to" property at premises.

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ORDER GRANTING PLAINTIFF'S MOTION FOR

PARTIAL SUMMARY JUDGMENT RE: COVERAGE

GRANT - 4

GORDON

TILDEN

THOMAS

CORDELL

600 University Street

Suite 2915

Seattle, WA 98101

206.467.6477
WORKING COPY

1 20. As a result, the Court is mindful of Washington's rules for interpreting insurance

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3 policies.

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5 21. In Washington, insuring provisions must be interpreted liberally to provide

7 coverage whenever possible. Bordeaux, Inc. v. Am. Safety Ins. Co., 145 Wn. App. 687, 694, 186

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9 P.3d 1188 (2008).

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11 22. Insurance policies are construed in favor of coverage because: "the purpose of

insurance is to insure." Phil Schroeder, Inc. v. Royal Globe Ins. Co., 99 Wn.2d 65, 68, 659 P.2d

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15 509(1983).

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17 23. When a term in an insurance policy is subject to multiple, reasonable definitions,

the "[policyholder's] reasonable interpretation of the policy must be accepted." Holden v.

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21 Farmers Insurance Co. of Washington, 169 Wn.2d 750, 760, 239 P.3d 344 (2010).

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23 24. When terms are undefined, Washington requires courts to use their "plain,

ordinary, and popular" meaning - how an "average lay person" would understand them. Boeing

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27 Co. v. Aetna Cos. & Sur. Co., 113 Wn.2d 869, 876-77, 784 P.2d 507 (1990).

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29 25. The Court may be aided by dictionary definitions, as the Washington Supreme

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31 Court so relied upon in Boeing v. Aetna.

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33 26. Dictionary definitions of"loss," include "'destruction' 'ruin' or 'deprivation.'"

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35 Loss, Merriam-Webster, https://www.merriam-webster.com/dictionary/loss.

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37 27. At minimum, PSBC had a "deprivation" of its business property.

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39 28. The undefined phrases "loss of' property and "damage to" property also are

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41 distinct from one another. Nautilus Group, Inc. v. Allianz Global Risks US, No. CI 1-5281BHS,

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43 2012 WL 760940 (W.D. Wash. Mar. 8, 2012). In Nautilus, the Court reasoned that "if'physical

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45 loss' was interpreted to mean 'damage,' then one or the other would be superfluous. The fact that

ORDER GRANTING PLAINTIFF'S MOTION FOR

PARTIAL SUMMARY JUDGMENT RE: COVERAGE

GRANT -5

600 University Street

Suite 2915

Seattle, WA 98101

206.467.6477

GORDON

TILDEN

THOMAS

CORDELL
WORKING COPY

1 they are both included in the grant of coverage evidences an understanding that physical loss

3 means something other than damage." Nautilus, 2012 WL 760940, at *7.

29. The Court agrees with the rationale in Nautilus, especially since the undefined

7 phrases "loss of' and "damage to" have popular meanings distinct from one another.

30. Accordingly, one reasonable interpretation of "direct physical loss of' property at

1 1 premises is that the interruption ofPSBC's business operations as a result of the proclamations

13 was a direct physical loss of PSBC's property because PSBC's property could not physically be

15 used for its intended purpose, i.e., PSBC suffered a loss of its property because it was deprived

17 from using it.

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19 3 1 . The Court finds that this is an interpretation that an average lay person would

understand by the phrase "loss of' property in the Policy. See also Boeing, 113 Wn.2d at 876.

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23 32. In sum, the Court concludes as a matter of law that PSBC suffered a loss of its

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25 property at premises when PSBC lost the ability to use its property at premises for its intended

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27 purpose.

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29 33. The Court, therefore, grants Plaintiffs Motion.

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31 DATED this day ofNovember 2020.

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35 Michelle D. s;:ambelan

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37 /he Honorable Michelle Szambel

38 Superior Court Judge / 7

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ORDER GRANTING PLAINTIFF'S MOTION FOR

PARTIAL SUMMARY JUDGMENT RE: COVERAGE

GRANT - 6

600 University Street

Suite 2915

Seattle, WA 98101

206.467.6477

GORDON

TILDEN

THOMAS

CORDELL
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