Opinion ID: 472582
Heading Depth: 2
Heading Rank: 3

Heading: Layup Premiums

Text: 21 Lexington next attacks the district court's award of layup premiums to Austin. The policy provides that the insurance company would return the premiums applicable to each period of thirty consecutive days the vessel was laid up. The AMAZON TRADER was laid up for four consecutive thirty-day periods in Spain when it broke down on its way back to Tampa; however, when Austin requested return of the applicable premiums, Lexington refused to return them. Lexington argues that Austin violated the following provision of the policy: [I]n no case shall a return for lay-up be allowed when the Vessel is lying ... in any location not approved by the Underwriters. Lexington argues that since Lexington did not approve the layup in Spain, Austin is not entitled to lay up premiums. We disagree. 22 The policy does not say that Lexington must first approve a layup port; rather, the policy says that layup premiums will not be allowed when the vessel is laid up in a location not approved by the Underwriters. This ambiguous phrase could easily be construed as meaning that Lexington maintained a list of unapproved ports and that the vessel could not be laid up at one of those ports. Applying the time-honored rule that ambiguities in insurance policies are to be construed against the insurer, Walter v. Marine Office of America, 537 F.2d 89, 94-95 (5th Cir.1976), we hold that the district court correctly determined that Austin was entitled to layup premiums.