45.4 Case Problem with Sample Answer. Richard Vanderbrook’s home in New Orleans, Louisiana, was insured through Unitrin Preferred Insurance Co. His policy excluded coverage for, among other things, “[f]lood, surface water, waves, tidal water, overflow of a body of water, or spray from any of these, whether or not driven by wind.” The policy did not define the term flood. In August 2005, Hurricane Katrina struck along the coast of the Gulf of Mexico, devastating portions of Louisiana. In New Orleans, some of the most significant damage occurred when the levees along three canals—the 17th Street Canal, the Industrial Canal, and the London Avenue Canal—ruptured and water submerged about 80 percent of the city, including Vanderbrook’s home.

He filed a claim for the loss, but Unitrin refused to pay. Vanderbrook and others whose policies contained similar exclusions asked a federal district court to order their insurers to pay. They contended that their losses were due to the negligent design, construction, and maintenance of the levees and that the policies did not clearly exclude coverage for an inundation of water induced by negligence. On what does a decision in this case hinge? What reasoning supports a ruling in the plaintiffs’ favor? In the defendants’ favor? [In re Katrina Canal Breaches Litigation, 495 F.3d 191 (5th Cir. 2007)] After you have answered Problem 45.4, compare your answer with the sample answer given on the Web site that accompanies this text. Go to www.cengage.com/blaw/blt, select “Chapter 45,” and click on “Case Problem with Sample Answer.”