Ongoing Or Completed Operations? Fifth Circuit Finds No Duty To Defend Contractor Under Additional Insured Endorsement


In Woodward, L.L.C. v. Acceptance Indemnity Insurance Company, WL 535726 (5th Cir. 2014), the Fifth Circuit Court of Appeals held the insurer had no duty to defend the contractor named as an additional insured under a subcontractor’s Commercial General Liability policy. The Court’s holding, based on its interpretation of “completed operations” versus “ongoing operations,” demonstrates the importance of the specific wording of the additional insured endorsement on the insurer’s duty to defend. Furthermore, in regards to Mississippi law, the Fifth Circuit’s ruling adds support to the proposition that an insurer’s duty to defend depends significantly upon the facts in the underlying complaint.

Woodward stems from Pass Marianne, L.L.C.’s contract with general contractor Carl E. Woodward to construct condominiums, which were later determined to have construction issues. Woodward entered into a contract with subcontractor DCM Corporation, L.L.C. to provide concrete work for the project. DCM subsequently obtained a CGL policy in November 2005 from Acceptance Indemnity Insurance Co. for its work on the project from January to October 2006. Upon completion of the project in August 2007, Pass Marianne sold the condominiums to Lemon Drop Properties in October of the same year.

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