News & Analysis as of

PA Supreme Court Grants Important Victory for Insurers Regarding CGL Coverage for Progressive Property Damage

In a comprehensive and sweeping opinion, the Pennsylvania Supreme Court affirmed several key principles of commercial general liability (CGL) policy interpretation in Penn National v. St. John, decided on December 15, 2014....more

Tenth Circuit: Property Damage Surrounding Defective Windows Is an “Occurrence” Because Damage Is Unexpected from Insured’s...

In Cincinnati Insurance Company v. AMSCO Windows, No. 13-4155 (10th Cir. November 26, 2014), Cincinnati insured AMSCO, which manufactures windows for use in homes and sells the windows to distributors. Certain AMSCO windows...more

Federal District Court in Pennsylvania Grants Summary Judgment To CGL Insurer Based Upon Lack of “Occurrence”

On October 14, 2014, the United States District Court for the District of Pennsylvania granted a motion for summary judgment filed by State Farm Fire and Casualty Co. (“State Farm”), seeking a declaration that it had no duty...more

Finding Insurance Coverage for Consumer Products Class Action Complaints

Consumer class action claims are a familiar tool for addressing dissatisfaction with a defective product. Given that one of the goals of a consumer class action claim is to recover damages for the claimants, triggering...more

Fifth Circuit Addresses Contractual Liability Exclusion

In its recent decision in Crownover v. Mid-Continent Cas. Co., 2014 U.S. App. LEXIS 20737 (5th Cir. October 29, 2014), the United States Court of Appeals for the Fifth Circuit withdrew its prior ruling and held that the...more

More “Texas Justice” For Policyholder On Contractual Liability Exclusion

On October 29, the Fifth Circuit reversed itself for the second time this year in a case involving the interpretation of a contractual liability exclusion in a CGL policy. This recent decision by the Fifth Circuit in...more

Regional Steel: the continuing effort to avoid the cost of correcting the insured’s work

Casualty insurers normally do not expect to pay the cost of their insureds simply doing a good job. Insurers typically view their contracts as assuming the risk of delineated consequences – damages – if the insured’s work...more

No CGL Coverage for Faulty Workmanship Under Pennsylvania Law

In State Farm Fire & Casualty Co. v. McDermott, 2014 WL 5285335 (E.D. Pa. Oct. 15, 2014), a federal court recently held that an insurer has no duty to defend or indemnify its insured against an underlying construction defect...more

Fifth Circuit Holding Breathes Life Back Into the Contractual Liability Exclusion

Liability insurance policies typically exclude coverage for obligations arising out of the insured’s “assumption of liability in a contract or agreement.” Earlier this year, the Texas Supreme Court took a narrow view of this...more

Appellate Court Notes

SC19089 - Travelers Casualty & Surety Co. of America v. Netherlands Ins. Co. - Travelers brought a declaratory judgment action, claiming that the Netherlands Insurance Company had to participate in the defense costs of...more

Choose Your Words Wisely: The Allegations in a Construction Defect Complaint

On August 5, 2014, the Supreme Court of Connecticut, in Travelers Cas. & Sur. Co. v. Netherlands Ins. Co., 312 Conn. 714 (2014), affirmed a trial court's decision that allegations of years-long, continuing and progressive...more

Whether faulty workmanship constitutes an "occurence" continues to be revisited by courts across the country

Is there a shift in the longstanding majority view, including in New York, New Jersey and Connecticut, that construction defect claims do not constitute an occurrence when the damage is to the insured’s own work because it...more

Alabama Joins Recent Trend of States Finding Defective Work May Be Covered Under a Commercial General Liability Policy

The Supreme Court of Alabama recently held in Owners Ins. Co. v. Jim Carr Homebuilder, LLC that a contractor’s commercial general liability (“CGL”) policy provided coverage for property damage caused by the defective work of...more

“Your Work” Exclusion Bars Coverage for Tearing Down & Rebuilding Wall

The S.C. Court of Appeals recently applied the “your work” exclusion in a declaratory judgment action arising out of a construction defect suit to find the policy did not provide coverage. In Precision Walls v. Liberty Mutual...more

Alabama Supreme Court Reverses Course, Finds Insurance Coverage for Faulty Workmanship Claims

Companies such as homebuilders, construction companies and contractors face significant financial risk from bodily injury and property damage claims arising from allegedly faulty workmanship or construction defects. Although...more

Insurance Coverage – Duty to Defend – Construction Defects

Regional Steel Corporation v. Liberty Surplus Insurance Corporation - Court of Appeal, Second Appellate District (June 13, 2014) - There has been a split of decisions in California as to whether incorporation of...more

When Can a CGL Policy Do a Disappearing Act?

In Evanston Insurance Company v North American Capacity Company, 2014 U.S. LEXIS 92682, Evanston Insurance Company sued in U.S. District Court to seek contribution from North American Capacity Insurance Company where both...more

The Alabama Supreme Court Changes Its Mind on Coverage Under CGL Policy

Last September the Alabama Supreme Court issued an opinion addressing the applicability of the “own work” exclusion to claims against a contractor for defective construction. However, on March 28, 2014, the Alabama Supreme...more

When Is a Construction Defect a Mere Business Risk and Not Insurable?

In an unpublished appellate decision from the state of Washington, on May 5, 2014, the Washington Court of Appeals affirmed a summary judgment in favor of a CGL insurer, Western National Assurance, relieving it of any...more

Policyholders Must Be Vigilant for Construction Defect Exclusions, Including For Impaired Property to Combat Insurance Companies’...

Continuing the most recent trend in coverage litigation, insurance companies are increasingly engaging “Big Law” firms to develop legal arguments for narrower interpretation of their policies when troublesome claims threaten...more

More Legal Developments for the Construction Industry in the Southeast

Alabama - The Alabama Supreme Court reversed itself and concluded that faulty workmanship can constitute an “occurrence” under a commercial general liability insurance policy which triggers coverage for the insured. In a...more

New York and New Jersey Hold Fast to No “Occurrence” for Faulty Workmanship Claims

During the past year, five state supreme courts (Alabama, Connecticut, Georgia, North Dakota and West Virginia) have found that faulty workmanship by a construction contractor or subcontractor can be a covered “occurrence.”...more

Is Defective Construction an “Occurrence”? More States Are Answering Yes

Last year, we examined the different approaches states have adopted to resolve whether defective construction by itself is an “occurrence” within the meaning of liability insurance policies. See Is Defective Construction...more

Think You Are Covered By An Additional Insured Endorsement? Recent Opinion Serves as a Reminder to Read the Coverage Language

The United States Court of Appeals for the Fifth Circuit issued an opinion this month that should serve as a reminder to prime contractors to review the coverage granted to them as additional insureds on their subcontractors’...more

General Contractors Beware: Coverage Under Additional-Insured Endorsement to Subcontractor’s CGL Policy May End When...

Within the past four months, two courts interpreting Mississippi law have held that an additional-insured endorsement to a subcontractor’s commercial general liability (CGL) insurance policy did not obligate the insurer to...more

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