Jing on Insurance Coverage for Construction Defects: Recent Developments in Federal and State Law by Audrey J. Jing of Kelley, Drye & Warren LLP examines the current split among jurisdictions as to whether a claim for defective workmanship falls within the scope of the standard form insuring agreement, i.e. whether such a claim can allege "property damage" caused by an "occurrence" under a CGL policy. The commentary analyzes court decisions from a number of jurisdictions that hold that damage resulting from faulty workmanship may be accidental or fortuitous, and thus may be caused by an "occurrence." It also analyzes court decisions from other jurisdictions which find that defective workmanship can never result in property damage deemed unintended or accidental, and thus, cannot trigger coverage. The commentary finds that the latter position has caused significant concern in the construction industry because those decisions ran counter to the industry's understanding that CGL policies did provide coverage (at least to some degree) for claims alleging property damage caused by defective workmanship. Adding to the concern, in the wake of these pro-insurer decisions, many insurance companies have responded by methodically disclaiming their obligations to defend and/or indemnify construction insureds in connection with all claims arising from alleged defective workmanship. The construction industry's concern did not go unnoticed, however, and state legislatures in Colorado, Hawaii, South Carolina and Arkansas reacted by recently enacting legislation intended to counter-balance the effect of recent judicial decisions. The commentary analyzes those laws as well as pertinent decisions by the courts in the aftermath of the legislation.
Audrey Jing is an associate in Kelley Drye's Los Angeles office. Ms. Jing has represented and advised entertainment companies and broadcasters in connection with a variety of claims, including copyright, idea submission, employment, insurance, breach of contract, and disputes before the Motion Picture Association of America. Ms. Jing has experience representing non-entertainment clients in general litigation matters, including contract disputes and insurance coverage.
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