RALEIGH, N.C. - Questions remain regarding whether damage caused by an insured's allegedly defective work exists to property other than to the insured's work, a North Carolina federal judge held on June 1, denying separate summary judgment motions filed by the insured and its commercial marine liability insurer (National Union Fire Insurance Company of Pittsburgh, PA v. Intercoastal Diving Inc., No. 10-115, E.D. N.C.; 2012 U.S. Dist. LEXIS 76291).
LITTLE ROCK, Ark. - The Arkansas Supreme Court on May 31 affirmed a lower court's ruling that a commercial general liability insurer has a duty to defend its insured against nuisance and trespass claims in an underlying lawsuit questioning the insured's conduct as to its poultry houses, finding that the insurer could not rely on the policy's pollution exclusion to deny coverage because the exclusion is ambiguous (Scottsdale Insurance Company v. Morrow Land Valley Company LLC, et al.,No. 11-905, Ark. Sup.; 2012 Ark. LEXIS 273).
ELGIN, Ill. - An Illinois appeals panel on May 31 denied a motion to rehear its March 16 ruling affirming a lower court's finding that a commercial general liability insurer had no duty to defend against underlying breach of fiduciary claims (Pekin Insurance Company v. Precision Dose Inc., et al., No. 2-11-0195, Ill. App., 2nd Dist.).
BIRMINGHAM, Ala. - A commercial general liability insurer has no duty to defend or indemnify an insured from allegations of damages to a home because the insured did not tender the claim or the arbitration award as soon as practicable under the policy, an Alabama federal magistrate judge ruled May 23 (Auto-Owners Insurance Co. v. Toxey Construction Co. Inc., et al., No. 11-01192, N.D. Ala.; 2012 U.S. Dist. LEXIS 71718).
PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on May 24 affirmed a lower federal court's ruling in favor of a commercial general liability insurer on the insured's breach of contract and bad faith claims in a coverage dispute arising from allegations that the insured sold defective reheat coils and air valves to a university hospital (Toro-Aire Inc. v. Federal Insurance Co., No. 10-56880, 9th Cir.; 2012 U.S. App. LEXIS 10514).
SAN FRANCISCO - A commercial general liability insurer has no duty to defend or indemnify insureds in an underlying construction defect action, a California federal judge ruled May 18, also finding that another insurer has no duty to reimburse or to indemnify the insureds for any expenses or damages arising from the underlying action (Aspen Insurance UK Ltd. v. Killarney Construction Co. Inc., et al., No. 11-1294, N.D. Calif.; 2012 U.S. Dist. LEXIS 69925).
BOSTON - Vacating a lower court decision, a First Circuit U.S. Court of Appeals panel on May 18 found that a broken airplane window could have been caused by defective workmanship by an aviation repair company and, therefore, was an occurrence covered under a commercial general liability insurance policy (Oxford Aviation, Inc., et al. v. Global Aerospace, Inc., No. 11-2208, 1st Cir.; 2012 U.S. App. LEXIS 10101).
RALEIGH, N.C. - In a case where a commercial general liability insurance company filed its lawsuit first and no exception to the first-filed rule applies, a North Carolina federal judge on May 18 found no cause to stay or dismiss the claim for declaratory judgment as to the rights and obligations of various insurers and their mutual insured with regard to underlying construction defect cases (Harleysville Mutual Insurance Co. v. Hartford Casualty Insurance Co., et al., No. 11-187, E.D. N.C.; 2012 U.S. Dist. LEXIS 69550).
ST. PAUL, Minn. - A commercial general liability insurer has a duty to defend an additional insured against an underlying lawsuit arising from a worksite injury, a Minnesota appeals panel ruled May 14, reversing and remanding a lower court (Nor-Son Inc., et al v. Western National Mutual Insurance Company, et al., No. A11-2016, Minn. App.; 2012 Minn. App. Unpub. LEXIS 411).
SAN FRANCISCO - A commercial general liability insurance company waived its right to control an insured's defense of underlying construction defects actions, a California federal judge found May 10, dismissing the insurer's claim for breach of the covenant of good faith and fair dealing (Travelers Property Casualty Company of America, et al. v. Centex Homes, et al., No. 11-3638, N.D. Calif.; 2012 U.S. Dist. LEXIS 65834).
CONCORD, N.H. - A federal magistrate judge in New Hampshire on May 11 refused to quash subpoenas issued to a police department that investigated a sexual assault that allegedly happened to a plaintiff in a gender discrimination suit as well as to her wireless phone provider because the plaintiff failed to show that the information was privileged (Katie M. Bates v. Private Jet Commercial Group Inc., et al., No. 11-cv-547-SM, D. N.H.; 2012 U.S. Dist. LEXIS 66319).
NEW YORK - Citing her ruling in a similar securities investor lawsuit over losses sustained as part of an investment in a structured investment vehicle (SIV), which was issued on the same day, a federal judge in New York granted in part and denied in part defendants' motion to dismiss certain common-law tort claims in an order made available on May 7 (Abu Dhabi Commercial Bank, et al. v. Morgan Stanley & Co., Inc., et al., No. 08-7508, S.D. N.Y.). Subscribers may view the order available within the full update.
CONCORD, N.H. - Tort claims based on misappropriation of technical and customer information related to an emergency breathing apparatus are preempted under the New Hampshire Uniform Trade Secrets Act (NHUTSA), a New Hampshire federal judge said May 7, while claims stemming from commercial disparagement are not (Wilcox Industries Corp. v. Mark Hansen, Advanced Life Support Technologies Inc., Case No. 11-cv-551-PB, D. N.H.; 2012 U.S. Dist. LEXIS 63668).
BIRMINGHAM, Ala. - A commercial general liability insurance company has no duty to indemnify a jury's damages award against an insured general contractor regarding a breach of contract claim, an Alabama federal judge found May 3 (Owners Insurance Co. v. Shep Jones Construction Inc., et al., No. 08-514, N.D. Ala.; 2012 U.S. Dist. LEXIS 62095).
PORTLAND, Maine - An employer does not owe interest on a payment for failing to properly respond to an employee's claim and may use the payment as an offset against an award for asbestos-related lung disease, but it may not receive an offset for the widow's death benefits, the Maine Supreme Judicial Court held May 3 (Estate of Michael Joyce v. Commercial Welding Co., et al., No. WCB 11-352, Maine Sup.; 2012 Me. LEXIS 64).
SHREVEPORT, La. - A Louisiana federal judge on May 1 cleared an insurance company of providing coverage to its insured for damages and claims arising out of a ceiling replacement project in which allegedly defective products were used (QBE Specialty Insurance Company v. Royal Commercial Construction, Inc., et al.,No. 11-2062, W.D. La.; 2012 U.S. Dist. LEXIS 60897).
NEW YORK - Insureds failed to tender their claim regarding property damage to an adjacent building allegedly caused by construction work on the insureds' property in a timely manner as required under the notice provisions in their commercial insurance policy, the Second Circuit U.S. Court of Appeals affirmed May 1 (United National Insurance Co. v. 515 Ocean Avenue, et al., No. 11-836, 2nd Cir.; 2012 U.S. App. LEXIS 8802).
OAKLAND, Calif. - A commercial general liability insurance company breached its duty to defend allegations against insureds regarding construction defects in their work in a home, a California federal judge found April 26, awarding damages of $301,334 plus interest to the insureds (Swi-Co Construction Inc., et al. v. AMCO Insurance Co., et al., No. 10-3122, N.D. Calif.; 2012 U.S. Dist. LEXIS 59391).
INDIANAPOLIS - Even though a home builder was an additional insured under a plumbing contractor's general commercial liability (GCL) policy, an Indiana federal magistrate judge on April 26 found that its claims related to the decontamination of a home that was exposed to raw sewage were precluded under both the policy's fungi and bacterial exclusion and voluntary-payments exclusion (West Bend Mutual Insurance Co. v. Willmez Plumbing Inc., et al., No. 1:09-cv-00832, S.D. Ind.; 2012 U.S. Dist. LEXIS 58395).
BROOKLYN, N.Y. - A commercial general liability insurance policy does not cover the cost to repair defective pipes because the damages claimed arise from injury caused by an insured's own work, a New York federal judge concluded April 23 (Franco Belli Plumbing & Heating and Sons Inc. v. Liberty Mutual Insurance Co., No. 12-128, E.D. N.Y.; 2012 U.S. Dist. LEXIS 56761).
HOUSTON - Insureds' losses did not result "directly" from their employees' misconduct but were the result of the insureds' contractual liability to third-party financial institutions, a Texas federal judge ruled April 23, finding that a commercial crime insurance policy does not provide coverage for the losses (BJ Services S.R.L., et al. v. Great American Insurance Co. No. H-11-2448, S.D. Texas). Subscribers may view the memorandum and order available within the full update.
CONCORD, N.H. - Whether an insured's original construction work or his subsequent repair work caused water damage is a genuine issue of fact material to whether a commercial general liability insurance policy provides coverage, the New Hampshire Supreme Court said April 20, reversing and remanding a judge's entry of summary judgment (Marc Brown and Laurie Brown v. Concord Group Insurance Co., No. 2011-385, N.H. Sup.; 2012 N.H. LEXIS 56).
NEW ORLEANS - A commercial general liability insurance company had a duty to defend allegations of diminution in value attributable to "property damage" against its insureds, the Fifth Circuit U.S. Court of Appeals affirmed on April 20 (Mid-Continent Casualty Co. v. Academy Development Inc., et al., No. 11-20219, 5th Cir.; 2012 U.S. App. LEXIS 8056).
DENVER - A federal judge in Colorado on April 23 granted the defendants' motion to transfer to a district court in Illinois a suit filed against them by a bank attempting to recover amounts owed on a promissory note, loan agreement and two commercial guaranties, finding that factors including the residence of the defendants and a witness's health issues favor transfer (Community Banks of Colorado v. 1320 Snowbunny Lane, LLC et al., No. 11-02700, D. Colo.; 2012 U.S. Dist. LEXIS 56176).
DENVER - A commercial general liability insurer has no duty to defend an insured against allegations of construction defects, the 10th Circuit U.S. Court of Appeals ruled April 19, finding that the insured failed to establish that the "event" of its unworkmanlike or negligent construction produced any unnatural or unexpected results (Employers' Mutual Casualty Co. v. Bartile Roofs Inc., et al., No. 11-8026, 10th Cir.; 2012 U.S. App. LEXIS 7894).