Trizec Properties, Inc. v. Biltmore Constr. Co.

Trizec Properties, Inc. v. Biltmore Constr. Co.

Opinion

 [*811]  HENLEY, Senior Circuit Judge:

Trizec Properties, Inc. (Trizec) sued several contractors, including Decks, Inc. (Decks), for negligence and breach of contract in the construction of a shopping mall. By third party complaint, Decks, in turn, sued its insurers, one of which is the appellant Liberty Mutual Insurance Company (Liberty). Decks sought to impose a duty to defend and indemnify Decks in the main action. The narrow issue we address here is whether Liberty owes Decks a duty to defend Trizec's suit. We hold that it does and affirm the judgment of the district court. ² 

 [**2]  Decks worked as a subcontractor in installing the roof deck on the shopping mall. Trizec's complaint alleges that the mall was constructed "commencing in or about 1971, and ending in or about 1975." Decks' insurers were all on the risk at different times during and after the mall's construction. Liberty was Decks' liability insurer from November 20, 1972 until January 1, 1976. The district court entered partial summary judgment in favor of Decks on the duty to defend issue stating that "the allegations of Plaintiff's Complaint are sufficiently broad to bring the claims against DECKS within potential coverage under the policies issued by the insurors. . . ." Liberty is the only one of the four insurers to appeal this ruling.

We begin by stating the general principles of Florida law ³ which govern an insurer's duty to defend. ] The duty to defend "depends solely on the allegations in the complaint filed against the insured." Tropical Park, Inc. v. United States Fidelity and Guaranty Co., 357 So. 2d 253, 256 (Fla. 3d DCA 1978); Coblentz v. American Surety Co., 416 F.2d 1059, 1062 (5th Cir. 1969). The complaint must allege facts which fairly bring [**3]  the case within coverage even though ultimately there may be no liability on the part of the insured. Tropical Park, 357 So. 2d at 256. If the complaint alleges facts partially within and partially outside the scope of coverage, the insurer is obligated to defend the entire  [*812]  suit. Id.; Battisti v. Continental Cas. Co., 406 F.2d 1318, 1321 (5th Cir. 1969). The duty to defend is separate and apart from the duty to indemnify and the insurer may be required to defend a suit even if the later true facts show there is no coverage. Klaesen Bros., Inc. v. Harbor Ins. Co., 410 So. 2d 611, 612-13 (Fla. 4th DCA 1982); Burton v. State Farm Mutual Auto. Ins. Co., 335 F.2d 317, 321 (5th Cir. 1964). All doubts as to whether a duty to defend exists are resolved against the insurer and in favor of the insured, 7C Appleman, Insurance Law & Practice 99-100 (Berdal ed. 1979), and if the complaint alleges facts which create potential coverage under the policy, the duty to defend is triggered. See Tropical Park, 357 So. 2d at 256.

 [**4]  As stated, Trizec's complaint alleges the mall was constructed from 1971 to 1975. It alleges negligence and breach of express and implied warranties against several contractors, including Decks. Only the negligence allegations are pertinent here since Decks acknowledges that the causes of action for breach of warranty are excluded from coverage. The complaint states that there are defects in the roof deck resulting from Decks' negligent failure to properly install the deck. The complaint further alleges that, as a result of the improper installation, the roof membrane split and leaked, the roof control joints and expansion joints malfunctioned, the flashings and walls leaked, and that pipes and lighting fixtures began to rust. The complaint does not say when these consequential effects of the improper installation actually began to occur. It does allege that the defects "involve latent defects" which were not discovered by plaintiff until their "manifestation" in 1979.

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