LexisNexis® Legal Newsroom
Mealey's Insurance - Insured's Breach Of Contract Is Barred By 2-Year Statute Of Limitations, Judge Says

DENVER - A two-year statute of limitations precludes an insured's breach of contract claim against its insurer for denied coverage for property damage to commercial properties, a Colorado federal judge ruled Feb. 13 (The Pinewood Townhome Association Inc. v. Auto-Owners Insurance Co., No. 15-01604, D. Colo.; 2017 U.S. Dist. LEXIS 19999).

Mealey's Insurance - Texas Panel Finds Take- Nothing Judgment In Hurricane Ike Coverage Suit Was Proper

HOUSTON - A Texas appeals panel held Feb. 9 that a take-nothing judgment against insureds is proper because a commercial insurer overpaid the actual cash value of Hurricane Ike property damage by more than $1.5 million based on the jury's findings as to actual cash value (Triyar Companies, LLC, et al. v. Fireman's Fund Insurance Co., No. 14-14-00160, Texas. App., 14th Dist., 2017 Tex. App. LEXIS 1126).

Mealey's Insurance - 2nd Circuit Panel Says Policy Is Ambiguous On Insurer's Liability Limits

NEW YORK - The Second Circuit U.S. Court of Appeals on Feb. 10 vacated a district court's award of partial judgment on the pleadings entered in favor of an insured seeking coverage for an oil spill after determining that the policy language regarding the insurer's liability to the insured is ambiguous (American Commercial Lines LLC v. Water Quality Insurance Syndicate, Nos. 16-91, 16-119, 2nd Cir., 2017 U.S. App. LEXIS 2460).

Mealey's Insurance - Judge: Fact Issues Exist On If Roofing Limitation Bars Coverage For Insured

CHARLESTON, S.C. - A genuine issue of material fact exists as to the suitability of a roof covering on a homeowner's roof in order to trigger a roofing limitation endorsement in a commercial general liability insurance policy that would preclude coverage for damages, a South Carolina federal judge held Feb. 6 (Williford Roofing Inc. v. Endurance American Specialty Insurance Co., et al., No. 16-01830, D. S.C., 2017 U.S. Dist. LEXIS 16033).

Mealey's Insurance - Yahoo Sues Insurer Over Coverage Of Email Scanning Suits

SAN JOSE, Calif. - On Jan. 31, Yahoo! Inc. sued its commercial general liability (CGL) provider in California federal court, alleging breach of contract and bad faith related to the insurer's decision not to defend or indemnify the internet firm in four class actions alleging privacy violations in certain email-scanning practices (Yahoo! Inc. v. National Union Fire Insurance Company of Pittsburgh, Pa., No. 5:17-cv-00489, N.D. Calif.).

Mealey's Insurance - Failure To Perform Claim Is Not An 'Occurrence' Under Insurance Policy, Judge Says

EAST ST. LOUIS, Ill. - Allegations of an insured's failure to perform do not constitute an "occurrence" triggering coverage under a commercial general liability insurance policy, an Illinois federal judge ruled Jan. 31, agreeing with the insurer that they "are nothing more than claims of disappointed expectations in the performance of a construction contract" (Owners Insurance Co. v. James C. Warren d/b/a Warren Exterior and Remodeling, et al., No. 15-00349, S.D. Ill., 2017 U.S. Dist. LEXIS 13171).

Mealey's Insurance - Hazing Exclusion Bars Coverage, Federal Judge Rules In Dispute Between Insurers

FLORENCE, S.C. - A South Carolina federal judge on Jan. 25 ruled that a hazing exclusion precludes commercial general liability insurance coverage for an underlying $1.6 million judgment against the vice president of the local alumni chapter of a fraternity (State Farm Fire and Casualty Co., et al. v. Admiral Insurance Co., No. 15-2745, D. S.C.; 2017 U.S. Dist. LEXIS 1007).

Mealey's Insurance - Majority Affirms Ruling In Coverage Dispute Over $2.6M Tornado Damage

NEW ORLEANS - A majority of the Fifth Circuit U.S. Court of Appeals on Jan. 23 affirmed a lower federal court's ruling that an insurer failed to provide sufficient notice that it was canceling a commercial property insurance policy, further affirming that the insurer had an arguable basis for its decision to deny coverage for the alleged $2.6 million tornado damage to a church building (GuideOne Elite Insurance Co., et al. v. Mount Carmel Ministries, et al., No. 15-60915, 5th Cir.; 2017 U.S. App. LEXIS 1147).

Mealey's Insurance - Faulty Work Claims Do Not Constitute 'Occurrence' Under Insurance Policy, Judge Says

PHILADELPHIA - Faulty workmanship claims do not constitute "accidents" or "occurrences" under a commercial general liability insurance policy, a Pennsylvania federal judge ruled Jan. 23, finding that an insurer has no duty to defend its insured (Quality Stone Veneer Inc. v. Selective Insurance Company of America, No. 15-6509, E.D. Pa.; 2017 U.S. Dist. LEXIS 9393).

Mealey's Insurance - 11th Circuit: 'Damage To Your Work' Exclusion Bars Duty To Defend Insured

ATLANTA - The "damage to your work" exclusion relieves a commercial general liability insurer from any duty to defend an insured in a construction defects lawsuit, the 11th Circuit U.S. Court of Appeals affirmed Jan. 23, because the allegations relate only to the structure of the property itself, which the insurer and insured agreed is excluded (Auto-Owners Insurance Co. v. Elite Homes Inc., No. 16-10996-AA, 11th Cir.; 2017 U.S. App. LEXIS 1132).

Mealey's Insurance - Federal Judge Dismisses Insurers' Coverage Suit In Favor Of State Court Case

BALTIMORE - Finding similarities with a declaratory judgment action filed by subcontractors' commercial general liability insurers, a Maryland federal judge on Jan. 20 dismissed a case involving a contractor's insurers over the same duties to defend allegations of excessive radon asserted in two underlying putative class actions (Evanston Insurance Co., et al. v. Dan Ryan Builders Inc., No. 15-3419, D. Md.; 2017 U.S. Dist. LEXIS 8320).

Mealey's Litigation Procedure - South Carolina High Court Affirms Time-On-The-Risk Allocation Of Insurer's Costs

COLUMBIA, S.C. - The majority of the South Carolina Supreme Court on Jan. 11 affirmed a special referee's finding that coverage under commercial general liability insurance policies was triggered and calculation of an insurer's pro rata portion of the progressive damages based on its time on the risk (Harleysville Group Insurance v. Heritage Communities Inc., et al., No. 2013-001281 & 2013-001291, S.C. Sup.; 2017 S.C. LEXIS 8).

Mealey's Toxic Tort/Environmental - EPA Proposes Ban On Trichloroethylene, Cites 'Unreasonable Risks' To Health

WASHINGTON, D.C. - The U.S. Environmental Protection Agency on Jan. 11 advertised in the Federal Register a proposed rule to prohibit the manufacture, import, processing and distribution of trichloroethylene (TCE), a volatile organic compound used in industrial and commercial processes, due to "unreasonable risks" to health.

Mealey's Insurance - South Carolina High Court Affirms Time-On-The-Risk Allocation Of Insurer's Costs

COLUMBIA, S.C. - The majority of the South Carolina Supreme Court on Jan. 11 affirmed a special referee's finding that coverage under commercial general liability insurance policies was triggered and calculation of an insurer's pro rata portion of the progressive damages based on its time on the risk (Harleysville Group Insurance v. Heritage Communities Inc., et al., No. 2013-001281 & 2013-001291, S.C. Sup.; 2017 S.C. LEXIS 8).

Mealey's Insurance - Insurer Says No Coverage For Roofing Subcontractor's $6.6M In Faulty Work Damage

CHICAGO - A commercial general liability insurance policy does not cover a roofing subcontractor over faulty work claims that resulted in more than $6.6 million in damages to townhomes, an insurer says in its Jan. 4 complaint to an Illinois federal court (Nautilus Insurance Co. v. Classic Roofing Inc. and Custom Roofing Contracting Ltd., No. 17-45, N.D. Ill.).

Mealey's Insurance - 10th Circuit: Court Properly Vacated Order Confirming Appraisal Award, Judgment

DENVER - A commercial property insurer's voluntary payment of an appraisal award and the insured's acceptance of the payment settled any dispute over the amount of storm loss to the insured's property, the 10th Circuit U.S. Court of Appeals ruled Jan. 4, affirming a lower court's decision to vacate an order confirming the appraisal award and a judgment in favor of the insured (In re: Appointment of Umpire for Hayes Family Trust, on behalf of itself and all others similarly situated, Clayton A. Hayes, cotrustee v. State Farm Fire & Casualty Co., No. 15-6164, 10th Cir.; 2017 U.S. App. LEXIS 81).

Mealey's PI/Product Liability - Panel Affirms $714,450.24 Ruling In Favor Of Target In Dispute Over CGL Coverage

CHICAGO - The Seventh Circuit U.S. Court of Appeals on Dec. 29 affirmed a lower federal court's finding that a commercial general liability insurer has a duty to defend or indemnify Target Corp. as an additional insured against an underlying lawsuit brought by a customer who was injured when a fitting room door fell on her (Selective Insurance Company Of South Carolina v. Target Corp., No. 16-1669, 7th Cir.; 2016 U.S. App. LEXIS 23370).

Mealey's Insurance - Panel Affirms $714,450.24 Ruling In Favor Of Target In Dispute Over CGL Coverage

CHICAGO - The Seventh Circuit U.S. Court of Appeals on Dec. 29 affirmed a lower federal court's finding that a commercial general liability insurer has a duty to defend or indemnify Target Corp. as an additional insured against an underlying lawsuit brought by a customer who was injured when a fitting room door fell on her (Selective Insurance Company Of South Carolina v. Target Corp., No. 16-1669, 7th Cir.; 2016 U.S. App. LEXIS 23370).

Mealey's Insurance - Judge: Fees Awarded Under Texas Civil Practice, Remedies Section Are Not Covered

HOUSTON - Fees awarded under Section 82.002(g) of the Texas Civil Practice and Remedies Code are not "damages" covered by a commercial general liability insurance policy, a Texas federal judge ruled Dec. 30, finding that the ruling in Hollybrook Cottonseed Processing, L.L.C. v. Am. Guarantee & Liab. Ins. Co. (772 F.3d 1031 [5th Cir. 2014]) does not affect that conclusion (Mid-Continent Casualty Co. v. Petroleum Solutions, Inc., et al., No. 09-0422, S.D. Texas; 2016 U.S. Dist. LEXIS 180539).

Mealey's Insurance - Contract Claims Are Not Covered Under Insurance Policy, Federal Judge Says

HONOLULU - Claims based in contract do not constitute an "occurrence" under a commercial general liability insurance policy, a Hawaii federal judge ruled Dec. 16, dismissing counterclaims for breach of contract and reformation against two insurers in a coverage dispute over defects in a construction project (American Automobile Insurance Co. and National Surety Corp. v. Hawaii Nut & Bolt Inc. and Safeway Inc., No. 15-00245, D. Hawaii; 2016 U.S. Dist. LEXIS 174243).

Mealey's PI/Product Liability - Judge: Fact Issue Exists As To Whether Professional Services Exclusion Was In Policy

JONESBORO, Ark. - Ruling on dueling summary judgment motions, an Arkansas federal judge concluded Nov. 28 that there is a genuine factual dispute concerning whether a professional services exclusion was included in a commercial general liability insurance policy when an underlying injury occurred at a day care (Penn-Star Insurance Co. v. New Edition Early Learning Academy, et al., No. 15-104, E.D. Ark.; 2016 U.S. Dist. LEXIS 163196).

Mealey's Insurance - Judge: Fraud Claim Against Insured Is Not An 'Occurrence' Due To Intentional Conduct

LITTLE ROCK, Ark. - Property owners' fraud claim is not a covered "occurrence" under a commercial general liability insurance policy because they allege intentional intent by an insured contractor, an Arkansas federal judge ruled Nov. 18, also upholding a previous decision that the insurer had a duty to defend a breach of contract claim (Columbia Insurance Group Inc. and Columbia Mutual Insurance Company Inc. v. Arkansas Infrastructure Inc., et al., No. 14-00512, E.D. Ark.; 2016 U.S. Dist. LEXIS 160151).

Mealey's Insurance - Damages From Insured's Faulty Work Are Not Covered, Arkansas Federal Judge Says

LITTLE ROCK, Ark. - Damages for defective workmanship that resulted in damages only to an insured general contractor's work product itself does not constitute property damage caused by an "occurrence" under a commercial general liability insurance policy, an Arkansas federal judge ruled Nov. 18, granting summary judgment to the insurer on its duty to defend and indemnify two underlying construction defects cases (Auto-Owners Insurance Co. v. Hambuchen Construction Inc., et al., No. 16-0005, E.D. Ark.; 2016 U.S. Dist. LEXIS 160364).

Mealey's Insurance - Georgia Panel Affirms Reformation Of Policy Due To Parties' Mutual Mistake

ATLANTA - A Georgia appeals panel on Nov. 14 affirmed a trial court's decision to reform a commercial insurance policy to identify the proper insured in a wrongful death coverage dispute because of a mutual mistake made by the applicant and the insurer (Occidental Fire and Casualty of North Carolina v. Goodman, et al., Nos. A16A1372 and A16A1373, Ga. App., 3rd Div.; 2016 Ga. App. LEXIS 639).

Mealey's Insurance - Judge Denies Motion To Vacate Man's 120-Month Insurance Fraud Sentence

CHICAGO - A federal judge in Illinois on Nov. 4 denied a man's motion to vacate a 120-month sentence for selling fraudulent commercial insurance policies to business and property owners, ruling that the defendant failed to show that his counsel acted ineffectively by not negotiating a plea agreement in response to a blind plea offer (United States of America v. Michael A. Ward, No. 15-cv-3910, N.D. Ill.; 2016 U.S. Dist. LEXIS 152989).