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Subcontractor Exception Torpedoes Insurers’ Defense To Faulty Workmanship Claim

September 16, 2016 by Daniel G. Enriquez and Robert D. Helfand

Cypress Point Condominium Ass’n, Inc. v. Adria Towers, L.L.C.

As this blog has reported, a line of cases deciding coverage disputes over faulty workmanship runs against (or, at least, around) a basic rule for interpreting insurance policies.  Under that rule, the scope of coverage is determined by a policy’s insuring clause, which may be narrowed by one or more exclusions.  Exceptions to the exclusions can add back coverage that the exclusions remove, but they cannot create coverage beyond the ambit of the insuring clause.  E.g., ... Keep Reading »

On Remand, District Court Expands Subcontractor Exception to Rule Against Coverage for Faulty Workmanship

May 1, 2013 by John C. Pitblado

Recent decisions from the U.S. Courts of Appeal for the Tenth and Second Circuits have partially overturned a longstanding rule against coverage for faulty workmanship under commercial general liability policies.  The rule, known as the “fortuity doctrine,” was based on insuring clauses that provided coverage only for claims arising out of an “occurrence,” and which defined “occurrence” to mean “accident.”  For many years, courts held that claims based on the insured’s ... Keep Reading »

In Faulty Workmanship Cases, Insuring Clause Dogs are Wagged by Exclusion Tails

April 1, 2013 by John C. Pitblado and Robert D. Helfand

In Greystone Const., Inc. v. National Fire & Marine Ins. Co., 661 F.3d 1272, 1289 (10th Cir. 2011), the U.S. Court of Appeals for the Tenth Circuit articulated an important rule for construing commercial general liability policies: [A] CGL policy ‘begin[s] with a broad grant of coverage, w[hich is then limited in scope by exclusions.  Exceptions to exclusions narrow the scope of the exclusion and . . . add back coverage.  But it is the initial broad grant of ... Keep Reading »

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