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BT Policyholder Protection Blog
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27 Feb 2018 The Tenth Circuit Hands Another Win to Policyholders Seeking to Insure Defective Workmanship By Their Subcontractors

  Your company, an engineering firm, is hired by an agent for coal-fired plants to serve as contractor on projects to build jet bubbling reactors, which eliminate contaminants from the plants’ exhaust.  Your company, in turn, subcontracts the engineering and construction of the reactors’ internal components to another firm.  After the contractor’s work is done, the plants discover that the components are defective, causing the reactors to deform, crack or even collapse.   The agent notifies your company of the problem and asserts that it is liable for the costs of repairing and replacing the defective components, an amount which will run well into the hundreds of millions of dollars.   Your company tenders the claim under its commercial general liability (“CGL”) policy, which says that…

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12 May 2014 Clifford Shapiro presents “The Next Wave of ‘Occurrence’ Disputes”

On May 7, Clifford Shapiro spoke before more than one hundred attendees at the second annual meeting of the American College of Coverage and Extracontractual Counsel (ACCEC) held in Chicago.  Tom Mielenhausen is also a member of the ACCEC, and he also attended the conference. Clifford’s topic was insurance coverage for construction defect claims.  Among other things, he presented an update on the 50 state survey of the “occurrence” issue, and a summary of recent state statues that have been enacted to attempt to resolve this thorny issue.  The ACCEC’s brochure summarized the presentation: This presentation will discuss the history and analysis of the “occurrence” issue in the construction defect claim context. This issue has divided the courts across the country. The presentation will also include…

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29 Apr 2014 NEWS ALERT: Alabama Supreme Court Withdraws and Re-Issues Decision to Find “Occurrence” for Construction Defect Claim

Last September, the Alabama Supreme Court issued a decision that denied insurance coverage to a homebuilder on the ground that there can be no “occurrence” where construction defect claims do not allege property damage to something other than the home the policyholder built. Owners Insurance Co. v. Jim Carr Homebuilder LLC, 2013 Ala. LEXIS 122, 2013 WL 5298575 (Ala. Sept. 20, 2013). In that decision, the court did not analyze the policy language to distinguish between damage to the insured’s project (which it held did not constitute an “occurrence”) and damage to other property or other parts of the structure (which it held could constitute an “occurrence”).   On March 28, 2014, the Alabama Supreme Court withdrew its earlier decision and issued a new decision…

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