Yesterday, the Oregon Court of Appeals dealt a hefty blow to insurance companies seeking to exclude coverage for property damage to multi-family dwellings and for awards of attorney fees. In Hunters Ridge Condominium Ass’n v. Sherwood Crossing, LLC, the Oregon Court of Appeals held that an insurance company’s “Multi-Unit New Residential Construction” exclusion was unclear as to whether it excluded coverage for property damage to both residential-only and mixed-use condominiums. Given there were two plausible ways to read the exclusion, the Oregon Court of Appeals held the exclusion must be construed against the insurance company. Continue Reading Not so fast insurance company, that judgment against your insured may in fact be covered

Back in August 2015, I wrote this post about the Oregon Court of Appeals opinion in West Hills Development Co. v. Chartis Claims, Inc., where the court confirmed that Oregon’s broad duty to defend extended to parties claiming rights as “additional insureds.” Last week, the Oregon Supreme Court affirmed that decision, broadly holding that “regardless of ambiguity or lack of clarity, the duty to defend is triggered if the complaint’s allegations, reasonable interpreted, could result in the insured being held liable for damages covered by the policy.” Continue Reading Oregon Supreme Court reaffirms broad nature of the duty to defend, even in the face of ambiguous or unclear allegations

On August 19, 2015, the Oregon Court of Appeals issued its opinion in West Hills Development Co. v. Chartis Claims, Inc., reaffirming the broad nature of an insurer’s duty to defend, even when that duty is owed to an “additional insured.”

Contracting parties rely on indemnity agreements and additional insured status to protect against liability arising from the other party’s negligence. Insurers, however, frequently ignore or summarily deny tenders from parties who qualify as additional insureds under the policies they issued. That is exactly what happened in West Hills. Continue Reading Oregon’s broad duty to defend extends to “additional insureds”

The Oregon Supreme Court recently addressed an issue that has been the source of significant uncertainty in construction disputes: the extent to which construction agreements can require subcontractors to indemnify general contractors for damages caused by the negligence of others. This issue keenly interests coverage counsel because of the close connection between these contractual-indemnity provisions and the equally common requirement that subcontractors include the general contractor as an “additional insured” under their liability policies. Continue Reading Oregon Supreme Court enforces indemnity provisions, but only to a point

Recently, the Illinois Court of Appeals emphasized the importance of careful pleading when it comes to triggering an insurer’s duty to defend. In West Bend Mut. Ins. Co. v. Pulte Home Corp. (May 15, 2015), the court upheld a trial court’s denial of West Bend Mutual Insurance Company’s (“West Bend”) motion for summary judgment, which argued that West Bend had no duty to defend a developer and siding subcontractor in a construction-defect lawsuit filed by a homeowner’s association for alleged property damage resulting from improper installation of siding (among other things).

On appeal, the court analyzed whether the allegations in the complaint contained any claims and/or damages which might have the potential for coverage under West Bend’s policy. After reviewing the key allegations, the court upheld the trial court’s decision that West Bend had a duty to defend the developer and siding subcontractor. This decision to uphold West Bend’s obligation to defend was made despite the fact that Illinois courts had previously ruled that property damage to a building caused by a contractor’s defective construction was not an accident and therefore does not constitute an “occurrence” under traditional commercial general liability coverage forms. Continue Reading Would-be plaintiffs, don’t ignore the importance of pleading into coverage

Last week, a Florida circuit court found an insurer jointly and severally liable not only for post-tender attorney’s fees but, because the insurer had refused to defend its insured, the insurer was liable for pre-tender attorney’s fees as well.

In Centex Homes v. Builders FirstSource-Florida, LLC, Centex Homes developed a residential condominium community. Centex Real Estate Corporation, the general contractor, hired Builders FirstSource-Florida, LLC (“BFS”) to supply and install the windows for the project. BFS was insured by Liberty Mutual Fire Insurance Company (“Liberty”), and the two Centex entities were named as additional insureds under the Liberty policies. Continue Reading Florida Court: Insurers, if you deny defense, you must pay your insured’s pre-tender attorney’s fees.