Construction Defect Claims as Occurrences: Part II

Abstract

This is the companion article to Construction Defect As Occurrences, posted on May 13, 2011. This article further explains the meaning of occurrence under the Commercial General Liability (CGL) policy. It is imperative that these 2 articles be read together to fully glean the subject matter. Part II addresses cases in Tennessee, Kentucky, Indiana, New York and Ohio. A very interesting 2010 case in New York, Metropolitan Property & Casualty Ins. Co. v. Marshall, involves a homeowner's policy and a murder in which the court ruled that this particular murder, under the subject policy, was an accident and thus coverage. The court stated that since the insured did not expect and could not foresee her son murdering the underlying claimant, that act was in fact an accident from her point of view.

The State of Indiana in Sheehan Construction Co. Inc. v. Continental Insurance Co has departed from the majority view. The Indiana Supreme Court, in Sept. 2010 ruled that if faulty workmanship is unexpected and without intention or design and not foreseeable from the viewpoint of the insured, then it is an accident within the meaning of a CGL policy.

Keywords: Construction Defect Claims, CGL Policy, Occurrence, Accident