In HB Development, LLC, et al. v. Western Pacific Mutual Insurance, et al., Case No. 2:13-cv-5050-RMP (E.D.Wa. Feb. 6, 2015), the United States District Court for the Eastern District of Washington granted summary judgment in favor of the insurer, holding that a claims-made policy did not provide coverage because the insured did not provide timely notification of claims or potential claims to the insurer.
Western Pacific Mutual Insurance (“Western”) had issued claims-made commercial general liability coverage to a general contractor, HB Development, LLC, and its members, Fraser Hawley and Sharon Brown (collectively, “HB”) for a policy period from 2004 to 2010. Between 2007 and 2010, HB received complaints from two homeowners regarding defects in a home HB had built. HB never notified Western of these complaints, however. In 2012, after the Western policy period expired, the homeowners served written notice of their construction defect, property damage, and loss of use claims to HB, and provided Western with copies of the claims. Through its claim administrator, Western denied coverage for the claims. Subsequently, the homeowners filed a lawsuit against HB, and the parties reached a $600,000 settlement (later reduced to $420,000), in which HB assigned its rights against Western to the homeowners.
Continue reading Washington State: Insurer Prevails on Summary Judgment Due to Insured’s Lack of Prompt Notice
In Roman Catholic Diocese of Brooklyn v. National Union Fire Insurance Company of Pittsburgh, Pa., 2013 NY Slip Op 03264 (May 7, 2013), the New York Court of Appeals, New York’s highest court, held that a priest’s multiple incidents of sexual abuse against one victim over a span of six years constituted multiple occurrences. The Court of Appeals also held that the underlying settlement amount should be allocated on a pro rata basis over the seven policy periods, requiring satisfaction of the SIR attendant to each implicated policy.
Continue reading New York Court of Appeals Holds That Multiple Incidents of Sexual Abuse Constitute Multiple Occurrences
In Admiral Ins. Co. v Joy Contractors, Inc., 2012 NY Slip Op 4670 (N.Y. June 12, 2012), the New York Court of Appeals, New York’s highest court, held that an insurer may seek rescission against an additional insured for the named insured’s misrepresentations during the underwriting process.
The coverage dispute arose from the deadly collapse of a tower crane operated by Joy Contractors, Inc. during construction of a luxury high-rise condominium in Manhattan. Admiral Insurance Company, which issued an excess commercial general liability policy to Joy, denied coverage to Joy and other entities claiming additional insured status under the policy on the basis of a residential construction exclusion. Continue reading New York Court of Appeals Holds an Insurer May Rescind a Policy to an Innocent Additional Insured’s Detriment