Breaking News: Connecticut Supreme Court Decides Significant Coverage Issues in R.T. Vanderbilt

Patricia B. Santelle and Ciaran B. Way | White and Williams

On October 4, 2019 (almost two years after granting certification), the Connecticut Supreme Court affirmed the Appellate Court’s rulings on four key coverage issues in R.T. Vanderbilt Company v. Hartford Accident & Indemnity Company, et al. The coverage dispute in Vanderbilt concerns underlying actions alleging that talc and silica mined and sold by the insured contained asbestos and/or caused asbestos-related disease. The case has been proceeding in phases, two of which have been tried to date, resulting in the matter on appeal.

(1) “Continuous Trigger” Theory of Coverage Applies: The Court affirmed and adopted the Appellate Court’s opinion applying a “continuous trigger” for the underlying claims at issue, and agreed that the trial court properly excluded testimony from medical experts the insurers had proffered to prove that the asbestos disease process did not support a continuous trigger.

(2) The “Unavailability of Insurance” Exception to Time-on-Risk Pro Rata Allocation Applies: The Court affirmed and adopted the Appellate Court’s ruling that (a) damages and defense costs should not be allocated to any period in which insurance was “unavailable” in the market, (b) the insurers bear the burden of proving that coverage for asbestos liabilities was available to the policyholder after the date asbestos exclusions were added to the policies and (c) the insured bears the burden of proving that it was unable to obtain asbestos coverage prior to 1986 (when such insurance was generally available). The Appellate Court recognized that, in certain circumstances, there could be an “equitable exception” to the unavailability rule if the insured continued to manufacture products containing asbestos after 1986 with the knowledge that such products were hazardous and uninsurable (circumstances which the court found were not present in this case).

(3) The “Sudden and Accidental” and “Absolute” Pollution Exclusions Are Only Applicable to Claims Arising From “Traditional” Environmental Pollution and Not Occupational Disease Caused by Exposure to Asbestos: The Court affirmed and adopted the Appellate Court’s conclusion that the pollution exclusions were intended to apply only to “traditional environmental pollution” and not to disease caused by exposure to asbestos. 

(4) Occupational Disease Exclusions Precludes Coverage for Claims of Occupational Disease, Regardless of Whether the Claimant Was Employed by the Policyholder or a Third Party: Noting that this is an issue of first impression nationally, the Court affirmed the Appellate Court’s ruling that the occupational disease exclusions contained in certain excess policies applied to the underlying asbestos-related claims, which the parties stipulated were brought by non-employees. The Court agreed with the insurers’ argument that “occupational disease” has a plain meaning that is broader than the workers’ compensation context.

This is the first occasion in which the Connecticut Supreme Court has ruled definitively on the application of a “continuous trigger,” the “unavailability” rule and the application of pollution exclusions in the context of asbestos-related claims. As noted above, the occupational disease exclusion issue was one which the Court noted is of first impression nationally.

The 98-page Appellate Court decision in Vanderbilt can be found at R.T. Vanderbilt Company, Inc. v. Hartford Accident and Indemnity Company, 171 Conn. App. 61 (Conn. App. Ct. March 7, 2017). The Supreme Court decision will be officially released shortly.

Connecticut Supreme Court Affirms Continuous Trigger and Unavailability Exception, Makes First-In-The-Nation Law Regarding Occupational Disease Exclusion

Paul C. Fuener | K&L Gates | October 28, 2019


Earlier this month, the Connecticut Supreme Court (the “Supreme Court”) finally issued its long-anticipated ruling regarding the Connecticut Appellate Court’s (the “Appellate Court”) landmark 2017 decision in R.T. Vanderbilt v. Hartford Accident and Indemnity Co. (the “2017 Appellate Court Decision”). [1] The Supreme Court adopted in its entirety the Appellate Court’s policyholder-favorable decisions regarding the application of the continuous trigger theory to long-tail asbestos-related bodily injury claims, the application of the unavailability-of-insurance rule to allocation of liability for such claims, and the inapplicability of the qualified pollution exclusion to asbestos-related bodily injury claims.

The Supreme Court’s opinion also contained a potentially problematic ruling for policyholders. Ruling on an issue of national first impression, the Supreme Court held that an occupational disease exclusion in certain of the policyholder’s policies applied not only to claims brought by the policyholder’s own employees but also to all underlying claimants alleging that they suffer from an occupational disease, even if they were employed by others.

The Supreme Court’s Vanderbilt Decision

The Connecticut Supreme Court considered four issues on appeal from the 2017 Appellate Court Decision. [2] Three of those issues were raised by the defendant insurers: (1) whether the continuous trigger theory was properly applied to long-tail asbestos claims under Connecticut law, (2) whether the unavailability-of-insurance rule should be applied to allocation of liability under Connecticut law for long-tail liability claims, and (3) whether under Connecticut law the pollution exclusion applied only to traditional environmental pollution or more broadly to asbestos bodily injury claims. [3]

The policyholder raised the final issue on appeal: whether the occupational disease exclusion was limited to claims brought by the policyholder’s own employees or had broader application. [4]

Trigger, Allocation, and the Qualified Pollution Exclusion

In its 2017 Appellate Court Decision, the Appellate Court placed Connecticut among those jurisdictions that apply the continuous trigger theory to long-tail claims. The Appellate Court’s decision reasoned that this theory best reflected the medical particularities of long-tail asbestos claims and was therefore the most fair and efficient way to distribute costs. [5]

The Appellate Court also adopted the “unavailability-of-coverage” rule to augment Connecticut’s pro rata allocation theory for long-tail claims. Under this rule, no amounts are allocated to a policyholder for years when the policyholder was unable to purchase insurance for third-party asbestos-related bodily injury claims because such insurance was unavailable in the market. [6] In adopting the “unavailability-of-coverage” rule, the Appellate Court rejected the insurers’ attempt to include an “equitable exception” to the rule that would have made the rule inapplicable to periods during which a policyholder sold allegedly asbestos-containing products. It also rejected the insurers’ suggestion that the alleged availability of coverage for asbestos liabilities under “claims-made” policies should be factored into the question of whether coverage for asbestos-related bodily injury claims was “available” in the market. [7]

Finally, the Appellate Court held that the so-called “qualified” pollution exclusion (also referred to as the “sudden and accidental” pollution exclusion) only applied to traditional environmental pollution. [8] The Appellate Court reasoned that the meaning of “environmental pollution” was clear at the time the insurers drafted the exclusion and referred to traditional methods of environmental pollution, such as unintentional migration of a pollutant through a water source. [9] The Appellate Court held, therefore, that this exclusion does not apply to asbestos-related bodily injury claims. [10]

On appeal, the Supreme Court agreed with the Appellate Court’s reasoning and conclusions with respect to these three issues and adopted in full the Appellate Court’s discussion of them without further elaboration. [11]

The Occupational Disease Exclusion

In considering the scope of the occupational disease exclusion, the Supreme Court, after summarizing the discussion of the issue below, began by making an independent inquiry into the plain meaning of the term “occupational disease.” [12]

Looking first to the language of the exclusion in the relevant policies, the Supreme Court noted that neither defined the term “occupational disease,” thus requiring the court to turn to the plain meaning of the term when the policies were written. [13]

Citing an array of dictionaries and cases, the court found definitions such as “[a] disease caused by the condition or hazards of a particular occupation” [14] and “an illness caused by factors arising from one’s occupation.” [15] In light of these broad definitions, the Supreme Court rejected the policyholder’s argument that the term “occupational disease” belonged to the workers compensation domain and should therefore only apply in a workers compensation context to claims brought by the policyholder’s own employees. [16] The Supreme Court acknowledged that “the relationship between occupational disease and workers’ compensation is now a matter of black letter law….” [17] However, it found that:

the definitions on which Vanderbilt relies — including the definition in Black’s Law Dictionary — [do not] suggest[] in any way that the phrase “occupational disease” is a construct devoid of meaning outside the law of workers’ compensation, notwithstanding its obvious significance within that area of the law. Instead, we read those definitions only to highlight the availability of workers’ compensation as a common, legal remedy for claims arising from the underlying condition. [18]

The Supreme Court also found it significant that the relevant exclusions themselves, like the general definitions of “occupational disease” that it had considered, did not contain an express limitation to the policyholder’s own employees. [19] The Supreme Court contrasted the language of the relevant exclusions with that of certain other exclusions contained in the relevant policies that did expressly limit the exclusion’s scope, noting that “when the drafters of the policy desired to limit the application of an exclusion to a certain group of individuals, they did so.” [20]

The Supreme Court then rejected the policyholder’s argument that the relevant exclusions were ambiguous in the absence of limiting language. [21] It also held that the policyholder’s preferred interpretation would require adding nonexistent limiting language in violation of bedrock principles of contract interpretation. [22]

The Supreme Court also disagreed with the policyholder’s argument that a reference to “occupational diseases sustained by any employee of the assured” in the body of one of the relevant policies limited the scope of the occupational disease exclusion in that policy, which was found in an endorsement. [23] The Supreme Court held that this reference did not constitute a generally applicable definition of “occupational disease” and so was irrelevant to interpreting the scope of the exclusion found in an endorsement. [24]

Finally, the Supreme Court addressed the policyholder’s argument that interpreting the occupational disease exclusion without an own-employees limitation would render the relevant policies’ liability coverage meaningless. [25] The Supreme Court found this argument “tempting” but ultimately held that the facts in the record undercut its applicability to the case at bar. [26] In Vanderbilt, the parties had stipulated below that the underlying claims were all brought entirely by claimants who were not the policyholder’s own employees, and those claims could be classified into three categories: claims arising from workplace exposure, claims arising from both workplace and nonworkplace exposure, and entirely nonworkplace exposure claims. [27] The Supreme Court held that its interpretation of the occupational disease exclusion did not render the relevant policies’ liability coverage meaningless in these circumstances, since that interpretation did not affect coverage for claims in the second and third category. [28] Moreover, the Supreme Court noted that even a significant exclusion limiting available coverage does not mean that the insured did not get the coverage for which it bargained or that the “insurance policies are rendered meaningless by virtue of the denial of coverage.” [29]

In light of all these reasons, the Supreme Court concluded that the occupational disease exclusion was clear and unambiguous, and it applies to occupational disease claims brought by both a policyholder’s own employees and other individuals who contract occupational disease in the course of work for other employers. [30]

Notably, in explaining the import of is decision, the Supreme Court did acknowledge that although a “disease might well have been contracted during [the underlying claimant’s] employment, that fact does not, without more, render it occupational in nature.” [31] Although the Supreme Court did not describe in detail what was needed to render a disease “occupational in nature,” it did suggest that the relevant employment had to be in “an industry that had peculiar incidence of diseases occasioned by exposure to [whatever the underlying claimant was allegedly exposed to].” [32]


Policyholders facing third-party long-tail liabilities whose general liability policies may be governed by Connecticut law should take heart that Connecticut has now joined those jurisdictions applying the continuous trigger theory and the unavailability-of-coverage rule. The Supreme Court’s Vanderbilt opinion also brings Connecticut into the majority of jurisdictions that properly interpret the qualified pollution exclusion as having no application outside the realm of traditional environmental pollution.

However, policyholders also should carefully review their policies for any “occupational disease” exclusionary language, particularly if those policies may be governed by Connecticut law. Policyholders that are uncertain as to whether Connecticut law may apply to the interpretation of their policies may wish to seek advice from coverage counsel regarding the applicable choice of law and the potential implications of Vanderbilt to their general liability insurance program. While a general “occupational disease” exclusion of the kind at issue in Vanderbilt may not be widely found in general liability policies, Vanderbilt may embolden insurers nationally whose policies contain similar provisions to attempt to raise new coverage defenses to escape their coverage obligations for toxic tort claims. Policyholders should carefully evaluate any attempts by their insurers to raise previously unasserted “occupational disease” exclusions.

New Jersey Court Adopts Continuous Trigger for Construction Defect Claims

Tred Eyerly | Insurance Law Hawaii | November 15, 2017

    The New Jersey Superior Court, Appellate Division, adopted the continuous trigger for establishing which insurers were on the risk for construction defect claims. Air Master & Cooling, Inc. v. Selective Ins. Co. of Am., 2017 N.J. Super. LEXIS 144 (N.J. Super. Ct., App. Div. Oct. 10, 2017).

The insured, Air Master, worked as a subcontractor on the construction of a condominium building. Air Master performed HVAC work in the building between November 2005 and April 2008. Air Master’s work consisted of installing condenser units on rails on the building’s roof, and also HVAC devices within each individual unit.

Starting in early 2008, some of the unit owners began to notice water infiltration and damage in their windows, ceilings, and other portions of their units. On April 29, 2010, an expert consultant, Jersey Infrared Consultants, performed a moisture survey of the roof for water damage. A report identified 111 spots on the roof damaged by moisture from water infiltration. The report noted it was impossible to determine when moisture infiltration occurred. The expert recommended that these damaged areas of the roof be removed and replaced.

Two unit owners and the condominium association each sued the developer and other defendants for property damage and remediation costs. The three lawsuits were consolidated. Third-party complaints were filed against Air Master and other subcontractors. Air Master sought defense and indemnity from its various insurers who had issued a succession of CGL policies. Air Master was insured by Penn National for the policy period form June 22, 2004 through June 22, 2009. Selective Insurance Company of America insured Air Master from June 22, 2009 through June 22, 2012.

Penn National defended the third party complaint, but Selective disclaimed coverage. Selective argued that the property damage had already manifested before its policy period began.

Air Master sued Selective for declaratory judgment. Selective moved for summary judgment. The motion judge decided on reconsideration that the continuous trigger doctrine applied. But the court ruled that Selective was not liable for coverage or a duty to defend because damage to the building had manifested before Selective’s policy period began in June 2009. The judge rejected Air Master’s argument that the CGL coverage period continued until damages attributable to the insured were discovered, or reasonably could have been discovered.

On appeal, the appellate division noted that no reported decisions in the state addressed the appropriate manner for identifying the date of manifestation of property damage that progressively advanced within a multi-unit building for purposes of third-party liability claims under a CGL policy.

The court held that a continuous trigger theory of CGL coverage applied to claims for third-party, progressive property damage in construction defect cases. The progressively-worsening nature of a variety of construction defects, such as water infiltration or mold, supported the application of the continuous trigger doctrine.

The court, however, rejected Air Master’s theory that the end date for a continuous trigger should be delayed until it first appeared, or reasonably could be known, that the damage was attributable to the conduct of the specific insured. It would be unwise to delay the coverage trigger date to a date by which there was sufficient information to link an insured’s faulty conduct to the progressive injury. Such an attribution analysis could be highly fact-dependent, and difficult to resolve when an insured made a request for defense and indemnification after being sued. By contrast, using a date of initial manifestation that was common to all parties – regardless of which contractor or subcontractor was “at fault” for the occurrence – promoted efficiency and certainty.

Finally, on the limited record presented, the court could not determine when the property damage due to water infiltration in the building had sufficiently manifested to comprise the “last pull” of the coverage trigger. Air Master urged that the May 2010 report provided an appropriate demarcation of the time of manifestation. By contrast, Selective argued that the point of manifestation happened much earlier when residents had first noticed and reported water infiltration in their units, prompting remedial investigations. There were genuine issues of material fact concerning when the water infiltration problems on the roof first became known, or reasonably could have been know.

Therefore, summary judgment in favor of Selective was vacated and the case remanded for further proceedings.

NJ Courts Continue Expansion of Insurance Coverage for Construction Defects: “Continuous Trigger” Doctrine Applied

Adam J. Sklar | Property Insurance Coverage Law Blog | October 25, 2017

New Jersey courts are continuing their trend of extending insurance coverage for third-party construction defect claims. Following last year’s NJ Supreme Court decision in Cypress Point Condo. Ass’n, Inc. v. Adria Towers, LLC, 226 N.J. 403 (2016), which broadly interpreted the standard CGL policy to extend an insured developer’s coverage to include claims of damage caused by the work of subcontractors, the New Jersey Appellate Division recently issued a published decision approving a trial court’s use (though not its application) of the “continuous trigger” theory of insurance coverage to third-party construction defect claims, thereby, potentially extending coverage in such cases over multiple policy years.

In Air Master & Cooling, Inc. v. Selective Insurance Co., A-5415-15T3 (N.J. App. Div. October 10, 2017), the Appellate Division reviewed a trial court’s decision in a declaratory judgment action filed by a subcontractor against two of its insurers. Those insurers had declined coverage and refused to defend the subcontractor in a construction defect litigation filed by the condominium association (the “Association”), on whose 101-unit building the subcontractor had performed certain HVAC work on the roof and in each individual unit. The Association and certain unit owners claimed damage due to progressive water infiltration, which they attributed to defective workmanship, and the subcontractor was joined in the litigation as a third-party defendant.

The subcontractor had performed work at the building from November 2005 through April 2008. In early 2008, unit owners began to notice water infiltration into their units and resulting damage. A newspaper article published 2010 detailed the 2008 discovery of leaks by the unit owners. In May 2010, the Association’s consultant issued a report identifying certain areas of the roof in need of replacement though noting it could not determine when the infiltration had occurred.

The subcontractor had three insurers from 2005 through 2015. The insurer for the period November 2005 through June 2009, agreed to defend the subcontractor under a reservation of rights, as it was the insurer during the period the work was performed and at the time the first water infiltration was alleged to have been discovered. The next insurer, Selective Insurance, provided coverage from June 2009 through June 2012, and disclaimed coverage, on the basis that the property damage was alleged to have manifested before the policy periods had begun. The third insurer, with coverage from June 2012 through June 2015, also disclaimed coverage, and was dismissed from the subcontractor’s declaratory judgment case, without appeal, on the basis that its 2012 coverage commenced long after any leaks had started and any resulting damage manifested.

After some discovery was conducted, Selective moved for summary judgment, which was granted by the trial court. The trial court applied the continuous trigger doctrine of insurance coverage in analyzing whether Selective owed the subcontractor a duty to defend the construction defect claim. It determined conclusively, however, that the damage to the building had manifested itself before Selective’s June 2009 coverage began.

On appeal, the Appellate Division, while agreeing that the continuous trigger doctrine was applicable in the construction defect context, disagreed with the ultimate determination – or at least found that the record was not sufficiently developed to make that determination. The appellate court, therefore, reversed the judgment in favor of Selective and remanded the case back to the trial court with guidance on the application of the continuous trigger doctrine in the construction defect coverage context.

The continuous trigger effectively grants continuous coverage to an insured in connection with a third-party damage claim from the date of the initial exposure to the harm through the date of the manifestation of the injury resulting from the harm. The appeals court rejected the subcontractor’s attempt to extend the doctrine even further to extend to the date of “attribution” – that is, when the particular damage could be attributed to a particular insured. Doing so would be akin to transforming policy to claims made policy from occurrence-based, and likely escalate premiums or deter policies from being written. Instead, the court determined that the endpoint of the coverage, or manifestation (or “last pull of the trigger”), should be the date when the harm has sufficiently become apparent or manifests itself to trigger a covered occurrence.

The Appellate Division, guided by the precedential first-party coverage case, Winding Hills Condo Ass’n v. North American Specialty Ins. Co., 332 N.J. Super. 85 (App. Div. 2000), held that the manifestation occurs at that time of the “essential” manifestation of the injury, and not necessarily at the initial discovery of the injury. The essential manifestation is “the revelation of the inherent nature and scope of that injury.” In examining whether the May 2010 report (during Selective’s policy period) or 2008 unit owner observations of water infiltration (before Selective’s policy period) should be used as the manifestation or end date of coverage, the court found the record too sparse to make that determination. There were no depositions, or other evidence, revealing who knew what and when about these construction defects, and the court refused to rely on hearsay statements of the unit owners in the newspaper article.

Accordingly, the court remanded the case back to the trial court for a determination of what information about the building defects at issue were or reasonably could have been revealed between the time of the unit owner complaints and the start of Selective policy in June 2009. The appeals court also noted that the matter was further complicated by the fact that the water infiltration associated with the roof was not discovered until the May 2010 expert report, while the newspaper article does not mention the roof. Thus, there were genuine issues of material fact as to, among other issues, when water infiltration problems on the roof first became known or reasonably could have been known.

The Air Master decision continues a trend in New Jersey jurisprudence of expanding, within reason, CGL coverage to insureds. In particular, in construction defect cases, the courts have recently liberally interpreted policies and legal theories to afford more coverage to insureds. Where construction defects cause progressive property damage, as in the common case of water infiltration, Air Master will help to guide insurers, insureds and their respective counsel in analyzing whether, based on the facts alleged by a third-party, coverage is available for particular policy years. It is also likely to spawn additional discovery and expense in the underlying construction defect cases specific to those issues.

New Jersey’s Manifestation Destiny: Appellate Division Applies Continuous Trigger to Claims for Progressive Third-Party Property Damage and Highlights Fact-Sensitive Nature of Manifestation Date

Frederick J. Giordano | K&L Gates | November 3, 2017

The New Jersey Appellate Division (the “Appellate Division”) recently issued a ruling in Air Master & Cooling Inc., v. Selective Insurance Co. of America (“Air Master”) [1] applying the “continuous trigger” theory to third-party construction defect liability claims in which property damage progressively advances. The court also held that the “last pull” for purposes of determining the endpoint of coverage occurs when “the essential nature and scope of the property damage first becomes known, or when one would have sufficient reason to know of it,” [2] which is a fact-sensitive inquiry. [3] In doing so, the court declined to adopt the rule that “the last pull of the trigger does not occur until there is some expert or other proof that ‘attributes’ the property damage to faulty conduct by the insured.” [4]

Air Master involved property damage from progressive water infiltration in a multi-unit condominium in Montclair, New Jersey. [5] Air Master & Cooling Inc. (“AMC”), an HVAC subcontractor, was named as a third-party defendant in the construction defect claim [6] ; Plaintiff alleged construction defects caused by the faulty workmanship of AMC and other contractors resulting in property damage. AMC sought defense and indemnity from Selective Insurance Company of America (“Selective”), one of several insurers that had issued commercial general liability policies to AMC over successive policy periods. [7] Selective’s policy provided coverage for damage during the policy period of June 22, 2009 through June 22, 2012. [8]

According to a November 4, 2010 news article, some residents began noticing damage as early as 2008. [9] A subsequent comprehensive moisture survey was performed on April 29, 2010, which revealed identified moisture damage on the roof and linked the damage to water infiltration. [11] Selective disclaimed coverage, asserting that it was not responsible for damage that manifested before the beginning of the policy period in 2009. The trial court applied the continuous trigger but agreed with Selective that the property damage manifested before its policy incepted and granted summary judgment in favor of Selective. AMC appealed the ruling. [12]

AMC argued on appeal that “continuous trigger principles should govern third-party liability coverage analysis in construction defect cases that involve progressive property damage.” [13] Further, AMC argued that continuous trigger principles “extend coverage to all insurance policies in effect from the time of the insured’s work on the construction project through the time by which it was known, or there was sufficient reason to know, that the manifested property damage was attributable to the insured’s work.” [14] Accordingly, AMC argued the manifestation date occurred when the 2010 expert study was issued, attributing the property damage to AMC’s work. [15]

Selective argued that property damage to the building had already manifested before its policy period commenced. It urged the court to find that the point of manifestation was in 2008, when certain residents reported water infiltration that prompted remedial investigations. [16]

The court first considered whether it should apply the continuous trigger theory, commonly applied in insurance claims that arise from the installation of asbestos-related products. [17] The doctrine holds “all the insurers over that period [from the date of exposure to manifestation are] liable for the continuous development of the [harm].” [18] The result of the theory is that coverage aggregates from the date of first exposure until the “manifestation date” [19] subject to insurance coverage having been available to the policyholder [20] and potential allocation or apportionment between carriers. [21] In holding that the “continuous trigger” theory should apply, the court noted that since the decision in Owens-Illinois, an asbestos-related bodily injury and property damage coverage case, [22] case law has extended the continuous trigger theory “beyond the asbestos context to other progressive forms of third-party injuries,” [23] including a Supreme Court case that “implicitly approved the use of continuous trigger in a construction defect context.” [24] The court further noted that public policy favors applying a continuous trigger approach because many construction defects are not immediately obvious. [25]

The court also considered when “the ‘last pull’ of that trigger for purposes of ascertaining the temporal end point of a covered occurrence happens . . . .” [26] In establishing the “end point” or “last pull” of coverage under a “continuous trigger” theory, the court rejected AMC’s “‘novel’ argument that the end date should be delayed until it first appears that the damage is ‘attributable’ to the conduct of the specified insured.” [27] Moreover, the court stated it was “unwise” because of the difficulty in applying the doctrine in practice due to its fact-dependent nature in requiring a “defendant-specific determination of when each defendant reasonably could have been deemed to be at fault in contributing to the progressive harm.” [28] Thus, the court rejected AMC’s argument and opted to use a “date of initial manifestation that is common to all parties.” [29]

Finally, the Appellate Division addressed the task of identifying the appropriate “last pull” date. [30] The court held the “last pull” occurred when “the essential nature and scope of the property damage first becomes known, or when one would have sufficient reason to know of it.” [31] The court defined “essential” as connoting “the revelation of the inherent scope of [the] injury.” [32] The court determined that neither the 2010 news article nor the 2010 expert report was dispositive of the manifestation question. [33] Because of the “sparse record” and lack of evidence regarding “persons who have knowledge of what information was known at what times about the building’s construction defects,” the court remanded the case for further proceedings. [34]

In Air Master, the Appellate Division has provided significant guidance to insureds with policies governed by New Jersey law by formally extending the continuous trigger doctrine to claims involving progressive property damage, particularly construction defect claims. Moreover, although the court rejected an analysis determining when the damage became “attributable” to a particular insured, it affirmed the test regarding the “last pull” date common to all parties as a fact-sensitive inquiry into when the essential nature and scope of the property damage becomes known.

[1] __ N.J. Super ___, Docket No. A-5415-15T3, 2017 WL 4507547 at * 1 (Oct. 10, 2017).

[2] Id.

[3] Id. at * 10.

[4] Id. at * 10.

[5] Id. at 1–2.

[6] Id.

[7] Id. at 2.

[8] Id.

[9] Id.

[10] Id.

[11] Id.

[12] Id. at 3.

[13] Id.

[14] Id.

[15] Id.

[16] Id. at 1.

[17] Id. at 3.

[18] Id. at 4.

[19] Point in time when an injury or disease first presents or manifests itself.

[20] Under Owens-Illinois, Inc. v. United Insurance Co., 138 N.J. 437 (1994), once insurance for the risk at issue was no longer reasonably available, the end date of the coverage block is the date when coverage became unavailable.

[21] Air Master, 2017 WL 4507547 at * 5.

[22] Owens-Illinois, 138 454–56.

[23] Air Master, 2017 WL 4507547 at * 5.

[24] Id. at 6 (citing Potomac Ins. Co. v. PMA Ins. Co., 215 N.J. 409, 422 (2013)).

[25] Id. at 6.

[26] Id. at 1.

[27] Id.

[28] Id.

[29] Id.

[30] Id. at 8.

[31] Id. at 1.

[32] Id. at 9.

[33] Id. at 10.

[34] Id.