{"id":2183,"date":"2013-10-09T06:44:27","date_gmt":"2013-10-09T12:44:27","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=2183"},"modified":"2013-10-07T16:44:47","modified_gmt":"2013-10-07T22:44:47","slug":"new-insurance-case-s-c-supreme-court-defective-construction-work-satisfies-caused-by-an-occurrence-requirement-in-cgl-policy","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/new-insurance-case-s-c-supreme-court-defective-construction-work-satisfies-caused-by-an-occurrence-requirement-in-cgl-policy\/","title":{"rendered":"New Insurance Case \u2013 S.C. Supreme Court: Defective Construction Work Satisfies \u201cCaused by an Occurrence\u201d Requirement in CGL Policy"},"content":{"rendered":"<p>Scott Turner &#8211; September 28, 2013<\/p>\n<p>On Monday, Sept. 25th , the Supreme Court of South Carolina issued its decision in Auto-Owners Ins. Co. v. Rhodes, &#8212; S.E.2d &#8212;-, 2013 WL 5348381 (2013). It held that the \u201coccurrence\u201d of a collapse of the policyholder\u2019s construction work in one location satisfies the causation part of the CGL policy\u2019s \u201ccaused by an \u2018occurrence\u2019\u201d requirement as to the significant consequential damages flowing from the resulting need to remove similar work in two other locations. A \u201cbut for\u201d test was applied for this causation requirement.<\/p>\n<p>Rhodes owns and leases outdoor advertising space in various locations. He contracted with contracted with the policyholder, Eadon, to erect three advertising signs on property owned by Rhodes that bordered Interstate 77. Rhodes obtained the requisite permits from the South Carolina Department of Transportation (\u201cSCDO\u201d) to erect the three signs.<\/p>\n<p>After completion, one sign was discovered to be leaning toward I\u201377. Shortly thereafter, one of the other signs fell across I\u201377. Based on its investigation, SCDOT ordered Rhodes to remove the remaining two signs and revoked Rhodes\u2019 permits to maintain signs on the property..<\/p>\n<p>Rhodes filed a tort action against Eadon, alleging damages to the real estate owned by Rhodes and lost income due to the negligent erection of the signs, which led to the removal of the three signs and the revocation of the SCDOT permits. A jury returned a verdict for Rhodes in the amount of $6.5 million. Eadon appealed this verdict.<\/p>\n<p>Meanwhile, Eadon\u2019s insurer, Auto\u2013Owners, issued a reservation of rights and brought a declaratory judgment action. While Eadon\u2019s appeal was pending, the judge in the DJ action found that Auto\u2013Owners was obligated to indemnify Eadon for the judgment rendered in the tort action. In so ruling, the judge found \u201cthe loss of use of the remaining two signs and the consequential damages flowing therefrom was causally linked to the sign that fell and constituted property damage caused by an occurrence.\u201d<\/p>\n<p>Then, the Court of Appeals reversed the verdict in the tort action and ordered a completely new trial.<\/p>\n<p>Based on this development, Auto\u2013Owners moved to have the DJ order declared null and void based on the judge\u2019s reliance on the evidence and testimony in the now-vacated tort action. The judge granted Auto\u2013Owners\u2019 motion in part, striking only the portion of the order referencing the money damages awarded by the jury. The other portions of the order remained in full force and effect. Auto\u2013Owners appealed this ruling, ultimately to the Supreme Court.<\/p>\n<p>The Supreme Court addressed the \u201ccaused by an \u2018occurrence\u2019\u201d requirement. It noted that the parties agreed as to the falling sign being an \u201coccurrence\u201d. The issue before the court, then, was not the \u201coccurrence\u201d issue itself but whether \u201cthe loss of the remaining two signs and the consequential damages flowing therefrom [was] causally linked to the sign that fell and, thus, . . . caused by an occurrence under the policy.\u201d That is, the issue was whether the damages related to the other two signs was \u201ccaused by\u201d the occurrence of the first sign falling. As the court notes, \u201cunlike the \u2018normal\u2019 defective construction case where damage from faulty workmanship is obvious and directly related, the mandated removal of the two additional signs in the instant case is more tangential.\u201d Nevertheless, the court held that the falling of the first sign satisfied the \u201ccaused by an \u2018occurrence\u2019\u201d requirement for the damages flowing from other two signs. In reaching this result, the court applied a \u201cbut for\u201d test of causation.<\/p>\n<p>via <a href=\"http:\/\/www.linkedin.com\/groupItem?view=&amp;srchtype=discussedNews&amp;gid=1808294&amp;item=277108443&amp;type=member&amp;trk=eml-anet_dig-b-pop_ttl-hdp&amp;fromEmail=&amp;ut=3TeG9I8m-mbBY1\">New Insurance Case \u2013 S.C. Supreme Court: Defective Construction Work Satisfies \u201cCaused by an Occurrence\u201d Requirement in CGL Policy | LinkedIn<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Scott Turner &#8211; September 28, 2013 On Monday, Sept. 25th , the Supreme Court of South Carolina issued its decision in Auto-Owners Ins. Co. v. Rhodes, &#8212; S.E.2d &#8212;-, 2013 WL 5348381 (2013). It held that the \u201coccurrence\u201d of a collapse of the policyholder\u2019s construction work in one location satisfies the causation part of the&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/new-insurance-case-s-c-supreme-court-defective-construction-work-satisfies-caused-by-an-occurrence-requirement-in-cgl-policy\/\">Continue reading <span class=\"screen-reader-text\">New Insurance Case \u2013 S.C. Supreme Court: Defective Construction Work Satisfies \u201cCaused by an Occurrence\u201d Requirement in CGL Policy<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[4,30,3],"tags":[309,392,440,11],"class_list":["post-2183","post","type-post","status-publish","format-standard","hentry","category-construction-defects","category-general-liability-policy","category-insurance-claims","tag-occurrence","tag-cgl-policy","tag-defective-construction-work","tag-insurance-claim","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>New Insurance Case \u2013 S.C. 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It held that the \u201coccurrence\u201d of a collapse of the policyholder\u2019s construction work in one location satisfies the causation part of the&hellip; Continue reading New Insurance Case \u2013 S.C. Supreme Court: Defective Construction Work Satisfies \u201cCaused by an Occurrence\u201d Requirement in CGL Policy","og_url":"https:\/\/www.myconstructionexpert.com\/blog\/new-insurance-case-s-c-supreme-court-defective-construction-work-satisfies-caused-by-an-occurrence-requirement-in-cgl-policy\/","og_site_name":"Advise &amp; Consult, Inc.","article_publisher":"https:\/\/www.facebook.com\/Advise-Consult-Inc-126949043996790\/","article_published_time":"2013-10-09T12:44:27+00:00","author":"admin","twitter_card":"summary_large_image","twitter_creator":"@adviseconsult","twitter_site":"@adviseconsult","twitter_misc":{"Written by":"admin","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.myconstructionexpert.com\/blog\/new-insurance-case-s-c-supreme-court-defective-construction-work-satisfies-caused-by-an-occurrence-requirement-in-cgl-policy\/#article","isPartOf":{"@id":"https:\/\/www.myconstructionexpert.com\/blog\/new-insurance-case-s-c-supreme-court-defective-construction-work-satisfies-caused-by-an-occurrence-requirement-in-cgl-policy\/"},"author":{"name":"admin","@id":"https:\/\/www.myconstructionexpert.com\/blog\/#\/schema\/person\/0a11abe008083d5fb19c2b0feefe7bd7"},"headline":"New Insurance Case \u2013 S.C. 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