{"id":899331,"date":"2021-11-11T10:38:53","date_gmt":"2021-11-11T17:38:53","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=899331"},"modified":"2021-11-11T10:39:08","modified_gmt":"2021-11-11T17:39:08","slug":"plead-allegations-trigger-liability","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/plead-allegations-trigger-liability\/","title":{"rendered":"How You Plead Allegations to Trigger Liability Insurer&#8217;s Duties is Critical"},"content":{"rendered":"\n<p>David Adelstein | <a href=\"https:\/\/www.floridaconstructionlegalupdates.com\/how-you-plead-allegations-to-trigger-liability-insurers-duties-is-critical\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Florida Construction Legal Updates<\/a><\/p>\n\n\n\n<p><br><strong>How you <a href=\"https:\/\/www.myconstructionexpert.com\/blog\/faulty-construction-continued-defense\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">plead allegations<\/a> in your lawsuit to trigger duties of a liability insurance carrier is a critical consideration<\/strong>. \u00a0If the complaint is not pled appropriately, it can result in the carrier NOT owing a duty to defend its insured, which is the party(ies) you are suing.\u00a0<strong>If there is no duty to defend, there will be no duty to indemnify the insured to cover your damages.<\/strong>\u00a0\u00a0For this reason, in a number of circumstances, this is NOT what you want because you want to trigger insurance coverage and potential proceeds to be paid by a carrier to cover your damages. There are times when you are confronted with a case that just is not a good insurance coverage case. \u00a0This may result in you coming up with creative arguments to maximize insurance coverage. \u00a0Even in these times, you want to plead the complaint to best maximize coverage under the creative arguments you have developed.<\/p>\n\n\n\n<p>An example of not pleading allegations in a complaint to trigger an insurer\u2019s duties can be found in the Eleventh Circuit Court of Appeal\u2019s decision in&nbsp;<em>Tricon Development of Brevard, Inc. v. Nautilus Insurance Co<\/em>., 2021 WL 4129373 (11<sup>th<\/sup>&nbsp;Cir. 2021).&nbsp; &nbsp;This case involved a general contractor constructing condominiums.&nbsp; The general contractor hired a subcontractor to fabricate and install metal railings.&nbsp; The subcontractor had a commercial general liability (CGL) policy that named the general contractor as an&nbsp;<strong>additional insured<\/strong>&nbsp;with respect to liability for property damage \u201ccaused in whole or in part\u201d by the subcontractor\u2019s direct or vicarious acts or omissions.&nbsp; (This is a good additional insured endorsement.)<\/p>\n\n\n\n<p>A dispute arose as to defective work by the subcontractor in fabricating and installing the railings.&nbsp; The general contractor, therefore, engaged another subcontractor to fabricate new railings and remove the current railing to install the new ones. The general contractor submitted a claim to its original railing subcontractor\u2019s insurer.&nbsp; The insurer denied the claim and the general contractor filed a coverage action against the insurer as an additional insured under the CGL policy.<\/p>\n\n\n\n<p>The problem, however, is that the general contractor\u2019s complaint did not appear to truly consider insurance coverage, although it appeared to be a case where insurance coverage was not a great option.&nbsp; &nbsp;The Eleventh Circuit explained there was no coverage based on the allegations in the complaint:<\/p>\n\n\n\n<p><strong>Here, [the general contractor] alleges that the subcontractor\u2019s railings were deficient due to having defects and damage, not being installed properly, and not satisfying the project\u2019s specifications;&nbsp;<u>it does not allege that the subcontractor\u2019s faulty workmanship damaged otherwise non-defective components of the project\u2026<\/u>. Thus, the costs that [the general contractor] incurred in removing the subcontractor\u2019s railings and the fabrication and installation of new railings do not constitute \u201cproperty damage\u201d under the policies\u2026.<\/strong><\/p>\n\n\n\n<p><em>Tricon Development of Brevard<\/em>&nbsp;at *2.<\/p>\n\n\n\n<p>This is obviously not what the general contractor wanted and had it pled allegations differently, the outcome may have turned out different. &nbsp;Although, the general contractor may have been faced with trying to come up with a creative argument recognizing it was not a great insurance coverage action.<\/p>\n\n\n\n<p>Nonetheless, the Eleventh Circuit, finding there was no insurance coverage, includes a worthy paragraph when it comes to property damage in a construction defect\/damage dispute so that parties recognize CGL policies do not cover defective workmanship. Take note of this discussion so that you can ensure allegations are pled to best maximize coverage:<\/p>\n\n\n\n<p><strong>The policies at issue in this appeal are post-1986 standard form commercial general liability policies with products-completed operations hazard coverage, which are governed by Florida law. We have held that such policies do not cover the costs of replacing defective products. In&nbsp;<em>Amerisure Mutual Insurance Company v. Auchter Company<\/em>, we examined a post-1986 standard form commercial general liability policy with products-completed operations hazard coverage. That policy \u201cdefine[d] \u2018property damage\u2019 as \u2018physical injury to tangible property, including all resulting loss of use of that property \u2026 or \u2026 loss of use of tangible property that is not physically injured.\u2019 \u201d&nbsp;673 F.3d 1294, 1298 (11th Cir. 2012)&nbsp;(cleaned up).&nbsp;<u>Applying Florida law, we held that \u201cthere is no coverage if there is no damage beyond the faulty workmanship, i.e., unless the faulty workmanship has damaged some otherwise nondefective component of the project<\/u>.\u201d&nbsp;<em>Id.<\/em>&nbsp;at 1306&nbsp;(citing&nbsp;<em>U.S. Fire Ins. Co. v. J.S.U.B., Inc.<\/em>, 979 So.2d 871, 889 (Fla. 2007)).&nbsp;<u>We also held that \u201cif a subcontractor is hired to install a project component and, by virtue of his faulty workmanship, installs a defective component, then the cost to repair and replace the defective component is not \u2018property damage.<\/u>\u2019 \u201d&nbsp;<em>Id.<\/em>&nbsp;(citing&nbsp;<em>Auto-Owners Ins. Co. v. Pozzi Window Co.<\/em>, 984 So.2d 1241, 1248 (Fla. 2008)).&nbsp;<u>We further held that \u201cnondefective and properly installed raw materials can constitute a defective project component when the contract specifications call for the use of different materials, yet the cost to reinstall the correct materials is not \u2018property damage\u2019\u2014even though the remedy for such a nonconformity is to remove and replace that component of the project<\/u>.\u201d&nbsp;<em>Id.<\/em>&nbsp;(citing&nbsp;<em>Pozzi<\/em>, 984 So.2d at 1248).<\/strong><\/p>\n\n\n\n<p><em>Tricon Development of Brevard<\/em>&nbsp;at *2.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>David Adelstein | Florida Construction Legal Updates How you plead allegations in your lawsuit to trigger duties of a liability insurance carrier is a critical consideration. \u00a0If the complaint is not pled appropriately, it can result in the carrier NOT owing a duty to defend its insured, which is the party(ies) you are suing.\u00a0If there&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/plead-allegations-trigger-liability\/\">Continue reading <span class=\"screen-reader-text\">How You Plead Allegations to Trigger Liability Insurer&#8217;s Duties is Critical<\/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":[10,9914],"tags":[9895,57,23,11582],"class_list":["post-899331","post","type-post","status-publish","format-standard","hentry","category-duty-to-defend","category-insurance-coverage","tag-advise-consult","tag-duty-to-defend-2","tag-insurance-coverage","tag-plead-allegations","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>How You Plead Allegations to Trigger Liability Insurer&#039;s Duties is Critical - Advise &amp; 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