With little time to absorb the obvious ramifications of Lennar, the Texas Supreme Court has again ruled in favor of the insured in Ewing Constr. Co. v. Amerisure Ins. Co., 2014 Tex. LEXIS 39 (Tex. 2014). In another recent case extending coverage to insureds which are found liable for construction defects, the Texas Supreme Court held in January 2014 that a contractor which entered into a contract to construct a building in a “good and workmanlike manner” did not assume any liability as required for the contractual liability exclusion to apply. Ewing Construction built tennis courts for its client Tuluso-Midway Independent School District (“TMISD”), however, after the courts were complete, they began to show numerous defects. TMISD filed suit against Ewing, and claimed damages based upon faulty construction of the courts. TMISD’s theories of liability were breach of contract and negligence. Ewing tendered its suit to its commercial general liability carrier, Amerisure Insurance Company; which denied coverage. Ewing claimed that coverage was not available for the suit based upon the contractual liability exclusion. This exclusion … Continue reading
In Johnson v. PPI Technology Services, LP., et al., 2013 WL 6665996 (E.D. La 2013), Plaintiffs alleged that they received various injuries when gunmen attacked the High Island VII, an oil rig platform off the coast of Nigeria, on which both Plaintiffs were working. They sued their employer, PPI, which sought coverage under its insurance policy with ISOP. ISOP denied coverage based upon several exclusions, including the terrorism exclusion. The parties agreed that Texas law governed the interpretation of the exclusions contained in the insurance policy. The court held that the policy provisions regarding terrorism were clear. The policy’s definition of terrorism was divided into three relevant elements: (1) use of violence; (2) that is undertaken by a person or group of persons; (3) that has the effect of intimidating a segment of the population or disrupting a segment of the economy. It was undisputed that the first two elements were met; however, it was unclear whether the gunmen’s actions had the effect of intimidating a segment of the population and/or disrupting a segment of … Continue reading
On December 18, 2013, in the majority opinion of Philadelphia Indemnity Insurance Company v. White, the San Antonio Court of Appeals ruled the catch-all provision — “due to . . . any other cause not due to our negligence or fault” — contained in paragraph 12 of a Texas Apartment Association lease is void. The court concluded that paragraph 12’s broad imposition of liability on a tenant for damage not caused by the landlord is void because it violates public policy as expressed in the Texas Property Code. The dissent by Justice Barnard asserted that the public policy preservation of contractual freedom trumps White’s claim.