Insurer has Duty to Defend When Complaint Includes Allegations of Resulting Damages

In 2012 the Archdiocese of New York purchased a roof membrane system from Siplast for a New York high school. Siplast guaranteed the system for a period of 20 years or the company would replace the roof at its own expense. Four years later, the school noticed water damage. A Siplast contractor attempted a repair, but the leaks continued. Siplast declined to honor its guarantee. The Archdiocese plus Underlying Plaintiffs filed suit against Siplast and the installing contractor. Siplast submitted a claim to its insurer Employers Mutual Casualty Company (EMCC) for coverage under its general liability policy. EMCC declined coverage citing the “Your Product/Your Work Exclusion.” The district court granted EMCC’s motion for summary judgment, and Siplast appealed. 

In the Fifth Circuit Court of Appeals opinion, we find a good discussion of the different facts that give rise to a duty to defend where RESULTING damages occur and are alleged. The Court determined that EMCC had a duty to defend Siplast where the allegations in the Complaint included claims for/allegations of resulting damages (damages to other portions of the structure caused by/resulting from the faulty roof membrane). Texas and MS law are almost identical where it comes to these issues. Read the full case here.

The attorneys at Webb Sanders & Williams have experience resolving insurance disputes for both the insurer and their insured. If you need assistance regarding an insurance case, contact our office at 662-844-2137or by fax at 662-842-3863.