Insurance

For more than a year, BILD has been involved in a case currently before the California Court of Appeal that promises to determine whether or not insurance coverage for construction defect claims continues to exist.  The case is Navigators Specialty Insurance Company v. Moorefield Construction, Inc.  BILD has appeared in the case as a friend of the court, filing its brief in September 2015.  BILD’s outside counsel, Gerard Mooney with Rutan & Tucker, LLP, obtained an Order from the Court of Appeal to participate in oral argument and will be making BILD’s case before the Court on October 19, 2016.

The case revolves around a commercial construction defect action wherein the floor tiles of a retail store were installed by Moorefield and are now claimed to be defective as a result of an adhesive failure.  Moorefield tendered the matter to its insurer, Navigators, under its comprehensive general liability policy, seeking coverage for the retailer’s defect claims.  Navigators argued before the trial court that Moorefield’s installation of the flooring titles over a concrete slab with elevated moisture vapor levels was an intentional act, rather than an “accident” as a required by the policy, such that the policy did not cover the matter. The trial court agreed with Navigators – leaving Moorefield with no insurance coverage. 

BILD believes that the trial court erred in siding with Navigators and that to rule in any way other than to affirm Moorefield’s coverage under its policy would potentially negate coverage for construction defects under CGL policies.  Specifically, BILD’s brief contends that contractors do not intend to do their work defectively, and that any reasonable interpretation of the term “accident” should cover a contractor’s allegedly defective work, particularly given nearly all construction work is done with knowledge of a potential risk of product failure. 

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