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Vol. 9 - Issue 1
January 8, 2020

Utah: A Very Tough State For Insureds For Construction Defect Coverage
The lack of coverage, for the cost to repair or replace an insured’s defective workmanship, is typical around the country (the reasons why vary).  A few states go a step further and preclude coverage for that which just about every state provides – damages to other property, i.e., consequential damages, caused by the insured’s defective workmanship.  Utah is one of these states that does not afford coverage for consequential damages.  This was on display in Cincinnati Specialty Underwriters Ins. Co. v. Green Property Solutions, No. 19-10 (D. Utah Dec. 23, 2019): “According to the Underlying Complaint, the damage to the roof was a direct product of Green Property’s own alleged construction defects. While blowing insulation into the attics of the condominiums, Green Property allegedly performed negligently by blocking the ventilation ports in the attics.  The subsequent moisture buildup and water damage was a natural and probable result of the lack of ventilation caused directly by Green Property’s allegedly defective work. Thus, the property damage alleged in the Underlying Complaint was not caused by an ‘occurrence’ and is not covered by the CGL Policy.”

9th Circuit: You Can "Occupy" A Vehicle While Being Outside Of It 
I don't usually do much in CO with UM/UIM cases.  But once in a while a case is pretty interesting.  Here is one  It's definitely Tapas-worthy.  My hunch is that the average person thinks of "occupying" a vehicle as being inside of it.  But, not necessarily, as Nikolaychuk v. Nat'l Cas. Co., No. 18-36013 (9th Cir. Dec. 13, 2019) shows: "Igor Nikolaychuk was installing tire chains on his work vehicle when he was struck and killed by an underinsured driver.  National Casualty Company, the vehicle's insurer, appeals the district court's rulings that (1) Nikolaychuk was 'occupying' the vehicle under the policy when the accident occurred[.] . . . Nikolaychuk was 'occupying' the vehicle.  The policy defines 'occupancy' as 'in, upon, getting in, on, out or off, and Oregon law defines 'occupying' as 'in or upon or entering into or alighting from.' Or. Rev. Stat. § 742.504(2)(f). 'A person is 'upon' the insured car when a part of that person's body is above and rests on a portion of the car.' (citation omitted) So too here.  Hands are body parts; tires form a portion of a car; and one's hands inevitably rest on a tire in the process of attaching chains to it.  That Nikolaychuk was 'upon' the vehicle when he was struck and killed and, therefore, 'occupying' the vehicle under the policy, necessarily follows."  But I still suspect that you'd get a funny look if you asked a person, washing their car, to step out of their car.



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