On Thursday of last week, a federal court in New York City tossed an Order of Civil Authority (OCA) claim by a New York City law firm in Bamundo, Zwal & Schermerhorn, LLP v. Sentinel Ins. Co., 2015 WL 1408873, 2015 U.S. Dist. LEXIS 39409 (S.D.N.Y., Mar. 26, 2016). The policy extended coverage to loss of business income caused by an OCA issued “as the result of a Covered Cause of Loss,” but it excluded flooding from the definition of that term. The insured was a law firm with offices on John Street in lower Manhattan. On October 28, 2012, the Mayor of New York City issued an executive order evacuating all homes and business located in the area. Superstorm…
Monthly Archives: March 2015
Order of Civil Authority Claim for Superstorm Sandy Barred by Flooding Exclusion in New York
Tagged with: Evacuation, New York
Posted in Bad Faith, Flood, Order of Civil Authority, Superstorm Sandy
Posted in Bad Faith, Flood, Order of Civil Authority, Superstorm Sandy
New Jersey Trial Court Holds Storm Surge Not Subject to Flood Sublimit Where Policy Expressly Includes “Ensuing Storm Surge” in Named Windstorm Coverage
In recent years, many courts have held that storm surge is a species of excluded flood loss; we reported on a New York example in July. This week, in Public Serv. Enter. Group, v. ACE Amer. Ins. Co., 2015 WL 1428370, Unpub. LEXIS 620 (N.J.Super., Mar. 23, 2015), a New Jersey trial court granted summary judgment to Public Service Electric & Gas (PSEG) and held that the flood sublimit did not apply to a claim for Superstorm Sandy loss from storm surge where the contracts of insurance specifically recited that coverage for a “named windstorm” – which was not subject to any sublimit – included “ensuing storm surge.” Eight large PSEG generating stations and a number of smaller distribution facilities…
Tagged with: New Jersey, Storm Surge
Posted in Causation, Efficient Proximate Cause, Ensuing Loss, Flood, Superstorm Sandy, Windstorm
Posted in Causation, Efficient Proximate Cause, Ensuing Loss, Flood, Superstorm Sandy, Windstorm
Iowa’s Highest Court: Damage by Rainwater is Damage by Rain
Last July, we posted that an intermediate level appellate court in Iowa had held that a policy excluding loss “caused by rain” did not bar coverage for loss occasioned by the non-excluded peril of “rainwater.” On Friday, the state’s highest court threw cold water on such nonsense, holding that there was no distinction between rain and rainwater for coverage purposes. No justice disagreed, though the court split 4-3 on another issue. The decision can be found at Amish Connection, Inc. v. State Farm Fire & Cas. Co., 2015 WL 1260085, 2015 Iowa Sup. LEXIS 32 (Iowa, Mar. 20, 2015). The insured operated the Amish Connection Store in Crossroads Shopping Mall in Waterloo, Iowa. Rooftop drains discharged into a 4” cast-iron…
Tagged with: Iowa, Rain, Rainwater
Posted in Anti-Concurrent Causation, Corrosion, Ensuing Loss, Flood, Water
Posted in Anti-Concurrent Causation, Corrosion, Ensuing Loss, Flood, Water
California Court Holds Product Contamination Insurance Does Not Cover Ingredients Contaminated by Insured’s Supplier
On February 6th, an intermediate level California appellate court held that a product contamination policy only covered contamination that occurs during or after manufacturing operations by the insured, meaning that there was no coverage where the policyholder’s product was found to be adulterated because it used an ingredient that had been contaminated by a third-party supplier. The decision is Windsor Food Quality Co. v. Underwriters of Lloyds of London, 2015 WL 901867, 2015 Cal. App. LEXIS 195 (Cal.App., Feb. 6, 2015). One of the three panel members filed a lengthy and convincing dissent that is arguably a more correct interpretation of the language at issue. The policyholder was Windsor Food Quality Company, a frozen food manufacturer. Windsor’s ground beef supplier…
Silica Dust Damage Held Barred by Pollution and Faulty Workmanship Exclusions in New York
Building construction frequently generates silica dust, a substance that can cause lung disease and other respiratory problems. Abrasive sand-blasting or jack hammering as well as concrete drilling and block cutting can lead to its release. In Broome Cty. v. Travelers Indem. Co., – N.Y.S.2d –, 125 A.D.3d 1241, 2015 WL 790256, 2015 N.Y.App.Div. LEXIS 1706 (N.Y.App.Div., Feb. 26, 2015), a unanimous panel from New York’s intermediate level appellate court held that the pollution and faulty workmanship exclusions in a first-party policy barred coverage for the property damage when silica dust spread throughout an office building due to construction activities nearby. The insured was Broome County, the owner of a building in a government complex. During the construction of a parking…
Tagged with: New York, Silica Dust
Posted in Ambiguity, Contamination, Faulty Workmanship or Design, Particulates, Pollution
Posted in Ambiguity, Contamination, Faulty Workmanship or Design, Particulates, Pollution
New York’s Highest Court Enforces a Water Damage Exclusion Despite an Ensuing Loss Exception
In Platek v. Town of Hamberg, et al., 2015 WL 685726, 2015 N.Y. LEXIS 252 (N.Y., Feb. 19, 2015), the New York Court of Appeals held that an exclusion for water below the surface of the ground was unambiguous and operated to bar coverage when a subsurface water main burst and flooded the insureds’ basement. The policyholders’ attempt to invoke an ensuing loss exception to the exclusion was also rejected in an opinion that surveys the historical genesis of ensuing loss provisions and explains the limited circumstances under which they operate to restore coverage. The insureds, Frederick and Mary Platek, owned a home in Hamberg, New York. On September 7, 2010, a subsurface water main abutting their property ruptured, flooding…
Tagged with: New York, Subsurface Water
Posted in Ambiguity, Burden of Proof, Ensuing Loss, Explosion, Flood, Water
Posted in Ambiguity, Burden of Proof, Ensuing Loss, Explosion, Flood, Water
