Successful Appeal Finds No Duty on Behalf of Insurer to Defend or Indemnify in Underlying Construction Case
Mike Ethridge appealed a summary judgment in favor of an insured and against Carlock Copeland’s client, an insurance company. The Defendant had denied coverage for a claim arising from the insured’s construction of a horse barn. Mike contended that the claim was essentially one for defective work, and as such there was no coverage available. The insured filed a declaratory judgment action against the client alleging that they had wrongfully denied defending and indemnifying the insured in the underlying lawsuit. Mike filed cross motions for summary judgment. The trial court granted the insured’s motion and found that the Defendant did have a duty to defend the insured in the underlying case, and had failed to fulfill its contractual obligations to the insured. Therefore the insured was entitled to collect costs and attorney’s fees from the client. Mike appealed the trial court’s finding. The Court of Appeals agreed and ruled that the “Your Work” exclusion applied to preclude coverage, and there was no duty to defend. The decision also included a lot of discussion regarding what constitutes an “occurrence” and what constitutes “property damage” in CGL policies for general contractors—topics of significant interest in South Carolina insurance and construction law.