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Judges split on whether 2 insurers must pay for damage

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An Indiana Court of Appeals judge dissented from the majority’s holding that two insurers were financially responsible for the damages caused by a fractured storm pipe and subsequent flooding of a school. The judge believed that only one of the responsible party’s insurers had to pay for the property damage.

In Grange Mutual Casualty, et al. v. West Bend Mutual Ins., et al. No. 29A02-1008-PL-965, the two insurers disputed which policy was triggered after a school in which insured McCurdy Mechanical installed plumping, sewers, and drains was flooded due to a fractured storm drain pipe. At the time McCurdy performed the work on the school, it had a commercial general liability policy with West Bend Mutual Insurance. When the damaged pipe burst and caused the flooding in the school, Grange Mutual Casualty provided McCurdy’s CGL insurance. It was later discovered that the pipe was fractured by McCurdy sometime around spring of 2005, when West Bend's policy was active.

The two insurers jointly settled with the school’s insurance company for damages from the flood and then filed competing motions for summary judgment as to which insurer was responsible. The trial court denied Grange’s motion for summary judgment and granted West Bend’s motion for summary judgment.

The majority found that the parties incorrectly focused on the timing of the occurrences in the case and that they aren’t really relevant to the determination of coverage based on the insurance policies, which are very similar. What’s important is the timing of the property damage because the policies require that the damage occur during the policy period, wrote Judge Ezra Friedlander.

The majority held that in this case, it’s not an “either-or determination.” West Bend’s coverage was triggered by the original fracturing of the storm drain pipe which resulted in immediate damage to the pipe and subsequent flooding. They held that the policy covers all damages that flowed from the original damage, including the extensive flood damage. But Grange is also responsible for some damages, they held. Coverage under the Grange policy was triggered when the flooding occurred during its policy period, regardless of when the original negligence took place, wrote the judge. The majority remanded for the trial court to apportion damages accordingly.

Judge Melissa May agreed with the majority that West Bend’s policy covers all damages that flowed from the original damage, but disagreed that Grange’s policy also covers the flood damage at issue.

“There is nothing to ‘apportion.’ The majority is correct that the West Bend policy covers ‘all damages,’ and I would accordingly decline to hold there could be damages in addition to ‘all damages’ or that any such additional damages could be assigned on remand to Grange,” she wrote. “I believe ‘all’ means ‘all,’ and I would accordingly reverse and direct summary judgment for Grange.”

Judge May cited Parr v. Gonzalez, 669 N.W.2d 401 (Minn. Ct. App. 2003), to support her conclusion that the Grange policy isn’t implicated. Parr held that when damages arise from “discrete and identifiable events that occur within the policy period, the actual-injury trigger theory allows those policies on the risk at the point of initial damage to pay for all the damages that follow.”

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  1. Frankly, it is tragic that you are even considering going to an expensive, unaccredited "law school." It is extremely difficult to get a job with a degree from a real school. If you are going to make the investment of time, money, and tears into law school, it should not be to a place that won't actually enable you to practice law when you graduate.

  2. As a lawyer who grew up in Fort Wayne (but went to a real law school), it is not that hard to find a mentor in the legal community without your school's assistance. One does not need to pay tens of thousands of dollars to go to an unaccredited legal diploma mill to get a mentor. Having a mentor means precisely nothing if you cannot get a job upon graduation, and considering that the legal job market is utterly terrible, these students from Indiana Tech are going to be adrift after graduation.

  3. 700,000 to 800,000 Americans are arrested for marijuana possession each year in the US. Do we need a new justice center if we decriminalize marijuana by having the City Council enact a $100 fine for marijuana possession and have the money go towards road repair?

  4. I am sorry to hear this.

  5. I tried a case in Judge Barker's court many years ago and I recall it vividly as a highlight of my career. I don't get in federal court very often but found myself back there again last Summer. We had both aged a bit but I must say she was just as I had remembered her. Authoritative, organized and yes, human ...with a good sense of humor. I also appreciated that even though we were dealing with difficult criminal cases, she treated my clients with dignity and understanding. My clients certainly respected her. Thanks for this nice article. Congratulations to Judge Barker for reaching another milestone in a remarkable career.

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