Policy only Applies to Risks Taken by Insurer

Post 4699

Plaintiffs in multiple consolidated actions appeal the Judgment granting
the Motion for Summary Judgment in favor of defendant, The Burlington
Insurance Company ("TBIC") based upon a clear and unambiguous exclusion.

In Cameron Soule v.  Woodward Design + Build, LLC, et. al., Nos.
2022-CA-0352, 2022-CA-0353, 2022-CA-0354, 2022-CA-0355, 2022-CA-0356,
Court of Appeals of Louisiana, Fourth Circuit (December 21, 2023)
Louisiana resolved the dispute.

STATEMENT OF FACTS

Program ("CCIP") policy or "Wrap-Up" policy from Houston Casualty
Company ("HCC") for the insurance on the Project.

Regarding insurance, Eagle's
Subcontract stated, in pertinent part, that Woodward "has arranged for
the Project to be insured under a controlled insurance program (the
"CCIP" or "Wrap-Up")."

In connection with the accident, plaintiffs filed suit against various
parties and TBIC, Eagle's own commercial general liability ("CGL")
insurer.

TBIC denied coverage for Eagle, maintaining that its CGL policy
contained a"Wrap-Up Exclusion" which precluded coverage to Eagle for all
claims arising from the Project. The Wrap-Up Exclusion provided, in
pertinent part, that coverage is excluded in "[a]ll locations where you
perform or have performed work that is or was to be insured under a
consolidated (wrap-up) insurance program as described below." (Emphasis
added).

On April 24, 2017, the Administrator sent a letter advising Eagle that
it was not covered "under the General Liability Contractor Controlled
Insurance Program for the trade of Hoist Rental and Service - the
Standard Project."

TBIC maintained that the CCIP policy was intended to cover Eagle under
two distinct provisions: 1) as a lessor of equipment under the above
mentioned "Additional Insured" endorsement; and 2) as an enrolled
contractor, (for Eagle's work pursuant to the Subcontract to erect,
dismantle, and provide preventative maintenance for the hoist) under the
Wrap-Up endorsement. The latter endorsement provided that Woodward's
"enrolled contractors" are insured "only while performing duties related
to the project."

Interpretation of Insurance Contracts

An insurance policy is a contract between the parties and should be
construed using the general rules of interpretation of contracts set
forth in the Civil Code. The judicial responsibility in interpreting
insurance contracts is to determine the parties' common intent.

An insurance policy should not be interpreted in an unreasonable or a
strained manner so as to enlarge or to restrict its provisions beyond
what is reasonably contemplated by its terms or so as to achieve an
absurd conclusion.

If after applying the other general rules of construction an ambiguity
remains, the ambiguous contractual provision is to be construed against
the insurer and in favor of coverage. Under this rule of strict
construction, equivocal provisions seeking to narrow an insurer's
obligation are strictly construed against the insurer.

ANALYSIS

Woodward's Subcontract with Eagle specifically provides that Woodward
Moreover, the plain language of the Wrap-Up Exclusion stated  that
coverage for Eagle is excluded in "[a]ll locations where you perform or
have performed work that is or was to be insured under a consolidated
Accordingly, the Wrap-Up
Exclusion must be enforced as written.

ZALMA OPINION

Courts are required to read the entire policy at issue and interpret the
policy as its wording relates to the facts of the incident that
resulted in bodily injury to the plaintiffs. The court did so and
ignored the creative, yet unconvincing, arguments made by the
plaintiffs. The policy excluded the incident.

(c) 2023 Barry Zalma & ClaimSchool, Inc.

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