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Click here for the full text of this decision FACTS:A couple, the Larsons, who bought a home designed and manufactured by Gehan Builders sued the builder, saying the home was not constructed in a good and workmanlike manner. The Larsons also alleged that Gehan was negligent in relying on the developers’ general soil analysis, which was inadequate for the foundation design. The Larsons brought other claims for negligence, as well as claims for malice, breach of contract and warranty, Deceptive Trade Practices Act violations and fraud. In the alternative, the Larsons asked the court to rescind their purchase of the home. Employers Mutual Casualty Co., who issued a general liability policy to Gehan applicable from June 30, 1997, to June 30, 1998, filed a declaratory action asking the court to find it had no duty to defend. Great American Lloyds Insurance Co., who issued a GLP applicable from June 30, 1998, to June 30, 1999, did so also. The trial court granted both insurers’ traditional motions for summary judgment holding that they had no duty to defend or indemnify Gehan and denied their no-evidence motions. HOLDING:Reversed and remanded. The court first looks at the policy language to determine if there was a duty to defend. The policy language states: “We will pay those sums that the insured becomes legally obligated to pay as damages because of”bodily injury’ or”property damage’ to which this insurance applies. We will have the right and duty to defend any”suit’ seeking those damages.” Another section states that the policy applies only if the property damage or bodily injury is caused by an “occurrence.” The term “occurrence” is defined as an “accident, including continuous or repeated exposure to substantially the same general harmful conditions.” The court finds two lines of cases that deal with the further refinement of the definition of “occurrence.” One line pertains to coverage of claims against an insured for damage caused by its alleged intentional torts. Another line says that “accident” and “occurrence” include damages that is unexpected, unforeseen or undesigned happening or consequence of an insured’s negligent behavior. The court acknowledges that thee is some confusion arising from application of these two lines of cases, but the court rejects the insurers suggestion that the Larsons’ claim is really based on an underlying contract and that all conduct should be judge according to what was required under the contract. The court says this position essentially asks this court to ignore the negligence allegations the Larsons raise and instead look beyond the pleadings to the contract to determine whether an “occurrence” has been potentially claimed. “In this case, the intentional act of performing the contract was allegedly performed negligently. The purported damage was an unexpected and undesigned consequence of Gehan’s alleged negligence. . . . We conclude, therefore, that the insurers did not establish as a matter of law that the Larsons’ petition does not allege an”occurrence’ under the terms of the policy.” The court next turns to whether the Larsons have established that there has been property loss. The court concludes that the Larsons’ request for damages for the reasonable expense of temporary housing is a “loss of use” claim under both policies’ definition of property damage. Additionally, the Larsons’ assertion that they suffered “great physical and mental pain” is enough to raise a claim under the definition of bodily injury. The court then looks at whether any policy exclusions apply. The court finds that all but two are based on property damage and, as decided above, will not apply. Two exclusions remain, but there was no argument on these exclusions at the summary judgment hearing. Consequently, the court looks at the exclusions itself to determine if they would apply. One exclusion applies to property damage or bodily injury that is expected or intended by the insured; another excludes coverage for property damage or bodily injury that the insured is obligated to pay under contract or agreement liability. The court finds no evidence that either case applies. Finally, the court rules that the claims are being made for damage that took place during the coverage period, as the Larsons were alleging that they suffered “past” bodily injuries and property damages. OPINION:Lang-Miers, J.; Whittington, Lang and Lang-Miers, JJ.

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