Webcor Constr., LP v. Zurich Am. Ins. Co.

372 F. Supp. 3d 1061
CourtDistrict Court, N.D. California
DecidedMarch 12, 2019
DocketCase No.: 17-cv-2220 YGR
StatusPublished
Cited by1 cases

This text of 372 F. Supp. 3d 1061 (Webcor Constr., LP v. Zurich Am. Ins. Co.) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Webcor Constr., LP v. Zurich Am. Ins. Co., 372 F. Supp. 3d 1061 (N.D. Cal. 2019).

Opinion

In pertinent part, the Policy specifically excluded from coverage:

j. Damage to Property
'Property damage' to ... (5) [t]hat particular part of real property on which you or any contractors or subcontractors working directly or indirectly on your behalf are performing operations, if the 'property damage' arises out of those operations, or (6) [t]hat particular part of any property that must be restored, repaired, or replaced because 'your work' was incorrectly performed on it ... [unless] included in the 'products-completed operations hazard.'3
k. Damage to Your Product
'Property damage' to 'your product' arising out of it or any part of it.
l . Damage to Your Work
'Property damage' to 'your work' arising out of it or any part of it and included in the 'products-completed operations hazard.' This exclusion does not apply if the damaged work or the work out of which the damage arises was performed on your behalf by a subcontractor.
m. Damage to Impaired Property Or Property Not Physically Injured
'Property damage' to 'impaired property' or property that has not been physically injured, arising out of [¶ ...] [a] defect, deficiency, inadequacy or dangerous condition in 'your product' or 'your work' after it has been put to its intended use.

(Id. at MM000229-30, 240-41.) The Policy also defined certain terms relevant here, including:

8. 'Impaired property' means tangible property, other than 'your product' or 'your work,' that cannot be used or is less useful because:
a. It incorporates 'your product' or 'your work' that is known or thought to be defective, deficient, inadequate or dangerous; or
b. you have failed to fulfill the terms of a contract or agreement;
if such property can be restored to use by:
a. the repair, replacement, adjustment or removal of 'your product' or 'your work'; or
b. Your fulfilling the terms of the contract or agreement.
* * *
21. 'Your product':
*1068a. Means:
(1) Any goods or products, other than real property, manufactured, sold, handled, distributed or disposed of by:
(a) You;
(b) Others trading under your name; or
(c) A person or organization whose business or assets you have acquired; and
(2) Containers (other than vehicles), materials, parts or equipment furnished in connection with such goods or products.
b. Includes:
(1) Warranties or representations made at any time with respect to the fitness, quality, durability, performance or use of 'your product'; and
(2) The providing of or failure to provide warnings or instructions....
22. 'Your work':
a. Means:
(1) Work or operations performed by you or on your behalf; and
(2) Materials, parts or equipment furnished in connection with such work or operations.
b. Includes:
(1) Warranties or representations made at any time with respect to the fitness. quality, durability, performance or use of 'your work,' and
(2) The providing of or failure to provide warnings or instructions....

(Id. ) After the end of the effective period of the policy on June 30, 2007, Midwest was insured by Acuity Mutual Insurance Company through June 30, 2014. (Motorists Additional Fact 6.)

C. Defense of the Underlying Action

Both AGA and Webcor tendered their defense to Motorists, and Motorists denied a duty to defend them. (Old Republic Facts 39-41 and 45-47.) Motorists provided a defense to Midwest under the Policy, though it did so under a reservation of rights. (Old Republic Facts 29-30.) Old Republic provided a defense for AGA and Webcor in the underlying action. The underlying action settled on April 24, 2017. (Old Republic Fact 28.)4 Old Republic filed the instant third-party complaint against Motorists for contribution toward the costs of defense paid by Old Republic on behalf of Webcor and AGA on July 12, 2017. (Dkt. No. 69.)

II. APPLICABLE STANDARDS

A. Summary Judgment

The parties each have filed motions for summary judgment on the issue of whether Motorists had a duty to defend Webcor and AGA. Summary judgment is appropriate when "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). Summary judgment is mandated "against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett , 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). "[W]hen parties submit cross-motions for summary judgment, each motion must be considered on its own merits."

*1069Fair Hous. Council of Riverside Cty., Inc. v. Riverside Two , 249 F.3d 1132, 1136 (9th Cir. 2001) (alteration and internal quotation marks omitted). Thus, "[t]he court must rule on each party's motion on an individual and separate basis, determining, for each side, whether a judgment may be entered in accordance with the Rule 56 standard." Id. (quoting Wright, et al., FEDERAL PRACTICE AND PROCEDURE § 2720, at 335-36 (3d ed. 1998) ). If, however, the cross-motions are before the court at the same time, the court must consider the evidence proffered by both sets of motions before ruling on either one. Riverside Two , 249 F.3d at 1135-36.

B. Duty to Defend

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Bluebook (online)
372 F. Supp. 3d 1061, Counsel Stack Legal Research, https://law.counselstack.com/opinion/webcor-constr-lp-v-zurich-am-ins-co-cand-2019.