In Barber v. Berthiaume, No. NNH-CV-05-4009532-S (Oct. 19, 2009), a contractor was hired to expand and repair plaintiff’s home. As part of that work, the contractor was required to raise the home in order to construct new piers. During that process, the house toppled, causing damage in the amount of $26,000. Judgment entered in favor of plaintiff against the contractor, which was paid by plaintiff’s homeowner’s insurer when the insolvent contractor did not pay. The plaintiff and his homeowner’s insurer subsequently brought suit against the contractor and the contractor’s general liability insurer to recover the judgment.

The contractor’s insurer refused to indemnify plaintiffs, claiming that the general liability policy excluded coverage for “business risks.” The exclusion provided: “[t]his insurance does not apply to ‘property damage’ to: [t]hat particular part of real property on which you or any contractor or subcontractor working directly or indirectly on your behalf is performing operations, if the ‘property damage’ arises out of those operations.” Because Connecticut did not have any case on point addressing the issue, the court looked to a factually similar case decided by the North Dakota Supreme Court and, consistent with that opinion, held that because the contractor was working on the entire house when he had to raise the building and the damage occurred during that process, the damages fell within the business risk exclusion. Judgment entered in favor of the contractor’s general liability insurer.

For a complete copy of the opinion, please click here.