In Shilo Inn, Seaside Ocean Front, LLC v. Grant, et al. (08-cv-00618-BR), the United States District Court for the District of Oregon addressed, in addition to a number of other issues, that a claim for damage resulting from the insureds own faulty repair work was barred by the policy. The specific policy exclusion stated: ‘[t]hat particular part of any property that must be restored, repaired, or replaced because ‘your work’ was incorrectly performed on it. The court stated:
The dispute between Shilo and Maryland Casualty arises out of Grant’s inadequate performance of a work contract with Shilo...Shilo sought a total of $580,481 damages based on the following: (1) The reasonable expenses incurred to return the rooms to rentable condition, in the amount of $32,036; (2) the reasonable value of lost rent in the meantime, in the amount of $82,500;(3) the reasonable value of repairing Grant’s poor workmanship, in the amount of $373,695; and (4) the reasonable value of lost room revenues while the repairs were being performed, in the amount of $92,250...Shilo asserts, and Maryland Casualty does not disagree, that Grant’s installation left gaps between the granite slabs and bathtub surrounds through which water intrusion occurred. Shilo’s claim to coverage for property damage under Maryland Casualty’s CGL policy rests on its contention that, during the policy period, Grant negligently installed granite that allowed for water to intrude into the bathtub surrounds in those hotel rooms in which Grant installed the granite.
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Maryland Casualty’s policy excludes coverage for property damage to ‘[t]hat particular part of any property that must be restored, repaired, or replaced because ‘your work’ was incorrectly performed on it.” (Emphasis added). See Policy, Section I, Coverage A, Bodily Injury and Property Damage Liability, § j(6). Accordingly, this item of damage is excluded under the policy.
The opinion is below:
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