Association of

For the Win

CGL policy does not apply
when only damage is to insured's product

December, 2016

S.E. Arnold and Company Inc. v. Cincinnati Insurance Company, Arkansas Court of Appeals 16-73. In the first appellate review of the Comprehensive General Liability (CGL) policy following the statutorily mandated amendment to the policy's definition of "occurrence" to include "faulty workmanship", the court affirmed the trial court's grant of summary judgment in favor of the insurer. Both the trial court and the appellate court found the policy unambiguously excluded coverage when "faulty workmanship" damaged nothing other than the insured's product, even when the work was done by subcontractors. The court adopted decisions from other jurisdictions indicating the CGL policy was not intended to serve as a warranty for an insured's damaged or defective products. The insured/appellant, S.E. Arnold and Company (DBA Arnold's Flooring America) was represented by David Hodges.

The Appellee, Cincinnati Insurance Company was represented by Scott Strauss and Carolyn Harder Ryburn of The Barber Law Firm.

Limits of business and dwelling insurance
in the Tony Alamo case

January, 2017

Victims of defrocked prophet/minister/cult leader Tony Alamo have filed numerous lawsuits over the last six years. Over the course of several declaratory judgment suits, approximately ten insurance carriers contended the various business and dwelling policies provided no coverage for the victims’ heinous allegations against Alamo.

In the most recent, Alamo adherent and alleged leader Steve Johnson held title to though did not reside in two homes. These homes were occupied by other Alamo followers who used the children as unpaid labor in restoring and maintaining the homes and several allege they were beaten by residents of the homes. The underlying child plaintiffs allege Johnson was aware of these actions and failed to protect the child plaintiffs or was himself responsible for the actions against the child plaintiffs.

Though numerous policy defenses were raised, Judge Susan Hickey of the United States District Court for the Western District of Arkansas held the underlying allegations did not arise from Johnson's "ownership, use or maintenance" of the insured homes and granted the insurers motion for summary judgment.

In Cameron Mutual Insurance Company v. Johnson, Case No: 4:15-cv-4081 W.D. Ark., Cameron Mutual insurance Company was represented by Carolyn Harder Ryburn and Scott Strauss of the Barber Law Firm