Injury to Building Caused by Negligent Soil Analysis May Constitute Occurrence Under CGL That is Not Precluded by Business Risk Exclusions Or Similar Limitations on Coverage (Recent Court Decisions) (Commercial General Liability‪)‬

American Family Mutual Ins. Co. v. West American Insurance Co., 673 N.W.2d 65 (Wisconsin Supreme Court--January 9, 2004) Construction defect litigation has been in something of a boom period during the past 15 years, a phenomenon of no small consternation to homeowners, builders, insurers, and state legislatures. In addition to its overall costs to society, shoddy home construction and complex litigation resulting from housing problems also produces complex and costly insurance-coverage litigation. Commercial General Liability (CGL) insurers have attempted to minimize their exposure for these claims by generally arguing that they are not responsible for mere defects in housing but only for housing problems that cause classic third-party tort injury in the manner of a building collapse that injures bystanders or adjoining property. Builders seeking coverage (supported by plaintiff homeowners and associations seeking deeper defendant pockets) have argued, with significant but mixed success, that the CGL policy is indeed triggered by many allegations of shoddy construction so long as the poor construction causes physical injury to tangible property other than the errant contractor or engineer's own work.