Commentators are easy to find on Insurance Coverage Issues surrounding Chinese Drywall Claims. No reported Cases decided by Courts have been found, however. Until actual Cases have been decided, general principles of Insurance Law must predict the outcome of Insurance Coverage for Chinese Drywall Claims as a result.
Attorneys who may be involved in such Cases are requested to please send me the cites of their Cases. When such decisions become available, they will be posted here. On the other hand, if there are no future Comments from attorneys anxious to share their legal results, it will confirm that there are still no Cases at that time.
The installation of Chinese Drywall in homes built
in the United States has resulted in many Bodily Injury and Property Damage Claims
arising out of its reportedly nasty smell of sulfur and corrosion of tangible property such as copper tubing in air conditioning systems. The author of this post has drawn from the excellent summary of the damages caused by Chinese Drywall by M.P. McQueen, "The Prisoners of Drywall" p. D1, col. 2 (Wall Street Journal, "Personal Journal" Section, Thursday, August 6, 2009).
However, this post is not intended to be a manual or how-to guide on recovery for persons injured or damaged by Chinese Drywall. Other remedies besides Insurance may exist. See Download XL Specialty Insurance Co. v. Interstate Industrial Corp., Interstate Drywall Corp., et al. (D.N.J. Opinion Filed August 18, 2009), attached Official Slipsheet Opinion at 1, 6 (denying motion to dismiss for failure to join party under Fed. R. Civ. P. 19; Defendants' Agreement of Indemnity contained "collateral security provision" requiring Defendants to deposit with Plaintiff Surety certain money, upon demand of the Plaintiff, for reserves "in an amount that is either the sum of all pending claims asserted against Plaintiff on a bond or the reserve Plaintiff established because it issued bonds on Interstate's behalf.").
This extended post will address, in installments, whether there is or may be Insurance Coverage under standard Commercial General Liability Insurance and Homeowner's Insurance Policy provisions. Not all forms of Liability Insurance or Property Insurance will be discussed here, at least at first.
Next: The Insurance Coverage Issues Surrounding "Bodily Injury" and "Property Damage" Coverage, or Not, Under Commercial General Liability Insurance Policies: General Principles for a Specific Claim in the Absence of Decided Cases.
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