11th Circuit Asks Florida Supreme Court To Clear Up Coverage For Repair Of Construction Defects

In most jurisdictions, it’s a sure bet that a Commercial General Liability policy will be interpreted as not covering the cost to repair or replace defective construction work, whether the defective work was done by the general contractor or a subcontractor.  On the other hand, damage to property other than the work itself is usually covered.  The customary reasoning is that a CGL is not a performance bond.

In Florida, however, the 11th Circuit found an unsettled question of law on this issue in Pozzi Window Co. v. Auto-Owners Insurance, 2006 WL 1009341 (April 19, 2006).   Most of the cases cited by the 11th Circuit seemed to me to indicate that Florida is with the rest of the country on this issue.  However, a couple Florida Court of Appeals cases gave the court pause, and the 11th Circuit certified the question of coverage to the Florida Supreme Court.  For those who aren’t lawyers, when federal circuit courts of appeals are deciding a case based on state law, they often consider issues that haven’t been definitively established by state courts.  Sometimes these courts guess at the result, but because federal courts are courts of limited jurisdiction and need to defer to state courts on state law questions, they often ask for clarification by "certifying" a question to a state supreme court.  My guess on the answer?  That there is no coverage for replacement of defective work.

(Someone who knows Florida law better than I do may want to chime in).

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