I’m having a hard time buying the court’s opinion in Stansley Group v. Fru-Con Construction Corp., 2006 WL 2711795 (N.D. Ohio September 21, 2006)(click here for a pdf of the case). Stansley poured some apparently defective concrete in construction of two bridge pylons, although the concrete it poured for 11 other pylons met pressure standards of 10,000 pounds per square inch. Stansley was sued by the general contractor, and the issue in the case was whether Stansley’s insurer owed a duty to defend and indemnify.
The court acknowledged that defective work does not constitute an "occurrence" under a Commercial General Liability policy, and that only damage to other work or property could constitute covered property damage. Then the court went in a direction I did not anticipate. Now, to finish out this discussion let’s remember that in the construction business wet concrete is called "mud." It will be more fun and make us feel like construction insiders if, for the rest of this post, we call the concrete "mud." Let’s also remember that many courts will find that if other property has to be destroyed to tear out defective work, the damage to the non-defective work is covered.
Strangely, to my way of thinking, the court said an issue of fact precluded summary judgment for the insurer. It was unclear, the court said, if all the mud poured for the two pylons was bad mud, or if some good mud was mixed in with the bad. If some good mud was in the pylons, the court said, destruction of the defective pylons resulted in damage to non-defective property. I am not agreeing with this. If I give you a beverage that is 98 percent coffee and 2 percent poison, I am not giving you a drink that is mostly good coffee and a little bad coffee, I am giving you poison. If I pour some loads of good mud and some loads of bad mud in a pylon, I am not giving you partly a good product and partly a defective product, I am giving you one whole product that is no good. To my mind, the whole pylon is uncovered defective work.
UPDATE: We’re not afraid of dissenting opinions at this blog. Here is another point of view on Stansley, which focuses on different things about the case, but calls the analysis "great."