A federal appeals court overturned a lower court ruling that a subcontractor's policy required the insurer to defend or damage the contractor's reason. a parking lot for a power tool company and subcontracted the parking lot construction to Canton-based Glosson Group LLC, according to Wednesday's decision by the 8th U.S. Circuit Court of Appeals in St. Louis. Louis Selective Way Insurance Co. v. CSC General Contractors, Inc. et al.
The subcontractor required CSC to be an additional insurance under Glosson's general liability policy, which was with Selective Way Insurance Co., a unit in Branchville, New Jersey-based Selective Insurance Group Inc.
Selective denied coverage on the ground that there was no additional insurance, and that Glosson had no obligation to defend or damage. CSC filed a third-party complaint against Glosson, claiming that it caused the damage by adding too much water to the concrete.
The complaint went to arbitration and in 2017 the arbitrator ruled that Glosson was liable to CSC compensation for all the company's damages.  Selective then sued the U.S. District Court in Fargo, North Dakota, which ruled that Selective was not liable to defend and harm CSC, even though it considered CSC to be an additional insured.
The decision was set aside by a unanimous panel of three judges. Selective claims that it is not an extra insurance because Glosson did not handle a "product" but only constructed "real estate", says the Court of Appeal's decision.
“Cement is a product that Glosson handled. Thus, property damage caused at least in part by the cement Glosson mixed under the policy is covered, "said the decision, which also claimed that the district court had made a mistake when it focused on coverage issues that went beyond the letter of denial in its decision. . The case was taken up for further negotiations.
Lawyers in the case did not respond to a request for comment.