Davis v. Nola Home Construction, L.L.C.
222 So. 3d 833
La. Ct. App.2017Background
- Plaintiffs Karla and Dollie Davis contracted Beard (general contractor) and NOLA Home (subcontractor) to rebuild their Katrina‑damaged house; construction began Dec 2008.
- Catlin issued a CGL policy to Beard effective Jan 1, 2009 and Beard cancelled it July 28, 2009. Plaintiffs alleged defective and incomplete work causing property damage.
- Jury awarded the Plaintiffs $1,397,018.06 against Beard, NOLA Home, and Mr. Garcia; coverage of Catlin remained for the trial court to decide.
- Catlin relied on policy exclusions (notably j(5), j(6), and k) to deny coverage but did not plead j(5) and j(6) as affirmative defenses in its answer.
- Trial court granted a directed verdict that damage occurred before July 28, 2009 and later (after a granted new trial/reconsideration) found Catlin’s policy provided coverage up to policy limits; Catlin appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Catlin waived exclusions by failing to plead them as affirmative defenses | Catlin failed to plead exclusions; Plaintiffs would be prejudiced by untimely defenses | Exclusions were tried/argued at summary judgment and evidence at trial enlarged pleadings; Plaintiffs had notice | Court: insurer must plead exclusions as affirmative defenses; Catlin waived j(5) and j(6); no enlargement of pleadings occurred |
| Whether property damage occurred during Catlin’s policy period | Damage to the house and defective work began during policy period (supported by photos, testimony, expert) | Some additional/new damage occurred after policy cancellation, so not all loss is covered | Court: directed verdict that damage occurred before July 28, 2009; policy covers damage occurring during period and continuing afterward; Plaintiffs met burden of coverage |
| Whether Catlin proved exclusions barred coverage or proved apportionment of post‑policy damage | Plaintiffs contend insurer bears burden to prove exclusion; no evidence offered to apportion or show exclusions applied | Catlin argues some damage is "new" (post‑policy) and exclusions apply to bar coverage | Court: insurer bears burden to prove applicability of exclusions and to apportion excluded damage; Catlin failed to do so; coverage stands |
| Whether trial court abused discretion by entering coverage ruling without additional hearing after granting new trial | Plaintiffs: new trial was for reargument/reconsideration; no new evidence offered so reconsideration on existing record was proper | Catlin: trial court should have held a separate hearing on coverage | Court: permitted to reconsider existing record on new trial for reargument; no abuse of discretion — no new hearing required |
Key Cases Cited
- Boes Iron Works, Inc. v. Gee Cee Grp., Inc., 206 So.3d 938 (La. App. 4 Cir. 2016) (standards of review for appellate review of factual and legal issues)
- Spencer v. Chevron Corp., 202 So.3d 1055 (La. App. 4 Cir. 2016) (discussion of manifest error and de novo standards)
- Jones v. Estate of Santiago, 870 So.2d 1002 (La. 2004) (insurer bears burden to prove applicability of policy exclusion)
- Doerr v. Mobil Oil Corp., 774 So.2d 119 (La. 2000) (insurer’s burden to prove exclusion applies)
- Blackburn v. Nat. Union Fire Ins. Co. of Pittsburgh, 784 So.2d 637 (La. 2001) (insurer bears burden to prove loss falls within exclusion)