Great American Lloyds Insurance Co. v. Audubon Insurance Co., 377 S.W.3d 802

Holigan Family Investment, Inc. purchased consecutive commercial general liability policies from Great American for 1995–1996 and 1996–1997; Audubon and other insurers provided consecutive coverage from 1997–1998.
In December 2001, the homeowners sued Holigan in Harris County alleging construction defects, defective balcony, HVAC, and mold, and also sued Prudential for claims handling.
Great American initially agreed to pay one-third of defense costs but later withdrew its defense contribution after discovering tentative dates of damage around March 30, 1998, which fell outside its policy period.
Audubon and other insurers continued to defend Holigan and eventually settled the case with the homeowners and Prudential.
Audubon sued Great American for contribution and reimbursement for defense and settlement costs, claiming breach of duty to defend and indemnify.
The trial court granted Audubon’s summary judgment on duties to defend and indemnify; Great American appeals on multiple grounds.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Duty to defend triggered by pleadings	Audubon argues eight corners show potential coverage; Gehan controls.	Great American contends no duty since timing/trigger not alleged and exclusions apply.	Great American duty to defend affirmed; potential coverage exists under pleadings.
Damage during policy period and work exclusion	Petitions show damage during Great American periods and subcontractor work avoids exclusion.	Damage to your work exclusion may bar coverage if not subcontractor work.	Exclusion did not defeat duty to defend; subcontractor work exception applies and coverage potentially exists.
statute of limitations / relation back	Amendment to include 1995–96 policy relates back to timely 1996–97 claim.	Relation back not permitted across different transactions; 1995–96 claim barred.	Amendment related back; not time-barred.
Mid-Continent barrier to reimbursement	Consecutive policies allow contribution and reimbursement despite time gaps.	Mid-Continent bars cross-policy reimbursement among co-primary insurers.	Mid-Continent does not apply; policies cover different periods, not co-primary.

Gehan Homes, Ltd. v. Employers Mut. Cas. Co., 146 S.W.3d 833 (Tex.App.-Dallas 2004) (duty to defend if pleadings not clearly outside coverage; eight corners rule)
Pine Oak Builders, Inc. v. Great American Lloyds Insurance Co., 279 S.W.3d 650 (Tex. 2009) (work-product exclusion and subcontractor exception analyzed)
Mid-Continent Insurance Co. v. Liberty Mutual Insurance Co., 236 S.W.3d 765 (Tex. 2007) (co-primary insurers; other insurance provision guidance)
Don’s Building Supply, Inc. v. OneBeacon Insurance Co., 267 S.W.3d 20 (Tex.2008) (relation back and timing of amendments in insurance cases)
Union Insurance Co. v. Don’s Building Supply, Inc., 266 S.W.3d 592 (Tex.App.-Dallas 2008) (relation back and timing considerations in insurance disputes)
National Union Fire Ins. Co. v. Merchants Fast Motor Lines, Inc., 939 S.W.2d 139 (Tex. 1997) (doubt in coverage resolved in insured’s favor)
Zurich Am. Ins. Co. v. Nokia, Inc., 268 S.W.3d 487 (Tex. 2008) (duty to defend dictated by eight corners; liberal interpretation)
Heyden Newport Chem. Corp. v. S. Gen. Ins. Co., 387 S.W.2d 22 (Tex.1965) (traditional eight-corners approach to coverage disputes)