United Fire & Casualty Company v. Boulder Plaza Residential, LLC
633 F.3d 951
10th Cir.2011Background
- BPR appeals district court’s summary judgment denying defense/indemnity by UFC under Colorado law.
- M&R and Summit contracted for wood-floor installation; Summit agreed to indemnify M&R, and UFC issued CGL policies naming M&R as Additional Insured for Summit’s ongoing operations.
- UFC denied defense/indemnity, citing that coverage for M&R was limited to Summit’s ongoing operations and completed operations were not covered.
- BPR and Summit’s underlying state-court actions alleged damage to floors arising after installation, with UFC denying defense.
- Colorado district court held UFC had duty to defend indemnify based on ongoing-operations interpretation but later narrowed following Colorado appellate authority; this court affirms both duties were not owed.
- The question presented is whether UFC owed a duty to defend or indemnify M&R, considering the four-corners rule, ongoing vs completed operations, and insured-contract coverage; the court resolves without applying § 13-20-808.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Duty to defend or indemnify under policy terms | BPR argues UFC’s duties arise from ongoing operations. | UFC contends coverage limited to ongoing operations; no occurrence during installation. | No duty to defend or indemnify. |
| Impact of four-corners rule and extrinsic evidence | Extrinsic documents show damages during ongoing operations. | Extrinsic evidence cannot create duty to defend; four-corners rule controls. | Extrinsic evidence not considered; four-corners rule controls; no duty to defend. |
| Effect of insured-contract and indemnity provisions | Indemnity via General Contract and insured-contract coverage should trigger UFC. | Coverage to M&R as added insured is limited to Summit’s liability arising from ongoing operations. | No indemnity duty; liability imputed to Summit not Summit’s liability imputable to M&R. |
| Timing of damage vs occurrence for coverage | Damage occurred during ongoing operations, within policy period. | Damage occurred after completion; not an occurrence. | Damage occurred post-completion; no occurrence; no duty to defend. |
Key Cases Cited
- Cyprus Amax Minerals Co. v. Lexington Ins. Co., 74 P.3d 294 (Colo. 2003) (duty to defend arises from allegations, not actual liability; four-corners rule)
- Weitz Co., LLC v. Mid-Century Insurance Co., 181 P.3d 309 (Colo. App. 2007) (ongoing operations limitation; completed operations not covered)
- Pompa v. Am. Family Mut. Ins. Co., 520 F.3d 1139 (10th Cir. 2008) (extrinsic evidence can create narrow four-corners exception)
- AIMCO v. Nutmeg Ins. Co., 593 F.3d 1188 (10th Cir. 2010) (predicts Colorado Supreme Court would recognize exception to four-corners rule)
- Cotter Corp. v. American Empire Surplus Lines Co., 90 P.3d 814 (Colo. 2004) (insurer’s duty to defend arises from complaint; four-corners rule applied)
- General Security Indemnity Co. of Arizona v. Mountain States Mutual Casualty Co., 205 P.3d 529 (Colo. App. 2009) (Colorado appellate interpretation of “occurrence” in insured-contract context)
- Globe Indem. Co. v. Travelers Indem. Co. of Ill., 98 P.3d 971 (Colo. App. 2004) (distinguishes timing of wrongful act vs. damage for coverage)