Balfour Beatty Construction, LLC v. Liberty Mutual Fire Insurance Co., No. 19-20216 (5th Cir. 2020)
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Appellants filed suit against Liberty in Texas state court claiming breach of contract and violations of Sections 541 and 542 of the Texas Insurance Code. After Liberty removed to federal court, the district court granted Liberty's motion for summary judgment and denied appellants' partial motion for summary judgment.
After determining that it has appellate jurisdiction, the Fifth Circuit affirmed, holding that the insurance policy does not provide coverage for appellants' claims. The court need not determine whether the policy at issue is an all-risks policy because the court construed the policies one at a time. The court held that an ensuing loss provision like the one presented here is only triggered when one (excluded) peril results in a distinct (covered) peril, meaning there must be two separate events for the exception to trigger. In the underlying action, appellants' welding operation involved falling slag, which damaged the exterior glass of Energy Center 5. The court explained that the welding operation is inseparable from the falling slag and that they are not two separate events. Furthermore, the court held that the policy is not illusory. Therefore, appellants have not met their burden to show that the exception to the exclusion reinstates coverage. Finally, appellants' ambiguity argument is forfeited.
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