Lennar Corp. v. Markel Am. Ins. Co. (Opinion)Annotate this Case
Homes built with an exterior insulation and finish system (EIFS) suffer serious water damage that worsens over time. Homebuilder began a remediation program in which it offered to homeowners to remove exterior EIFS from the homes it had built and to replace it with conventional stucco. Almost all the homeowners accepted Homebuilder's offer of remediation. Homebuilder sought indemnification for the costs from its insurers (Insurers). Insurers denied coverage, preferring instead to wait until the homeowners sued. This litigation ensued. Now, only one insurer remained. The court of appeals reversed the trial court's judgment in favor of Homebuilder, finding (1) Homebuilder failed to establish its legal liability to the homeowners to trigger Insurer's coverage; and (2) Homebuilder failed to offer evidence of damages covered by the policy. The Supreme Court reversed, holding (1) Homebuilder's settlements with the homeowners established both Insurer's legal liability for the property damages and the basis for determining the amount of loss; and (2) Insurer's policy covered Homebuilder's entire remediation costs for damaged homes.