Allied Roofing, Inc. v. W. Res. Group

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State: Ohio

Court: Ohio Southern District Court

Docket No: 2013-Ohio-1637

Case Date: 04/23/2013

Plaintiff: Allied Roofing, Inc.

Defendant: W. Res. Group

Preview:[Cite as Allied Roofing, Inc. v. W. Res. Group, 2013-Ohio-1637.]
IN THE COURT OF APPEALS OF OHIO
TENTH APPELLATE DISTRICT
Allied Roofing, Inc.,                                                                       :
Plaintiff-Appellant,                                                                        :
                                                                                                No. 12AP-575
v.                                                                                          :   (C.P.C. No. 10CVH-02-3107)
Western Reserve Group et al.,                                                               :   (REGULAR CALENDAR)
Defendants-Appellees.                                                                       :
D    E    C    I    S    I    O    N
Rendered on April 23, 2013
Caborn  &  Butauski  Co.,  LPA,  and  David  A.  Caborn,  for
appellant.
Weston Hurd LLP, Ronald A. Rispo and Robert E. Goff, Jr.;
David L. Jarrett, for appellee Western Reserve Group.
APPEAL from the Franklin County Court of Common Pleas
DORRIAN, J.
{¶ 1}  Plaintiff-appellant, Allied Roofing, Inc. ("Allied Roofing"), appeals from a
judgment of the Franklin County Court of Common Pleas denying Allied Roofing's motion
for  summary  judgment  and  granting  the  motion  for  summary  judgment  filed  by
defendant-appellee,  Western  Reserve  Group  ("Western  Reserve").  We  conclude  that
Western Reserve is entitled to judgment as a matter of law because the underlying claim
in this case does not involve "property damage" caused by an "occurrence" for purposes of
the applicable insurance policy; therefore, we affirm.
{¶ 2}  This case arises from work performed by Michael Beish ("Beish") under a
subcontract agreement with Allied Roofing. The subcontract provided that Beish would
remove rubber roofing from a damaged roof at Brown Logistics's building in Columbus,
Ohio, and replace it with new rubber roofing. As part of Beish's work, he was required to

No. 12AP-575                                                                                     2
remove and reinstall air conditioning units that were located on the roof. At some point
during the process of removing and reinstalling the air conditioning units, the coils
became twisted, causing the coolant to leak out. The damage to the air conditioning units
was discovered when they were turned back on after Beish completed his work. Allied
Roofing reimbursed Brown Logistics for the damage, incurring costs of $10,148.
{¶ 3}  Beish was insured under a policy issued by Western Reserve.  Allied Roofing
filed  a  lawsuit  against  Beish  and  Western  Reserve  seeking  to  recover  the  costs  of
remedying the damage.   Allied Roofing and Western Reserve entered into an agreement
to adjudicate all coverage issues in exchange for an agreement that Allied Roofing would
not seek to recover damages from Beish in his personal capacity and would limit any
recovery to the proceeds available under the insurance policy. As part of that agreement,
Allied  Roofing  and  Western  Reserve  agreed  to  certain  stipulations  regarding  the
underlying  facts  of  the  case.  Allied  Roofing  and  Western  Reserve  each  moved  for
summary judgment. The trial court granted Western Reserve's motion for summary
judgment and denied Allied Roofing's motion for summary judgment, concluding that the
damage to the air conditioning units was not covered under the insurance policy because
it fell into exclusions set forth in the policy.
{¶ 4}  Allied Roofing appeals from the trial court's judgment, assigning three
errors for this court's review:
[1.] THE TRIAL COURT ERRED IN GRANTING WESTERN
RESERVE  GROUP'S  MOTION  FOR  SUMMARY  JUDG-
MENT[.]
[2.]  THE  TRIAL  COURT  ERRED  IN  DENYING  ALLIED
ROOFING'S MOTION FOR SUMMARY JUDGMENT[.]
[3.]  THE  TRIAL  COURT  ERRED  IN  NOT  ENTERING
JUDGMENT  IN  FAVOR  OF  ALLIED  ROOFING  IN  THE
AMOUNT OF $10,148.00[.]
{¶ 5}  Allied Roofing's three assignments of error are interrelated, asserting that
the trial court erred by denying its motion for summary judgment and by granting
Western Reserve's motion for summary judgment. Therefore, we will address all three
assignments of error together.

No. 12AP-575                                                                                     3
{¶ 6}  We review a trial court's ruling on a summary judgment motion de novo.
Capella III, L.L.C. v. Wilcox, 190 Ohio App.3d 133, 2010-Ohio-4746, ¶ 16 (10th Dist.),
citing Andersen v. Highland House Co.,  93 Ohio St.3d  547,  548  (2001). "De novo
appellate review means that the court of appeals independently reviews the record and
affords no deference to the trial court's decision." (Citations omitted.) Holt v. State, 10th
Dist. No. 10AP-214, 2010-Ohio-6529, ¶ 9. Summary judgment is appropriate where "the
moving party demonstrates that (1) there is no genuine issue of material fact, (2) the
moving party is entitled to judgment as a matter of law, and (3) reasonable minds can
come to but one conclusion, and that conclusion is adverse to the party against whom the
motion for summary judgment is made." Capella III at ¶ 16, citing Gilbert v. Summit Cty.,
104 Ohio St.3d  660,  2004-Ohio-7108,  ¶  6. Therefore, we undertake an independent
review to determine whether Western Reserve or Allied Roofing was entitled to judgment
as a matter of law.
{¶ 7}  The insurance policy at issue in this case provides in part that Western
Reserve will pay all sums to which the insured becomes legally obligated to pay as
damages due to "bodily injury" or "property damage" caused by an "occurrence." The
policy further defines "occurrence" as "an accident and includes repeated exposure to
similar conditions." Western Reserve asserted that it was entitled to summary judgment
because the damage to the air conditioning units did not constitute an "occurrence" under
the terms of the policy. In the alternative, Western Reserve argued that various exclusions
in the policy applied to the particular claim asserted in this case. Allied Roofing argued
that it was entitled to summary judgment because the damage to the air conditioning
units was an "occurrence" under the policy and that none of the exclusions cited by
Western Reserve applied to exempt the damages from coverage.
{¶ 8}  The  Supreme  Court  of  Ohio  recently  addressed  the  question  of  what
constitutes an "occurrence" under a commercial general liability insurance policy in
Westfield Ins. Co. v. Custom Agri Sys., Inc., 133 Ohio St.3d 476, 2012-Ohio-4712. The
Westfield case, which was filed in federal court under diversity jurisdiction, involved
damages  resulting  from  a  defective  steel  grain  bin.  Id.  at  ¶  2.  The  company  that
constructed the grain bin, Custom Agri Systems, sought to have its insurance company,
Westfield Insurance, defend and indemnify it against claims for defective construction

No. 12AP-575                                                                                    4
and consequential damages under the terms of its commercial general liability insurance
policy. Id. at ¶ 2-3. Westfield Insurance argued that the claims were not covered under the
insurance policy because they did not seek compensation for property damage caused by
an occurrence within the terms of the policy. Id. at ¶ 3. The federal trial court granted
summary judgment for Westfield Insurance, and Custom Agri Systems appealed.
{¶ 9}  After finding a lack of controlling precedent in its own decisions, the United
States Court of Appeals for the Sixth Circuit certified a question of state law to the
Supreme Court of Ohio as to whether claims of defective construction or workmanship
brought by a property owner are claims for "property damage" caused by an "occurrence"
under a commercial general liability policy. Id. at ¶ 6. In examining this question, the
Supreme Court  noted  that,  in  general,  commercial  general  liability  policies  are  not
intended to insure against "business risks" that are the normal, frequent or predictable
consequences of doing business that a business can and should control or manage. Id. at
¶ 10. The specific insurance policy at issue in the case provided that Westfield Insurance
would pay damages due to "bodily injury" or "property damage" to which the policy
applied and that Westfield Insurance had the right and duty to defend against any suit
seeking those damages. Id. at ¶ 9. The policy further provided that the insurance applied
to bodily injury or property damage only if it was caused by an "occurrence" that took
place within the coverage territory. Id. The policy defined the term "occurrence" as "an
accident, including continuous or repeated exposure to substantially the same general
harmful conditions." Id. at ¶ 12. Because the policy did not define the term "accident," the
Supreme Court concluded that the natural and commonly accepted meaning of that term
would apply. Id.
{¶ 10} Reviewing decisions from other courts, the Supreme Court noted that a
central concept in the realm of insurance coverage was the doctrine of fortuity and the
idea that commercial general liability policies cover truly accidental property damage, not
damages arising from processes controlled by the insured and that could be anticipated.
Id. at ¶ 13. Ultimately, the Supreme Court concluded that the insurance policy did not
provide coverage for alleged defective construction of and workmanship on the steel grain
bin. Id. at ¶ 14. Responding to the certified question of state law, the Supreme Court held
that "claims of defective construction or workmanship brought by a property owner are

No. 12AP-575                                                                                    5
not claims for 'property damage' caused by an 'occurrence' under a commercial general
liability policy." Id. at ¶ 19.
{¶ 11} The insurance policy at issue in this case is substantially similar to the policy
at issue in Westfield. The policy provides coverage for "bodily  injury" or "property
damage" caused by an "occurrence." In this case, the policy defines "occurrence" as "an
accident  and  includes  repeated  exposure  to  similar  conditions."  This  language  is
effectively the same as the policy at issue in Westfield. Therefore, the question is whether
the  claim  in  this  case  involves  defective  construction  or  workmanship.  The  parties
stipulated that, as part of Beish's work, he had to remove and reinstall air conditioning
units  located  on  the  roof.  Further,  in  response  to  Western  Reserve's  requests  for
admission, Allied Roofing admitted that Beish was negligent in failing to ensure that the
air conditioner coils did not become twisted and that the air conditioning unit was
damaged when the coils became twisted, causing the coolant to leak out. Thus, the claim
in this case is a result of Beish's defective workmanship in performing his obligations
under the contract. Pursuant to Westfield, such a claim does not constitute "property
damage" caused by an "occurrence," and therefore it falls outside the grant of coverage
under the terms of the insurance policy. Because the claim does not involve property
damage  caused  by  an  occurrence,  we  need  not  address  whether  any  of  the  other
exclusions in the policy apply. Western Reserve is entitled to judgment as a matter of law
because the claim that Allied Roofing asserts is not covered under the terms of the
insurance policy.
{¶ 12} Accordingly,  the trial  court  did not  err  by  granting  Western Reserve's
motion  for  summary  judgment  and  denying  Allied  Roofing's  motion  for  summary
judgment. Because we reach the same result as the trial court, albeit for a different reason,
we overrule  appellant's three  assignments  of error  and affirm the judgment of the
Franklin County Court of Common Pleas.
Judgment affirmed.
SADLER and CONNOR, JJ., concur.

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