Arizona Court of Appeals Holds Multiple Negligent Acts Constitute a Single Occurrence Under CGL Policy
In Cincinnati Indem. Co. v. Southwestern Line Constructors Joint Apprenticeship and Training Program, et al, 2018 WL 2330627 (May 31, 2018), the Arizona Court of Appeals upheld summary judgment granted to an insurer because, under the Policy’s definition of “occurrence” as an “accident,” a single event caused by several independent acts constitutes a single occurrence.
Property damage and/or bodily injury claims caused by multiple negligent acts or omissions constitute only one occurrence under Policies defining “occurrence” as an “accident” rather than “any incident, act or omission.”
Two electrical linemen were working at the top of a utility pole at the Insured’s training facility when the pole broke, the linemen fell, and the linemen sustained serious injuries. The linemen and the Insured settled for the Policy limits. The Policy included $1 million “occurrence” limits and $2 million aggregate limits. The Insurer sought a declaratory judgment that the linemen’s injuries resulted from a single “occurrence.” The superior court granted summary judgment in favor of the Insurer.
In affirming that the linemen's separate injuries arose from a single occurrence, the Arizona Court of Appeals reasoned as follows:
- The Policy defined “occurrence” as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions.”
- “Accident” means an unforeseen and unplanned event.
- The linemen argued the Insured committed five independent negligent acts that caused the pole to break.
- The Court of Appeals distinguished Arizona Property and Casualty Insurance Guaranty Fund v. Helme, 153 Ariz. 129 (1987), which held the number of acts producing the injury determined the number of occurrences, because the Helme policy defined “occurrence” as “any incident, act or omission, or series of related incidents, acts or omissions resulting in injury.” Thus, two omissions constituted two occurrences in Helme. In Southwestern Line, however, the Policy defined “occurrence” as an “accident.”
- The pole collapse was one accident and, therefore, one occurrence under the Policy.
Read the entire Southwestern Line opinion here.
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About the Author: Micalann C. Pepe is an attorney at the Phoenix law firm of Jaburg Wilk. Her primary focus is insurance coverage and bad faith. Micalann advises and represents insurance clients in coverage, bad faith, contribution and liability matters.