Lagoon Loss Excluded By "Faulty Workmanship" Clause in All-Risk Policy
The loss in this case occurred when a dredging contractor, hired to remove biosolids from a city wastewater lagoon in Oak Harbor, accidentally punctured the lagoon's liner.
As with most all-risk policies (such as builder's risk policies), there was an exclusion which prohibited coverage for loss due to "faulty workmanship" of the builder.
Long story short: coverage denied. The tearing and puncturing of the liner was bad workmanship whether looked at from a tort or contract standard, the Court held.
Copy of decision also available here Download file
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