This is the third in a series of articles addressing
commercial general liability insurance. The first
article, published in the October 2008
issue, addresses whether claims alleged as a breach of contract
are potentially covered by insurance. The second
article, published in the December
2008 issue, discusses what constitutes an occurrence and
whether claims alleging defective workmanship meet the occurrence
requirement. Also, though it is Professional Roofing's
policy to provide location information for companies mentioned in
articles, some information is missing from this article because the
companies in question no longer are in business.
Let's say a roofing contractor signs a contract to install a
large roof system on a high-end shopping center in south Florida. A
vast majority of the job consists of a low-slope membrane roof
system, but there are certain areas where tile is to be installed.
The roofing contractor hires a subcontractor to install the tile
Following construction, the tile roof system leaks. Efforts to
stop the leaks are unsuccessful. The leaks damage tenants'
inventory, and one tenant withholds rent, claiming he cannot use a
portion of his leased space because of the risk of roof leaks.
The owner hires a roof consultant to investigate. The consultant
concludes the leaks are a result of the subcontractor's use of the
wrong type of tile and defective installation. To stop the leaks,
the consultant recommends the tile roof system's removal and
replacement. Meanwhile, the subcontractor has...
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