In Palm Beach Grading, Inc. v. Nautilus Ins. Co., No. 10-12821 (11th Cir. July 14, 2011), claimant general contractor Palm Beach Grading (“PBG”) subcontracted with insured A-1 for construction of a sewer line for the project. A-1 abandoned its work and PBG hired another subcontractor to complete construction of the sewer line. The new subcontractor discovered that A-1’s work was defective requiring repair and replacement of portions of the sewer line which also required the destruction and replacement of surrounding work. PBG sued A-1 seeking recovery of the repair costs and ultimately obtained a judgment against A-1. PBG then sued A-1’s CGL insurer Nautilus to recover a portion of the judgment. The federal district trial court granted summary judgment in favor of Nautilus. On appeal, the U.S. Court of Appeals for the Eleventh Circuit affirmed. Applying Florida law, the court held that, absent “damage independent of the repair and replacement of” A-1’s defective sewer line, the costs incurred by PBG in repairing and removing A-1’s defective sewer line did not constitute damages because of “property damage.”
Florida “get to” costs do not constitute damages because of “property damage”
