Monday, December 9, 2013

Washington Supreme Court Rules In Favor of Insurer on Exception to Insured Contract Provision



On November 27, 2013, in a 5-4 decision, the Washington Supreme Court ruled that a commercial general liability policy issued to a general partnership, ABCD Marine, LLC (“ABCD”), did not provide coverage for bodily injury suffered by one of its general partners while he was working as an independent contractor for Northland Services Inc. (“NSI”).   Int’l Marine Underwriters v. ABCD Marine, LLC, No. 87231-7, __Wn.2d__, __P.3d __ (Nov. 27, 2013).

ABCD’s liability policy excluded coverage of liability ABCD contractually assumed, but exempted from that exclusion agreements assuming liability for injury to third persons.  The Court ruled the general partner was not a “third person” and therefore not covered for injuries he sustained while doing work for NSI under ABCD’s agreement to indemnity NSI for injuries arising out of the ABDC’s operations or use of NSI’s property.