Brown v. Kvs Construction
George W. Brown, Employee v. Kvs Construction (Subcontractor), Employer, Alleged Noninsured, and James Fleming, Individually, and Keith Suggs, Individually and/or Flaherty Collins, Inc. (General Contractor), Employer, and/or Westfield Insurance Company and/or Commerce and Industry Insurance company/aig Claim Services (Aiu Holdings, Administrator), Carrier
Attorneys
APPEARANCES Plaintiff: Law Office of K. Gregory Gunter, Raleigh, North Carolina; K. Gregory Gunter, Counsel of Record. The Honorable Roy A. Cooper, Attorney General, State of North Carolina; North Carolina Department of Justice; Raleigh, North Carolina, Assistant Attorney General Tracy Curtner, Counsel of Record. Defendants: Hedrick, Gardner, Kincheloe Garofalo, Raleigh, North Carolina; Vachelle Willis, Counsel of Record for KVS Construction. Teague Campbell Dennis Gorham, Raleigh, North Carolina; Jacob Wellman, Counsel of Record for Commerce and Industry Insurance Co.
Procedural Posture
This case was heard by the Full Commission on June 10, 2009 upon appeal of defendants Commerce and Industry Insurance Company from an Opinion and Award by Deputy Commissioner Robert Wayne Rideout, Jr. filed January 15, 2009. An Opinion and Award was issued by the Full Commission on July 16, 2009. This Amended Opinion and Award is issued following defendants' motion to amend the Opinion and Award.
Full Opinion (html_with_citations)
50. Defendant AIG owed a duty to defend its insured, KVS Construction, Inc.
The Conclusions of Law are amended as follows:
6. AIG has waived all coverage defenses by failing to provide a defense for its insured, KVS Construction, Inc. "Any doubt as to coverage must be resolved in favor of the insured when determining the liability insurer's duty to defend." Waste Mgmt. of theCarolinas, Inc. v. Peerless Ins. Co.,
7. Moreover, by failing to provide a defense for its insured, Defendant AIG owes payment to KVS Construction, Inc. for attorney fees and costs incurred in this litigation. Based on North Carolina case law, the duty to defend is a broad duty. An insurer is excused from its duty to defend only "if the facts are not even arguably covered by the policy." Waste Mgmt. of the Carolinas, Inc.,
8. Defendant-employer provided proper notice to AIG, through Appalachian Underwriters, of work beginning in North Carolina. Defendant-employer also complied with the notice requirement outlined in Section B of Part III of the policy which states, "Tell us at once if you begin work in any state listed in Item 3C of the Information Page." The phrase "at once" is not defined in the policy, is ambiguous and, therefore, must be construed against the drafter. Woods v. Insurance Co., supra. *Page 3
9. Defendant-employer properly maintained insurance coverage in North Carolina for all relevant periods of time and, as such, no penalty should be assessed.
10. Defendant AIG breached its duty to defend its insured, KVS Construction, Inc. This breach constituted unfounded litigation. N.C. Gen. Stat. §
The Award portion of the Opinion and Award is amended as follows:
6. Defendant AIG breached its duty to defend its insured, KVS Construction, Inc., and now owes attorney fees and costs associated with this litigation.
7. Defendant KVS Construction, Inc. shall be allowed to submit a written itemization of attorney fees and charges incurred as a result of this litigation to the Commission for approval.
8. Defendant Commerce and Industry Insurance Company (formerly AIG) shall pay the costs due the Commission.
This 22nd day of December, 2009.
S/___________________ LAURA KRANIFELD MAVRETIC COMMISSIONER
CONCURRING: *Page 4
S/___________________ STACI MEYER COMMISSIONER
S/___________________ DIANNE C. SELLERS COMMISSIONER