INSURANCE-INDEMNITY-OCCURRENCE

American Home Assur. Co. v. Superior Well Servs., Inc., 2023 U.S. App. LEXIS 18974 (3d Cir. July 25, 2023) (Jordan, C.J.) American Home Assurance Co. (“American Home”) appeals the District Court’s order granting summary judgment for policy holder Superior Well Services, Inc. (“Superior”). Specifically, American Home contends that the insurance policy it issued to Superior does not indemnify the latter for property damage caused by Superior’s own faulty workmanship. We agree and we will reverse the District Court’s order, remanding with directions to enter judgment for American Home. In May 2018, the jury found against Superior on the breach of contract claim and determined that Superior had damaged 53 of the 97 wells. The jury’s verdict form specified that Superior “fail[ed] to perform its contract with U.S. Energy in a workman like manner” and that this “failure” was “a substantial factor in causing damage to the U.S. Energy wells[.]” Accordingly, it awarded U.S. Energy $6.16 million, a figure that was increased to approximately $13.18 million after the state court tabulated interest. Before the unfortunate misperformance of its duties to U.S. Energy, Superior purchased four commercial general liability (“CGL”) policies from American Home, one for each of the years 2004-2005, 2005-2006, 2006-2007, and 2007-2008. Superior’s policy provided coverage for “property damage” arising out of an “occurrence.” The policy defined “property damage” as both “[p]hysical injury to tangible property, including all resulting loss of use of that property” and “[l]oss of use of tangible property that is not physically injured.” It defined “occurrence” as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions[,]” but it did not define the term “accident.” The policy further contained exclusions, one of which excluded coverage for all damage to “[p]ersonal property in the care, custody or control of the insured[.]” In July 2016, American Home filed this diversity action seeking a declaratory judgment that Superior’s policy does not indemnify Superior for any damages that might be awarded to U.S. Energy and which were caused by Superior’s breach of contract. American Home argued below — and now argues on appeal — that property damage caused by a failure to perform a contract “in a workman like manner” is not an “occurrence” under the policy. It further argued that, even if the policy covered Superior’s insurance claim, the claim would involve a single “occurrence” under Pennsylvania law, as opposed to 53 separate occurrences, and is thus subject to the policy’s $2 million per-occurrence limit. U.S. Energy intervened as a defendant and counter-claimed for a declaration that American Home has a duty to indemnify Superior. It argued that the plain text of the endorsement, which modified the standard CGL policy, expressly covers the judgment awarded to U.S. Energy and that the 53 instances of well damage were separate “occurrences.” Each of the parties then moved for summary judgment. For the foregoing reasons, we will reverse the District Court’s summary judgment order and remand with instructions to enter judgment for American Home.