F & H Construction v. ITT Hartford Insurance

F & H Construction (F&H) appeals from the judgment in favor of ITT Hartford Insurance Group (Hartford) on the parties’ cross-motions for summary judgment.

F&H brought suit against Hartford under a commercial general liability insurance (CGLI) policy issued to Hartford’s insured, L. O’Reilly & Son, Inc. (O’Reilly), after O’Reilly declared bankruptcy.

F&H had contracted with Contra Costa Water District to build ,a water facility pumping plant. F&H entered into a subcontract with O’Reilly for the manufacture and delivery of grade A-50 steel pile caps with a load capacity of 50,000 pounds per square inch. After O’Reilly delivered the pile caps and F&H welded the majority of them to driven piles, F&H discovered the caps were made with grade A-36 steel rather than the agreed upon A-50 grade steel. F&H now seeks damages from Hartford under O’Reilly’s CGLI policy for property damage.

The issue tendered by the parties is whether welding inadequate pile caps onto driven piles constitutes property damage under the CGLI policy when there is no physical injury to the piles or to other property, and the defective pile caps are ultimately used as modified to meet design…