Transportation Ins. Co. v. Piedmont Const. Grp., LLC.
(Georgia Court of Appeals, Fourth Division, November 13, 2009)
In a strongly worded opinion, the Court of Appeals affirmed the trial court decision and assessed frivolous appeal penalties where insurer denied not only coverage but a defense under liability policy issued to a general contractor based upon a “novel and radical interpretation of a single Georgia case.” The court further noted that “this egregious conduct warrants not only affirmance but the imposition of penalties for frivolous appeal. Only the fact that the trial court did not enter a judgment for a sum certain prevents the assessment of an additional ten percent penalty under OCGA §5-6-6,” where the court presumed that the appeal was taken up for purposes of delay only.
Specifically the case concerned the issue of coverage under a CGL policy issued by Transportation to Piedmont Construction. A fire extensively damaged a building where Piedmont was performing renovation work. The policyholder sought coverage under the policy, however, the insurer denied both coverage and a defense based upon the business-risk exclusion in the policy and the policyholder filed a third party claim against it. Thereafter the insurer appealed from the trial court’s grant of summary judgment in favor of Piedmont on the issue of coverage and the award of damages and attorney fees under OCGA 33-4-6. In affirming the decision, the court of appeals noted the extensive 43-page decision analyzing the facts that ultimately rejected the insurer’s reliance on the business exclusion. The court further noted that because the insurer ignored the substantial body of law on business-risk exclusions and appeared to have filed the appeal solely for the purposes of delay, the court assessed frivolous appeal penalties pursuant to Rule 15b.
A copy of the decision is attached here
Paul Steck and Joanna Roberto