The Alabama Supreme Court found there was no coverage for the insured cabinet maker for claims arising from alleged faulty workmanship. Shane Traylor Cabinetmaker, L.L.C. v. Am. Resources Ins. Co., Inc., 2013 Ala. LEXIS 42 (May 3, 2013).
The insured was sued by a homeowner for property damage caused by faulty workmanship. The insurer refused to defend, contending there was no "occurrence." The trial court granted summary judgment to the insurer. It determined that the underlying complaint did not allege an accident, but rather a business dispute between the homeowner and the insured.
The Alabama Supreme Court noted its prior case held that faulty workmanship itself did not constitute an "occurrence." Under Alabama case law, faulty workmanship could lead to an occurrence if it subjected personal property or other parts of the structure to continuous or repeated exposure to some other harmful condition and, as a result of that exposure, there was property damage.
Because the property damage alleged here was due to the faulty workmanship of the insured and did not result in property damage to other property, there was no duty to defend or to indemnify.