Lawsuits filed for recovery due to the faulty design and installation of doors and windows by homeowners across the country were found to allege multiple occurrences. Pella Corp. v. Liberty Mut. Ins. Co., 2017 U.S. Dist. 53631 (C.D. Iowa March 31, 2017).

   The underlying lawsuits alleged that Pella Corporation's windows were defectively designed, manufactured, or installed, and allowed water intrusion to buildings that resulted in third-party property damage or personal injury.

    Pella sued Liberty Mutual for declaratory judgment and filed a motion for partial summary judgment to determine how many occurrences the underlying cases presented. Pella sought a determination that each of the 15 underlying cases presented one "occurrence" as the term was defined in the CGL policies issued by Liberty Mutual. Liberty Mutual argued that only three or four occurrences were presented, relying on common fact patterns.

    Pella argued that there were separate and distinct causes of different injuries and damage and thus, each underlying case constituted a separate occurrence. Liberty Mutual, on the other hand, highlighted language within the definition of "occurrence," which stated that an "occurrence" included "continuous or repeated exposure to the same general harmful conditions." The "substantially the same general harmful conditions" language dictated that the scope of "occurrence" be understood to be broad, such that various instances of damage-causing water intrusion in different times and places constituted "substantially the same general harmful conditions."

    The court found that this language merely communicated the notion that accidents based on the accretion of small exposures to damage-causing conditions (that remained generally the same over time) could constitute an occurrence, even if the individual exposures would not, in isolation, be sufficient to cause the damage covered by the policy. Unintended water intrusion through a window, over a period of time but in a single location, provided a good example of this type of occurrence.

    But this language did not address whether unintended water intrusion in difference places, happening at different times, and caused by defects in different products constituted a single occurrence just because the damage-causing instances were of the same type or could be described in the same manner.

    The court was compelled to find that the CGL policies were ambiguous in this respect because the language was subject to multiple reasonable interpretations when interpreting the policies as a whole. Because both parties offered reasonable interpretations of the proper scope of "occurrence," the court was compelled to adopt Pella's construction. Therefore, each underlying case presented one "occurrence."