01-1871 American Family Mutual Ins. Co. v. The Pleasant Co.

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Buyer hired insured to design and construct a building; insured subcontracted with a soils engineer who supervised surcharging of the site prior to construction; despite those efforts, the building settled, causing substantial damage. Buyer asserted claims against insured for breach of contract and negligence.

Insurer seeks a declaratory ruling that the CGL and excess liability policies it had issued did not provide coverage and did not impose a duty to defend insured in arbitration. Because the policies exclude coverage for liability assumed in a contract, we remand for entry of summary judgment for the insured.

The circuit court erred in concluding that the exclusion applied only to indemnity and hold harmless agreements (though that court reached the right result by relying on the professional services exclusion – an issue we need not reach).

Affirmed in part, reversed in part, remanded.

Recommended for publication in the official reports.

Dist IV, Dane County, Albert, J., Vergeront, J.

Attorneys:

For Appellant: Wayne M. Yankala, Milwaukee; Michael R. Vescio, Milwaukee

For Respondent: Daniel W. Hildebrand, Madison