In Council Tower Ass’n v. Axis Specialty Ins. Co., No. 09-3900, 2011 WL 31519 (8th Cir. 2011), the Eight Circuit considered whether, under Missouri law, the falling of seven stories of a twenty-six-story exterior brick veneer was a covered “collapse” of a building.
The insured had sought coverage from its property carrier for losses suffered as a result the “collapse.” The policy insured against “collapse of a building or any part of a building…if the collapse is caused by…[h]idden decay.” The policy, however, also contained wear-and-tear and faulty-design-or-construction exclusions. The carrier denied coverage after its investigation determined that the brick veneer fell due to inadequate design. The insured sued, arguing that the veneer collapse was owing to hidden decay of anchor bolts.
The trial court granted summary judgment in favor of Axis Specialty. On appeal, the court first observed that the term “collapse” generally contemplates a loss of structural integrity. It also observed that coverage was only triggered when all or “part” of a building collapses, distinguishing the term “part” from a “partial collapse of a part:”
The language [in the policy] ‘or any part thereof’ obviously refers to ‘collapse’ of a part of a building, not ‘partial collapse’ of a part or the whole of a building. The falling or reduction to a flattened form or rubble of an attached garage, supporting foundation wall or roof would appear to be but a few examples of collapse of a part of a building…. ‘Where the claim pertains to a collapse of a part of a building, there must be a [total] collapse of that part. A partial collapse of a part is entirely outside the contemplation of the parties to the insurance contract.’
The Eight Circuit thus affirmed the district court’s conclusion holding that “the falling of less than one-third of Council Tower’s decorative brick veneer was not a collapse of a part of the building within the meaning of the [policy].” For a complete copy of the decision, click here.
