BPI, Inc. v. Nationwide Mut. Ins. Co.
Decision Date | 20 May 2015 |
Docket Number | No. 14–0799.,14–0799. |
Court | West Virginia Supreme Court |
Parties | BPI, INC., Petitioner v. NATIONWIDE MUTUAL INSURANCE COMPANY, Respondent. |
Leigh G. Latherow, Esq., VanAntwerp, Monge, Jones, Edwards & McCann, LLP, Ashland, KY, for Petitioner.
Ronda L. Harvey, Esq., Bowles Rice LLP, Charleston, WV, Drew Byron Meadows, Esq., Pro Hac Vice, Kellie M. Collins, Esq., Pro Hac Vice, Golden & Waters, PLLC, Lexington, KY, for Respondent.
This matter is before the Court upon certified question from the United States District Court for the Eastern District of Kentucky (hereinafter “District Court”). That court has certified two questions regarding retroactive application of this Court's decision in Cherrington v. Erie Insurance Property & Casualty Co., 231 W.Va. 470, 745 S.E.2d 508 (2013). This Court accepted the certified questions and docketed the matter for resolution. Upon review of the parties' briefs and arguments, this Court answers the retroactivity issue presented in the first certified question and remands this matter to the District Court for further proceedings.
The underlying insurance dispute arose from a construction project in Prestonsburg, Kentucky, for which BPI, Inc. (hereinafter “BPI”), was the general contractor. In February 2008, American Towers LLC (hereinafter “American Towers”) hired BPI, a West Virginia contractor, to construct a 300–foot cell tower and cell tower compound, with an access road to the tower, using plans engineered and provided by American Towers. The access road collapsed within one year after the completion of the project, allegedly due to faulty workmanship of BPI and/or its subcontractors.
American Towers filed a civil action against BPI, and BPI filed a cross-claim against Nationwide Mutual Insurance Company (hereinafter “Nationwide”), claiming that BPI's potential liability was covered under the commercial general liability (hereinafter “CGL”) policy it had purchased from Nationwide. In response, Nationwide sought a declaration that it was not obligated to insure BPI for this incident. Subsequent to discovery, BPI and Nationwide filed cross-motions for summary judgment.1
The District Court determined that West Virginia law should apply, based upon the residence of the named insured and the contract itself. The District Court also recognized that determinative issues in this case depend upon the application of West Virginia law regarding BPI's insurance policy covering property damage caused by an “occurrence.” The District Court examined this Court's holding in Cherrington and noted that damages arising from faulty workmanship had not been deemed damages caused by an “occurrence” prior to this Court's Cherrington decision. See, e.g., Corder v. William W. Smith Excavating Co., 210 W.Va. 110, 116, 556 S.E.2d 77, 83 (2001) ; Erie Ins. Prop. & Cas. Co. v. Pioneer Home Improvement, Inc., 206 W.Va. 506, 512, 526 S.E.2d 28, 34 (1999) ().
The 2013Cherrington decision, issued after American Towers filed the underlying civil action against BPI, overruled several cases examined by the District Court,2 HOLDING AS FOLLows in syllabus point six:
In the certified questions presented to this Court, the District Court observes that at least a portion of BPI's potential damages may arise from what could be characterized as defective workmanship. Thus, the District Court requests this Court to answer the question of whether our decision in Cherrington applies retroactively. Further, the District Court poses the question: “if Cherrington does not apply retroactively, and the road collapsed because it was poorly constructed, then does the collapse of the road nevertheless qualify as an ‘occurrence’?” For reasons explained below, this Court holds that Cherrington applies retroactively.
This Court has consistently explained that .” Syl. Pt. 2, Aikens v. Debow, 208 W.Va. 486, 541 S.E.2d 576 (2000) ; see also Syl. Pt. 1, T. Weston Inc. v. Mineral Cnty., 219 W.Va. 564, 638 S.E.2d 167 (2006) : Syl. Pt. 1, Feliciano v. 7–Eleven, Inc., 210 W.Va. 740, 559 S.E.2d 713 (2001) ; Syl. Pt. 1, Gallapoo v. Wal–Mart Stores, Inc., 197 W.Va. 172, 475 S.E.2d 172 (1996). Likewise, in syllabus point one of Bower v. Westinghouse Electric Corp., 206 W.Va. 133, 522 S.E.2d 424 (1999), this Court explained that we “undertake [ ] plenary review of legal issues presented by certified question from a federal district or appellate court.” Under this plenary standard of review, we proceed to consider this matter.
As referenced above, this Court's decision in Cherrington addressed the issue of defective workmanship causing bodily injury or property damage and held that such event is properly characterized as an “occurrence” under a CGL insurance policy. The Cherrington decision altered the law in West Virginia with regard to that issue, and the new principle was applied to the 2004 insurance policy under review in Cherrington. Beyond its decision to apply the new principle to the 2004 policy in that case, this Court did not address the matter of retroactivity in Cherrington, and no reference to past or future insurance policies was made.
This Court has wisely explained that we will not attempt to formulate a “single answer to questions that may arise on the issue of retroactivity.” Adkins v. Leverette, 161 W.Va. 14, 20, 239 S.E.2d 496, 499 (1977).3 In this Court's scrutiny of concepts of retroactivity, however, discussions appropriately commence with the recognition that this Court, Caperton v. A.T. Massey Coal Co., 225 W.Va. 128, 157, 690 S.E.2d 322, 351 (2009) ; see also Alaskan Vill., Inc. v. Smalley, 720 P.2d 945, 949 (Alaska 1986) (); Citicorp N. Am., Inc. v. Franchise Tax Bd., 83 Cal.App.4th 1403, 100 Cal.Rptr.2d 509, 525 (2000) (); Findley v. Findley, 280 Ga. 454, 629 S.E.2d 222, 228 (2006) (); Aleckson v. Village of Round Lake Park, 176 Ill.2d 82, 223 Ill.Dec. 451, 679 N.E.2d 1224, 1226 (1997) (); Dempsey v. Allstate Ins. Co., 325 Mont. 207, 104 P.3d 483, 489 (2004) ; In re Commitment of Thiel, 241 Wis.2d 439, 625 N.W.2d 321, 326 (Ct.App.2001) ().
Particularly relevant in the civil context, courts have consistently held that common law provides that appellate decisions are presumed to apply retroactively. Ireland v. Worcester Ins. Co., 149 N.H. 656, 826 A.2d 577, 580–81 (2003) ; see also Beavers v. Johnson Controls World Servs., Inc., 118 N.M. 391, 881 P.2d 1376, 1383 (1994) (); Christy v. Cranberry Volunteer Ambulance Corps, Inc., 579 Pa. 404, 856 A.2d 43, 51 (2004) (); State v....
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