In Mid-Continent Casualty Co. v. Siena Home Corp., No. 5:08-CV-385-Oc-10GJK (M.D. Fla. July 8, 2011), insured residential real estate developer Siena was sued by homeowners seeking damages for moisture penetration property damage resulting from exterior wall construction defects. Siena’s CGL insurer Mid-Continent filed suit seeking a declaratory judgment of no duty to defend or indemnify in part on the basis that the alleged “property damage” did not manifest during the Mid-Continent policy period. On cross-motions for summary judgment, the federal district trial court, applying Florida law, first held that the underlying complaint sufficiently alleged that property damage occurred during the Mid-Continent policy period such that Mid-Continent had a duty to defend. As to Mid-Continent’s duty to indemnify, the court determined that there were unresolved issues of fact as to when such property damage actually “manifested” thus precluding summary judgment. The court did grant partial summary judgment establishing the following “principle as the law of the case” with regard to trigger:
The Court concludes that the “manifestation” of the “occurrence” of property damage … is the time that such damage was discernable and reasonably discoverable either because it was open and obvious or upon a prudent engineering investigation, and not the time of actual discovery where the two circumstances come about in sequence at different times.