Morrison Mahoney Partner Michael Aylward was recently quoted in Massachusetts Lawyers Weekly.
A general liability policy for losses related to a policyholder’s motel did not cover fire damage that workers caused while renovating a different property the policyholder was in the process of purchasing, the Supreme Judicial Court has ruled.
The opinion is significant because it evidences an emerging view on the part of the justices, many of whom are new to the Supreme Judicial Court and has have little familiarity in the past with insurance issues, to take a pragmatic view of the scope of insurance coverage. In this case, the court declined to adopt a hard and fast rule of what “doing business as” meant for all cases but rather found that in this case, the insurance was clearly intended to only cover the insured’s motel business operations and not these other, undisclosed business operations that had never been disclosed to the insurer.
Aylward agreed with the court on the right decision, likening the case to a misrepresentation suit. He goes on to say one “could think of this case in the context of a policy application that omits information about a significant part of an insured’s business,” Aylward said. “Basically the court looked at it as though Union was led to believe they were insuring a more limited risk involving a single Super 8 motel; whereas, in fact, the insured had an operation that presented a much greater risk than the insurer was aware of.”
Aylward added that the decision is also noteworthy in that Chief Justice Kimberly S. Budd issued a dissenting opinion.
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