Background
Simon Contractors, a general contractor, subcontracted work to S&J Signs, Inc. for a highway construction project. The subcontract required S&J to obtain insurance naming Simon as an additional insured and to protect Simon from liability. S&J obtained a policy through Cincinnati Insurance Company. Two tractor-trailer drivers sued Simon and S&J for negligence after a rollover accident on the construction site, alleging failures to warn and erect barriers. Liberty Mutual Insurance Company, Simon’s own insurer, sought a declaration that Cincinnati had a duty to defend Simon. The district court granted summary judgment for Liberty, and Cincinnati appealed.
The court’s reasoning
The Tenth Circuit reviewed the case de novo under Wyoming law. The court interpreted the additional insured policy language requiring injuries to be caused in whole or in part by the subcontractor’s ongoing operations. The court defined ongoing operations as work in progress prior to completion. The court found the underlying lawsuits alleged injuries caused at least in part by S&J’s failure to provide warnings and barriers, which fell within the scope of S&J’s ongoing operations. The court rejected Cincinnati’s argument that the claims were independent or that the subcontract limited coverage, noting the subcontract explicitly covered liability whether or not it arose from concurrent acts of the general contractor.
What it means going forward
The decision clarifies that under Wyoming law, an insurer must defend an additional insured if the underlying complaint alleges any causal connection, however partial, between the subcontractor’s ongoing work and the alleged injuries. It reinforces that ongoing operations coverage extends to the period before project completion.
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