Lennar Corp. v. Markel American Insurance (Insurance Coverage)


Texas Supreme Court

NAHB Involvement


This case involves several questions regarding the scope and extent of insurance coverage under a CGI policy. NAHB and the Texas Association of Builders (TAB) filed an amicus brief in support of the builder's petition for certiorari to the Texas Supreme Court. The questions for review by the court are:

  1. Did the court of appeals err in holding that an insurer need not show prejudice when the settlement-without-consent clause is in the policy's insuring agreement, even though a similar clause in the policy's conditions section requires such a showing and the jury found that the insurer did not suffer any prejudice?
  2.  Did the court of appeals err in holding that the costs incurred by the insured to remove materials to determine the areas of property damage were "preventative" and, therefore, uncovered by the policy, except for the limited costs to remove materials above locations where the damage was actually found? Does the court of appeals' holding conflict with Texas law on coverage for consequential damages, and also with the policy that requires the insurer to pay "the total amount of damages for which the insured is legally liable . . . because of" property damage? 

On July 11, 2011, NAHB and TAB jointly filed an amicus brief in support of Lennar's petition for cert to the Texas Supreme Court. On June 8, 2012, the court accepted the petition for cert. On Aug. 23, 2013, the Supreme Court of Texas ruled in favor of Lennar, reversing the judgment of the court of appeals and affirming the judgment of the trial court.