Replacement of Gym Floor Due to Sloppy Paint Job is Not Resulting Loss

    The court granted the insurer's motion for summary judgment finding damage to the gym floor due to a poor paint job was not a resulting loss. Bob Robinson Commercial Flooring, Inc. v. RLI Ins,. Co., 2023 U.S. Dist. LEXIS 196105 (D. Ark. Nov. 1, 2023).

    Bob Robinson Commercial Flooring (BRCF) submitted a bid to the general contractor, Nabholz Construction Corporation, to install a vinyl athletic floor and striping at a middle school. The job also included the painting of a "Wildcat" logo the main gym floor. Therefore, BRCF's job was to install floors with proper painting and striping.  Robert Liles and Robert Lines Parking Lot Services was the subcontractor hired to do the painting and striping. BRCF did not supervise or inspect Liles' work while it was ongoing.

    Nabholz informed BRCF that there were problems with the floor painting, including crooked lines, incorrect markings, misplacement of the three point lines for the basketball surface, drips, smudges, etc. The gym floor was eventually rejected due to the nature of the vinyl flooring, once primer and paint were applied, the paint could not be removed and repainted. BRCF had to hire a new subcontractor to remove the flooring, install new flooring and then paint new lines. The cost for removal and replacement was $134,188.95. 

    BRCF submitted a proof of loss to RLI. The claim was denied. BRCF filed sued. BRCF did not seek any part of the cost of repainting the flooring, but only the cost of the underlying flooring that had to be replaced. RLI moved for summary judgment arguing the policy language unambiguously excluded a loss caused by a defect in workmanship from coverage because it was undisputed that the only damage occurred as a result of the subcontractor's misapplication of the paint, not as a result of any ensuing peril or loss. 

    RLI's policy did not cover loss caused by errors caused in workmanship or construction. But if an error resulted in a covered peril, the loss or damage caused by the covered peril was covered. 

    The court found there was nothing wrong with the paint; the lines that the paint defined were in the wrong places, were not straight and sloppily applied. BRCF was not seeking payment for the cost to redo the painted lines and logo. But the vinyl floor under the paint was damaged and had to be removed. 

    The ensuing loss provision was not triggered because BRCF indentified no "covered peril' as required "resulting from inherent defects, errors, or omissions in coverage property relating to . . . 2) workmanship or construction." The only reason the floor was rejected and had to be torn out was because it did not meet specifications, and this was due to the workmanship of Mr. Liles. To the extent that BRCF relied on the vinyl floor in the gym as the covered peril, the vinyl floor described what could be covered property, not a covered peril. 

    For these reasons, RLI's motion for summary judgment was granted,.