INSURED DOES THEIR “BEST TO MAINTAIN HEAT IN THE BUILDING” WATER DAMAGE FROM FROZEN PIPE BURSTING IS COVERED

Last Wednesday, the El Paso Court of Appeals affirmed summary judgment in favor of a commercial property owner after finding that maintaining heat in an adjoining occupied unit was sufficient to meet an exception to a frozen plumbing exclusion if the insured does their “best to maintain heat in the building or structure” when a pipe over the adjoining, unoccupied and unheated unit burst, flooding both apartments.  In American National Property & Casualty Company v. Fredrich 2 Partners, Ltd., 2013 WL 3939931 (Tex.App. – El Paso July 31, 2013), the trial court granted summary judgment in favor of the insured and American National appealed.

The court focused on the insured’s argument that even though heat was not maintained in the vacant unit, above which a frozen pipe burst, they did maintain heat in the building because an adjacent unit was occupied and heated during a four-day ice storm.  The court observed that “the policy did not require Fredrich to maintain heat in each unit, but rather to heat the building – the property covered under the policy.”  As a result, the insured satisfied the exception to the frozen plumbing exclusion and summary judgment in favor of the insured was affirmed.