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ARTICLE · 04 APRIL 2014

Builder’s Risk Policies: Scope Of The Faulty Design/Work Exclusion

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What is the scope of the exclusion for making good faulty workmanship under a builders risk insurance policy?

CanadaReal Estate and Construction

What is the scope of the exclusion for making good faulty workmanship under a builders risk insurance policy? If cleaners scratch the windows during the construction process, does making good just mean a repeat cleaning or does it also include repairs to the windows?

This was the issue that the Alberta Court of Queen's Bench grappled with in Ledcor Construction Limited v. Northbridge Indemnity Insurance Company, 2013 ABQB 585.

Station Lands Ltd. is the owner of the newly constructed EPCOR Tower. Ledcor Construction Limited was the general contractor responsible for building the new office tower. As the building neared completion, Ledcor contracted with a cleaning company to have the exterior of the building cleaned to remove accumulated debris. This included cleaning the building's exterior windows. While cleaning, the cleaners scratched those windows so badly that they had to be replaced at considerable cost.

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