Dear Tx/Up: You are always so optimistic. What’s the latest good news about the situation in the Gulf? Dora, Amarillo, Tx.
Dear Dora: Well, the tuna are now getting about 35 miles per gallon.
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This morning, the Texas Supreme Court holds HO-B covers mold damage to personal property, but not to dwelling: The principal issues in this mold-coverage case are (1) whether the standard Texas homeowners policy (HO-B) provides coverage for mold damage to a dwelling resulting from plumbing leaks; or (2) whether it provides mold-damage coverage for personal property in the dwelling; or (3) whether it provides coverage for both. Page sued State Farm for its refusal to replace her carpet after it repaired mold damage in her house and personal belongings. The trial court granted summary judgment for State Farm, but the appeals court reversed.
The Supremes held in a decision handed down this morning that the policy covers mold damage to personal property but not to a dwelling when that mold results from a plumbing leak. In Balandran v. Safeco Insurance Co., the Court held that the exclusion-repeal provision was ambiguous with respect to an exclusion (1.h) because the exclusion for foundation damage was specifically limited to dwelling coverage (part A). In other words, because the losses excluded under 1.h — losses caused by “settling, cracking, bulging, shrinkage, or expansion of foundations, walls, floors, ceilings, roof structures, walks, drives, curbs, fences, retaining walls or swimming pools” — applied only to the dwelling under Coverage A, to hold that repeal of the 1.h exclusion only applied to personal property under Coverage B would make no sense. That is not the case with the mold exclusion (1.f) because the exclusion’s plain language stating that it applies to property loss under Coverage A (dwelling) and Coverage B (personal property) can be given full effect. To hold that the exclusion-repeal provision reinstates coverage for mold damage under both Coverage A and Coverage B would render the mold exclusion entirely “nugatory.” State Farm Lloyds, et al v. Page (Tex. June 11, 2010).