Birch brought a lawsuit against Wilshire seeking coverage for the damage. The circuit court awarded summary judgment to the apartment complex and the insurer appealed.

In the appeal, the insurer asserted that certain policy exclusions precluded coverage for the underlying claims. Birch argued that the exclusions did not apply. The appeals court said that the record showed that cleaning paint spatter from windows and doors was within the natural and intended scope of the work undertaken by the insured contractor as part of the painting operations for Birch. The scope of the insured's operations were intended to include the apartments that were being painted, and would, if required, involve cleaning up surfaces that were spattered with paint.

The court then applied exclusion (j)(5) on the general liability policy which stated that there is no coverage for property damage to “that particular part of real property” on which the insured is performing operations if the damage arises out of those operations. The court saw no genuine issue of material fact that the property damage in this case was to the apartment upon which H&H was performing its operations, and that the damage arose out of those operations. Thus it was error to conclude that coverage existed under the undisputed facts of this case.

The ruling of the trial court was reversed and remanded for entry of declaratory judgment in favor of the insurer.

Editor's Note: Disputes over the damage to property exclusion, (j)(5), are not unusual. Just what does “that particular part of real property” include when it comes to a property damage claim? This opinion was rather simple in that the insured was working on the glass surfaces when it damaged the glass. Suppose the insured was scrapping the old paint off the window sill and accidentally damaged the glass. Would the exclusion still apply?