Vermont Mutual v Poirier SJC (2022)

FACTS

Sewage got into a homeowner’s basement. Poirier (doing business as Servpro of Fitchburg-Leominster) cleaned it up.

Poirier warned the homeowner to stay out of the basement while the disinfectants dried but did not warn her that going in, before the disinfectants dried, could be dangerous to her health. The homeowner developed respiratory problems determined by her doctors to have been caused  by exposure to chemicals Poirier used.

Homeowners sued Poirier based on breach of warranty under MGL  c 93A §2, Massachusetts law of bad faith business  practices and a big judgment entered.

The Poirier’s insurer Vermont Mutual paid the big judgment award but refused to pay the homeowner’s attorney’s fees ($250,000 or so) awarded based on Massachusetts law of bad faith law MGL c 93A §2 which calls for an award of attorney’s fees for successful MGL c 93 A plaintiffs.

Vermont Mutual sued its insured Poirier asking the Court to declare that the general liability insurance policy did not cover attorney’s fees awarded to successful bodily injury plaintiffs.

ISSUE

Must a commercial insurer pay winning plaintiff’s attorney’s fees in a case based on MGL c 93A §2?

HOLDING

Insurer had to pay the homeowner’s personal injury damages but did not have to pay the attorney’s fees awarded under MGL c 93 A.

REASONS

Words of the policy determine coverage. No question Poirier was legally obligated to pay the plaintiff’s attorney’s fees but those are not bodily injury or property damage under the insurance policy definitions.