Opinion ID: 63283
Heading Depth: 3
Heading Rank: 3

Heading: Professional Services

Text: Hartford's final argument is that the following clause excludes coverage: This insurance does not apply to: . . . (j). . . `property damage' . . . due to the rendering of or failure to render any professional service. This includes but is not limited to: . . . (3) [s]upervisory, inspection, architectural or engineering activities. [10] The Texas Supreme Court, interpreting this same clause in the context of a medical lawsuit, has held that such an exclusion does not preclude a duty to defend where the petition alleges both negligent professional services and negligent services of some other nature. Utica Nat'l Ins. Co. v. Am. Indem. Co., 141 S.W.3d 198 (Tex.2004). The question is whether the plaintiff's injury is caused by a breach of the professional standard of care. Here, under the Statement of Claim, the design of the project  professional services  may have been negligent, resulting in the damage to the Aircraft. Alternatively, a worker may simply have made a mistake in the implementation of the design, which could be ordinary negligence. See Guar. Nat'l Ins. Co. v. N. River Ins. Co., 909 F.2d 133 (5th Cir.1990) (failure to safeguard a patient's window did not fall within professional services exclusion); see also Allstate Ins. Co. v. Disability Servs. of the Sw., 400 F.3d 260, 264 (5th Cir.2005) (distinguishing between services that are inherent in the provision of professional services and those that are incidental to such services). Hartford's brief on this point relies almost entirely upon a Southern District of Texas case broadly applying a professional services exclusion to support an insurer's refusal to defend. Mid-Continent Cas. Co. v. Davis-Ruiz Corp., Nos. C-06-315, C-06-350, 2006 WL 2850067, 2006 U.S. Dist. LEXIS 74986 (S.D.Tex. Oct. 3, 2006), rev'd, No. 07-40727, 2008 WL 2330982, 2008 U.S.App. LEXIS 11730 (5th Cir. June 2, 2008). However, after Hartford's brief was filed, our court reversed the district court in that case in an unpublished decision. Because the Statement of Claim does not unequivocally place the blame on the engineering services, the exclusion does not negate the duty to defend. As a result, we need not reach Gore's argument that such an exclusion would render the additional insured coverage meaningless. See St. Paul Ins. Co. v. Tex. Dept. of Transp., 999 S.W.2d 881, 886-87 (Tex. App.  Austin 1999, pet. denied) (holding that professional services exclusion in that policy, if construed as suggested by the insurer, would negate any coverage provided by the additional insured clause); see also ATOFINA Petrochemicals, Inc. v. Cont'l Cas. Co., 185 S.W.3d 440, 444 (Tex. 2005) ([W]e adopt [the insured's] construction because [the insurer's] interpretation. . . would render coverage under the endorsement largely illusory).