Opinion ID: 2795632
Heading Depth: 2
Heading Rank: 2

Heading: “Wrongful Exhaustion”

Text: Separately, Amerisure also argued that the policy limits were not exhausted because Arch wrongfully paid for the toilet leak claim and the fire sprinkler claim. In Amerisure’s view, these claims were not covered under the “products-completed” coverage because the apartment building was not “complete.” Arch calls this the “wrongful exhaustion” claim. It is not altogether clear under what authority Amerisure (as an excess insurer arguing on behalf of a common insured) argues that amounts were “wrongfully” paid. Nor is it altogether clear how a court should evaluate such a claim under a policy with multiple insureds, one of which successfully demanded coverage for these claims and another of which now contends payments of the demanded sums should not have been made. We conclude that it is unnecessary to plumb these depths because, even assuming arguendo that there is a cause of action for “wrongful exhaustion,” the district court correctly held it does not apply here. We conclude that the reasons given by the district court in this regard are clear, and we need not address this argument further. Accordingly, we AFFIRM the district court’s judgment regarding the duty to indemnify, REVERSE the district court’s judgment regarding the duty to defend, and RENDER judgment for Arch. 9