Wisconsin Federal Court Finds Newly Discovered Damage is Covered 'Occurrence'

MILWAUKEE - In a case the judge cautioned is 'fact intensive,' a federal judge held that mold damage that may have predated a homeowner's policy is an occurrence if discovered within the policy period. Atlantic Mutual Insurance Cos. v. Lotz, No. 03-C-4 (E.D. Wis.).

U.S. District Judge J.P. Stadtmueller of the Eastern District of Wisconsin cited extensive case law from other jurisdictions in finding that '[m]ost courts, as well as the First Restatement of Contracts, adhere to the view that a loss is fortuitous if neither party knew or contemplated there was a defect in the insured property at the …