Property insurer refuses to defend landlord after fatal accident

Must State Farm pay despite cancelled policy?

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James McGowan owned a four-unit apartment building where Lori Dutton and her 4-year-old daughter, Amy, lived in one of the apartments. McGowan sold the building to Mohammed Hakeem in May 2001. Dutton and her daughter continued to occupy the apartment. In September 2001, McGown cancelled his State Farm property owner's insurance policy. Purchase Bob Bruss reports online. During a thunderstorm in October 2001, a rotting tree next to the building collapsed onto the Dutton apartment, killing Amy. Dutton subsequently sued former owner, McGowan, for damages. She alleged McGowan was negligent during the time he owned the building by failing to correct the dangerous condition created by the rotting tree and his negligence caused or contributed to Amy's death. McGowan tendered defense of Dutton's lawsuit to State Farm, his former insurer. State Farm refused to defend under the policy that was an "occurrence" policy. State Farm then sued its former insured, McGowan, for declaratory judgment th...