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The Rough Notes Company Inc.

Intervention? Not so fast.

Intervention? Not so fast.

September 23
08:55 2019

Intervention? Not so fast.

On August 8, 2014, Robert O’Brien and others filed a complaint against Duerk Construction, Inc., and James Duerk, seeking to recover damages for alleged defective construction of property on Sea Island, Georgia. The complaint included claims for breach of contract, breach of warranties, and negligent construction. The Duerk defendants filed an answer and a third-party complaint naming as third-party defendants various subcontractors who had performed work on the property.

On July 14, 2017, Builders Insurance, the insurer for the Duerk defendants, filed a motion to intervene. In the motion, Builders sought to participate in discovery and propose a special verdict form to determine whether it was obligated to provide coverage for the damages claimed against the Duerk defendants.

After a hearing, the court, without explaining the basis for its ruling, summarily granted the motion and allowed Builders to intervene for the purposes of participating in discovery and proposing a special verdict form. The court certified its order for immediate review, the appellate court granted the application for interlocutory review filed by O’Brien and others, and their appeal followed.

On appeal, O’Brien and others objected to intervention by Builders, asserting that the motion was untimely, that intervention would improperly expand the scope of the litigation from one involving issues of liability to one involving issues of coverage, and that Builders had the independent statutory remedy of a declaratory judgment action to determine those issues of coverage. Builders acknowledged that it could bring a declaratory judgment action to determine coverage after the underlying action was completed.

The court noted that it was well settled that a declaratory judgment action is a proper proceeding for determining issues of coverage. Under those circumstances, the court said, the trial court abused its discretion in granting Builders motion to intervene in the O’Brien action. The order granting the motion to intervene was reversed.

O’Brien v. Builders Insurance-Court of Appeals of Georgia-May 3, 2019-No. A19A0686.

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