A cooling tower must be considered equipment, not a structure, a federal appeals court ruled Wednesday, in concluding there is insurance coverage in a negligence case filed by a worker who developed Legionnaires’ disease after working on a cooling tower.

Cooling towers are designed to remove heat from facilities by spraying water down through them.

Wednesday’s ruling by the 11th U.S. Circuit Court of Appeals in Atlanta in Southern-Owners Insurance Co. v. Waterhouse Corp., Nursery Supplies Inc., Darrell Patterson, in a case that hinged on how a cooling tower should be classified, affirmed a lower court decision.

In July 2019, Mr. Patterson, a plumber and electrician, worked in and around a cooling tower on property owned by Kissimmee, Florida-based Nursery Supplies Inc., which had hired Deltona, Florida-based Waterhouse to perform monitoring, maintenance and water treatment services for the tower.

About two weeks later, he was admitted to a hospital and diagnosed with Legionnaire’s disease, with water samples from the tower confirming the legionella bacteria’s presence. Mr. Patterson sued Nursey Supplies and Waterhouse for negligence.

Waterhouse was insured under commercial general liability and umbrella policies issued by Lansing, Michigan-based Southern-Owners that included exclusions for fungi or bacteria found within a building or structure.

The insurer agreed to defend Waterhouse under a reservation of rights, but argued that the fungi exclusions applied because the cooling tower was a structure. Nursery Supplies and Mr. Patterson argued the cooling tower was not a “structure” within the meaning of the exclusions.

The U.S. District Court in Orlando ruled the insurer had a duty to defend and potentially indemnify Waterhouse, and was affirmed by a three-judge appeals court panel.

A cooling tower “is more properly considered machinery,” the ruling said. “While a cooling tower may indeed qualify as a ‘structure’ under a broad definition of the term, Florida law clearly instructs that ambiguous provisions in insurance policies must be interpreted strictly against the drafter,” it said.

“Here, given the ambiguity” in the exclusions’ language, “we must construe provisions strictly against Southern Owners and liberally in favor of coverage.”

Attorneys in the case did not respond to requests for comment.