Fairfield Connecticut Building Expert Directory

Not So Unambiguous: California Court of Appeal Finds Coverage for Additional Insured

October 11, 2017 — Malcom Ranger-Murdock - Saxe Doernberger & Vita, P.C.
California’s Fourth District Court of Appeal recently determined that manuscript additional insured endorsements (AIEs), which purportedly provided coverage for ongoing operations only, were ambiguous. The court also found the insurer that issued the policies, American Safety Indemnity Co. (American Safety), acted in bad faith due to its systematic efforts to deny coverage to general contractors as additional insureds. In Pulte Home Corp. v. American Safety Indemnity Co.,1 Pulte Home Corporation (Pulte Home), a general contractor, sued American Safety for failure to defend Pulte Home as an additional insured in connection with two underlying construction defect lawsuits. American Safety contended that it did not have a duty to defend Pulte Home because the loss occurred after the construction project was complete and the applicable AIEs did not provide coverage for completed operations, and/or because the policy’s faulty workmanship exclusions applied. The trial court awarded $1.4 million in compensatory and punitive damages to Pulte Home, and American Safety appealed. Read the court decision
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Reprinted courtesy of Malcom Ranger-Murdock, Saxe Doernberger & Vita, P.C.
Mr. Ranger-Murdock may be contacted at mrm@sdvlaw.com

Colorado Senate Revives Construction Defects Reform Bill

March 01, 2017 — Beverley BevenFlorez-CDJ STAFF
A re-booted construction defects reform bill recently passed its first Senate committee, according to the Denver Business Journal. Next, Senate Bill 156, sponsored by Sen. Owen Hill, R-Colorado Springs, heads to the Senate floor for debate. SB 156 “would require that condominium owners alleging construction defects take their disputes to arbitration or mediation if requested by builders,” the Denver Business Journal reported. “It also would require that homeowners be informed of the consequences of filing legal actions over purported disputes and that a majority of all owners in a condominium complex vote to proceed with legal action, rather than just a majority of homeowners association board members.” However, it is almost identical to the failed measures that were introduced in 2014 and 2015. Homeowners association group members and owners of defective condominiums argued against the measure, stating “that the effort would not improve the quality of building in the state, but simply would block aggrieved Coloradans from taking their complaints before a jury of their peers.” Proponent of the bill, Tom Clark, CEO of Metro Denver Economic Development Corp., said “that Denver’s housing costs have risen since the first bill was introduced in 2013 to the sixth-most-expensive in the country – and are tops for any metro area not on a coast.” Read the court decision
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Another Exception to Fraud and Contract Don’t Mix

January 18, 2021 — Christopher G. Hill - Construction Law Musings
Here at Construction Law Musings, we’ve discussed the fact that, in Virginia, the “economic loss rule” generally renders claims of fraud and construction contracts like oil and water. This is true in most states, including Florida. What this means is that as a general rule where any party is supposed to perform under a contract, and fails to do so, the Virginia courts will dismiss a fraud claim out of a desire to avoid turning any breach of contract (read “broken promise”) case into a claim for fraud. As you have likely gathered by the title of this post, there are exceptions. One is a properly plead Virginia Consumer Protection Act (“VCPA”) claim. Another, found in a recent Loudoun County, VA Circuit Court opinion in Madison v. Milton Home Systems Inc., is so called fraud in the inducement (in other words, inducing a person to enter the contract under false pretenses). In Madison the Court analyzed several counts based upon a modular home contract and so called “performance agreement” guarantying that the home would be installed by the manufacturer in the event that it’s installer failed to perform. Read the court decision
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Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

Pre-Judgment Interest Not Awarded Under Flood Policy

January 17, 2023 — Tred R. Eyerly - Insurance Law Hawaii
The court granted the insurer's motion to dismiss state law and extracontractual claims, including pre-judgment interest. Hurley v. Wright Nat'l Flood Ins. Co., 2022 U.S. Distl. LEXIS 203803 (W.D. La. Nov. 8, 2022). The insured suffered damage from Hurricane Delta. He filed suit, alleging that Wright National Flood Insurance Company breached the Standard Flood Insurance Policy (SFIP). The insured sought damages for state law claims for bad faith, diminution in value, actual repair costs, attorney's fees , litigation costs, and interest. Wright moved to dismiss the extracontractual state law causes of action for bad faith and various claims for damages, other than the damages sought for the alleged breach of the SFIP. The court explained that the Write-Your-Own (WYO) Program carriers issuing flood insurance under the National Flood Insurance Program (NFIP) arranged for the adjustment, settlement, payment, and defense of all claims arising from the policy. Congress underwrote all operations of the NIFP, including claims adjustment, through United States Treasury funds. A judgment against a WYO Program carrier constituted a judgment against FEMA, and consequently, a direct charge on the United States Treasury. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

Senior Housing Surplus Seen as Boomers Spur Building Boom

May 19, 2014 — Brian Louis – Bloomberg
Real estate developers are betting big on U.S. housing for the elderly, preparing for a surge in demand as the population of senior citizens almost doubles in the next 35 years. They may be building too fast. A jump in supply is forecast to cut growth in senior-housing net operating income to 1.8 percent in 2015 and 1.4 percent in 2016 from 3.3 percent this year, according to Green Street Advisors Inc. The increase may hurt health-care real estate investment trusts and companies including Brookdale Senior Living Inc. (BKD), which is buying competitor Emeritus Corp. (ESC) for about $1.4 billion to become the biggest owner of senior properties, the research firm said. “Increased supply is always worrisome in any type of commercial real estate,” said Jim Sullivan, a managing director at Newport Beach, California-based Green Street. “In senior housing, new construction has ramped up considerably over the last two years.” Read the court decision
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Reprinted courtesy of Brian Louis, Bloomberg
Mr. Louis may be contacted at blouis1@bloomberg.net

NYC Supertall Tower Condo Board Sues Over Alleged Construction, Design 'Defects'

October 04, 2021 — James Leggate - Engineering News-Record
The condominium board at a 1,396-ft-tall residential tower on New York City’s Billionaires’ Row has sued the building’s developers, claiming to have identified more than 1,500 construction and design defects in common areas alone. Reprinted courtesy of James Leggate, Engineering News-Record Mr. Leggate may be contacted at leggatej@enr.com Read the full story... Read the court decision
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New Mandatory Bond Notice Forms in Florida

December 16, 2019 — Brian A. Wolf & Miles D. Jolley - Smith Currie
Subcontractors and suppliers must now use new, statutory notice of nonpayment forms to preserve payment bond claims, and sign each notice of nonpayment under oath. The State of Florida instituted changes to the statutes governing public-project payment bonds (section 255.05, Florida Statutes) and private-project payment bonds (section 713.23, Florida Statutes). The changes went into effect on October 1, 2019. Previously, notices of nonpayment were not required to be signed under oath. Now, the law requires the use of specific statutory notice forms that claimants must sign under oath. Previously, there were no statutory penalties for claimants who exaggerated the amount claimed against a payment bond. Now there are specific statutory penalties against a claimant who willfully or negligently signs a notice of nonpayment that includes a claim for work not performed or materials not furnished, or who is guilty of signing a notice prepared with willful or gross negligence. Public construction payment bonds are governed by section 255.05, Florida Statues, also known as Florida’s Little Miller Act. This statute requires all payment bond claimants who don’t have a direct contract with the general contractor to serve both the bonding company and the general contractor with a notice of nonpayment no later than 90 days after their last date of work or last delivery of materials. The amended statute now requires that the claimant use the statutory notice form and sign the form under oath. If the claimant includes exaggerated claims, or intentionally makes a claim for work or materials not provided, or otherwise prepares a notice with gross negligence, then the bonding company and the general contractor will be able to use such as a complete defense to an otherwise valid bond claim. Reprinted courtesy of Brian A. Wolf, Smith Currie and Miles D. Jolley, Smith Currie Mr. Wolf may be contacted at bawolf@smithcurrie.com Mr. Jolley may be contacted at mdjolley@smithcurrie.com Read the court decision
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Avoid the Headache – Submit the Sworn Proof of Loss to Property Insurer

October 12, 2020 — David Adelstein - Florida Construction Legal Updates
Property insurance policies (first party insurance policies) contain post-loss obligations that an insured must (and should) comply with otherwise they risk forfeiting insurance coverage. One post-loss obligation is the insurer’s right to request the insured to submit a sworn proof of loss. Not complying with a post-loss obligation such as submitting a sworn proof of loss can lead to unnecessary headaches for the insured. Most of the times the headache can be avoided. Even with a sworn proof of loss, there is a way to disclaim the finality of damages and amounts included by couching information as estimates or by affirming that the final and complete loss is still unknown while you work with an adjuster to quantify the loss. The point is, ignoring the obligation altogether will result in a headache that you will have to deal with down the road because the property insurer will use it against you and is a headache that is easily avoidable. And, it will result in an added burden to you, as the insured, to demonstrate the failure to comply did not actually cause any prejudice to the insurer. By way of example, in Prem v. Universal Property & Casualty Ins. Co., 45 Fla. L. Weekly D2044a (Fla. 3d DCA 2020), the insured notified their property insurer of a plumbing leak in the bathroom. The insurer requested for the insured to submit a sworn proof of loss per the terms of the insured’s property insurance policy. The insurer follow-up with its request for a sworn proof of loss on a few occasions. None was provided and the insured filed a lawsuit without ever furnishing a sworn proof of loss. The insurer moved for summary judgment due the insured’s failure to comply with the post-loss obligations, specifically by not submitting a sworn proof of loss, and the trial court granted the insurer’s motion. Even at the time of the summary judgment hearing, the insured still did not submit a sworn proof of loss. Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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