Beyond the COI: The Importance of an Owner's or Facilities Manager's Downstream Insurance Review Program
March 15, 2021 —
Hugh D. Hughes, Eric M. Clarkson & Mollie H. Levy - Saxe Doernberger & Vita, P.C.The risk of bodily injury lawsuits is an unavoidable reality for property owners and facilities managers (“FMs”) of large commercial sites such as universities, malls, office buildings, or stadiums. Any person who steps foot on the property is a potential plaintiff, including students, tenants, customers, contractors, and vendors.
Insurance mitigates these risks, but a property owner’s or FM’s risk transfer strategy should include more than their own suite of general liability and other third-party policies. Ensuring additional insured status on a vendor’s or contractor’s policy is also essential to a comprehensive risk transfer strategy. In a functional risk transfer program, a vendor’s or contractor’s general liability insurer should defend and indemnify property owners or FMs as additional insureds (“AIs”) for liability for bodily injury caused, in whole or in part, by the vendor’s or contractor’s operations. When this works as intended, it effectively transfers costs associated with such a lawsuit from the owner or FM to the vendor’s or contractor’s insurer. It also increases the insurance limits available for a loss.
Reprinted courtesy of
Hugh D. Hughes, Saxe Doernberger & Vita, P.C.,
Eric M. Clarkson, Saxe Doernberger & Vita, P.C. and
Mollie H. Levy, Saxe Doernberger & Vita, P.C.
Mr. Hughes may be contacted at HHughes@sdvlaw.com
Mr. Clarkson may be contacted at EClarkson@sdvlaw.com
Ms. Levy may be contacted at MLevy@sdvlaw.com
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Where Do We Go From Here?
March 21, 2022 —
Christopher G. Hill - Construction Law MusingsGreen Builder CoalitionFor this week’s Guest Post Friday, I welcome an old friend and past Guest Post Friday contributor, Mike Collignon. Mike is the Co-Founder and Executive Director of the Green Builder® Coalition. He engages in national and state-level advocacy and publishes regular content for Green Builder® Media. Mike is also the Chair of the WERS Development Group and has served as the moderator or host for Green Builder® Media’s Impact Series webinars from 2012– present.
This post originally appeared on Green Builder® Media’s Code Watcher.
Do you ever have a line from a song just pop into your head? I get that… a lot. It’s probably due to my lifelong love of music. Anyway, while I was researching this column, the line that cites the title of “Where Do We Go From Here?” by Filter started playing between my ears. You’ll see why in a couple of minutes.
In case you didn’t
read about it here or elsewhere, the IECC development process has undergone an overhaul. It is now following a standards process, yet it retains the word “code” in the name. The residential committee (which is the scope of this column) is now a consensus committee and has been greatly expanded. Proposals are still submitted, reviewed and voted on by the committee. On the surface, it doesn’t sound like much has changed. As they say, the devil is always in the details.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Structure of Champlain Towers North Appears Healthy
August 04, 2021 —
Nadine M. Post - Engineering News-RecordThere is good news for the residents of the occupied Champlain Towers North, the 12-story residential condominium in Surfside, Fla., located a short distance up Collins Avenue from its near-twin Champlain Towers South, which failed unexpectedly June 24. The unstable remaining wing of the Champlain Towers South concrete structure was imploded July 4, after the partial progressive collapse that killed at least 94 people and left another 22 still missing.
Reprinted courtesy of
Nadine M. Post, Engineering News-Record
Ms. Post may be contacted at postn@enr.com
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Fraud and Construction Contracts- Like Oil and Water?
December 31, 2014 —
Christopher G. Hill – Construction Law MusingsWe have discussed the interaction of fraud and breach of contract actions on occasion here at Construction Law Musings. In most cases the two do not mix. Between the economic loss rule and the general desire of Virginia courts to keep contract actions and tort actions separate, most of the time it is impossible to make a fraud action relating to a contract stick in a construction context.
The Virginia Supreme Court recently confirmed this fraud/contract distinction. As discussed in the Virginia Real Estate Land Use & Construction Law blog (Thanks Heidi!), Station No. 2, LLC v. Lynch, et. al. strongly re-states the Virginia courts’ strong reluctance to allow a breach of contract turn into a claim for fraud. Without re-iterating the great discussion of the facts of the case found in the post by Heidi Meizner, suffice it to say that certain contractual promises between and among the parties were not fulfilled much to Station 2, LLC’s detriment.
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Christopher G. Hill, Law Office of Christopher G. Hill, PCMr. Hill may be contacted at
chrisghill@constructionlawva.com
Illinois Appellate Court Addresses Professional Services Exclusion in Homeowners Policy
August 03, 2022 —
James M. Eastham - Traub LiebermanIn Stonegate Ins. Co. v. Smith, 2022 IL App (1st) 210931, the Insured was performing plumbing work at a multi-story townhouse when a fire ensued causing damage to the second story unit. Although a carpenter by trade, the Insured was performing plumbing work consisting of the replacement of a shower valve as a favor for a friend. To accomplish the task, the Insured utilized a small propane torch to attempt to remove the old water piping to the shower. In doing so, the insulation behind the bathroom wall caught fire and the flame spread upward to the neighboring unit. Stonegate had issued a homeowner’s policy to the Insured during the relevant time period. The homeowner's policy excluded coverage for property damage "[a]rising out of the rendering of or failure to render professional services." Subsequent to tender of the loss, Stonegate initiated a declaratory judgment action seeking a declaration that it owned no duty to defend or indemnity pursuant to the professional services exclusions.
In finding in favor of the Insured, the Court began its analysis by noting that the homeowner's policy did not define the term "professional services" such that it was the Court’s task to determine whether the Insured’s work qualified as a "professional service" for purposes of the exclusion. The Court further prefaced its holding by stating that for an exclusionary clause to effectively deny coverage, its applicability must be clear and free from doubt because any doubts as to coverage will be resolved in favor of the insured. Looking to Illinois case precedent, the Court found that the term "professional service" is not limited to services for which the person performing them must be licensed by a governmental authority. Rather, "professional services" encompass any business activity conducted by an insured that (1) involves specialized knowledge, labor, or skill, and (2) is predominantly mental or intellectual as opposed to physical or manual in nature.
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James M. Eastham, Traub LiebermanMr. Eastham may be contacted at
jeastham@tlsslaw.com
Los Angeles Warehousing Mecca Halts Expansion Just as Needs Soar
September 05, 2022 —
Ngai Yeung & Augusta Saraiva - BloombergCommunities in the Inland Empire, the US’s logistics mecca east of Los Angeles, are suspending new warehousing projects to examine the impact from decades of pollution -- putting the industry under pressure when it’s needed most.
This week, the city council for Pomona is set to vote on extending a temporary halt on industrial developments to study the environmental impact, while the nearby city of Norco will decide whether to establish a 45-day moratorium. The actions follow similar freezes by a handful of Southern California cities like Riverside, Colton, Chino and Redlands over the past several years.
Meanwhile, a state-level bill -- which is a long-shot to pass in the legislature but gives a reading of the mood -- proposes banning large industrial construction within 1,000 feet of non-industrial areas such as schools, homes and playgrounds in Riverside and San Bernardino counties, an area that spans 27,000 square miles.
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Ngai Yeung, Bloomberg and
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Discussing Parametric Design with Shajay Bhooshan of Zaha Hadid Architects
May 10, 2017 —
Aarni Heiskanen - AEC Businessobotics, 3D printing, and digital fabrication—these evolving technologies are changing how we design and construct. Looking into the future can surprisingly cause us to rediscover history, as I learned when discussing parametric design with Shajay Bhooshan.
During the AEC Hackathon Munich in April 2017, I became acquainted with Shajay Bhooshan, associate at Zaha Hadid Architects. Shajay showed me designs that were intriguingly reminiscent of natural forms but completely modern in expression. He explained how these lightweight structures had been digitally designed and constructed with minimal use of material. One of the examples he shared was a large shell structure that consisted of aluminium elements that could be assembled and dismantled easily.
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Aarni Heiskanen, AEC BusinessMr. Heiskanen may be contacted at
info@aepartners.fi
Court Orders House to be Demolished or Relocated
April 26, 2011 —
Beverley BevenFlorezCDJ STAFFDecision Affirmed in Central Arkansas Foundation Homes, LLC v. Rebecca Choate
The Arkansas Court of Appeals affirmed the decision by the trial court in Central Arkansas Foundation Homes, LLC v. Rebecca Choate. In the trial case, Central Arkansas Foundation Homes (CAFH) sought payment for a home built for Choate, while Choate alleged that the builders committed multiple construction defects including using the wrong foundation materials and positioning the house in the wrong direction.
After the house was built, CAFH contacted Choate regarding payment, however, Choate alleged that the finished product did not match the contract. “ After CAFH completed construction, it obtained permanent home financing for Choate and tried to contact her to close the transaction. Choate did not respond until October 2005, when she sent CAFH a list of alleged construction defects, including that the house was facing in the wrong direction; that it was not built on a slab; and that the fireplace, garbage disposal, driveway, and storage area were missing. CAFH replied to Choate in writing, telling her that she had until January 6, 2006, to close on the house or CAFH would sell it. The correspondence enclosed worksheets showing that the amount Choate would owe at closing exceeded $94,000, which included interest that had accrued on the as-yet unpaid construction loan.”
Initially, the court found in favor of CAFH. “On April 18, 2007, Choate’s attorney withdrew from representing her. Soon thereafter, CAFH’s attorney asked the court to set a final hearing on the case. The attorney purportedly sent Choate a letter by regular mail on May 15, 2007, advising her that the case was set for trial on July 9, 2007. Choate, however, did not appear. CAFH did appear, and its general manager, John Oldner, testified to events leading up to the case and the amount of damages claimed. According to Oldner, the interest on the construction loan had accrued to the point that CAFH now sought $104,965.88 from Choate. The court found in favor of CAFH and entered judgment for that amount, plus attorney fees, on July 18, 2007. The court ruled that CAFH could sell the house and either remit any excess to Choate or look to Choate for the deficiency if the sales price did not cover the judgment.”
However, Choate successfully argued that she did not receive notice of the trial. A new trial was ordered, and the outcome was quite different. “On June 6, 2008, the circuit court entered judgment for Choate, ruling that the house was not in substantial compliance with the parties’ contract and that the contract should be rescinded. The court found that the house suffered from numerous construction defects, that the contract contemplated a slab rather than a concrete-pier foundation, and that CAFH ignored Choate’s complaints that the house was facing the wrong way. The judgment directed CAFH to hold Choate harmless on the construction loan, to deed Choate’s two acres back to her, and to remove the house from Choate’s property.”
The Court of Appeals “found that Choate would be unjustly enriched by retaining the benefit of the septic systems and utility lines that CAFH installed on her land. The court therefore awarded $5340 to CAFH as a quantum-meruit recovery for the value of that work. CAFH contends that the award is not sufficient, but we see no clear error.” In the end, the Court of Appeals provided this reason for declining to reverse the trial court’s decision: “The court in this case apparently concluded that the house constructed by CAFH was so fundamentally at odds with Choate’s contractual expectations that she was not unjustly enriched and should simply be, as nearly as possible, returned to the status quo ante. Accordingly, the court ordered the house removed from her property and permitted CAFH to either relocate the house or salvage the house’s materials and unused appliances. We decline to reverse the court’s weighing of the equities in this manner.”
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