CAMBRIDGE MASSACHUSETTS BUILDING EXPERT
DIRECTORY AND CAPABILITIES

Playing Hot Potato: Indemnity Strikes Again

September 17, 2015 — Garret Murai – California Construction Law Blog
Indemnity can be like playing hot potato (for those of you closer to the Minecraft generation, in the game of hot potato, a metaphoric “hot potato” is tossed between (ahem amongst) players while music is playing, and when the music stops, the player holding the hot potato is out. It’s a barrel of monkeys, trust me.). Anyway, like hot potato, with indemnity an owner typically requires its general contractor to indemnify the owner (sometimes the property owner in TI projects and occasionally design professionals) from and against any and all claims arising out of, related to . . . blah, blah, blah . . . the general contractor’s scope of work . A general contractor in turn will usually require indemnity from its subcontractors. And subcontractors will require indemnity from their sub-subcontractors. And down the line it goes with each party pointing their finger at the next party down the proverbial “food chain.” But it doesn’t always happen that way as the next case, American Title Insurance Company v. Spanish Inn, Case No D067137, California Court of Appeals for the Fourth District (August 14, 2015), illustrates. Read the court decision
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Reprinted courtesy of Garret Murai, Wendel Rosen Black & Dean LLP
Mr. Murai may be contacted at gmurai@wendel.com

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Coverage Found For Cleanup of Superfund Site Despite Pollution Exclusion

March 05, 2015 — Tred R. Eyerly – Insurance Law Hawaii
The court determined that the pollution exclusion did not bar defense or indemnity for the insured's obligation to clean up a superfund site. Decker Mfg. Corp. v. The Travelers Indem. Co., 2015 U.S. Dist. LEXIS 12169 (W.D. Mich. Feb. 3, 2015). From 1966 to 1981, Decker disposed of its waste materials at the township landfill. The landfill was closed in 1981. Decker was insured under a CGL policy for a four year period from January 1, 1973, through January 1, 1977. After the landfill was closed, the EPA began an investigation which eventually led to a Unilateral Administrative Order in 1995 in which Decker was ordered to remove drums, construct a landfill cap, and monitor groundwater. Decker notified Travelers of the EPA's order on November 14, 1995. Travelers responded that it had no duty to defend or indemnify Decker. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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When Your “Private” Project Suddenly Turns into a “Public” Project. Hint: It Doesn’t Necessary Turn on Public Financing or Construction

September 28, 2017 — Garret Murai - California Construction Law Blog
In 1931, during the Great Depression, the federal government enacted the Davis-Bacon Act to help workers on federal construction projects. The Davis-Bacon Act, also known as the federal prevailing wage law, sets minimum wages that must be paid to workers on federal construction projects based on local “prevailing” wages. The law was designed to help curb the displacement of families by employers who were recruiting lower-wage workers from outside local areas. Many states, including California, adopted “Little Davis-Bacon” laws applying similar requirements on state and local construction projects. California’s current prevailing wage law requires that contractors on state and local public works projects pay their employees the general prevailing rate of per diem wages based on the classification or type of work performed by the employee in the locality where the project is located, as well as to hire apprentices enrolled in state-approved apprentice programs and to make monetary contributions for apprenticeship training. Read the court decision
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Reprinted courtesy of Garret Murai, Wendel Rosen Black & Dean LLP
Mr. Murai may be contacted at gmurai@wendel.com

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Two More Lawsuits Filed Over COVID-19 Business Interruption Losses

April 13, 2020 — Michael S. Levine - Hunton Andrews Kurth
Two more lawsuits were filed yesterday concerning business interruption losses resulting from the COVID-19 pandemic. The plaintiffs, the Chickasaw and Choctaw nations, filed their lawsuits, copies of which can be found here and here, in Oklahoma state court against a litany of property insurers, led by AIG. The lawsuits seek an order that any financial losses suffered by the nations’ casinos, restaurants and other businesses as a result of the coronavirus pandemic are covered by the nations’ insurance policies. According to the complaints:

On or about March of 2020, the United States of America became infected by COVID 19 resulting in a pandemic. As a result of this pandemic and infection, the Nation’s Property sustained direct physical loss or damage and will continue to sustain direct physical loss or damage covered by the policies, including but not limited to business interruption, extra expense, interruption by civil authority, limitations on ingress and egress, and expenses to reduce loss. As a direct result of this pandemic and infection, the Nation’s Property has been damaged, as described above, and cannot be used for its intended purpose.

Read the court decision
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Reprinted courtesy of Michael S. Levine, Hunton Andrews Kurth
Mr. Levine may be contacted at mlevine@HuntonAK.com

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Governor Inslee’s Recent Vaccination Mandate Applies to Many Construction Contractors and their Workers

September 13, 2021 — Brett M. Hill - Ahlers Cressman & Sleight PLLC
This month Governor Jay Inslee enacted COVID vaccination requirements that apply to certain construction contractors and their workers in Washington state. Inslee’s vaccine proclamation becomes effective October 18, 2021 and requires construction contractors, subcontractors, and their workers to be fully vaccinated to perform work onsite on certain covered projects. The following are types of covered projects where the vaccine mandate applies:

1. State agencies: All contractors working at projects for Washington state agencies (including WSDOT, DES, DNR, etc.) if the work is required to be performed in person and onsite, regardless of the frequency or whether other workers are present. The vaccine mandate applies to indoor and outdoor settings and there is no exemption even if social distancing requirements can be met.
2. Education/Higher Education/Child Care: All contractors performing work onsite for K-12, higher education (community colleges, technical colleges, and 4-year universities), child care and other facilities where students or persons receiving services are present. New and unoccupied projects are exempt but it does apply to public and private projects.
3. Medical facilities: All contractors performing work at a “healthcare setting” where patients receiving care are present. “Healthcare setting” is defined as any public or private setting that is primarily used for the delivery of in-person health care services to people. “Healthcare setting” includes portions of a multi-use facility, but only the areas that are primarily used for the delivery of health care, such as a pharmacy within a grocery store. Additional information is on the state’s Q&A page.

Read the court decision
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Reprinted courtesy of Brett M. Hill, Ahlers Cressman & Sleight PLLC
Mr. Hill may be contacted at brett.hill@acslawyers.com

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Is Your Design Professional Construction Contract too Friendly? (Law Note)

July 09, 2014 — Melissa Dewey Brumback – Construction Law North Carolina
My husband often travels the back roads between Chapel Hill and Fuquay Varina to visit friends. En route (a circuitous route that goes past Sharon Harris Nuclear Power Plant, among other places), he passes by the “Friendly Grocery.” [Sign] No *Loitering*Littering*Alcoholic Beverages on Premises*Bike*Skateboard* *10 minutes Parking Limit*Towing Enforced* I’m not sure which is the “friendly” part of that sign. In fact, the sign seems to be the antithesis of friendly. What does this have to do with your construction contracts? Sometimes, in an effort to please the client and/or secure the project, architects and engineers have the habit of being too friendly in their contract language. That is, you make promises or proposals that may promise too much of a good thing for the client. This can cause big problems. Bigger than being towed away from a rural grocery store in the middle of nowhere. You could be putting your insurance coverage at risk. Have you ever promised to use “best efforts” in your design or plans? Promised to design to a specific LEED standard? Guaranteed 100% satisfaction? You might be putting your errors & omission coverage at issue. By warrantying or guaranteeing something, you are assuming a level of liability well beyond the standard of care required by law. By law, you only need to conform to the standard of care, and your insurance will only provide coverage up to that standard of care. In other words, if you make guarantees or promise “best efforts,” you are contracting to something that will *not* be insured. If something goes wrong, you will be without the benefit of your professional liability coverage. Read the court decision
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Reprinted courtesy of Melissa Dewey Brumback, Construction Law in North Carolina
Ms. Brumback may be contacted at mbrumback@rl-law.com

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Measure of Damages for a Chattel Including Loss of Use

November 16, 2020 — David Adelstein - Florida Construction Legal Updates
In a non-construction case, but an interesting case nonetheless, the Second District Court of Appeals talks about the measure of damages when dealing with chattel (property) including loss of use damages. Chattel, you say? While certainly not a word used in everyday language, a chattel is “an item of tangible movable or immovable property except real estate and things (such as buildings) connected with real property.” Equipment, machinery, personal items, furniture, etc. can be considered chattel. With respect to the measure of damages for a chattel:

“Where a person is entitled to a judgment for harm to chattels not amounting to a total destruction in value,” the plaintiff may make an election out of two theories of recovery in addition to compensation for the loss of use. Badillo v. Hill, 570 So. 2d 1067, 1068 (Fla. 5th DCA 1990) (quoting Restatement of Torts § 928 (Am. Law Inst. 1939)). In addition to compensation for the loss of use, the plaintiff may elect either “the difference between the value of the chattel before the harm and the value after the harm” or “the reasonable cost of repairs or restoration where feasible, with due allowance for any difference between the original value and the value after repairs.” Id. (quoting Restatement of Torts § 928).

Sack v. WSW Rental of Sarasota, LLC, 45 Fla.L.Weekly D2306a (Fla. 2d DCA 2020). Sack is a good example of a case dealing with the measure of damages with a chattel, here, an aircraft, including loss of use damages. 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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No Coverage for Construction Defect Claim Only Impacting Insured's Work

January 08, 2024 — Tred R. Eyerly - Insurance Law Hawaii
In a coverage dispute between two insurers over a claim for damages caused by faulty workmanship, the court found there was no right to equitable contribution or indemnity. Travelers Prop. Cas. Co. of Am. v. Mallcraft, Inc., 2023 Cal. Super. LEXIS 67568 (Cal. Super. Ct. Sept. 15, 2023). Mallcraft was the general contractor for a building project and was sued for construction defects. Travelers was an additional insured under a policy issued to a subcontractor, KitCor. Travelers defended Mallcraft in an arbitration. Travelers sought equitable contribution and equitable indemnity from Hartford, Mallcraft's insurer. Mallcraft and Travelers stiulated to a judgment agianst Mallcraft for all costs Travelers incurred in the arbitration. Travelers' insured, KitCor, was not implicated in the construction defect claims against Mallcraft. The judgment set forth findings, including the fact that the underlying plaintiff never made any claim that KitCor perfomred work on the project or casued property damage. 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

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