SEATTLE WASHINGTON BUILDING EXPERT
DIRECTORY AND CAPABILITIES

Whether Subcontractor's Faulty Workmanship Is an Occurrence Creates Ambiguity

March 16, 2017 — Tred R. Eyerly – Insurance Law Hawaii
The Ohio Court of Appeals determined that the CGL policy was ambiguous as to whether a subcontractor's faulty workmanship was an "occurrence." Ohio N. Univ. v. Charles Constr. Serv., 2017 Ohio App. LEXIS 258 (Ohio Ct. App. Jan. 23, 2017). In 2007, Ohio Northern University (ONU) entered a contract with Charles Construction Services, Inc. (CCS) to construct a hotel on the campus. In 2011, the building was completed, but ONU found water intrusion and moisture damage in the interior. When remediating the water damage, ONU found additional, serious structural defects. ONU sued CCS, alleging breach of contract, breach of express warranty, and negligent misrepresentation. CCS filed a third-party action against many of its subcontractors. Cincinnati Insurance Company (CIC) intervened and filed a cross-claim for a declaratory judgment that it had no duty to provide coverage to CCS. CIC and ONU filed cross motions for summary judgment. 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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The U.S. Tenth Circuit Court of Appeals Rules on Greystone

November 18, 2011 — Derek J. Lindenschmidt, Higgins, Hopkins, McLain & Roswell, LLC

On November 1, 2011, the Tenth Circuit Court of Appeals ruled on the certified question of whether property damage caused by a subcontractor’s faulty workmanship is an “occurrence” for purposes of a commercial general liability (CGL) insurance policy. In Greystone Const., Inc. v. National Fire & Marine Ins. Co., No. 09-1412 (10th Cir. Nov. 1, 2011), the Tenth Circuit determined that because damage to property caused by poor workmanship is generally neither expected nor intended, it may qualify under Colorado law as an occurrence and liability coverage should apply. Id. at 2.

The short history of the Greystone case is as follows. In Greystone Const., Inc. v. National Fire & Marine Ins. Co., 649 F. Supp. 2d 1213 (D. Colo. 2009), two contractors and one of their insurers brought an action against a second insurer after the second insurer refused to fund the contractors’ defense in construction defect actions brought by separate homeowners. Id. at 1215. The U.S. District Court for the District of Colorado, relying on General Sec. Indem. Co. of Arizona v. Mountain States Mut. Cas. Co., 205 P.3d 529 (Colo. App. 2009), granted summary judgment in favor of the second insurer on the basis that the homeowners’ complaints did not allege accidents that would trigger covered occurrences under the second insurer’s policies. Id. at 1220. Notably, the Greystone, General Security, and other similar decisions prompted the Colorado General Assembly to enact C.R.S. § 13-20-808, which was designed to provide guidance for courts interpreting perceived coverage conflicts between insurance policy provisions and exclusions. The statute requires courts to construe insurance policies to favor coverage if reasonably and objectively possible. C.R.S. § 13-20-808(5).

The Tenth Circuit began its analysis by determining whether C.R.S. § 13-20-808, which defines the term “accident” for purposes of Colorado insurance law, would have a retroactive effect, and thereby settle the question before the court. The Tenth Circuit gave consideration to several Colorado district court orders issued since the enactment of C.R.S. § 13-20-808 which have suggested that the statute does not apply retroactively, including Martinez v. Mike Wells Constr., No. 09cv227 (Colo. Dist. Ct., Mar. 1, 2011), and Colo. Pool. Sys., Inv. V. Scottsdale Ins. Co., No. 09cv836 (Colo. Dist. Ct., Oct. 4, 2010). The Tenth Circuit also attempted to ascertain the General Assembly’s intent behind the term “all insurance policies currently in existence...” Greystone, No. 09-1412, at 12. The Tenth Circuit determined that the General Assembly would have more clearly stated its intentions for the term if it was supposed to apply retroactively to expired policies, rather than those still running. Id. at 12-13. Ultimately, the Tenth Circuit decided that C.R.S. § 13-20-808 did not apply retroactively, but noted that “the retrospective application of the statute is not necessarily unconstitutional.” Id. at 9, 11-14. As such, the Tenth Circuit advised that it was required to decide the question presented in the appeal under the principles of Colorado insurance law. Id. at 15.

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Reprinted courtesy of Higgins, Hopkins, McLain & Roswell, LLC. Mr. Lindenschmidt can be contacted at lindenschmidt@hhmrlaw.com

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Crumbling Roadways Add Costs to Economy, White House Says

July 16, 2014 — Roger Runningen – Bloomberg
More than two-thirds of U.S. roadways are in need of repair and the poor condition of the nation’s transportation network results in billions in extra costs, according to a White House report. The report was released today in conjunction with President Barack Obama’s campaign to pressure Congress for a deal to replenish the Highway Trust Fund. The fund, supplied by fuel taxes, is heading toward insolvency as early as next month, jeopardizing jobs and projects during the peak construction season. Crumbling roads and bridges cut into economic growth, by increasing transportation costs and delaying shipments, according to the report. “A well-performing transportation network keeps jobs in America, allows businesses to expand, and lowers prices on household goods to American families,” said a 27-page report by the Council of Economic Advisers and National Economic Council. Read the court decision
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Reprinted courtesy of Roger Runningen, Bloomberg
Mr. Runningen may be contacted at rrunningen@bloomberg.net

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Estoppel Certificate? Estop and Check Your Lease

May 06, 2019 — Lauren Podgorski - Snell & Wilmer Real Estate Litigation Blog
If you are leasing space in a building, there may come a time when you receive a request from your landlord to fill out and sign an estoppel certificate. Estoppel certificates are usually sent to tenants in connection with the sale or refinance of a building, and a third party may rely on the accuracy of the statements and information contained in the estoppel certificate in connection with that transaction. Estoppel certificates can range from a very simple, one-page document, to several pages. I’ve received an estoppel certificate in the mail. What do I do now? Consider the following: Check your lease. Your lease may require you to deliver the signed estoppel certificate and may even give you a timeframe within which you are required to return it. A form of estoppel certificate may also be included in your lease as an exhibit. If you’ve previously agreed to a form of estoppel certificate in your lease, check to ensure the one you have received matches the form you previously agreed to and if it doesn’t make sure to review it carefully to make sure it is acceptable. Review the estoppel certificate and confirm that all of the information is accurate. Be on the lookout for any terms or provisions that you did not agree to in your lease. If it seems like the landlord is trying to modify your lease, you likely do not need to consent to the change in this document. Cross off (or modify or delete, if you have an electronic copy) any information that is inaccurate. Fill in all blanks (if the blank is not applicable, write “N/A”), and if any exhibits are referenced in the body of the document, make sure they are actually attached. Read the court decision
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Reprinted courtesy of Lauren Podgorski, Snell & Wilmer
Ms. Podgorski may be contacted at lpodgorski@swlaw.com

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Companies Move to Houston Area and Spur Home Building

December 30, 2013 — CDJ STAFF
A number of companies are developing commercial properties in the Kingwood area of the Houston metropolitan region and that’s spurring residential development as well. According to the Houston Chronicle, a number of key industries will be moving the area. And it’s leading to a lot of residential and commercial development. The 4,000-acre mixed-use development Generation Park will include offices, hotels, shops, and other amenities. But an important part of its success is expected to come from the adjacent master-planned community, Summerwood. Another development, Kingwood Parc City Center will include retail, restaurants, a movie theater, and office space. Other development in the Kingwood area includes a $71 million addition to the Kingwood Medical Center. The new tower will specialize in services for women and infants. Read the court decision
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Appraisal Ordered After Carrier Finds Loss Even if Cause Disputed

April 04, 2022 — Tred R. Eyerly - Insurance Law Hawaii
The court ordered an appraisal when the parties differed on the amount of loss to the dwelling even when the carrier contended the dispute was over the cause of the loss. Khaleel v Amguard Ins. Co., No. 21 C 992, Memorandum Opinion and Order (N.D. Ill. Feb. 11, 2022). The order is here. Plaintiffs home was damaged by wind and hail. A claim was submitted to Amguard for damage to the roof. Amguard found there was hail damage to the soft metal vents on the roof and estimated repair costs to be $3,815.16. Amguard found no damage to the roof itself. Plaintiffs contended there was additional damage to the roof. Plaintiffs demanded an appraisal. Amguard rejected the appraisal demand, claiming that the damage to the roof was due to wear and tear, and therefore constituted an excluded cause under the Policy. Plaintiff filed suit. After Amguard answered, plaintiffs moved for judgment on the pleadings. 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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US Civil Rights Tools Are Failing the Most Polluted Black Communities

February 05, 2024 — Manann Donoghoe & Andre Perry - Bloomberg
In 2022, the United Nations declared that access to a safe and healthy environment, free of pollutants and toxic waste, is a universal human right. The resolution provides a legal foundation for international challenges to environmental injustice; it should also provide an impetus for nations like the US to enforce their own environmental protections. Without more clearly defined rights, some of the greatest environmental injustices may continue to be mired in politics. Take the case of “Cancer Alley,” an 85-mile stretch along the Mississippi River in Louisiana where Black residents have long faced higher rates of death and morbidity due to polluted and toxic environments. For people of color living in the region, fresh air is certainly not a right; it is a privilege for others to experience. Reprinted courtesy of Manann Donoghoe, Bloomberg and Andre Perry, Bloomberg Read the court decision
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$24 Million Verdict Against Material Supplier Overturned Where Plaintiff Failed To Prove Supplier’s Negligence Or Breach Of Contract Caused A SB800 Violation

June 05, 2017 — Jon A. Turigliatto & Chelsea L. Zwart - CGDRB News & Publications
The Fourth District California Court of Appeal published its decision, Acqua Vista Homeowners Assoc. v. MWI, Inc. (2017) 7 Cal.App.5th 1129, holding that claims against a material supplier under SB800 (Civil Code §895, et. seq.) require proof that the SB800 violation was caused by the supplier’s negligence or breach of contract. In this case, Acqua Vista Homeowners Association (“the HOA”) sued MWI, a supplier of Chinese pipe used in the construction of the Acqua Vista condominium development. The HOA’s complaint asserted a single cause of action for violation of SB800 standards, and alleged that defective cast iron pipe was used throughout the building. At trial, the HOA presented evidence that the pipes supplied by MWI contained manufacturing defects, that they leaked, and that the leaks had caused damage to various parts of the condominium development. The jury returned a special verdict against MWI, and the trial court entered a judgment against MWI in the amount of $23,955,796.28, reflecting the jury’s finding that MWI was 92% responsible for the HOA’s damages. MWI filed a motion for a directed verdict prior to the jury’s verdict and motion for judgment notwithstanding the verdict following the entry of judgment, both on the grounds that the HOA had failed to present any evidence that MWI had caused a SB800 violation as a result of its negligence or breach of contract, and had therefore failed to prove negligence and causation as required by SB800. MWI relied on the Fourth District’s prior decision in Greystone Homes, Inc. v. Midtec, Inc. (2008) 168 Cal.App.4th 1194, and its interpretation therein of Civil Code §936, which states, in relevant part, that the statute applies “to general contractors, subcontractors, material suppliers, individual product manufacturers, and design professionals to the extent that the general contractors, subcontractors, material suppliers, individual product manufacturers, and design professionals caused, in whole or in part, a violation of a particular standard as the result of a negligent act or omission or a breach of contract….” (emphasis added.) However, the trial court denied both motions, relying on the last sentence of Civil Code §936, which states in part, “[T]he negligence standard in this section does not apply to any…material supplier…with respect to claims for which strict liability would apply.” Reprinted courtesy of Jon A. Turigliatto, Chapman Glucksman Dean Roeb & Barger and Chelsea L. Zwart, Chapman Glucksman Dean Roeb & Barger Mr. Turigliatto may be contacted at jturigliatto@cgdrblaw.com Ms. Zwart may be contacted at czwart@cgdrblaw.com Read the court decision
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