Zurich American Insurance Company v. Ironshore Specialty Insurance Company
October 05, 2020 —
Michael Velladao - Lewis BrisboisIn Zurich American Ins. Co. v. Ironshore Specialty Ins. Co., __F.3d__(July 2, 2020), the United States Ninth Circuit Court of Appeals certified the following questions to the Nevada Supreme Court in connection with a contribution action for defense costs filed by Zurich American Insurance Company and American Guarantee & Liability Insurance Company (“Zurich”) against Ironshore Specialty Insurance Company (“Ironshore”) with respect to the defense and settlement of 14 construction defect lawsuits on behalf of eight subcontractors (“lawsuits”) insured by both companies:
Whether, under Nevada law, the burden of proving the applicability of an exception to an exclusion of coverage in an insurance policy falls on the insurer or the insured? Whichever party bears such a burden, may it rely on evidence extrinsic to the complaint to carry its burden, and if so, is it limited to extrinsic evidence available at the time the insured tendered the defense of the lawsuit to the insurer?
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Michael Velladao, Lewis BrisboisMr. Velladao may be contacted at
Michael.Velladao@lewisbrisbois.com
Construction Recovery Still Soft in New Hampshire
May 10, 2013 —
CDJ STAFFThe latest building news out of New Hampshire is somewhat mixed. Yes, there has been an increase of seventeen percent in the value of future residential construction on the state. But that’s not enough to offset the general slide in the value of future construction overall. The New Hampshire Business Review reports that the state saw a four percent drop in the cost of planned construction, comparing March 2012 to March 2013.
The total value of the drop was shared between the twelve percent drop in nonresidential construction and the fifty-two percent drop in infrastructure building, each of which were more than $4 million less than in the prior year. The rise in residential construction could not make up the loss in other areas.
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A Court-Side Seat: SCOTUS Clarifies Alien Tort Statute and WOTUS Is Revisited
July 11, 2021 —
Anthony B. Cavender - Gravel2GavelWhat follows is a brief account of some of the notable U.S. environmental and administrative law cases recently decided.
THE U.S. SUPREME COURT
Nestle USA, Inc. et al. v. Doe, et al.
The Supreme Court has decided another important case interpreting the Alien Tort Statute. Released on June 17, 2021, this decision reverses the Ninth Circuit which had ruled that the respondents—six individuals who alleged they were child slaves employed on Ivory Coast cocoa farms, could sue the American-based companies for aiding and abetting child slave labor. Without dissent, the Court rejected this reading of the ATS and affirmed its own recent rulings on the scope of the ATS.
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Anthony B. Cavender, PillsburyMr. Cavender may be contacted at
anthony.cavender@pillsburylaw.com
Rent Increases During the Coronavirus Emergency Part II: Avoiding Violations Under California’s Anti-Price Gouging Statute
April 06, 2020 —
Dan Schneider - Newmeyer DillionIn my earlier article, Profiting From Fear: What You Need to Know About Price Gouging During the Coronavirus Emergency, I discuss price gouging and how the anti-price gouging statute, California Penal Code 396 (“CPC 396”), protects buyers of goods and services deemed vital and necessary for the health, safety and welfare of consumers. Part II of the article provides guidance to landlords on the parameters applicable to acceptable price increases and focuses attention on the application of CPC 396 to rental housing and related issues.
California Penal Code 396
As it pertains to housing, defined as “any rental housing with an initial lease term of no longer than one year,” price gouging occurs when a landlord increases the rent of an existing or prospective tenant by more than 10 percent of the previously charged or advertised price following an emergency or disaster declaration for a period of 30 days.2 A residential landlord is only allowed to increase rent in excess of 10 percent if “the increase is directly attributable to additional costs for repairs or additions beyond normal maintenance that were amortized over the rental term that caused the rent to be increased greater than 10 percent or that an increase was contractually agreed to by the tenant prior to the proclamation or declaration” (CPC 396(e).) Further, landlords are prohibited from evicting a tenant and then re-renting the property at a rate that the landlord would have been prohibited from charging the evicted tenant under the statute (CPC 396(f).)3
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Dan Schneider, Newmeyer DillionMr. Schneider may be contacted at
daniel.schneider@ndlf.com
Why You Make A Better Wall Than A Window: Why Policyholders Can Rest Assured That Insurers Should Pay Legal Bills for Claims with Potential Coverage
March 14, 2018 —
Alan Packer and Graham Mills - Newmeyer & Dillion, LLPUnfortunately, policyholders, such as manufacturers and contractors, routinely face the unnecessary challenge of how to access all of the insurance coverage which they have purchased. Frequently, the most pressing need is to get the insurance company to pay the legal bills when the policyholders have been sued. The recent Iowa federal district court opinion in
Pella Corporation v. Liberty Mutual Insurance Company should help a policyholder in a dispute to require its insurance company to pay those legal bills sooner rather than later by highlighting that the duty to defend arises from the potential for coverage, and the insurer may not force the policyholder to prove the damage to obtain a defense.
In
Pella, a window manufacturer purchased several years of insurance coverage from Liberty Mutual. Similar to many companies, Pella had many “layers” of insurance coverage in any given year. These layers collectively function like a tower. The general idea is that each layer provides a certain amount of coverage after the insurance policy below it had paid its money. The Liberty Mutual insurance policies provided excess coverage.
After the
Pella window manufacturer made and sold its windows, it was sued in numerous lawsuits alleging that its windows were defective and that those defective windows caused a wide variety of damage to the structures in which they were installed. The window manufacturer tendered those lawsuits to its insurance companies in its tower of coverage, asking that the insurance companies pay its legal bills incurred in its defense. As to Liberty Mutual, the window manufacturer argued that the Liberty Mutual insurance policies were triggered, and so obligated to reimburse it, if a window was installed during the years that those policies provided coverage or if there was a mere allegation that a window was installed during the years that those policies provided coverage. Liberty Mutual opposed, arguing that the date of installation of the windows was insufficient to trigger the policies, and that the manufacturer was required to demonstrate the date that damage actually occurred to trigger a defense.
The key issue before the
Pella Court in this decision was a simple one: which insurance policies, if any, issued by Liberty Mutual had an obligation to pay the window manufacturer’s legal bills? The answer to that question is critical and financially significant. Getting an insurance company to honor its obligations and start paying the legal bills as soon as possible is very important for a policyholder because of the cost of defending oneself in a lawsuit; often the key reason why an insurance policy is even purchased is to provide the policyholder with the right to call upon the insurance company’s financial resources to defend it should it be sued.
In a ruling that will be welcomed by policyholders, the
Pella Court held that Liberty Mutual’s multiple insurance policies were triggered, and so obligated to pay for the window manufacturer’s defense, if one of two events occurred during the years in which those insurance policies provided coverage: (1) a window was actually installed during a year when the insurance policy provided coverage or (2) the window was alleged to be installed in the year that the insurance policy provided coverage. The Court agreed with the policyholder that once the windows were installed, property damage was alleged and “may
potentially have occurred” from that point on, thus the policies on the risk from that point forward. The practical effect of this ruling meant that Liberty Mutual had to reimburse the window manufacturer for the defense fees and costs that it had paid.
While
Pella was decided under Iowa law, the principles upon which it relied are similar to those applied under California law. Importantly, both California and Iowa law hold that an insurance company must provide a defense in response to a claim that is, or could be, covered by the insurance policy. The mere potential that the claim might be covered is enough for the insurance company to be obligated to pay for policyholder’s legal fees and costs.
Establishing that an insurance company must pay legal fees and costs as soon as possible allows a policyholder to save its own money. Why should a policyholder pay legal bills when it purchased an insurance policy as protection to ensure that it did not have to pay those bills? The answer is that a policyholder should not and, under
Pella, the policyholder does not have to. Rather, the insurance company must start paying for that defense from a very early date. Pella confirms for policyholders the position that their insurance companies should pay legal bills earlier rather than later.
Alan Packer is a partner in the Walnut Creek office for Newmeyer & Dillion, LLP, representing homebuilders, property owners, and business clients on a broad range of legal matters, including risk management, insurance matters, wrap consultation and documentation, efforts to counter solicitation of homeowners, subcontract documentation, as well as complex litigation matters. Alan can be reached at alan.packer@ndlf.com.
Graham Mills is a partner in the Walnut Creek offce of Newmeyer & Dillion, LLP, representing clients in the area of complex insurance law with an emphasis on insurance recovery, construction litigation, real estate litigation, and business litigation. He regularly examines and analyzes a wide variety of insurance policies. Graham can be reached at graham.mills@ndlf.com.
ABOUT NEWMEYER & DILLION LLP
For more than 30 years, Newmeyer & Dillion has delivered creative and outstanding legal solutions and trial results for a wide array of clients. With over 70 attorneys practicing in all aspects of business, employment, real estate, construction and insurance law, Newmeyer & Dillion delivers legal services tailored to meet each client’s needs. Headquartered in Newport Beach, California, with offices in Walnut Creek, California and Las Vegas, Nevada, Newmeyer & Dillion attorneys are recognized by The Best Lawyers in America©, and Super Lawyers as top tier and some of the best lawyers in California, and have been given Martindale-Hubbell Peer Review’s AV Preeminent® highest rating.
For additional information, call 949.854.7000 or visit www.ndlf.com.
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Working Safely With Silica: Health Hazards and OSHA Compliance
January 17, 2022 —
Rick Pedley - Construction ExecutiveAbout 2.3 million American workers are exposed to silica, including those in construction, oil and gas, agriculture and manufacturing. Silica is commonly found in a range of construction materials and when this material breaks apart, small particles are released into the air, creating what’s known as respirable crystalline silica. These particles can get into a person’s respiratory tract, which can lead to a range of serious and potentially fatal illnesses including silicosis, lung cancer, chronic obstructive pulmonary disease and kidney diseases.
The Occupational Safety and Health Administration has set clear regulations for working with this substance, so construction workers and managers can know the risks of inhaling this substance and protect themselves on the job site.
What is Silica?
Crystalline silica is a mineral that forms naturally in the earth. Raw construction materials such as sand, stone, concrete and mortar often contain deposits of crystalline silica, which can put employees at risk. Silica becomes a danger to workers when it is released into the air and breathed in.
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Rick Pedley, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Helsinki is Building a Digital Twin of the City
May 20, 2019 —
Aarni Heiskanen - AEC BusinessThe capital of Finland first tested city modeling as long back as 1987. But the most recent model of the Kalasatama district demonstrates the new state-of-the-art possibilities of this technology: creation of a highly accurate digital twin of the city.
My hosts, Helsinki’s city modeling specialists Jarmo Suomisto and Enni Airaksinen, showed me their latest projects. One of them offered a glimpse of history through a lens of the future.
With 3D glasses on, I was able to experience the unrealized city plan made by Eliel Saarinen, the father of the world-renowned architect Eero Saarinen. The virtual model in question was a digitized version of a huge physical model from 1915. Being able to stroll the streets and fly over the roofs of the imagined city really made me understand how awesome the original design was. I had seen a scale model of this same plan while it was laid in the foyer of the Museum of Finnish Architecture many years ago, but this experience was quite different.
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Aarni Heiskanen, AEC BusinessMr. Heiskanen may be contacted at
aec-business@aepartners.fi
An Oregon School District Files Suit Against Robinson Construction Co.
March 19, 2014 —
Beverley BevenFlorez-CDJ STAFFThe Tigard-Tualatin School District in Tigard, Oregon filed a lawsuit against Robinson Construction for water damage to the Alberta Rider Elementary school, built in 2005, according to The Oregonian. The school district “is seeking $1.4 million in damages.”
According to the suit, as quoted by The Oregonian, the school district “holds Robinson responsible for faulty construction of the school’s panel siding, windows, doors, exterior walls and more.”
Repairs began in December of 2011, reported The Oregonian, and the cost so far is more than one million: “The district had to replace parts of the ‘exterior wall cladding system’ and remove and reinstall ‘storefront windows and window/door assemblies to ensure watertight performance,’ in addition to other alterations, the lawsuit reads.”
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