No Coverage for Faulty Workmanship Where Underlying Claim is Strictly Breach of Contract
June 30, 2016 —
Tred R. Eyerly – Insurance Law HawaiiConsidering certified questions from the federal district court, the Arkansas Supreme Court followed a prior decision in deciding there was no coverage for property loss caused by faulty workmanship based solely on breach of contract. Columbia Ins. Group, Inc. v. Cenark Project Mgt. Services, Inc., 2016 Ark. LEXIS 185 (Ark. April 28, 2016).
The homeowners entered a contract in 2005 with Arkansas Infrastructure, Inc. (AII) to construct pads for the construction of six homes. The contract provided that AII would perform the work in accordance with the plans, specifications, and drawings developed by CENARK Project Management Services, Inc.
In 2012, the homeowners sued AII for breach of contract, alleging that AII had failed to construct the pads in accordance with the plans and specifications designed by CENARK.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Supreme Court’s New York Harbor Case Isn’t a ‘Sopranos’ Episode
August 03, 2022 —
Stephen L. Carter - BloombergThe long-simmering harbor dispute between New York and New Jersey has observers reaching for illustrations from “The Sopranos” and “On the Waterfront.” But now that the US Supreme Court has agreed to adjudicate the spat, I wonder whether a more useful resource might be “The Paper Chase.”
The disagreement stems from New Jersey’s determination to exit the Waterfront Commission of New York Harbor, an entity established by the two states back in 1953 in response to news reports of widespread corruption and violence among those who loaded and unloaded ships. New Jersey argues that as a sovereign state, it can’t be forced to remain in the pact forever. New York replies that the deal has the force of law and neither state can quit without the permission of the other. (And Congress!)
The Supreme Court is now involved because that’s the venue the Constitution prescribes when one state sues another. Four days before New Jersey’s announced departure date of March 28, the justices issued an injunction preventing the move. This week they agreed to adjudicate the dispute and set an accelerated schedule for briefs and oral argument.
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Stephen L. Carter, Bloomberg
When an Insurer Proceeds as Subrogee, Defendants Cannot Assert Contribution Claims Against the Insured
July 15, 2019 —
Shannon M. Warren - The Subrogation StrategistIn Farmers Mut. Ins. Co. of Mason County v. Stove Builder Int’l, 2019 U.S. Dist. Lexis 46993 (E.D. Ky.), the United States District Court for the Northern Division of the Eastern District of Kentucky, by adopting a Magistrate Judge’s report and recommendations, see Farmers Mut. Ins. Co. v. Stove Builder, Int’l, Inc., 2019 U.S. Dist. LEXIS 48103 (E.D. Ky. Feb. 11, 2019), considered whether to allow the defendants to file a third-party complaint against the plaintiff’s insureds-subrogors. Finding that the defendants could not pursue contribution claims against the plaintiff’s insureds-subrogors, the court denied the defendant’s motion to file a third-party complaint.
The underlying subrogation action involved allegations of strict liability, negligence and breach of warranty against a pellet heater manufacturer and the retailer who sold the heater. The claims arose from a fire allegedly originating from the heater, which spread to the insureds-subrogors’ home causing property damage, along with consequential damages. Pursuant to the applicable insurance policy, the insureds-subrogors’ insurer issued payments to its insureds-subrogors. Thereafter, the insurer filed suit against the heater manufacturer and retailer.
The defendants filed a motion for leave to file a third-party complaint against the plaintiff’s insureds-subrogors, seeking to assert a contribution claim. The defendants alleged that the insureds-subrogors failed to properly install and maintain the pellet heater. The defendants also sought a jury instruction that would permit the jury to apportion fault to the insureds-subrogors, resulting in a reduction of the plaintiff’s recovery. The court looked to federal procedural law, but Kentucky substantive law to decide the defendants’ motion.
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Shannon M. Warren, White and WilliamsMs. Warren may be contacted at
warrens@whiteandwilliams.com
Loss of Use From Allegedly Improper Drainage System Triggers Defense Under CGL Policy
February 28, 2018 —
Katherine E. Miller and Michael S. Levine – Hunton Insurance Recovery BlogThe Eleventh Circuit, in
Mid-Continent Casualty Co. v. Adams Homes of Northwest Florida, Inc., No. 17-12660, 2018 WL 834896, at * 3-4 (11th Cir. Feb. 13, 2018) (per curiam), recently held under Florida law that a homebuilder’s alleged failure to implement a proper drainage system that allowed for neighborhood flooding triggered a general liability insurer’s duty to defend because the allegations involved a potentially covered loss of use of covered property.
Reprinted courtesy of
Katherine E. Miller, Hunton & Williams and
Michael S. Levine, Hunton & Williams
Ms. Miller may be contacted at kmiller@hunton.com
Mr. Levine may be contacted at mlevine@hunton.com
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Decaying U.S. Roads Attract Funds From KKR to DoubleLine
January 28, 2015 —
Romy Varghese and Mark Niquette – Bloomberg(Bloomberg) -- Investors such as Jeffrey Gundlach’s DoubleLine Capital and KKR & Co. are looking at crumbling U.S. roads -- and like what they see.
DoubleLine, which oversees $64 billion, plans to start its first fund to finance infrastructure, Gundlach said this month. KKR, the private-equity firm led by Henry Kravis and George Roberts, signed a contract in December to manage the water system in Middletown, Pennsylvania, with Suez Environnement Co.’s United Water unit. Its debut infrastructure fund started buying assets in 2011, Bloomberg News reported in April.
The companies are partnering with states and localities fed up with federal inaction to jump-start transit projects and revamp public works suffering from decades of neglect. Such an alliance in Pennsylvania, home to the nation’s highest number of deficient bridges, is letting the state replace 558 crossings more cheaply and more quickly.
Reprinted courtesy of
Romy Varghese, Bloomberg and
Mark Niquette, Bloomberg
Ms. Varghese may be contacted at rvarghese8@bloomberg.net; Mr. Niquette may be contacted at mniquette@bloomberg.net
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A Sample Itinerary to get the Most out of West Coast Casualty’s Construction Defect Seminar
May 03, 2018 —
Beverley BevenFlorez-CDJ STAFFWith so many worthwhile events stretched across three days, as well as wanting to get out and explore the many attractions in Orange County, California, Construction Defect Journal has come up with a sample itinerary that balances work with recreation.
Day One: Wednesday, May 16th
9:00 a.m. – Breakfast at
Steakhouse 55 (Disneyland Hotel)
Meet up with colleagues at Disney’s Steakhouse 55 where you will find a more peaceful and upscale venue, perfect for networking or just catching up with friends.
10:00 a.m. -
Madara Spa at Disney’s Grand Californian Hotel
With a free morning, this is the perfect time to take advantage of one of the Disneyland Resort’s pools or schedule a massage at the Madara Spa located within the Grand Californian Hotel.
11:30 a.m. – Grab and Go Lunch at
The Coffee House (Disneyland Hotel)
Refuel with a salad or sandwich from one of Disneyland Resort’s quick service restaurants.
12:00 p.m. – Seminar Registration and Schwag Hunting
Start heading over to the seminar to register and be one of the first to check out the amazing exhibitors and grab the free items they have to offer. You don’t want to miss BHA’s golf challenge, where if you sink a putt you win a $25 Amazon gift card for yourself and BHA will match the $25 to the worthwhile WCC charities!
1:00 p.m. – Seminar Begins!
The afternoon starts with a not-to-be-missed panel, “Struggles and Successes of the Past 25 Years.” Next, you’ll learn about “Unwrapped and Unraveled - An insightful (or inciteful?) play at the
changing nature of the relationships between the parties in a wrap program who thought the wrap was supposed to take care of everything.”
3:00 p.m. – Afternoon Break
Get a cup of coffee or water, and head out into the exhibit hall. Don’t forget to go to BHA’s booth to enter to win Dodger tickets.
3:30 p.m. – Seminar Panels Continue
The seminar returns with two more amazing panels: “East Coast Meets West Coast –Hot Construction Defect Issues and Coverage Cases from the Other Coast” and “How to Conduct Your Claim Investigation and Early Claims Handling To Avoid Bad Faith Traps.”
6:00 p.m. – Attend an After Party
After taking a few minutes to unwind and freshen up, go and network as well as have some at one of the reception’s thrown by attending firms. No after party? Head over to the
Uva Bar at Downtown Disney for a cocktail and some people watching.
8:00 p.m. - Late Dinner at
Catal Restaurant (Downtown Disney)
Enjoy a relaxing and sumptuous meal at Catal in Downtown Disney, one of the famed Patina Group’s restaurants.
Day Two: Thursday, May 17th
7:30 a.m. – Breakfast in the Exhibit Hall
Take advantage of West Coast Casualty’s free breakfast, and peruse more exhibits. Check out BHA’s data process collection process and discover meaningful cost improvements that translate to reduced billing while providing superior accuracy and credibility.
8:30 a.m. – Seminar Panels
The seminar returns with more panels you won’t want to miss: “Recent Important Appellate Decisions in California, Nevada, and Arizona” and “Litigating In The Western States - A Judge’s Perspective.”
10:30 a.m. – Morning Break
Grab a cup of coffee or water and chat with your colleagues about the panels you just heard.
10:45 a.m. – Seminar Panel
Another important panel to finish the morning, “Subrogation is not the type of intervention I need. How a subrogated insurer affects construction defect matters.”
11:45 a.m. – Award Presentation
Find out this year’s winners of the Ollie, Legend of the Era and Silver Stars.
12:15 p.m. – WCC Luncheon
Network and chat with your colleagues at one of the meals provided by the seminar.
1:30 p.m. – Seminar Panel
Now that you’ve recharged, you’re ready for another incredible WCC panel: “What Comes Around (Sometimes) Goes Around: Dealing with Recalcitrant Carriers.”
2:30 p.m. – Afternoon Break
Stretch your legs in the exhibit hall and get yourself more schwag. Learn about BHA’s expanding market presence and full range of services in Texas, Florida, and across the Southeast United States.
3:00 p.m. – Seminar Panels Continue
Don’t miss the last two panels of the day: “Effective Use of Experts” and “Claims Managers Speak - A Retrospective & Prospective Discussion.”
5:30 p.m. – Cocktail Reception
With your glass of Cabernet, network with colleagues and then try your hand again at BHA’s golf challenge to win an Amazon gift card and earn money for WCC charities.
6:30 p.m. – Hit the Pool or Jacuzzi
Take those tired feet and soak them in one of the Disneyland Resort’s many pools and jacuzzi’s. Or schedule a spa treatment at
Madara in the Grand Californian Hotel.
7:00 p.m. – After Party or Ball Game
Now that you’ve given yourself some time to rejuvenate, you’re ready to meet up with friends and colleagues at one of the after parties and receptions. Or if you’re a sports fan and want a break from work, go cheer on the
Angel’s as they play Tampa Bay.
8:30 p.m. –
Uva Bar
Unless you chose to go to the game, enjoy a late supper and cocktail under the beautiful southern California sky at the Uva Bar in Downtown Disney.
Day Three: Friday, May 18th
7:30 a.m. – Breakfast at the Seminar
Take advantage of another free meal, and take the time to check out more exhibits as the last day of the seminar begins. Don’t forget to enter BHA’s raffle for Dodger tickets!
8:30 a.m. – Breakout Sessions I
Choose between one of three breakout sessions: “Known Knowns and Known: Unknowns, the Ins and Outs of Extrapolation,” “Risk Transfer Alphabet Soup - A twelve year lookback on legislative tinkering with anti-indemnity statutes - where are we now?” or “Florida – Opening Pandora's Box and How to Close It.”
9:30 a.m. – Breakout Sessions II
Three additional breakout sessions to choose from: “An Update on California’s Right to Repair Act, featuring McMillin Albany et al. v. Superior Court,” “Finding Evidence for your Coverage Case,” or “Northwest Insurance Coverage and Extra-Contractual Issues.”
10:30 a.m. – Morning Break
Refuel with coffee or water before the next group of exciting breakout sessions begins.
11:00 a.m. – Breakout Sessions III
You’ll want to go to one of these three breakout sessions: “Subcontractor Wars: The Last AI,” “Mediating the Luxury Single Family Home Construction Defect Case,” or “Creative Solutions to the Florida Problem: Making No Contribution and No State Law Work for You.”
12:00 p.m. – Breakout Sessions IV and the End of the Seminar
The seminar closes with the last trio of breakout sessions: “Everyone is a Small Player,” “Real World Solutions to the Real Problems Presented By Wrap Up Programs,” or “When Mother Nature Attacks, Are you Covered?”
1:30 p.m. – Lunch at
Corn Dog Castle in California Adventure Park OR
Hollinghead’s Delicatessen in Orange
If you’re a Disney lover, you’ll want to take advantage of the day by going to one of the Disney Resort Parks, of course. Get one of Disney’s amazing corn dogs at Corn Dog Castle in California Adventure Park.
Or if you would rather explore the greater Anaheim area, then head over to Hollinghead’s Delicatessen for a homemade sandwich and a glass of beer on tap.
3:00 p.m. –
Disney Entertainment OR Museum Exploring
If you chose to go to California Adventure, check out the event schedule for the day. Catch the show Frozen – Live at the Hyperion or get a
Fastpass for the Radiator Springs Racers and ride Soarin’ Around the World. If you purchased a two-park pass, don’t forget about Space Mountain or Star Tours located in the Disneyland Park.
North Orange county has many interesting museums. Head to the
Bowers Museum in Santa Ana or the
Muzeo in Anaheim.
7:00 p.m. – Dinner at the
Blue Bayou Restaurant OR the
Summit House Restaurant
Have a one-of-a-kind eating experience at the Blue Bayou in Disneyland Park. Enjoy a dinner in the midst of the Pirates of the Caribbean ride! If you wish to remain in the California Adventure Park, try an alfresco dinner at
Wine Country Trattoria or an indoor, upscale meal at
Carthay Circle.
After an afternoon perusing museums, enjoy a truly superb meal with attentive service at one of Anaheim’s premier restaurants, Summit House. Feeling like having some fun rather than a sedate meal? Head over to the
House of Blues in Anaheim for their Party Like It’s 1999! A Prince Tribute Party.
8:30 p.m. – Paint the Night Parade/Together Forever OR The Blind Rabbit Speakeasy
Head over to watch the
Paint the Night Parade at the California Adventure Park or the fireworks display,
Together Forever — A Pixar Nighttime Spectacular at the Disneyland Park. Be sure to check out the daily
event schedule for up to date information.
End your evening at Anaheim’s only speakeasy,
the Blind Rabbit, located in the Anaheim Meat Packing district. Be sure to check out their “rules” and reserve a table at this popular spot.
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Doing Construction Lead Programs the Right Way
October 16, 2018 —
Natalie Craigmile - Construction InformerRunning a construction business takes hard work. When you are working on a job, it can be difficult to find time to spend on marketing and advertising. If you are short on time, buying leads through construction lead programs could be a good way to meet new customers, grow your business, and find your next job. Keep reading to learn more about some of the pros and cons of buying leads.
A construction lead generation service exists solely to connect home owners with local home improvement contractors. They market across different construction specialties and reach customers who are looking for construction companies. Once they capture the ‘lead’, which is essentially the contact information and a few project details of that potential customer, they sell the lead to one or more local contractors in their network.
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Natalie Craigmile, Construction Informer
California Supreme Court Rights the “Occurrence” Ship: Unintended Harm Resulting from Intentional Conduct Triggers Coverage Under Liability Insurance Policy
June 13, 2018 —
Scott S. Thomas - Payne & Fears Legal AlertSUMMARY
In a ruling that bodes well for policyholders, the California Supreme Court provides much-needed clarity on the question of when a so-called "intentional act" may give rise to insurance coverage under a liability insurance policy. In Liberty Surplus Insurance Corp. v. Ledesma & Meyer Construction Co., Case No. S23765 (Cal. June 4, 2018), the Court holds that an employer's potential liability for negligent hiring, after its employee allegedly abused a 13-year old student, is the result of an "occurrence" and is thus covered under the employer's liability insurance policy.
COURT OPINION
The court's opinion dispels the misguided notion that an intentional act resulting in unintended harm is never an "occurrence" and can never trigger coverage. What matters, according to the Court, is that, from the insured's point of view, the consequences of its conduct are "unexpected, unforeseen, or undesigned" - even if the conduct is intentional. And in a concurring opinion, Justice Liu rightfully questions the legitimacy of the notion that intentional conduct cannot trigger coverage, even when it produces an unintended result, unless, in the words of a 1989 appellate court decision, some "additional, unexpected, independent, and unforeseen happening occurs that produces the damage." As Justice Liu explains, this intervening "happening" may be something as simple as the insured's mistaken belief that he was acting in self-defense, or that the victim had consented to the insured's conduct. This much-needed clarification restores vitality to the fundamental principle that injuries are "accidental" when they are "unexpected, unforeseen, or undesigned," regardless of their cause.
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Scott S. Thomas, Payne & FearsMr. Thomas may be contacted at
sst@paynefears.com
