Appraisal Goes Forward Even Though Insurer Has Yet to Determine Coverage on Additional Claims
December 11, 2023 —
Tred R. Eyerly - Insurance Law HawaiiThe trial court's order granting the insured's motion to stay litigation and compel an appraisal was affirmed even though the insurer had not determined coverage on the insured's additional claims.Heritage Prop. & Cas. Ins. Co. v. Wellington Place HOA, 2023 Fla. App. LEXIS 6405 (Fla. Ct. App. Sept. 13, 2023).
The insured homeowner's association reported roof damage to its insurer, Heritage, after Hurrican Irma struck. Heritage agreed the damage was covered, but issued no payment because the amount of loss was less than the deductible.
The insured hired its own adjuster. The insured requested an extension of the policy's two year time limit to complete repairs because the claim was still in dispute and the insurer had not yet paid sufficient funds to allow necessary repairs. Heritage sent a revised estimate and asked the insured to send its adjuster's estimate in order to address any disputes. The insured submitted its adjuster's estimate of more than $6 million, including, for the first time, the cost to replace all the windows and sliding glass doors.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
While Construction Permits Slowly Rise, Construction Starts and Completions in California Are Stagnant
December 05, 2022 —
John Kazanovicz & Jason Feld - Kahana FeldThere is an interesting phenomenon happening in the California construction market since the Summer of 2022. There is a steady but slow rise in the construction building permits being issued throughout California. According to the U.S. Census and the U.S. Department of Housing and Urban Development’s joint announcement (https://www.census.gov/construction/nrc/pdf/newresconst.pdf) of new residential construction statistics for September 2022, privately‐owned housing units authorized by building permits in September were at a seasonally adjusted annual rate of 1,564,000. This is 1.4 percent above the revised August rate of 1,542,000. While this is slightly lower than a year ago (3.2 percent below the September 2021 rate of 1,615,000), the trend for obtaining new home permits was reportedly ahead of the projected rates given the market conditions and inflation throughout the country. Interestingly, single‐family authorizations in September were at a rate of 872,000 which was also 3.1 percent below the revised August 2022 figure of 900,000. Authorizations of units in buildings with five units or more were at a rate of 644,000 in September. Overall, while slowly recovering from the record lows during the height of the pandemic, the economic forecast for new home construction in California is positive, but cautious.
The flip side of this coin is the construction starts in California, which continue to remain stagnant despite additional building permits being issued. Privately‐owned housing starts in September were at a seasonally adjusted annual rate of 1,439,000. This is 8.1 percent (±14.9 percent) below the revised August estimate of 1,566,000 and is 7.7 percent (±11.5 percent) below the September 2021 rate of 1,559,000. Single‐family housing starts in September were at a rate of 892,000; this is 4.7 percent (±10.7 percent) below the revised August figure of 936,000. The September rate for units in buildings with five units or more was 530,000.
Reprinted courtesy of
John Kazanovicz, Kahana Feld and
Jason Feld, Kahana Feld
Mr. Kazanovicz may be contacted at jkazanovicz@kahanafeld.com
Mr. Feld may be contacted at jfeld@kahanafeld.com
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Court Rules on a Long List of Motions in Illinois National Insurance Co v Nordic PCL
May 10, 2012 —
CDJ STAFFThe case Illinois National Insurance Co. v Nordic PCL, et al. “involves a dispute about whether insurance benefits are available to a general contractor who built structures that allegedly have construction defects. Plaintiffs Illinois National Insurance Company (‘Illinois National’) and National Union Fire Insurance Company of Pittsburgh, PA (‘National Union’) (collectively, the ‘Insurers’), commenced this action for declaratory relief against Defendant Nordic PCL Construction, Inc., f/k/a Nordic Construction, Ltd. ("Nordic"), on August 23, 2011.”
The court was asked to rule on a long list of motions: “Counterclaim Defendants’ Request for Judicial Notice in Support of Their (1) Motion to Dismiss the Counterclaim and (2) Motion to Strike Portions of the Counterclaim, ECF No. 16 (‘Request for Judicial Notice’); Counterclaim Defendants’ Motion to Dismiss Counterclaim Filed October 24, 2011, ECF No. 14 (‘Motion to Dismiss Counterclaim’); Counterclaim Defendants’ Motion to Strike Portions of the Counterclaim Filed October 24, 2011, ECF No. 15 (‘Motion to Strike’); Third-Party Defendant Marsh USA, Inc.’s Motion to Dismiss or, in the Alternative, Stay Proceedings in Favor of Pending State Action, ECF No. 33 (‘Marsh’s Motion To Dismiss Or Stay’); Defendant and Third-Party Plaintiff Nordic PCL Construction, Inc., f/k/a Nordic Construction Ltd.’s Substantive Joinder to Third-Party Defendant Marsh USA Inc.’s Motion to Dismiss or, in the Alternative, Stay Proceedings in Favor of Pending State Action, ECF No. 36 (‘Nordic’s Joinder’); and Third-Party Defendant Marsh USA, Inc.’s Motion for Judgment on the Pleadings on Counts V and VI of Defendant/Third-Party Plaintiff Nordic PCL Construction, Inc.’s Third-Party Complaint, ECF No. 29 (‘Marsh’s Motion for Judgment on the Pleadings’).”
In result, the court reached the following decisions: “The court GRANTS IN RELEVANT PART the Insurers’ Request for Judicial Notice to the extent it covers matters relevant to these motions; GRANTS IN PART the Insurers’ Motion to Dismiss Counterclaim, but gives Nordic leave to amend the Counterclaim in certain respects; DENIES the Insurers’ Motion to Strike; DENIES Marsh’s Motion To Dismiss Or Stay and Nordic’s Joinder; and GRANTS Marsh’s Motion for Judgment on the Pleadings.”
The court provides a bit of background on the case: “This action arises out of alleged construction defects involving two projects on which Nordic acted as the general contractor. Nordic is a defendant in a pending state court action with respect to one of the projects and says it spent more than $400,000 on repairs with respect to the other project. Nordic tendered the defense of the pending state court action to the Insurers and sought reimbursement of the cost of repairs already performed. The Insurers responded by filing this action to determine their rights under the insurance policies issued to Nordic.”
Furthermore, the court presented a brief procedural history: “The Insurers commenced this declaratory action in this court on August 23, 2011. The Complaint asserts two claims, one seeking a declaration that the Insurers have no duty to provide a defense or indemnification regarding the Safeway Action, the other seeking such a declaration regarding the Moanalua Claims. Along with its Answer, Nordic filed a Counterclaim against the Insurers. The Counterclaim asserts breach of contract, breach of the covenant of good faith and fair dealing, misrepresentations and omissions of material fact, and bad faith, and seeks declaratory relief against the Insurers.”
The procedural history continues: “Nordic also filed a Third-Party Complaint against Marsh, the broker that had procured the Policies from the Insurers for Nordic. Nordic alleges that it reasonably believed that the Policies would provide completed operations insurance coverage for the types of construction defects alleged in the Safeway Action and Moanalua Claims. The Third-Party Complaint asserts breach of contract, negligence, promissory estoppel, breach of fiduciary duties, implied indemnity, and contribution and equitable subrogation.”
In conclusion, “The court GRANTS IN RELEVANT PART the Insurers’ Request for Judicial Notice. With regard to the Insurers’ Motion to Dismiss Counterclaim, the court GRANTS the motion as to Count I (breach of contract), Count II (duty of good faith and fair dealing), Count III (fraudulent and negligent misrepresentation), the portion of Count IV (bad faith) premised on fraud, and Count IV (declaratory relief). The court DENIES the motion as to Count IV (bad faith) that is not premised on fraud. Except with respect to the "occurrence" issue, which the court disposes of here on the merits, and Count V, which concerns only a form of relief, Nordic is given leave to amend its Counterclaim within three weeks of the date of this order. The court DENIES the Insurers’ Motion to Strike, DENIES Marsh’s Motion to Dismiss or Stay and Nordic’s Joinder, and GRANTS Marsh’s Motion for Judgment on the Pleadings with respect to Counts V and VI of the Third-Party Complaint.”
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Court Strikes Expert Opinion That Surety Acted as a “De Facto Contractor”
November 27, 2023 —
David Adelstein - Florida Construction Legal UpdatesDesignating and admitting experts is a vital component of any construction dispute. Many construction disputes require experts. Many construction disputes can only be won with the role of an expert. Thus, experts and construction disputes go hand-in-hand. No doubt about it! Time needs to be spent on developing the right expert opinions to support your burden of proof. This means you want to designate the right expert that can credibly and reliably render an expert opinion.
It is common for one party to move to strike the testimony and expert opinions of another party. This is referred to as a Daubert motion. Sometimes the motion is about gamesmanship. Sometimes it is to see how the judge rules on the issue. Sometimes there is a legitimate reason associated with the expert opinion. And, sometimes, it is a combination of the above. Regardless of the reason, parties know the weight expert opinions can have and, therefore, treat the opinions seriously prompting the Daubert motion.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
New Strategy for Deterring Intracorporate Litigation?: Delaware Supreme Court Supports Fee-Shifting Bylaws
May 13, 2014 —
Marc Casarino and Lori Smith – White and Williams LLPA fee-shifting bylaw of a Delaware non-stock corporation is not facially invalid according to the Delaware Supreme Court’s May 8, 2014 opinion in ATP Tour, Inc. v. Deutscher Tennis Bund.
In this case, ATP Tour, Inc., a non-stock membership corporation (“ATP”) governed by a seven member board, had adopted a bylaw provision which provided that current and former members of ATP would be responsible for the litigation costs arising out of any litigation initiated by any such member against ATP or any of the other members in which the initiating party did not obtain a judgment on the merits that substantially achieved in substance and amount the full remedy sought. The bylaw provision had been adopted, in accordance with ATP’s charter, by the Board unilaterally without any consent from the members. The members had agreed at the time they joined ATP to be bound by the bylaws, as amended from time to time. Two members of ATP initiated a suit against ATP relating to certain actions taken with respect the ATP’s tournament schedule and format alleging both federal antitrust claims and Delaware fiduciary duty claims but did not prevail on any of their claims. ATP then moved to recover its legal fees relating to such actions.
Reprinted courtesy of
Marc Casarino, White and Williams LLP and
Lori Smith, White and Williams LLP
Mr. Casarino may be contacted at casarinom@whiteandwilliams.com; Ms. Smith may be contacted at smithl@whiteandwilliams.com
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The Metaphysics of When an Accident is an “Accident” (or Not) Under Your Insurance Policy
August 02, 2017 —
Garret Murai - California Construction Law BlogAs an undergrad, I remember taking an introductory philosophy class. When we came to the chapter on metaphysics our professor asked what makes an apple an apple? “We have a specific name for it, presumably, to distinguish it from other things,” she said. “But what makes an apple an apple?”
From there we went into a rabbit hole. With some students describing an apple by its colors, shape, size, smell and that it grows on trees and others trying to distinguish an apple from other things, which in turn led to further discussions such as why we believe apples come in red, green and yellow, whether an apple is still an apple if a person was colorblind, etc. In the end, we were questioning whether we were even in existence and sitting in a university classroom.
Insurance can be a bit like that sometimes. When is an accident an accident? If you engage in an intentional act that results in an unintended consequence, is it an accident? In Navigators Specialty Insurance Company v. Moorefield Construction, Inc. (December 27, 2016) 6 Cal.App.5th 1258, the Court of Appeals for the Fourth District, while not answering the question of the nature of existence, did shed some light on when an accident is an accident.
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Garret Murai, Wendel Rosen Black & Dean LLPMr. Murai may be contacted at
gmurai@wendel.com
Safety, Compliance and Productivity on the Jobsite
November 18, 2019 —
Matthew Ramage - Construction ExecutiveWith any project, managing a large contingency of workers—all with varying levels of security clearance—can be a logistical headache.
On the majority of construction sites, managers lack the resources to quickly and accurately identify all onsite personnel and ensure the right labor, equipment and materials are in the right place at the right time. Equally important, construction managers need to know if worker certifications are current and only allow access to authorized areas.
Multiple factors compound the need for better transparency across the workforce, including:
- Safety. Construction work is inherently dangerous. In 2017, nearly 1,000 fatalities occurred on construction sites. This means that the industry accounted for more than 20% of private sector fatalities across all industries.
- Regulatory. The Federal government has a heightened awareness of jobsite dangers and is targeting companies that are not making every effort to maximize the workers’ safety.
- Security. Sites in urban environments require round-the-clock protection from urban explorers, thieves and the general public.
- Employee wage disputes. Lawsuits and disputes over wages and hourly employment are increasing.
- Reduced productivity. It can be difficult to measure and track productivity in construction.
Reprinted courtesy of
Matthew Ramage, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Fourth Circuit Rejects Application of Wrap-Up Exclusion to Additional Insured
December 11, 2018 —
K. Alexandra Byrd & Samantha M. Oliveira - Saxe Doernberger & Vita, P.C.Utilizing an owner-controlled or contractor-controlled insurance program (collectively known as “wrap-ups”) can reduce claims, save costs, and give owners and general contractors comfort in knowing their project is adequately insured. However, problems often arise when a subcontractor doesn’t enroll in the wrap-up and, instead, agrees to provide additional insured coverage to the owner and general contractor on the subcontractor’s own general liability policy. One of those problems is the prevalence of wrap-up exclusions on subcontractors’ general liability policies. If the wrap-up exclusion is too broadly drafted, the exclusion can eliminate coverage for the general contractor and owner even when the subcontractor is not enrolled in the wrap-up.
Reprinted courtesy of
K. Alexandra Byrd, Saxe Doernberger & Vita, P.C. and
Samantha M. Oliveira, Saxe Doernberger & Vita, P.C.
Ms. Byrd may be contacted at kab@sdvlaw.com
Mr. Oliveira may be contacted at smm@sdvlaw.com
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