2017 Construction Outlook: Slow, Mature Growth, but No Decline, Expected
December 21, 2016 —
Garret Murai – California Construction Law BlogAs we count down the remaining days of 2016 (thank God) it’s time to think about what the new year will bring (I’m good with pretty much anything at this point).
The economists at Dodge Data & Analytics have a few predictions. According to their 2017 Dodge Construction Outlook, they predict that U.S. construction starts will increase modestly in 2017, up 5% to $713 billion, after rather anemic growth in 2016 following several years of steady growth.
According to Robert Murray, chief economist for Dodge Data & Analytics, while the first half of 2016 lagged behind construction activity in 2015, that shortfall grew smaller as the year progressed, easing concern that the construction industry might be in the early stage of a cyclical decline. Rather, according to Murray, it appears that the construction industry has now entered a more mature phase of expansion, one characterized by slower rates of growth than during the 2012-2015 period and that construction spending can be expected to see moderate gains through 2017 and beyond[.]
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Garret Murai, Wendel Rosen Black & Dean LLPMr. Murai may be contacted at
gmurai@wendel.com
Convictions Obtained in Las Vegas HOA Fraud Case
March 19, 2015 —
Beverley BevenFlorez-CDJ STAFFThe Las Vegas Review-Journal reported that a jury “convicted four defendants charged in the massive scheme to take over and defraud homeowners associations.” Convicted defendants included former Benzer attorney Keith Gregory, Benzer’s half-sister Edith Gillespie, Salvatore Ruvolo, and David Ball.
According to the Las Vegas Review-Journal, “Prosecutors contended the multimillion-dollar scheme was carried out between 2003 and 2009 by former construction company boss Leon Benzer and the late construction defects lawyer Nancy Quon. Benzer has since pleaded guilty. Quon committed suicide in 2012 under the weight of the high-profile investigation.”
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Exclusion Does Not Bar Coverage for Injury To Subcontractor's Employee
April 28, 2014 —
Tred R. Eyerly – Insurance Law HawaiiThe Third Circuit reversed the district court and held that the additional insured was covered for injury to the subcontractor's employee despite an employee's exclusion in the policy. ArcelorMittal Plate, LLC v. Joule Technical Serv, Inc., 2014 U.S. App. LEXIS 2905 (3d Cir. Feb. 18, 2014).
ArcelorMittal Plate, LLC (AMP) owned a steel production facility. AMP contracted with Joule, an industrial staffing and engineering firm, for regular performance of maintenance and repair work at its plant. Joule was obligated to provide a CGL policy adding AMP as an additional insured "for all claims including, but not limited to, claims by Joule's employees."
Joule added AMP as an additional insured to its policy with Liberty Surplus Ins. Corp. The policy had an "employee exclusion" which stated, “This insurance does not apply to bodily injury to (1) an employee of the insured arising out of and in the course of (a) employment by the insured or (b) performing duties related to the conduct of the insured's business.”
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Just Decided – New Jersey Supreme Court: Insurers Can Look To Extrinsic Evidence To Deny a Defense
September 05, 2022 —
Randy J. Maniloff - White and Williams LLPLast week, the New Jersey Supreme Court decided Norman International, Inc. v. Admiral Insurance Company, No. 086155 (N.J. Aug. 11, 2022). At issue was coverage for a work-site injury and the interpretation of a policy exclusion for operations or activities performed by an insured in certain counties in New York. The case is significant in terms of addressing causation for purposes of the application of exclusions. But the more wide-reaching issue has nothing to do with the scope of the exclusion.
The real story from Norman is the New Jersey high court’s pronouncement that an insurer, in certain circumstances, can use extrinsic evidence to deny a defense to its insured. New Jersey duty to defend law has been a jungle land and in need of more supreme court guidance.
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Randy J. Maniloff, White and Williams LLPMr. Maniloff may be contacted at
maniloffr@whiteandwilliams.com
Recent Regulatory Activity
October 25, 2021 —
Anthony B. Cavender - Gravel2GavelSelected federal regulatory actions taken or proposed by several federal agencies, including the Environmental Protection Agency:
EPA Actions.
On September 15, 2021, EPA’s Water Office issued a memo rescinding a January 2021 guidance document that purported to provide the regulatory community with EPA’s understanding of the Supreme Court’s Clean Water Act ruling in the case of County of Maui v. Hawaii Wildlife Fund. That case involved a discharge of pollutants to groundwater which eventually made their way to the Pacific Ocean. Was an NPDES permit required to authorize this discharge, which was not initially made to a navigable body of water? The text of the Clean Water Act provided little guidance, and the matter has become very controversial. The Court held that if the discharge was the “functional equivalent” of a direct discharge, a permit may be required, and the Court described some factors that could influence a determination that there was the functional equivalent of a direct discharge. However, EPA has rescinded the January 2021 guidance, opining that EPA’s earlier analysis was inconsistent the Court’s opinion, and that the guidance was issued without proper deliberation within EPA or with its federal partners. Until new guidance is prepared, EPA will continue to apply “site-specific, science-based evaluations” to resolve these questions. On October 1, 2021, EPA released its “Climate Adaption Action Plan.” Briefly, EPA will take steps to ensure that its programs and policies consider current and future impacts of climate change and how the impacts disproportionately affect certain underserved or environmental justice communities. The agency’s air and water quality programs, contaminated sites activities and chemical safety and pollution prevention programs will be analyzed to determine their impact. Also on October 1, 2021, EPA released its draft FY 2022-2026 Strategic Plan to protect health and the environment. The plan, essentially an internal directive to all offices and regions, reflects a new “foundational principle”—to advance justice and equity by taking on the climate crisis and taking decisive action to advance civil rights and environmental justice.
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Anthony B. Cavender, PillsburyMr. Cavender may be contacted at
anthony.cavender@pillsburylaw.com
Business Interruption Claim Granted in Part, Denied in Part
February 16, 2016 —
Tred R. Eyerly – Insurance Law HawaiiThe court granted portions of the business interruption claim, while denying other portions. Phoenix Ins. Co. v. Infogroup, Inc., 2015 U.S. Dist. LEXIS 162810 (S. D. Iowa Nov. 30, 2015).
Phoenix insured Infogroup's business buildings and personal business property, including data and data processing equipment. In late May 2011, warnings were issued of possible flooding from the Missouri River. On June 1, 2011, Infogroup moved and relocated its business operations and data centers away from the river and did not intend to return to the facilities. On July 19, 2011, Phoenix advanced $500,000 to Infogroup for anticipated claims under the policy. On August 22, 2011, heavy rain left surface water in the parking lot at Infogroup's facilities. Infogroup claimed that it suffered minor property damage during July and August, 2011, including damage to an uninterruptable power source and damage to a server.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Judgment for Insurer Reversed Due to Failure to Establish Depreciation
August 01, 2023 —
Tred R. Eyerly - Insurance Law HawaiiThe trial court erred in placing the burden on the policyholder to establish depreciation in determining the actual cash value of the loss. SFR Serv., LLC v. Tower Hill Prime Ins. Co., 2023 Fla. App. LEXIS 3570 (Fla. Ct. App. May 26, 2023).
The insureds' roof was damaged by Hurricane Irma. They submitted their claim to their insurer, Tower Hill. The cost of repair was assessed at $7,726.94, below the amount of the deductible. Therefore, there was no recovery under the policy. The insureds assigned their claim to SFR Services, LLC, their roofing contractor. SFR submitted a claim to Tower Hill for $162,083.84. Tower Hill refused to pay and SFR sued.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Settling with Some, But Not All, of the Defendants in a Construction Defect Case
March 28, 2018 —
David Adelstein – Florida Construction Legal UpdatesConstruction defect lawsuits can be complex multi-party disputes, especially when the plaintiff is doing what is necessary to maximize recovery. This means the plaintiff may sue multiple defendants associated with the defects and damage. For example, the owner (e.g., plaintiff) may sue the contractor, subcontractors, design professionals, etc. due to the magnitude of the damages. In many instances, the plaintiff is suing multiple defendants for overlapping damages. The law prohibits a plaintiff from double-recovering for the same damages prohibiting the windfall of a plaintiff recovering twice for the same damages. Perhaps this sentiment is straight common sense, but this sentiment is a very important consideration when it comes to settling with one or more of the defendants, while potentially trying the construction defect case as to remaining defendants.
Analysis and strategy is involved when settling with some but not all of the defendants in a construction defect case (and, really, for any type of case). Time must be devoted to crafting specific language in the settlement agreements to deal with this issue. Otherwise, the settlement(s) could be
set-off from the damage awarded against the remaining defendants.
The recent decision in
Addison Construction Corp. v. Vecellio, 43 Fla.L.Weekly D625(a) (Fla. 4th DCA 2018) details the analysis and strategy required when settling with some but not all of the defendants in a construction defect case, and the concern associated with a trial court setting-off the settlement amount from the damage awarded against the remaining defendants.
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David Adelstein, Florida Construction Legal UpdatesMr. Adelstein may be contacted at
Dadelstein@gmail.com