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Eleventh Circuit Asks Georgia Supreme Court if Construction Defects Are Caused by an "Occurrence"

December 20, 2012 — TRED EYERLY, INSURANCE LAW HAWAII
The Eleventh Circuit certified a question to the Georgia Supreme Court, asking whether property damage can constitute an "occurrence" under a CGL policy where its effects are not felt on "other property." HDI-Gerling Am. Ins. Co. v. Morrison Homes, Inc., 2012 U.S. App. Ct. LEXIS 23813 (11th Cir. Nov. 19, 2012). The general contractor, Taylor Morrison Services, Inc., was covered by a CGL policy issued by Gerling. The policy excluded "expected or intended injury," contractual liability," and business risk exclusions. Morrison was sued by homeowners in a class action suit. Morrison had allegedly omitted four inches of gravel required beneath the base of the concrete foundations by the Uniform Building Code. Thereafter, the houses sustained water intrusion, cracks in the floors and driveways, and warped and buckling flooring. Gerling defended, but sued Morrison for a declaratory judgment. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii.
Mr. Eyerly can be contacted at te@hawaiilawyer.com

Colorado Court of Appeals to Rule on Arbitrability of an HOA's Construction Defect Claims

November 20, 2013 — W. Berkeley Mann, Jr. — Higgins, Hopkins, McLain & Roswell, LLC
On October 24, 2013 the Colorado Court of Appeals granted a rare interlocutory appeal in a multi-family residential construction defect case. The Court of Appeals accepted the case ofTriple Crown at Observatory Village Association, Inc. v. Village Homes of Colorado, Inc.(2013 WL 5761028) as an interlocutory appeal after the parties briefed and obtained rulings from the trial court that compelled the case to binding arbitration in lieu of a jury trial on all issues. The appellate decision of October 24, 2013 did not decide the merits of the case, but discussed the issues to be decided in the eventual merits decision. The significance of the issues presented and the interlocutory nature of this appeal both make this case worth watching for further appellate proceedings. The core issue in this appeal was the applicability of Colorado’s Uniform Arbitration Act (C.R.S. § 13-22-201, et seq.), based on recorded Declarations filed by the developer. The Declarations mandated that the HOA arbitrate any design/construction disputes with the developer. Immediately prior to suit, the Association sought to amend the Declarations in order to avoid the arbitration process for these claims. The interlocutory appellate issues resulted from the trial court’s order compelling the arbitration over the objections of the Association. The trial court’s decision was based on a reading of the Colorado Revised Non-Profit Corporation Act (“CRNPC,” at C.R.S. § 7-127-107), which was found applicable to the Association. Read the court decision
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Reprinted courtesy of W. Berkeley Mann, Jr.
W. Berkeley Mann, Jr. can be contacted at mann@hhmrlaw.com

A Court-Side Seat: May Brings Federal Appellate Courts Rulings and Executive Orders

June 29, 2020 — Anthony B. Cavender - Gravel2Gavel
Here are a few interesting new rulings from the federal appellate courts. COURT ORDERS Like a Good Neighbor …? — State of Maryland v. EPA On May 19, 2020, the D.C. Circuit decided a Clean Air Act case involving the use of the “Good Neighbor Provision” of the Act, which is triggered when one state has a complaint about emissions generated in a neighboring upwind state that settle in the downwind state. Here, Maryland and Delaware filed petitions with EPA seeking relief from the impact of emissions from coal-fired power plants that allegedly affect their states’ air quality. EPA largely denied relief, and the court largely upheld the agency’s use and interpretation of the Good Neighbor Provision. The opinion is valuable because of its clear exposition of this complicated policy. A Volatile Underground Issue —Wayne Land and Mineral Group v. the Delaware River Basin Commission Also on May 19, 2020, the U.S. Court of Appeals for the Third Circuit issued a ruling involving the Delaware River Basin Commission. Established in 1961, the Commission oversees and protects the water resources in the Basin. Not long ago, the Executive Director of the Commission, citing a rule of the Commission, imposed very strict limitations on fracking operations in the Basin. This decision has been very controversial with the Third Circuit opining that the Commission’s authority to regulate fracking operations—thought to be a province of state authority—was not clear-cut. In this case, three Pennsylvania state senators filed motions to intervene in the case, but the lower court rejected their request. The Third Circuit has directed the lower court to take another look at their standing to participate in this litigation. This is a volatile issue in Pennsylvania. Read the court decision
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Reprinted courtesy of Anthony B. Cavender, Pillsbury
Mr. Cavender may be contacted at anthony.cavender@pillsburylaw.com

The G2G Year-End Roundup (2022)

January 04, 2023 — Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
Our year-end roundup highlights the top-read Gravel2Gavel posts from 2022. Our authors addressed the legal implications for a variety of hot topics and market disruptions, providing deep industry insights that spanned Metaverse real estate investments, economic sanctions in Russia, and cybersecurity for smart buildings.

NFT Use Cases in Real Estate by Megan L. Jones and David W. Wright. The authors discuss how entrepreneurs are searching for new industries to disrupt utilizing the advantages offered by NFTs and blockchain more generally, with many turning their heads towards real estate.
Commercial Real Estate Brokerages in an Uncertain Russian Market by Cait Horner and Adam J. Weaver. The authors discuss how several commercial real estate firms joined the list of companies temporarily suspending—or outright terminating—property and facility management operations in Russia amid economic sanctions and mounting international pressure.

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Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team

Antitrust Walker Process Claims Not Covered Under Personal Injury Coverage for Malicious Prosecution

May 18, 2020 — Christopher Kendrick & Valerie A. Moore – Haight Brown & Bonesteel LLP
In Travelers Property Casualty Co. of America v. KLA-Tencor Corp. (No. H044890; filed 1/16/20, ord. pub. 2/13/20), a California appeals court ruled that commercial general liability insurance for personal and advertising injury, defined to include malicious prosecution, does not cover a Walker Process antitrust cause of action under the Sherman Act and the Clayton Act for using a fraudulently procured patent to attempt to monopolize the market. Travelers insured KLA under commercial liability policies with coverage for personal and advertising injury liability, which was defined as “injury, other than ‘advertising injury’, caused by. . . (2) Malicious prosecution.” Reprinted courtesy of Christopher Kendrick, Haight Brown & Bonesteel LLP and Valerie A. Moore, Haight Brown & Bonesteel LLP Mr. Kendrick may be contacted at ckendrick@hbblaw.com Ms. Moore may be contacted at vmoore@hbblaw.com Read the court decision
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Breaking Down Homeowners Association Laws In California

April 03, 2019 — Lauren Hickey - Bremer Whyte Brown & O'Meara LLP
Purpose of HOAs Property ownership often combines elements of individual and common ownership interests. For example, a property owner may individually own his or her living quarters, but also own a common interest in amenities that are considered too expensive for a single homeowner to purchase individually (such as a pool, gym, or trash collection service). Properties with such elements usually take the form of apartments, condominiums, planned developments, or stock cooperatives (together known as “common interest developments” or “CIDs”). Whenever a CID is built, California law requires the developer to organize a homeowner association (or “HOA), which can take several different names, including “community association”. Initially, the developer relies on the HOA to market the development to prospective buyers. Once each unit in the development is sold, management of the HOA is passed to a board of directors elected by the homeowners. At that point, the primary purpose of the HOA shifts to maintenance of common amenities and enforcement of community standards. Dues/Assessments HOAs generally charge each homeowner monthly or annual dues to cover the cost of their services. HOAs may also charge special assessments to cover large, abnormal expenses, such as the cost of upgrades or improvements. The amount charged in dues and assessments is established by the HOA’s board of directors, within the limits set by the HOA’s governing documents and California Civil Code section 1366. Section 1366 provides that HOA dues may not be increased by more than 20 percent of the amount set in the previous year, and the total amount of any special assessments charged in a given year generally may not exceed 5 percent of the HOA’s budgeted expenses. Read the court decision
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Reprinted courtesy of Lauren Hickey, Bremer Whyte Brown & O'Meara LLP

Preparing Your Business For Internal Transition

October 14, 2019 — Stephen P. Katz, Esq. - ConsensusDocs
When is it right to start thinking about succession planning and preparing a construction company for transition? Many would agree – in concept, at least – that serious thought regarding succession and transition planning should begin at a company’s inception and be revisited throughout its lifecycle, but as a practical matter, it is frequently not part of the mindset when growing a business. This article explores issues that construction company owners should consider in order to achieve smooth transition of ownership and control. We will address three critical questions:

What happens to the business when an owner retires;
In the event an owner(s) become disabled; and,
Unplanned exit/owner pre-deceases her/his exit from the company

Owners who do not plan carefully for transition are often faced with the less than appealing option of liquidating their business for much less than its value, or by closing the business with no return upon that event. However, those who plan carefully can realize the value of their life’s work, pass the business to the next generation and see their legacy continue. Read the court decision
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Reprinted courtesy of Stephen P. Katz, Esq., Peckar & Abramson, P.C.
Mr. Katz may be contacted at skatz@pecklaw.com

Landmark Montana Supreme Court Decision Series: The Duty to Defend

February 28, 2022 — Lorelie S. Masters, Patrick M. McDermott & Rachel E. Hudgins - Hunton Insurance Recovery Blog
This post in our Landmark Montana Supreme Court Decision Series discusses the Montana Supreme Court’s consideration of an insurer’s duty to defend in National Indemnity Co. v. State, 499 P.3d 516 (Mont. 2021). For 67 years, W.R. Grace & Company’s mining operations spread asbestos through the town of Libby, Montana, causing elevated rates of asbestosis and asbestos-related cancer in Libby residents – even among those who never worked in the mine. The Environmental Protection Agency deemed the Libby Mine the “most significant single source of asbestos exposure” in US history. In 2000, Libby residents began filing lawsuits against the State of Montana, alleging that the State had failed to warn them about the mine’s danger, and this failure contributed to their bodily injuries. Id. at 521-22. The Libby plaintiffs’ asbestos exposures and related injuries had occurred decades earlier, and so the State searched its storage units for records of any potentially applicable insurance policies. Reprinted courtesy of Lorelie S. Masters, Hunton Andrews Kurth, Patrick M. McDermott, Hunton Andrews Kurth and Rachel E. Hudgins, Hunton Andrews Kurth Ms. Masters may be contacted at lmasters@HuntonAK.com Mr. McDermott may be contacted at pmcdermott@HuntonAK.com Ms. Hudgins may be contacted at rhudgins@HuntonAK.com Read the court decision
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