Negligent Failure to Respond to Settlement Offer Is Not Bad Faith
May 03, 2017 —
Tred R. Eyerly - Insurance Law HawaiiThe Ninth Circuit found that the insurer's negligent failure to respond to a settlement offer did not constitute bad faith. McDaniel v. Gov't Employees Ins. Co., 2017 U.S. App. LEXIS 4029 (9th Cir. March 7, 2017).
McDaniel was the assignee of claims against GEICO assigned by the insured after settling a wrongful death suit. McDaniel alleged that GEICO unreasonably refused to accept a $100,000 policy limits offer. The case went to trial and a jury awarded McDaniel over $3 million against the insured.
On August 7, 2009, McDaniel's attorney Steven Nichols extended a $100,000 policy limits settlement offer with a fifteen day acceptance deadline to GEICO's attorney Michael Griott. The parties subsequently agreed to extend the acceptance deadline to ten days following MacDaniel's service of responses to outstanding interrogatories, which Nichols hand-delivered to Griott on August 27, 2009. On September 1, 2009, Griott emailed GEICO claims adjuster Aldin Buenaventura with a letter attachment indicating that Nichols had submitted the requested interrogatories and, in bold and underlined text, that "[o]ur response to Plaintiff's policy limits demand is due on or before September 11, 2009.
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Tred R. Eyerly - Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Condo Developers Buy in Washington despite Construction Defect Litigation
October 22, 2014 —
Beverley BevenFlorez-CDJ STAFFMarc Stiles writing for Puget Sound Business Journal stated that “[t]he belief that contractors have been scared off by the legal liabilities that come with [condo] projects doesn't seem to hold water.” He interviewed Suzi Morris, of Lowe Enterprises, who plans on building a new condo tower in Seattle this November.
Morris stated that they didn’t have any problems getting construction bids for the 24-story tower. According to the Puget Sound Business Journal, “The development team is trying to head off construction defect claims by planning and documenting with photos their work.”
Stiles did admit that an unnamed “source in Seattle who consults on condo projects knows of two large general contracting companies that won't bid on condo projects because of” potential construction defect litigation.
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Estoppel Certificate? Estop and Check Your Lease
May 06, 2019 —
Lauren Podgorski - Snell & Wilmer Real Estate Litigation BlogIf you are leasing space in a building, there may come a time when you receive a request from your landlord to fill out and sign an estoppel certificate. Estoppel certificates are usually sent to tenants in connection with the sale or refinance of a building, and a third party may rely on the accuracy of the statements and information contained in the estoppel certificate in connection with that transaction. Estoppel certificates can range from a very simple, one-page document, to several pages.
I’ve received an estoppel certificate in the mail. What do I do now?
Consider the following:
Check your lease. Your lease may require you to deliver the signed estoppel certificate and may even give you a timeframe within which you are required to return it. A form of estoppel certificate may also be included in your lease as an exhibit. If you’ve previously agreed to a form of estoppel certificate in your lease, check to ensure the one you have received matches the form you previously agreed to and if it doesn’t make sure to review it carefully to make sure it is acceptable.
Review the estoppel certificate and confirm that all of the information is accurate. Be on the lookout for any terms or provisions that you did not agree to in your lease. If it seems like the landlord is trying to modify your lease, you likely do not need to consent to the change in this document. Cross off (or modify or delete, if you have an electronic copy) any information that is inaccurate. Fill in all blanks (if the blank is not applicable, write “N/A”), and if any exhibits are referenced in the body of the document, make sure they are actually attached.
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Lauren Podgorski, Snell & WilmerMs. Podgorski may be contacted at
lpodgorski@swlaw.com
Tennessee High Court Excludes Labor Costs from Insurer’s Actual Cash Value Depreciation Calculations
May 27, 2019 —
Michael S. Levine & Geoffrey B. Fehling - Hunton Andrews KurthThe Tennessee Supreme Court has refused to construe an ambiguous definition of actual cash value to allow for deduction of labor costs as part of depreciation calculations where that subset of repair costs are not clearly addressed in the policy. Despite the split of authority nationwide, the Tennessee case presents a straightforward application of policy interpretation principles to a common valuation issue in first-party property claims.
In Lammert v. Auto-Owners (Mutual) Insurance Co., No. M2017-2546-SC-R23-CV (Tenn. Apr. 15, 2019), insureds brought a class-action lawsuit against their property insurer, Auto-Owners, alleging breach of contract. The plaintiffs each owned buildings damaged by a hail storm and had each submitted claims to Auto-Owners. Auto-Owners accepted the claims and determined that the losses would be determined on an actual cash value basis. In performing those valuations, Auto-Owners depreciated both the building materials and the labor costs associated with repairing the properties. The insureds challenged the labor cost depreciation. Auto-Owners moved to dismiss the lawsuit. In response, the insureds requested that the district court certify to the Tennessee Supreme Court whether, “[u]nder Tennessee law, may an insurer in making an actual cash value payment withhold a portion of repair labor as depreciation when the policy (1) defines actual cash value as ‘the cost to replace damaged property with new property of similar quality and features reduced by the amount of depreciation applicable to the damaged property immediately prior to the loss,’ or (2) states that ‘actual cash value includes a deduction for depreciation?”’
Reprinted courtesy of
Michael S. Levine, Hunton Andrews Kurth and
Geoffrey B. Fehling, Hunton Andrews Kurth
Mr. Levine may be contacted at mlevine@HuntonAK.com
Mr. Fehling may be contacted at gfehling@HuntonAK.com
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Coverage Denied for Condominium Managing Agent
May 24, 2018 —
Tred R. Eyerly - Insurance Law HawaiiDetermining there were no allegations of bodily injury or property damage in the underlying lawsuit, the court found there was no duty to defend or indemnify the condominium's managing agent. State Farm Fire & Cas. Co. v. Certified Mgmt., 2018 U.S.Dist. LEXIS 71124 (D. Haw. April 27, 2018).
Frederick Caven sued Certified Management, dba Associa Hawaii ("Associa") on behalf of himself and a class. Caven alleged that he owned a condominium and was a member of the Regency homeowners' association. The suit alleged that Associa was the managing agent for the association. Caven sold his unit in April 2016. Caven asked Associa for condominium documents to provide to the purchaser. Associa charged Caven $182.29 to download 197 pages of condominium documents for Regency. Associa also charged Caven $286.46 for a one-page "fee status confirmation," a document prepared by Associa which contained financial and other information needed to complete the sale. Caven alleged that the fees charged by Associa and other unit owners were excessive and in violation of Hawaii law.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Harmon Towers Duty to Defend Question Must Wait, Says Court
March 01, 2012 —
CDJ STAFFThe Harmon Towers project in Las Vegas was eventually halted short of the planned forty-seven stories after “it was determined that there was substantial defective construction, including defective installation of reinforcing steel throughout the Harmon.” The American Home Insurance Company and Lexington Insurance Company put forth a claim that they had no duty to defend Perini Construction, the builder of the defective Harmon Towers. Further, American Home seeks to recover the monies American reimbursed Perini. The United States District Court of Nevada ruled in the case of American Home Assurance Co. v. Perini Building on February 3, 2012.
The two insurance companies covered Perini and its subcontractors, Century Steel, Pacific Coast Steel, and Ceco Concrete Construction. Century Steel was the initial subcontractor for the reinforcing steel; they were later acquired by Pacific Coast Steel. In this current case, Perini Construction is the sole defendant.
Perini sought a dismissal of these claims, arguing that without the subcontractors joined to the case, “the Court cannot afford complete relief among existing parties.” The court rejected this claim, noting that the court can determine the duties of the insurance companies to Perini, which the court described as “separate and distinct from those of the subcontractors.” The subcontractors “have not claimed an interest in the subject matter of the action.” The court concluded that it could determine whether Perini was entitled or not to coverage without affecting the subcontractors. The court rejected Perini’s claim.
Perini also asked the court to abstain from the case, arguing that it was better heard in a state court. The court noted that several considerations cover whether a case is heard in state or federal courts. The court noted that if the case weighed heavily on state law, the state courts would be the obvious location. Further, if there were a parallel action in the state courts, “there is a presumption that the whole suit should be heard in state courts.” This is, however, no parallel state suit, although the court noted that Perini has “threatened” to do so.
However, the issue of who is to blame for the problems at Harmon Towers has not been resolved. The court concluded that until the “underlying action” was concluded, it was premature to consider the issues raised in this case while the earlier lawsuit was still in progress. The court denied Perini’s motion to dismiss the case. Given that the outcome of the earlier construction defect case may lead to further litigation in state court, the District Court granted Perini’s motion to abstain, but staying their judgment until the construction defect case is resolved.
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Professional Liability Client Alert: Law Firms Should Consider Hiring Outside Counsel Before Suing Clients For Unpaid Fees
March 31, 2014 —
David W. Evans and Blythe Golay - Haight Brown & Bonesteel LLPLaw firms seeking to recover attorney’s fees as the prevailing party in fee dispute litigation with their former client should hire outside counsel in order to avoid waiving any entitlement to such fees. Evaluating any potential exposure for a professional negligence claim or cross-claim before filing suit should also be considered. In Soni v. Wellmike Enterprise Company, Ltd., et al., No. B242288 (filed March 26, 2014) the California Court of Appeal for the Second District held that a law firm, represented by its own employees and associates, was not entitled to recover attorney fees as the prevailing party, pursuant to the attorney’s fee provision in the retainer agreement. The Soni decision is the latest addition to the general prohibition enunciated by Trope v. Katz (1995) 11 Cal.4th 274 (“Trope”) and its progeny that law firms are precluded from recovering attorney’s fees for self-representation.
In Soni, the law firm obtained a $28,384 judgment for delinquent legal fees against a former client. The firm then filed a motion for attorney’s fees, seeking $120,912 as the fees it incurred as the prevailing party under the retainer agreement. The trial court denied the motion based on the general rule set forth in the Trope line of cases that fees are not recoverable where the firm is represented by attorneys employed by the firm, despite the presence in the applicable retainer agreement of a clause notifying the client that fees the law firm would seek if it prevailed would include those for its in-house personnel.
Reprinted courtesy of
David W. Evans, Haight Brown & Bonesteel LLP and
Blythe Golay, Haight Brown & Bonesteel LLP
Mr. Evans may be contacted at devans@hbblaw.com; Ms. Golay may be contacted at bgolay@hbblaw.com
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Virtual Jury Trials: The Next Wave of Remote Legal Practice
July 13, 2020 —
David R. Zaslow & Mark Paladino - White and WilliamsOne of the most obvious and unavoidable results of the COVID-19 crisis has been the postponement of jury service and, by extension, all jury trials. Given the inherent difficulties of convening juries in a world of social distancing, it is likely that multiple jurisdictions will be unable to conduct live jury trials for at least the next several months.
Recognizing the mounting delay and substantial docket backlog that is attendant to several months without jury trials, one court most recently permitted the litigants, upon consent, to try a new innovation – the nation’s first virtual jury trial conducted entirely on the Zoom platform. More than two dozen potential jurors in Collin County, Texas attended jury selection from home by smartphone, laptop, and tablet, a process that was streamed live on YouTube. The presiding judge occasionally provided prospective jurors technical advice on how to best use their devices.
Once selected, the jurors virtually attended a one-day, “summary jury trial” of an insurance dispute in which they heard a condensed version of the case and delivered a non-binding verdict. The parties were then able to gauge how their cases would fare before a jury in a full-scale trial and, with that insight, agreed to proceed to a mediation in an attempt to reach a resolution. Court officials further touted the abbreviated, non-binding experience as an ideal test for the viability of remotely holding jury trials that would result in a final judgment. This real-world test, albeit in a non-binding exercise, may be an indication of things to come, as courts in Indiana and Arizona have already communicated an intention to conduct jury trials remotely once able.
Reprinted courtesy of
David R. Zaslow, White and Williams and
Mark Paladino, White and Williams
Mr. Zaslow may be contacted at zaslowd@whiteandwilliams.com
Mr. Paladino may be contacted at paladinom@whiteandwilliams.com
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