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 BlogThis 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
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Contractor Disputes Report Amid Amazon Warehouse Collapse Lawsuit
May 02, 2022 —
James Leggate - Engineering News-RecordA contractor facing a lawsuit related to the December partial collapse of an Amazon.com Inc. warehouse that was hit by a tornado is pushing back on claims in a fire marshal’s report that highlighted possible “significant structural issues” with the building.
Reprinted courtesy of
James Leggate, Engineering News-Record
Mr. Leggate may be contacted at leggatej@enr.com
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Wave Breaker: How a Living Shoreline Will Protect a Florida Highway and Oyster Bed
December 23, 2024 —
Derek Lacey - Engineering News-RecordA living shoreline being constructed in the Florida Panhandle's Apalachicola Bay is protecting a critical local highway, while fostering marsh areas and oyster habitat that’s seen years of decline.
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Derek Lacey, Engineering News-RecordMr. Lacey may be contacted at
laceyd@enr.com
Federal District Court Dismisses Property Claim After Insured Allows Loss Location to Be Destroyed Prior to Inspection
September 29, 2021 —
James M. Eastham - Traub LiebermanIn BMJ Partners LLC v. Arch Specialty Insurance Co., No. 20-CV-03870, 2021 WL 3709182 (N.D. Ill. Aug. 20, 2021), the United States District Court for the Northern District of Illinois dismissed, with prejudice, a coverage action filed by an insured based on a failure to comply with a request to inspect the involved property under Rule 34 of the Federal Rules of Civil Procedure. The loss at issue involved a hail-damaged building in Carpentersville, Illinois. During the discovery phase of the litigation, the property insurer served a request to inspect the subject property under FRCP Rule 34. After ignoring numerous requests to schedule the inspection, the insurer filed a motion to dismiss for failure to prosecute or, alternatively, to compel an inspection. After the motion was filed, a status hearing was conducted where the insured’s counsel advised the Court of his intention to file a motion to withdraw from representation of the insured. After the date set to file the motion to withdraw passed without anything being filed, the Court entered an order directing the insured to show cause why the matter should not be dismissed for lack of prosecution.
In response to the order to show cause, the insured advised the Court that instead of responding to the property insurer’s discovery requests, the insured sold the property to a buyer who subsequently tore down the building. In light of what the Court described as the insured’s “flabbergasting admission”, the Court was compelled to grant the motion to dismiss and do so with prejudice. In support of the “extreme sanction” of dismissing the matter with prejudice, the Court first noted that the insured had not come close to justifying a discharge of the pending show-cause order. Rather, the insured’s responsive filing refers to the Court's show cause order only indirectly and does not deny, or offer any justification for, disregarding case-related communications for several months. Even if that were not enough, the Court further held that the insured’s spoliation of evidence likewise provides sufficient basis for dismissal given that Courts have inherent authority to sanction parties for failure to preserve potential evidence. According to the Court, dismissal with prejudice was the only appropriate sanction in light of the insured’s violation of the obligation to preserve the property. Not only did the insured ignore multiple requests from the insurer to inspect, but during the same time frame the insured found time to allow inspections of the building as part of the sale by both the Village of Carpentersville and the property's buyer.
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James M. Eastham, Traub LiebermanMr. Eastham may be contacted at
jeastham@tlsslaw.com
Interpreting Insurance Coverage and Exclusions: When Sudden means Sudden and EIFS means Faulty
June 15, 2020 —
Ben Volpe - Colorado Construction Litigation BlogEIFS, or Exterior Insulation and Finish System, is an integrated exterior insulation and synthetic stucco system, praised for its energy efficiency.[1] However, EIFS has come to be well known in the construction defect world as placing homes at risk due to a lack of a built-in moisture management system. Before long, insurance companies recognized the risk and began explicitly excluding coverage for EIFS-related damage. However, EIFS exclusions have not always been so clearly set forth in some policies, causing insurance coverage litigation.
Recently, a Greenwood Village couple, Mark and Susan Mock, lost this fight.
Built in 1994, the Mocks’ home was constructed with an EIFS system. The Mocks carried a homeowner’s insurance policy through Allstate, which covered “sudden and accidental loss” to property, but excluded coverage for “planning, construction or maintenance” issues. Such “planning, construction or maintenance” exclusions included “faulty, inadequate or defective designs.”
A few months after a hailstorm, the Mocks discovered moisture-related damage to their home’s EIFS system. They reported the damage to Allstate, but Allstate would not cover it, reasoning that the damage to the EIFS system was excluded as a design and/or construction failure, and thus not covered as a “sudden and accidental” loss. The experts who evaluated the damage concluded it was the result of inherent flaws in the EIFS systems common in the 1994 timeframe, which involved long term moisture intrusion behind the cladding and no means for the water to escape.
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Benjamin Volpe, Higgins, Hopkins, McLain & Roswell, LLCMr. Volpe may be contacted at
volpe@hhmrlaw.com
Lien Actions Versus Lien Foreclosure Actions
June 02, 2016 —
David R. Cook Jr. – AHHC Construction Law BlogThe lawsuits required to perfect and foreclose upon a lien have confused lien claimants and their attorneys for years. This confusion was recently demonstrated in a recent case entitled Founders Kitchen and Bath, Inc. v. Alexander, No. A15A1262, 2015 WL 6875026 (Ga. App. 2015).
In the case, the trial court granted an owner’s motion for summary judgment against a subcontractor that sought to foreclose on its materialman’s lien. In deciding to reverse the trial court’s decision, the Court held that issues of material fact still existed as to whether the owner and subcontractor were in privity of contract.
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David R. Cook Jr., Autry, Hanrahan, Hall & Cook, LLPMr. Cook may be contacted at
cook@ahclaw.com
Timely and Properly Assert Affirmative Defenses and Understand Statutory Conditions Precedent
August 05, 2024 —
David Adelstein - Florida Construction Legal UpdatesA recent case serves as a reminder to TIMELY and PROPERLY assert affirmative defenses and to understand statutory conditions precedent to construction lien claims. Failing to do one or the other could be severely detrimental to the position you want to take in a dispute, whether it is a lien foreclosure dispute, or any other dispute.
In Scherf v. Tom Krips Construction, Inc., 2024 WL 3297592 (Fla. 4th DCA 2024), the president of a construction company and his wife were building a residence. They orally accepted the proposal from the concrete shell contractor and asked for invoices to be submitted to the president’s construction company. No written contract was memorialized. The president and his wife did not pay the concrete shell contractor and the contractor recorded a lien and sued to foreclose on the lien. Years later (the case had been stayed because the president and his wife filed for bankruptcy and the shell contractor had to get leave of the automatic bankruptcy stay to pursue the lien foreclosure), the shell contractor moved for summary judgment. The president and his wife moved for leave to file an amended answer and affirmative defenses. They claimed the oral contract was with the construction company and the shell contractor was required to serve a Notice to Owner under
Florida Statute s. 713.06. Alternatively, they argued that if the oral contract was with the president and his wife, the shell contractor was required to serve a Final Contractor’s Payment Affidavit at least 5 days before filing its lien foreclosure claim, and did not, as required by s. 713.06.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
Gilroy Homeowners Sue over Leaky Homes
February 10, 2012 —
CDJ STAFFTwo years into a lawsuit against Shapell Homes, the builder of a subdivision called Eagle Ridge in Gilroy, California, homeowners have joined or left the lawsuit. About fifty homeowners are still in the suit, which contends that construction defects have lead to water intrusion in their homes. The lawyer for the homeowners contends that more than a hundred homes have construction defects.
One homeowner said that soon after he joined the suit, Sharpell sent workers to his home who repaired problems to his satisfaction. “They came in within two weeks and fixed everything,” said Frank Lowry. Another homeowner, Wilson Haddow, said that he was “quite happy” after Shapell repaired problems.
Others weren’t quite so happy. Greg Yancey said that problems had “been a nightmare” and that “it just doesn’t feel like home.” He said that his “house is possessed,” with problems that include walls that bow out and a balcony that drips rainwater to the front door. His home is currently worth far less than the $700,000 he paid in 2007.
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