Counsel Investigating Coverage Can be Sued for Invasion of Privacy
January 28, 2019 —
Christopher Kendrick & Valerie A. Moore - Haight Brown & Bonesteel LLPIn Strawn v. Morris, Polich & Purdy (No. A150562, filed 1/4/19), a California appeals court held that policyholders could state a claim for invasion of privacy against an insurer’s coverage counsel and law firm, where the counsel had disseminated inadvertently produced tax returns to forensic accountants while evaluating coverage.
In Strawn, a couple’s home was destroyed by fire and the husband was prosecuted for arson, but the criminal case was dropped. Notwithstanding, their insurance claim was denied on the ground that the husband intentionally set the fire and fraudulently concealed his actions. In addition to the insurance company, the insureds also named the carrier’s coverage counsel and his firm in the ensuing bad faith lawsuit, alleging causes of action for elder financial abuse and invasion of privacy.
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
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Impairing Your Insurer’s Subrogation Rights
May 06, 2024 —
David Adelstein - Florida Construction Legal UpdatesLiability insurance policies have a provision that allows them to subrogate to the rights of their insured. This provision is commonly referred to as a transfer of rights provision and reads:
If the insured has rights to recover all or part of any payment we have made under this Coverage Part, those rights are transferred to us. The insured must do nothing after loss to impair them. At our request, the insured will bring “suit” or transfer those rights to us and help us enforce them.
In a recent dispute, an insurer sued its insured claiming the insured breached the insurance policy-a contract—by impairing the insurer’s subrogation rights. In other words, the insurer claimed its insured breach the insurance contract and the transfer of rights provision above.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
What to do about California’s Defect-Ridden Board of Equalization Building
October 01, 2014 —
Beverley BevenFlorez-CDJ STAFFJerry Brown recently signed into law a bill requiring the state of California “to assess its properties in the Sacramento area and develop long-term plans for renovating, replacing or selling the most troublesome buildings,” according to SF Gate. Some say the Board of Equalization building, which was built for $80 million and then repaired for $60 million has construction defects, is “jeopardizing the health and safety of public employees.”
Current problems include “[f]looding, mold, falling windows and free-falling elevators,” reported SF Gate. Furthermore, recently, “three employees filed a $75 million lawsuit against the state, alleging toxic mold in the building is causing extreme fatigue, skin rashes, persistent flu-like symptoms, respiratory illnesses, frequent headaches, memory lapses and fears of cancer.”
“This is a disaster,” Assemblyman Roger Dickinson, D-Sacramento, who authored the bill regarding assessing state capitol buildings, told SF Gate. “It endangers the health and safety of employees and the public alike. And it is costing state taxpayers tens of millions of dollars.”
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Not Just Another Client Alert about Cyber-Risk and Effective Cybersecurity Insurance Regulatory Guidance
April 01, 2015 —
Robert Ansehl – White and Williams LLPThe prefix "cyber" was coined about 70 years ago to describe early stage computers, computer networks and virtual reality. Since then, the term has been used as a prefix for hundreds of words, however, the most recent (and newsworthy) usage is its link to the word “risk” and the correlative term “security.” Two sides of the same coin and not a day goes by when a data breach is not reported and the importance of cyber risk and cybersecurity underscored. Insurers, like other financial institutions, are at the forefront of the “cyber-curve.” Many insurers are particularly vulnerable on at least two fronts: (1) from a cyber risk/ cyber invasion perspective and; (2) an insurer’s insurance policy exposure, intentional and not, to third-parties under cyber policies, and even policies such as CGLs that may inadvertently cover such risks.
A number of federal and state regulators have spoken to this issue in an effort to address cyber risks with varying degrees of specificity. At last count, in addition to a myriad of existing and proposed state laws and regulations, there are at least nine federal Bills under consideration by Congress (covering six federal agencies including one new agency) that seek to impose regulatory requirements upon the cyber-arena. Those Bills empower six regulatory agencies; including one new agency. Initially, some states required companies to notify affected persons of a data breach. As breaches became more serious, state and federal regulators sought to increase the industry’s awareness of the potential exposures and provided instructions on appropriate steps to protect data from cyber invasions. Now, state insurance regulators are examining not only the threat of data theft, but the balance sheet impact of insurance exposures for underwriting such risks for third-parties’ under cyber risk policies. The regulatory efforts continue to multiply in an effort to stem some of these risks.
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Robert Ansehl, White and Williams LLPMr. Ansehl may be contacted at
ansehlr@whiteandwilliams.com
Congratulations to San Diego Partner Johnpaul Salem and Senior Associate Scott Hoy for Obtaining a Complete Defense Verdict!
November 13, 2023 —
Dolores Montoya - Bremer Whyte Brown & O'Meara LLPPartner Johnpaul Salem and Senior Associate Scott Hoy just concluded a 4-week trial defending a local renowned hotel in San Diego. Plaintiff alleged premises liability against BWB&O’s client arguing plaintiff was injured while riding in an elevator due to alleged negligent maintenance and inspection. Plaintiff brought in a “hired gun” elevator expert from Missouri and sought $25 million in damages for two fractured ankles, a compound tibia fracture, and lifelong CRPS/PTDS/anxiety. BWB&O argued any injuries sustained were a direct result of Plaintiff’s actions. After a passionate and powerful closing argument by Mr. Salem, attacking the foundation of Plaintiff’s expert’s opinions and presenting vigilance of the hotel in the safety of its guests, the jury unanimously ruled in BWB&O’s client’s favor.
Reprinted courtesy of
Dolores Montoya, Bremer Whyte Brown & O'Meara LLP
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Shoring of Ceiling Does Not Constitute Collapse Under Policy's Definition
November 12, 2019 —
Tred R. Eyerly - Insurance Law HawaiiDespite the need to shore up the ceiling, the building was not in a state of collapse under the language of the policy. Ravinia Vouge Cleaners v. Travelers Cas. Ins. Co. of Am., 2019 U.S. Dist. LEXIS 123594 (N.D. Ill. July 24, 2019).
Ravinia Cleaners held a property policy issued by Travelers for the building from which it operated its dry-cleaning business. On February 2, 2015, there was heavy snowfall. On February 4, Ravinia reported to Travelers a leak coming from the ceiling. A temporary "shoring " was placed on the ceiling. Ravinia reported to Travelers that there was damage to the roof on February 25, 2015. Travelers hired an engineer who observed a buckling truss and roof displacing downward. The inspector recommended that the building be vacated and not occupied until adequate shoring was in place.
Travelers denied coverage because the building was in a state of imminent collapse which was caused by the weight of ice and snow, and defective construction of the truss system. The policy excluded damage relating to a "collapse of a building." Collapse was defined by the policy as "an abrupt falling down or caving in of a building or any part of a building," such that the building could not be occupied for its intended purpose. There were exceptions to the exclusion, however, if the cause of the collapse was: (1) weight of snow; or (2) use of defective materials or methods in construction if the collapse occurred after construction. The policy also excluded damage from a building being in a state of imminent collapse unless the damage was caused by: (1) weight of snow; or (2) use of defective materials or methods in construction if the collapse occurred during construction.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
New California "Construction" Legislation
November 08, 2018 —
Richard H. Glucksman, Esq. & Chelsea L. Zwart, Esq. - Chapman Glucksman Dean Roeb & BargerGovernor Jerry Brown signed two potentially impactful Senate Bills relating to the construction of apartment buildings late last month. These Bills, discussed further below, were introduced, in part, in response to the Berkeley balcony collapse in June 2015, which was determined by the California Contractors State License Board to be caused by the failure of severely rotted structural support joists the repair of which were deferred by the property manager, despite indications of water damage.
SENATE BILL 721 ESTABLISHES HEIGHTENED “LOAD-BEARING” INSPECTION REQUIREMENTS
On August 21, 2018, the California State Senate passed SB 721, one of two bills by Senator Jerry Hill introduced this year seeking to address the safety of multifamily rental residences. Now that the Governor has signed the Bill, a new section will be added to the California Health and Safety Code, requiring that every 6 years, destructive testing be performed on at least 15% of each type of load-bearing, wood framed exterior elevated element (such as balconies, walkways, and stair landings) in apartment buildings with 3 or more units. Interestingly, prior to being passed by the State Senate, SB 721 was revised in June 2018, such that the inspection requirements do not apply to common interest developments (i.e., condominiums).
As set forth in the new Health and Safety Code Section 17973:
"the purpose of the inspection is to determine that exterior elevated elements and their associated waterproofing elements are in a generally safe condition, adequate working order, and free from any hazardous condition caused by fungus, deterioration, decay, or improper alteration to the extent that the life, limb, health, property, safety, or welfare of the public or the occupants is not endangered."
The inspection must be paid for by the building owner and performed by a licensed contractor, architect, or civil or structural engineer, or a certified building inspector or building official from a recognized state, national, or international association. Emergency repairs identified by the inspector must be made immediately. For non-emergency repairs, a permit must be applied for within 120 days and the repair completed within 120 days of the permit’s issuance. If repairs are not completed within 180 days, civil penalties of $100-$500 per day may be imposed.
The required inspection must be completed by January 1, 2025 and every 6 years thereafter, unless an equivalent inspection was performed during the 3 years prior to January 1, 2019, the effective date of the new law. For a building converted to condominiums that will be sold after January 1, 2019, the inspection required by Health and Safety Code Section 17973, must be performed prior to the first close of escrow.
SENATE BILL 1465 SETS CONTRACTOR REPORTING REQUIREMENTS
The Governor also signed SB 1465, adding Sections 7071.20, 7071.21, and 7071.22 to the California Business and Professions Code. The new law requires that a contractor licensed with the Contractors’ State License Board "report to the registrar in writing within 90 days after the licensee has knowledge of any civil action resulting in a final judgment, executed settlement agreement, or final arbitration award in which the licensee is named as a defendant or crossdefendant, filed on or after January 1, 2019," that meets certain and specific criteria, including that it is over $1 million and arises out of an action for damages to a property or person allegedly caused by specified construction activities of the contractor on a multifamily rental residential structure.
Where more than one contractor was named as a defendant or cross-defendant, each of the contractors apportioned more than $15,000 in liability must report the action. Importantly, the new statute also imposes similar reporting requirements on insurers of contractors. SB 1465 also addresses an impacted party’s failure to comply with the reporting requirements.
COMMENT
Both SB 721 and SB 1465 are potentially significant and seek “legislative reform” to address construction issues by placing a greater burden on apartment owners as well as builders and subcontractors. How pragmatic and what impact they will have on the industry is obviously developing. If you are interested in receiving further detail concerning the Bills, please contact us. We are analyzing the new legislation and its intent and will be providing our ongoing comments.
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RICHARD H. GLUCKSMAN, ESQ. CHELSEA L. ZWART, ESQ., CGDRBChelsea L. Zwart may be contacted at
czwart@cgdrblaw.com
Construction Spending Had Strongest Increase in Four Years
January 13, 2014 —
CDJ STAFFThe Commerce Department announced a 1% gain in construction spending, from October to November, which is the biggest gain that construction has seen since March 2009, according to The Spokesman-Review. The gain brought construction spending to an adjusted annual rate of $934.4 billion.
The Spokesman-Review further reports that residential construction rose 1.9% in November, while commercial construction rose 2.7%. Government construction, on the other hand, fell 1.8%.
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