Seattle Washington Building Expert Directory

When an Insurer Proceeds as Subrogee, Defendants Should Not Assert Counterclaims Against the Insured/Subrogor

June 14, 2021 — Gus Sara - The Subrogation Strategist
In a subrogation action, one party is substituted to the rights and remedies of another with respect to a lawful claim. The substituted party (the subrogee) is legally able to pursue any right or seek any remedy that would be available to the subrogor regarding that claim. But can a defendant in a subrogation action assert any claim against the subrogee that it would have against the subrogor? In Federated Mut. Inc. Co. v. Kosciusko County, No. 3:20-CV-960, 2021 U.S. Dist. Lexis 88735, the United States District Court for the Northern District of Indiana considered whether a defendant could assert counterclaims against the insureds/subrogors in an action filed in the name of their subrogee. The court held that since the insurerds/subrogors were not a party to the action and the defendant could assert the substance of its counterclaim as a defense, the defendant could not file counterclaims against the insureds/subrogors in the insurer’s subrogation action. Kosciusko County arose from a motor vehicle accident involving a semi-tractor trailer owned by Bellman Oil Company, Inc. (Bellman) and B & B Transport, Inc. (B & B). The accident occurred on a highway in Kosciusko County in October of 2019. The accident caused the semi-tractor trailer containing ethanol fuel to roll over four times and burst into flames. Federated Mutual Insurance Company (FMIC) insured Bellman and B & B for the semi-tractor trailer and issued payments as a result of the accident. Read the court decision
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Reprinted courtesy of Gus Sara, White and Williams
Mr. Sara may be contacted at sarag@whiteandwilliams.com

What are the Potential Damages when a House is a Lemon?

September 01, 2016 — Haldon L. Greenberg, Esq. – Florida Construction Law News
It seems that lemons are front page news these days. Beyonce just released a chart-topping[1] album all about what to do when life hands you lemons. In today’s vernacular, we use the term “Lemon” to describe a person or thing that is unsatisfactory, disappointing, or feeble.[2] In Florida, there is a “Lemon Law” that provides a way for consumers to receive a replacement or full refund for vehicles found to have defects which may affect the vehicle’s safety, value or use.[3] While there is no “Lemon Law” for construction projects, in Gray v. Mark Hall Homes, Inc.,[4] Florida’s Second District Court of Appeal cited to Florida Supreme Court precedent in holding that a home builder was on the hook for the entire contract value of a home he contracted to build for the Plaintiff, when it was revealed the home was a “Lemon”, or as the evidence at trial showed, “valueless.” Read the court decision
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Reprinted courtesy of Haldon L. Greenberg, Esq., Cole, Scott & Kissane, P.A.
Mr. Greenberg may be contacted at haldon.greenburg@csklegal.com

Insurer Awarded Summary Judgment on Collapse Claim

January 06, 2020 — Tred R. Eyerly - Insurance Law Hawaii
The Eleventh Circuit agreed with the insurer that there was no coverage for a collapse under the policy. S.O. Beach Corp. v. Great Am. Ins. Co.,2019 U.S. App. LEXIS 32569 (11th Cir. Oct. 31, 2019). S.O. Beach Corporation and Larios on the Beach, Inc ("Larios") owned a building in Miami Beach. Sometime between march 4, 2012 and April 10, 2013, Larios discovered that parts of the first three floors of its building had caved in to varying degrees. The primary cause of the collapse was a wooden support beam that had severely rotted. Larios found a broken pipe that was gushing water onto the beam, causing deterioration. Larios was forced to evacuate the building until the damage was repaired. Larios submitted a claim under its all-risk policy with Great American. The policy required that a collapse an "abrupt falling down or caving in of a building or any part of a building" to be covered. Before a coverage decision was made, Larios sued for breach of contract. The parties filed cross-motions for summary judgment. The district court granted Great American's motion and denied Larios' motion. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

Eleventh Circuit Rules That Insurer Must Defend Contractor Despite “Your Work” Exclusion, Where Damage Timing Unclear

May 13, 2019 — Michael S. Levine & David M. Costello - Hunton Andrews Kurth
The Eleventh Circuit has reversed an insurer’s award of summary judgment after finding that uncertainty about when the alleged property damage occurred raised questions about whether the damage came within the scope of the “Your Work” exclusion. More specifically, the court found unclear whether the damage occurred before or after the contractor abandoned the job, thereby triggering an exception to the “Your Work” exclusion for damage to work that had “not yet been completed or abandoned.” The decision illustrates how timing can be a critical factor when it comes to triggering coverage for work and completed operations. In Southern-Owners Insurance Company v. MAC Contractors of Florida, LLC, a pair of trustees hired MAC Contractors (doing business as KJIMS Construction) to serve as the general contractor for a custom residence. After construction began, disputes between the trustees and KJIMS caused the contractor to abandon the job before completing the project. The trustees followed with a lawsuit alleging, among other things, that KJIMS had damaged wood floors and a metal roof, which KJIMS had promised to remediate but never did. Reprinted courtesy of Michael S. Levine, Hunton Andrews Kurth and David Costello, Hunton Andrews Kurth Mr. Levine may be contacted at mlevine@HuntonAK.com Mr. Costello may be contacted at dcostello@HuntonAK.com Read the court decision
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Construction Litigation Roundup: “You May Want an Intervention …”

June 10, 2024 — Daniel Lund III - Lexology
You may want an intervention … but you are not getting one! So said a federal court in New Orleans to a masonry supplier seeking to intervene in in an upstream subcontractor’s lawsuit against a payment bond surety for allegedly unpaid subcontract sums. It all seems so obvious: the masonry supplier indicates it is unpaid, and the subcontractor to which it supplied materials is saying the same thing and pursuing monies from the general contractor’s surety. Eventually, if the subcontractor prevails against the surety, monies ought to flow to the supplier – a set of facts lending itself to an intervention. The federal district court disagreed, however. Referring to Federal Rule of Civil Procedure 24(a)(2) and prior United States Fifth Circuit Court of Appeals case law the topic, the court opined that the masonry supplier lacked an interest in the subcontractor’s potential recovery that was “related to the property or transaction that forms the basis of the controversy…an interest that is ‘direct, substantial, [and] legally protectable.’" Read the court decision
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Reprinted courtesy of Daniel Lund III, Phelps
Mr. Lund may be contacted at daniel.lund@phelps.com

How the Election Could Affect the Housing Industry: Steven Cvitanovic Authors Construction Today Article

October 07, 2016 — Steven M. Cvitanovic – Haight Brown & Bonesteel LLP
Though non-policy issues dominating the news cycle have set this presidential election apart, both Hillary Clinton and Donald Trump have recognized the importance of housing and infrastructure investment. In an article for Construction Today, Partner Steven Cvitanovic outlines several challenges facing the real estate development industry, and analyzes how Clinton and Trump might benefit or harm the industry. Read the court decision
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Reprinted courtesy of Steven M. Cvitanovic, Haight Brown & Bonesteel LLP
Mr. Cvitanovic may be contacted at scvitanovic@hbblaw.com

Appeals Court Upholds Decision by Referee in Trial Court for Antagan v Shea Homes

May 10, 2012 — CDJ STAFF

In the case Antangan v. Shea Homes Ltd. Partnership (Cal. App., 2012), Plaintiffs appealed “an order vacating a judgment and entering a modified judgment in their construction defect action against defendants Shea Homes, Inc. and Shea Homes Limited Partnership,” while the Defendant, Shea Homes Limited Partnership (Shea Homes) appealed “an order of the judicial referee denying its motion to strike and tax costs.”

On the Antagon issue, the appeals court concluded that “the trial court did not err by vacating and modifying its judgment so that the cost of referee’s fees would be equally divided by the parties and consistent with a prior stipulation they filed in court.”

On the Shea Homes issue, the appeals court concluded: “1) the judicial referee did not err by ruling that plaintiffs’ offers to compromise (§ 998) were validly served on Shea Homes’ counsel, 2) the offers substantially complied with statutory requirements, 3) the offers were not required to be apportioned, and 4) the referee’s award of $5,000 as costs for a person assisting plaintiffs’ counsel was not an abuse of discretion.” The appeals court affirmed the judgment.

Here is a brief history of the trial case: “Plaintiffs Chito Antangan, Jimmy Alcova and other homeowners brought an action against defendants Shea Homes, Inc. and Shea Homes Limited Partnership for damages alleging that the properties they purchased from these ‘developer defendants’ were defective. Plaintiffs claimed numerous construction defects required them ‘to incur expenses’ for ‘restoration and repairs’ and the value of their homes had been diminished.”

In response, Shea Homes filed a motion for an order to appoint a judicial referee. The motion was granted and it was ruled that “a referee would ‘try all issues’ and ‘report a statement of decision to this court.’”

On May 10, 2010 the judicial referee (Thompson) “awarded plaintiffs damages and various costs, and ruled that ‘Shea Homes shall bear all of the Referee’s fees.’” The latter ruling would become a matter for contention later on.

In July of 2010, the plaintiffs “sought, among other things, $54,409.90 for expert fees, and $14,812.50 for the services of Melissa Fox for ‘exhibit preparation & trial presentation.’ Shea Homes filed a motion to strike and/or tax costs claiming: 1) Fox was a paralegal, 2) plaintiffs were not entitled to attorney’s fees, and 3) the fees for Fox’s services were an indirect and improper method to obtain attorney’s fees. The referee disagreed and awarded $5,000 for Fox’s services. The referee also ruled that plaintiffs had properly served valid offers to compromise (§ 998) on Shea Homes’ counsel in 2009. He said those offers to defendants in the case at that time did not have to be apportioned.”

“Antangan contends the trial court erred when it vacated and modified its original judgment, which ordered Shea Homes to pay all the referee’s fees. We disagree.”

Antagon contended that the trial court erred when it vacated and modified its original judgment regarding Shea Homes paying the referee’s fees. The appeals court disagreed: “A trial court has inherent authority to vacate or correct a judgment that is void on its face, incorrect, or entered by mistake. (§ 473; Rochin v. Pat Johnson Manufacturing Co. (1998),67 Cal.App.4th 1228; Olivera

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Architectural Firm Disputes Claim of Fault

May 27, 2011 — CDJ STAFF

Lake-Flato Architects has disputed the arbitration panel’s conclusion that problems with the home of Tom Hanks and Rita Wilson were due to design flaws. The firm settled with the couple for $900,000, however the Idaho Mountain Express reports that David Lake said, “the settlement in the case in no way represents that Lake Flato was responsible for faulty design.” The Express reported that “the arbitrators found that problems at the home were attributable to design errors that did not take into account the cold winter climate of the Sun Valley area.”

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