Duty To Defend Construction Defect Case Affirmed, Duty to Indemnify Reversed In Part
May 07, 2015 —
Tred R. Eyerly – Insurance Law HawaiiThe Eleventh Circuit affirmed the district court's finding of a duty to defend, but reversed, in part, the insurer's duty to indemnify. Carithers v. Mid-Continent Cas. Co., 2015 U.S. App. LEXIS 5540 (11th Cir. April 7, 2015).
After discovering a number of defects in their home, the Carithers sued their homebuilder, Cronk Duch Miller & Associates. Cronk Duch's insurer, Mid-Continent Casualty Company, refused to defend.The parties entered into a consent judgment for $90,000 in favor of the Carithers. Cronk Duch then assigned to the Carithers the right to collect the judgment from Mid-Continent.
The Carithers then sued Mid-Continent. Florida law applied. Mid-Continent has issued four policies to Cronk Duch from March 2005 to October 2008. The parties filed cross-motions for summary judgment on the duty to defend issue. The underlying complaint alleged that the defects could not have been discovered until 2010, after the last policy period. The district court rejected Mid-Continent's argument that property damage occurred when it was discovered or when it reasonably could have been discovered. Therefore, summary judgment on the duty to defend was granted to the Carithers.
Read the court decisionRead the full story...Reprinted courtesy of
Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
The Colorado Court of Appeals Rules that a Statutory Notice of Claim Triggers an Insurer’s Duty to Defend.
October 23, 2012 —
David M. McLain, Higgins, Hopkins, McLain & RoswellGene and Diane Melssen d/b/a Melssen Construction (“Melssen”) built a custom home for the Holleys, during which period of time Melssen retained a CGL insurance coverage from Auto Owners Insurance Company. Soon after completion of the house, the Holleys noticed cracks in the drywall and, eventually, large cracks developed in the exterior stucco and basement slab. Thereafter, the Holleys contacted Melssen, the structural engineer, an attorney, and Auto-Owners, which assigned a claims adjuster to investigate the claim.
In April 2008, the Holleys sent Melssen a statutory notice of claim pursuant to C.R.S. § 13-20-803.5 (“NOC”). In this NOC, the Holleys claimed approximately $300,000 in damages related to design and construction defects. The Holleys also provided a list of claimed damages and estimated repairs, accompanied by two reports from the Holleys’ consultant regarding the claimed design and construction defects. In June 2008, Melssen tendered the defense and indemnity of the claim to Auto-Owners. While Auto-Owners did not deny the claim at that time, it did not inspect the property or otherwise adjust the claim. Thereafter, in October 2008, Auto-Owners sent Melssen a letter denying coverage on the basis that the damage occurred outside of the applicable policy period.
Ultimately, Melssen settled the claims against it for $140,000.
Read the full story…
Reprinted courtesy of David McLain, Higgins, Hopkins, McLain & Roswell, LLC. Mr. McLain can be contacted at mclain@hhmrlaw.com
Read the court decisionRead the full story...Reprinted courtesy of
Follow Up on Continental Western v. Shay Construction
March 28, 2012 —
Brady Iandiorio, Higgins, Hopkins, McLain & Roswell, LLCWriting in Construction Law Colorado, Brady Iandiorio revisits the case Continental Western v. Shay Construction. He promises to continue to follow cases dealing with Colorado HB 10-1394.
Recently the Court ruled on two Motions to Reconsider filed by Defendants Milender White and Shay Construction.
Procedurally, the Motions to Reconsider were ruled on by the Honorable William J. Martinez, because the day after the motions were filed the action was reassigned to Judge Martinez. In the short analysis of the Motion to Reconsider, the court leaned on Judge Walker D. Miller’s ruling on the summary judgment and his analysis of the (j)(5) and (j)(6) exclusions.
As a quick refresher regarding the grant of summary judgment, Judge Miller agreed with Continental Western’s argument that the asserted claims were excluded under the “damage to property” exclusion. The policy’s exclusions state: “(j) Damage to Property . . . (5) that particular part of real property on which you or any contractors or subcontractors working directly or indirectly on your behalf are performing operations, if the ‘property damage’ arises out of those operations; or (6) that particular part of any property that must be restored, repaired or replaced because ‘your work’ was incorrectly performed on it.” Judge Miller found that both exclusions (j)(5) and (6) applied to both Shay’s allegedly defective work.
Read the full story…
Reprinted courtesy of Brady Iandiorio of Higgins, Hopkins, McClain & Roswell, LLC. Mr. Iandiorio can be contacted at iandiorio@hhmrlaw.com.
Read the court decisionRead the full story...Reprinted courtesy of
5 Questions about New York's Comprehensive Insurance Disclosure Act
February 14, 2022 —
Richard W. Brown & Michael V. Pepe - Saxe Doernberger & Vita, P.C.On December 31, 2021, New York enacted the Comprehensive Insurance Disclosure Act (“CIDA”), requiring defendants to provide plaintiffs with “complete” information for any insurance policy through which a judgment could be satisfied, within sixty (60) days after serving an answer. The stated goal is to reduce delay tactics by compelling disclosures of all policies implicated by a claim as well as other claims, contracts, or agreements that may deplete available coverage or residual limits of policies that have already been eroded by other payments. The impact of CIDA’s disclosure requirements may be scaled back by proposed amendments currently pending before the New York state legislature.
1. What does CIDA Require?
CIDA requires the automatic disclosure of insurance information to plaintiffs. New York’s Civil Practice Law & Rules (“CPLR”) 3101(f) permits civil discovery of the contents of existing insurance agreements by which an insurer may be liable for all or part of a judgment. However, CIDA amends the CPLR to mandate that defendants must automatically disclose the following information in all pending cases starting March 1, 2022, or within sixty (60) days of filing an answer to a complaint going forward:
- Complete copy of all insurance policies that are available to satisfy all or part of a potential judgment.
- This includes Primary, Excess, and Umbrella policies.
- The relevant applications for insurance.
Reprinted courtesy of
Richard W. Brown, Saxe Doernberger & Vita and
Michael V. Pepe, Saxe Doernberger & Vita
Mr. Brown may be contacted at RBrown@sdvlaw.com
Mr. Pepe may be contacted at MPepe@sdvlaw.com
Read the court decisionRead the full story...Reprinted courtesy of
Assert a Party’s Noncompliance of Conditions Precedent with Particularity
July 26, 2017 —
David Adelstein - Florida Construction Legal UpdatesConstruction contracts oftentimes and should contain conditions precedent to payment. Conditions precedent apply to both progress payments and final payment. The conditions precedent operate such that payment is NOT due until the conditions are satisfied. The satisfaction of the conditions precedent triggers the payor’s obligation to pay.
If a dispute arises due to the payee’s noncompliance with conditions precedent to payment, the noncompliance should be asserted with particularity in the answer and affirmative defenses. For example, if a subcontractor was required to provide lien waivers and releases as a condition precedent to payment, then this should be asserted with particularity as an affirmative defense. If the contractor’s receipt of payment from the owner was a condition precedent to payment to the subcontractor (pay-when-paid), then this should be asserted with particularity as an affirmative defense. Any noncompliance with a condition precedent should be identified as an affirmative defense.
Read the court decisionRead the full story...Reprinted courtesy of
David Adelstein, Florida Construction Legal UpdatesMr. Adelstein may be contacted at
Dadelstein@gmail.com
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
Read the court decisionRead the full story...Reprinted courtesy of
No Coverage for Additional Insured
December 17, 2015 —
Tred R. Eyerly – Insurance Law HawaiiTwo insurers disputed who was responsible for coverage the additional insured contractor. Endurance Am. Spec. Ins. Co. v. Century Sur. Co., 2015 U.S. App. LEXIS 19194 (2nd Cir. Nov. 4, 2015). The district court granted summary judgment to Endurance, finding there was coverage for the additional insured general contractor after being sued by an employee of a subcontractor.
Century's policy included an Action Over Exclusion clause, which excluded insurance coverage for injury to certain employees as follows:
Exclusions:
. . .
e. Employer's Liability
"Bodily injury" to:
(1) an "employee" of the
named insured arising out of and in the course of:
- (a) Employment by the named insured; or
- (b) Performing duties related to the conduct of the named insured's business.
The named insured was Pinnacle Construction & Renovation Corp.
Read the court decisionRead the full story...Reprinted courtesy of
Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Partner Lisa M. Rolle and Associate Vito John Marzano Obtain Dismissal of Third-Party Indemnification Claims
December 22, 2019 —
Lisa M. Rolle & Vito John Marzano - Traub Lieberman PerspectivesOn June 1, 2019, Traub Lieberman partner Lisa M. Rolle and associate Vito John Marzano successfully secured dismissal of all third-party claims on behalf of a corporate entity and its principal in a third-party action in the New York State Supreme Court, County of Bronx. The underlying action concerned a trip and fall that occurred on a public sidewalk located in the Bronx. Plaintiff commenced suit against the corporation property owner and its principal. Defendants/third-party plaintiffs commenced the third-party action seeking contractual and common-law indemnification against three third-party defendants, the corporate tenant, another corporate entity that was not a party to the lease and its principal. Traub Lieberman represented the latter two third-party defendants.
On behalf of the corporate entity that was not a party to the lease, Traub Lieberman moved for dismissal on the basis that the lease constitutes documentary evidence establishing as a matter of law that the non-tenant corporation cannot be held liable to third-party plaintiffs. On behalf of the principal, Traub Lieberman sought dismissal for failure to state a cause of action because the principal was shielded from liability by virtue of having incorporated his business, and the complaint did not allege a claim for piercing the corporate veil.
In opposition, third-party plaintiffs sought to amplify their pleadings by alleging that a de facto merger had occurred between the non-tenant corporation and the tenant corporation. Third-party plaintiffs further argued that the corporate principal executed a guaranty to the lease, thus accepting liability on behalf of the tenant corporation.
Reprinted courtesy of
Lisa M. Rolle, Traub Lieberman and
Vito John Marzano, Traub Lieberman
Ms. Rolle may be contacted at lrolle@tlsslaw.com
Mr. Marzano may be contacted at vmarzano@tlsslaw.com
Read the court decisionRead the full story...Reprinted courtesy of
