Illinois Appellate Court Addresses Professional Services Exclusion in Homeowners Policy
August 03, 2022 —
James M. Eastham - Traub LiebermanIn Stonegate Ins. Co. v. Smith, 2022 IL App (1st) 210931, the Insured was performing plumbing work at a multi-story townhouse when a fire ensued causing damage to the second story unit. Although a carpenter by trade, the Insured was performing plumbing work consisting of the replacement of a shower valve as a favor for a friend. To accomplish the task, the Insured utilized a small propane torch to attempt to remove the old water piping to the shower. In doing so, the insulation behind the bathroom wall caught fire and the flame spread upward to the neighboring unit. Stonegate had issued a homeowner’s policy to the Insured during the relevant time period. The homeowner's policy excluded coverage for property damage "[a]rising out of the rendering of or failure to render professional services." Subsequent to tender of the loss, Stonegate initiated a declaratory judgment action seeking a declaration that it owned no duty to defend or indemnity pursuant to the professional services exclusions.
In finding in favor of the Insured, the Court began its analysis by noting that the homeowner's policy did not define the term "professional services" such that it was the Court’s task to determine whether the Insured’s work qualified as a "professional service" for purposes of the exclusion. The Court further prefaced its holding by stating that for an exclusionary clause to effectively deny coverage, its applicability must be clear and free from doubt because any doubts as to coverage will be resolved in favor of the insured. Looking to Illinois case precedent, the Court found that the term "professional service" is not limited to services for which the person performing them must be licensed by a governmental authority. Rather, "professional services" encompass any business activity conducted by an insured that (1) involves specialized knowledge, labor, or skill, and (2) is predominantly mental or intellectual as opposed to physical or manual in nature.
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James M. Eastham, Traub LiebermanMr. Eastham may be contacted at
jeastham@tlsslaw.com
University of California Earthquake Report Provides List of Old Concrete Buildings in LA
January 22, 2014 —
Beverley BevenFlorez-CDJ STAFFAccording to a list provided to the city of Los Angeles by the University of California, there are “about 1,500 old concrete buildings that are potentially at risk of collapse during an earthquake,” the Los Angeles Times reported. The list can help the city identify “concrete buildings most likely to fail in an earthquake.”
The report, however, “does not amount to a list of dangerous buildings,” the university scientists told the Los Angeles Times. It is a list of concrete buildings built before 1980. Some of the “buildings are vulnerable, others are not.”
Concrete buildings pose a potentially dangerous threat, reported the Los Angeles Times: “After the Northridge earthquake caused two concrete buildings to collapse and severely damaged others, structural engineers warned that the collapse of a single concrete building ‘has the potential for more loss of life than any other catastrophe in California’ since the 1906 San Francisco earthquake.”
Eric Garcetti, Los Angeles Mayor, has asked Lucy Jones, a U.S. Geological Survey seismologist, to act as his science advisor on earthquake issues. Garcetti has asked Jones “to come up with recommendations by the end of the year on retrofitting issues, including how to get privately owned concrete buildings retrofitted.”
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Property Damage, Occurrences, Delays, Offsets and Fees. California Decision is a Smorgasbord of Construction Insurance Issues
November 21, 2017 —
Garret Murai - California Construction Law BlogOriginally published by CDJ on November 15, 2017
I read once that 97 percent of cases never go to trial. However, there are still the ones that do. And, then, there are the ones that do both. The following case, Global Modular, Inc. v. Kadena Pacific, Inc., California Court of Appeals for the Fourth District, Case No. E063551 (September 8, 2017), highlights some of the issues that can arise when portions of cases settle and other portions go to trial, the recovery of delay damages on a construction project through insurance, and the recovery of attorneys’ fees.
Global Modular, Inc. v. Kadena Pacific, Inc.
The U.S. Department of Veterans Affairs contracted with general contractor Kadena Pacific, Inc. (Kadena) to oversee construction of its Center for Blind Rehabilitation in Menlo Park, California. Kadena, in turn, contracted with subcontractor Global Modular, Inc. (Global) to construct, deliver and install 53 modular units totaling more than 37,000 square feet for a contract price of approximately $3.5 million.
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Garret Murai, Wendel Rosen Black & Dean LLPMr. Murai may be contacted at
gmurai@wendel.com
PSA: Latest Updates from AGC-VA on COVID Rules (UPDATED)
June 14, 2021 —
Christopher G. Hill - Construction Law MusingsThe recent changes in masking requirements and COVID-related restrictions have prompted questions and concerns throughout the construction industry. We understand your questions and continue to work closely with the Department of Labor and Industry (DOLI) and the Safety and Health Codes Board.
Here is what we know at this point:
- The Governor’s second order terminates the state of public emergency as of May 28, 2021. At that point, the DOLI Safety and Health Codes Board will have 2 weeks to meet and decide whether to rescind, modify, or continue the Final Permanent Standard for Prevention of Covid-19. Companies should continue to follow the standard until further notice.
- UPDATE: At present, the emergency order does not expire before June 30, unless amended or otherwise changed. Therefore, the two-week period to announce a meeting of the SCHB to review the permanent COVID-19 standard does not begin until July 1, though the meeting can occur after the two-week period. AGCVA has joined other groups in pushing for a meeting as soon as possible.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Residential Interior Decorator Was Entitled to Lien and Was Not Engaging in Unlicensed Contracting
August 04, 2021 —
David Adelstein - Florida Construction Legal UpdatesResidential construction disputes can sometimes take nasty turns. This is not attributed to one specific reason, but a variety of factors. Sometimes, there are not sophisticated contracts (or contracts at all). Sometimes, relationships and roles get blurred. Sometimes, parties try to skirt licensure requirements. Sometimes, a party is just unreasonable as to their expectations. And, sometimes, a party tries to leverage a construction lien to get what they want. In all disputes, a party would certainly be best suited to work with construction counsel that has experience navigating construction disputes.
An example of a construction dispute that took a nasty turn involving an interior decorator is SG 2901, LLC v. Complimenti, Inc., 2021 WL 2672295 (Fla. 3d DCA 2021). In this case, a condominium unit owner wanted to renovate his apartment. He hired an interior decorator to assist. As his renovation plans became more expansive, the interior decorator told him he would need to hire a licensed contractor and architect. The interior decorator arranged a meeting with those professionals and, at that meeting, they were hired by the owner and told to deal directly with the interior decorator, almost in an owner’s representative capacity since the owner traveled a lot. The interior decorator e-mailed the owner about status and requested certain authorizations, as one would expect an owner’s representative to do. At the completion of the renovation job, the owner did not pay the interior decorator because he was unhappy with certain renovations. The interior decorator recorded a construction lien and sued the owner which included a lien foreclosure claim. There was no discussion of the contracts in this case because, presumably, contracts were based on proposals, were bare-boned, or were oral.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
EPA Fines Ivory Homes for Storm Water Pollution
June 26, 2014 —
Beverley BevenFlorez-CDJ STAFF“Utah’s largest home builder [Ivory Homes] has agreed to a $250,000 fine and to take several steps…to comply with Clean Water Act requirements to control pollution associated with storm-water runoff from construction sites,” reported The Salt Lake Tribune.
David Broadbent, Ivory Homes’ chief operating officer, stated in an email to The Salt Lake Tribune: “We are proud of our environmental record, particularly our storm-water compliance record. We are the first and the only home builder in Utah to implement a robust, companywide program to safeguard against sediment from entering Utah waters as a result of home-building activities.” Furthermore, Broadbent declared that the “inspections that led to the violations notices” did not yield any evidence that their “home-building practices resulted in any sediment discharge in any amount, let alone harm, to Utah waters.”
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Associated Builders and Contractors Northern California Chapter Announces New President/CEO
January 24, 2022 —
Associated Builders and Contractors, Northern California Chapter(January 19, 2022 – Livermore, CA) Associated Builders and Contractors, Northern California Chapter (ABC NorCal) Board of Directors launched an exhaustive, nationwide CEO search, and recently selected Deborah Maus as the next President/CEO. Deborah is a Certified Association Executive (CAE) with 25+ years of strategic and operational leadership. Prior to accepting the position, Deborah served as the chief executive officer of Plumbing Heating Cooling Contractors of California.
Mark Kirkes, President of MK Electric & Design Inc—and 2022 ABC NorCal Chair— said, "We believe Deborah will focus on strengthening organizational structure to meet new and expanding program needs, guide policy development and strategic innovations, bring increased value to members and continue to be the leading voice of the merit shop in Northern California. Her demonstrated knowledge of the industry and her support of all who desire to succeed in the construction industry made her an ideal choice to advance ABC's mission in Northern California."
Former ABC NorCal President/CEO Michele Daugherty is transitioning to the ABC Central Florida Chapter as President/CEO, continuing her 16+ years of service in ABC. ABC 2021 Chair, Josh Ward noted, "Michele has been working for ABC since 2006 and we are happy to see that she is staying in the ABC family—continuing to fight for the Merit Shop. The Executive Committee expresses its sincere appreciation for Michele and her remarkable services to the organization. Her enthusiasm and leadership will be deeply missed and difficult to replicate. However, we believe we have found the right person in Deborah Maus."
About ABC Northern California Chapter
ABC Northern California Chapter (ABC NorCal) is a trade association founded on the merit shop philosophy and dedicated to serving construction professionals from Fresno to the Oregon border. Our mission: To promote free enterprise by advancing the merit shop philosophy in the construction industry through education, advocacy and business services. To learn more visit www.abcnorcal.org
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Supreme Court Holds Arbitrator can Fully Decide Threshold Arbitrability Issue
March 18, 2019 —
David Adelstein - Florida Construction Legal UpdatesThe United States Supreme Court recently decided parties to a contract can agree, under the Federal Arbitration Act, an arbitrator, rather than a court, can fully resolve the initial arbitrability question. Henry Schein, Inc. v. Archer and White Sales, Inc., 2019 WL 122164 (2019). The arbitrability question is whether the dispute itself is subject to arbitration under an arbitration provision. Parties that do not want to arbitrate try to circumvent this process by filing a lawsuit and asking the court to determine the threshold arbitrability question.
In Henry Schein, Inc., the contract at-issue provided:
This Agreement shall be governed by the laws of the State of North Carolina. Any dispute arising under or related to this Agreement (except for actions seeking injunctive relief and disputes related to trademarks, trade secrets, or other intellectual property) shall be resolved by binding arbitration in accordance with the arbitration rules of the American Arbitration Association. The place of arbitration shall be in Charlotte, North Carolina.
The plaintiff in this case asserted a claim for injunctive relief (among other claims) and argued that, therefore, the dispute is not subject to arbitration based on the exception in the provision. The initial, threshold issue became whether the dispute was subject to arbitration and, importantly, who decides this issue. The Court further looked at whether a trial court can resolve this issue under the “wholly groundless” exception, i.e.,the court can decide the issue if the argument for arbitration is wholly groundless.
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David Adelstein, Kirwin NorrisMr. Adelstein may be contacted at
dma@kirwinnorris.com
