CAMBRIDGE MASSACHUSETTS BUILDING EXPERT
DIRECTORY AND CAPABILITIES

Extrinsic Evidence, or Eight Corners? Texas Court Sheds Light on Determining the Duty to Defend

December 18, 2022 — Nathan A. Cazier - Payne & Fears
Last year, the Texas Supreme Court adopted a narrow exception to the state’s eight-corners rule, and allowed the consideration of extrinsic evidence to determine the duty to defend. The exception arguably raised more questions than it resolved. Last month, a Texas federal court answered some of these questions by rejecting an insurer’s attempt to introduce extrinsic evidence under the newly minted exception. Texas permits few, if any, deviations from its eight-corners rule, which determines an insurer’s duty to defend by only considering the operative pleading and the terms of the policy, without any regard to extrinsic evidence or facts. This protects policyholders by erring on the side of defending claims, even if coverage is questionable. In Monroe Guar. Ins. Co. v. Bitco Gen. Ins. Corp., 640 S.W.3d 195, 199 (Tex. 2022) (“Monroe”), the Texas Supreme Court adopted an exception to the eight-corners rule, holding that extrinsic evidence may be considered when an “information gap” between the pleading and the policy makes it impossible to determine coverage, but only in limited scenarios where the extrinsic evidence (1) goes solely to an issue of coverage and does not overlap with the merits of liability, (2) does not contradict facts alleged in the pleading, and (3) conclusively establishes the coverage fact to be proved. Read the court decision
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Reprinted courtesy of Nathan A. Cazier, Payne & Fears
Mr. Cazier may be contacted at nac@paynefears.com

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Ackman Group Pays $91.5 Million for Condo at NYC’s One57

April 15, 2015 — David M. Levitt and Oshrat Carmiel – Bloomberg
A group including billionaire investor Bill Ackman paid $91.5 million for a duplex penthouse at Extell Development Co.’s One57 condominium tower, one of New York City’s most expensive home purchases ever. The purchase of unit 75 in the luxury skyscraper overlooking Central Park closed on March 27, according to property records filed Thursday. The buyer was listed as 57157 Co. LLC, a single-purpose entity that Ackman controls. The 13,554-square-foot (1,259-square-meter), six-bedroom home spans the 75th and 76th floors of the 90-story skyscraper. Ackman last year told the New York Times it was “the Mona Lisa of apartments.” Monthly common charges on the unit were estimated at $23,595, according to documents Extell filed with the state attorney general’s office. Reprinted courtesy of David M. Levitt, Bloomberg and Oshrat Carmiel, Bloomberg Read the court decision
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SCOTUS, Having Received Views of Solicitor General, Will Decide Whether CWA Regulates Indirect Discharge of Pollutants Into Navigable Water Via Groundwater

April 17, 2019 — Anthony B. Cavender - Gravel2Gavel
Prior to deciding whether to review an important February 1, 2018, U.S. Court of Appeals for the Ninth Circuit decision involving the jurisdictional reach of the Clean Water Act (CWA), Hawai’i Wildlife Fund, et al., v. County of Maui, the Supreme Court asked the Solicitor General for the views of the U.S. on the holdings of this case and the April 12, 2018 U.S. Court of Appeals for the Fourth Circuit decision, Upstate Forever, et al., v. Kinder Morgan Energy Partners, L.P., et al. On February 19, the Supreme Court confirmed that certiorari was granted to Question 1 presented by the Petition,

Whether the CWA requires a permit when pollutants originate from a point source but are conveyed to navigable waters by a nonpoint source, such as groundwater. (33 U.S.C. § 1362 (12)

In County of Maui , the Ninth Circuit held that indirect discharges to navigable waters through groundwater may be subject to the Environmental Protection Agency’s (EPA) CWA the National Pollutant Discharge Elimination System (NPDES) permitting authority, and in Kinder Morgan, the Fourth Circuit held that such an indirect discharge may be subject to regulation under the CWA when there is a direct hydrological connection between the discharge into groundwater and the direct discharge into navigable, surface waters. Read the court decision
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Reprinted courtesy of Anthony B. Cavender, Pillsbury
Mr. Cavender may be contacted at anthony.cavender@pillsburylaw.com

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No Duty to Defend Additional Insured for Construction Defects

November 23, 2016 — Tred R. Eyerly – Insurance Law Hawaii
The Eleventh Circuit found there was no duty to defend the contractor additional insured for the costs of repairing and replacing roofing installed incorrectly by the subcontractor insured. Core Constr. Servs. Southeast v. Crum & Forster Spec. Ins. Co., 2016 U.S. App. LEXIS 17575 (11th Cir. Sept 28, 2016). After the condominium project was completed, Hurricane Wilma damaged several roofs in the development. The association and its insurer, Empire Indemnity Insurance Company, discovered that the roof had been installed incorrectly by Patnode Roofing, Inc. Empire paid for the damages and the association assigned its claims against Core Construction and its subcontractors, including Patnode, to Empire. Empire then sued Core Construction, Patnode and other subcontractors. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Burden Supporting Termination for Default

January 11, 2021 — David Adelstein - Florida Construction Legal Updates
Terminating a contractor for default is a “‘drastic sanction’ and ‘should be imposed (or sustained) only for good grounds and on solid evidence.’” Cherokee General Corp. v. U.S., 150 Fed.Cl. 270, 278 (Fed.Cl. 2020) (citation omitted). This is true with any termination for default because terminating a contract for default is the harshest recourse that can be taken under a contract. It is a caused-based termination. For this reason, the party terminating a contract for default needs to be in a position to carry its burden supporting the evidentiary basis in exercising the default-based (or caused-based) termination. Stated differently, the party terminating a contract for default needs to justify the reasonableness in terminating the contract for default. A party looking to terminate a contract for default should smartly work with counsel to best position its justification in exercising the termination for default. Likewise, a contractor terminated for default should immediately work with counsel to best position the unreasonableness or the lack of justification for the default-based termination. Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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Recent Environmental Cases: Something in the Water, in the Air and in the Woods

July 22, 2019 — Anthony B. Cavender - Gravel2Gavel
State of Texas, et al. v. US EPA. The revised regulatory definition of “Waters of the U.S.” continues to generate litigation in the federal courts. On May 28, 2019, the U.S. District Court for the Southern District of Texas held that the 2015 rulemaking proceedings used by EPA and the U.S. Army Corp of Engineers to redefine this important component of the Clean Water Act were flawed in that the notice and comment provisions of the Administrative Procedure Act (APA) were violated because insufficient notice was provided by these agencies that “adjacent” waters newly subject to the regulatory jurisdiction of these agencies, can be determined on the basis of specific distances, which was a change in the agencies’ thinking, and insufficient notice of this change was provided to the public. In addition, the final rule “also violated the APA by preventing interested parties from commenting on the scientific studies that served as the technical basis” for the rule. However, the court did not vacate the new rule, but remanded the matter to the “appropriate administrative agencies” to give them an opportunity to fix this problem. State of Oklahoma, ex rel. Mike Hunter, Attorney General of Oklahoma v. US EPA and the United States Army Corps of Engineers. A day later, on May 29, 2019, the U.S. District Court for the Northern District of Oklahoma rejected arguments that the new redefinition should be preliminarily enjoined.While this case was filed in 2015, intervening litigation in the federal courts, including the U.S. Supreme Court, caused a substantial delay in the disposition of this case. The court, noting that the tests for granting such an injunction against the federal government are fairly exacting, held that the plaintiffs, the State of Oklahoma and a number of industry groups and associations, failed to convince the court that the harm they would suffer if the rules remained effective would be irreparable. Presumably, this case will be going to trial in the near future. Read the court decision
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Reprinted courtesy of Anthony B. Cavender, Pillsbury
Mr. Cavender may be contacted at anthony.cavender@pillsburylaw.com

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No Retrofit without Repurposing in Los Angeles

October 21, 2013 — CDJ STAFF
The Los Angeles Times has continued its series on the seismic safety of buildings in downtown Los Angeles. According to the article, Los Angeles only requires seismic retrofits of buildings if their purpose is being changed. One investor, Izak Shomof, bought a residential hotel and kept it as one to avoid retrofitting the building. He converted an office building to upscale residences and so the building was strengthened. His son, Eric Shomof, keeps an office in the unreinforced building. He said if more retrofitting were required, “you’d see a lot more vacant buildings down here,” describing the process as “not cheap.” Depending on whether or when a building has changed its use, the concrete buildings of downtown Los Angeles may or may not be protected against failure in an earthquake. Read the court decision
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Insurer’s Duty to Indemnify Not Ripe Until Underlying Lawsuit Against Insured Resolved

February 03, 2020 — David Adelstein - Florida Construction Legal Updates
A liability insurer has two duties: 1) the duty to defend its insured; and 2) the duty to indemnify its insured. With respect to the second duty – the duty to indemnify – this duty is typically “not ripe for adjudication unless and until the insured or putative insured has been held liable in the underlying action.” Hartford Fire Ins Co. v. Beazer Homes, LLC, 2019 WL 5596237, *2 (M.D.Fla. 2019) (internal quotation omitted). For instance, Beazer Homes involved an insurance coverage dispute stemming from construction defects. An owner sued its general contractor for construction defects relating to stucco problems. The general contractor paid for the repairs. The general contractor then sued its stucco subcontractor to recover the costs it incurred. The subcontractor tendered the defense of the lawsuit to its commercial general liability insurer which is defending its insured-subcontractor under the commonly issued reservation of rights. Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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