Cambridge Massachusetts Building Expert Directory

Insurance Law Alert: Incorporation of Defective Work Does Not Result in Covered Property Damage in California Construction Claims

June 18, 2014 — Valerie A. Moore and Chris Kendrick - Haight Brown & Bonesteel LLP
In Regional Steel Corp. v. Liberty Surplus Ins. (No. B245961, filed 5/16/14, ord. pub. 6/13/14), a California appeals court held that the insured's use of the wrong steel seismic reinforcement hooks in construction of a mixed-use building was not an occurrence, and did not result in covered property damage. Regional Steel was the structural steel subcontractor on a 14-story mixed-use project in North Hollywood, California. Regional supplied plans which were approved by the developer and its structural engineers for installation of steel reinforcements, including seismic reinforcement hooks, to be encased in concrete. During construction, City inspectors determined that the plans called for the wrong hooks, necessitating repairs to finished portions of the work and delays in further construction. This ultimately resulted in a lawsuit between the developer, Regional Steel, the concrete subcontractor, the structural engineer and a quality assurance inspector. The project was insured under a wrap policy issued to the developer, with Regional named as an additional insured. The court rejected an argument that the wrap endorsement fundamentally changed the insurance, and the issue boiled down to whether incorporation of the wrong hooks, the damage caused by tearing out concrete to replace the hooks, or the resulting loss of use, triggered coverage. Liberty asserted that no damage to property was alleged and the purely economic losses caused by the need to reopen the poured concrete to correct the tie hook problem did not constitute "property damage" within the meaning of the policy. Liberty further posited that the tie hook problem did not constitute an “occurrence” within the meaning of the policy because the alleged damage was not caused by an accident. Reprinted courtesy of Valerie A. Moore, Haight Brown & Bonesteel LLP and Chris Kendrick, Haight Brown & Bonesteel LLP Read the court decision
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Giant Gas Pipeline Owner, Contractor in $900M Payment Battle

January 22, 2024 — David Godkin, Debra K. Rubin
A Canadian partnership including energy developer TC Energy that is building the $10.6-billion Coastal GasLink pipeline, and a key project contractor, are disputing more than $900 million in project costs in court and in upcoming arbitration. The 670-kilometer line in British Columbia that announced mechanical completion last year is set to carry liquefied natural gas to the LNG Canada export terminal under construction on the province’s Pacific Coast—the country’s first such facility. Reprinted courtesy of David Godkin, Engineering News-Record and Debra K. Rubin, Engineering News-Record Ms. Rubin may be contacted at rubind@enr.com Read the full story... Read the court decision
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Insurer's Judgment on the Pleadings Based Upon Expected Injury Exclusion Reversed

October 30, 2018 — Tred R. Eyerly - Insurance Law Hawaii
The appellate court reversed the trial court's granting of a judgment on the pleadings based upon the expected injury exclusion in a homeowner's policy. Allstate Indemn. Co. v. Contreras, 2018 Ill. App. LEXIS 170964 (Ill. Ct. App. July 20, 2018). Alejandra Contreras owned Jasmine's Day Care. Her husband, Adan Contreras, was not an employee of the Day Care. Alejandra and Adan had a homeowner's policy which provided day care liability coverage through an endorsement. 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

Professional Liability and Attorney-Client Privilege Bulletin: Intra-Law Firm Communications

January 07, 2015 — David W. Evans & Stephen J. Squillario – Haight Brown & Bonesteel LLP
Attorney-Client Privilege Protects Confidential Communications Between Law Firm Attorney Representing Current Client and Firm’s General Counsel Regarding Disputes with Client Who Later Files Malpractice Suit In a case of first impression in California, Edwards Wildman Palmer LLP v. Superior Court (No. B255182 - filed November 25, 2014), Division Three of the Second District Court of Appeal addressed the question of whether the attorney-client privilege applies to intrafirm communications between law firm attorneys concerning disputes with a current client, when that client later sues the firm for malpractice and seeks to compel production of such communications. The court concluded that when an attorney representing a current client seeks legal advice from the law firm’s designated in-house “general counsel” concerning disputes with the client, the attorney-client privilege applies to their confidential communications. The court held that adoption of the so-called “fiduciary” or “current client” exceptions to the attorney-client privilege is contrary to California law because California courts are precluded from creating implied exceptions to the statutorily created attorney-client privilege. Reprinted courtesy of David W. Evans, Haight Brown & Bonesteel LLP and Stephen J. Squillario, Haight Brown & Bonesteel LLP Mr. Evans may be contacted at devans@hbblaw.com; Mr. Squillario may be contacted at ssquillario@hbblaw.com Read the court decision
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Insurer Has Duty to Defend Sub-Contractor

July 25, 2022 — Tred R. Eyerly - Insurance Law Hawaii
Interpreting Connecticut law, the federal district court had that the insured sub-contractor was entitled to a defense. County Wide Mech. Servs. LLC v. Regent Ins. Co., 2022 U.S. Dist. LEXIS 86726 (D. Conn. May 13, 2022). The underlying plaintiff, The Saybrook at Haddam, entered a contract with PAC Group to serve as general contractor for construction of an addition to The Saybrook's facility. PAC Group sub-contracted with County Wide Mechanical Services to install the HVAC system. The HVAC system was put into service on November 14, 2014. In October 2019, The Saybrook filed the underlying action against PAC group, County Wide, and others. The underlying complaint alleged that there had been at least seven "critical failures" of the HVAC system. As a result, The Seabrook had to replace multiple compressors and several circuit boards, valves, and other components. Further, the entire system had to be replaced. The underlying complaint alleged breach of contract against PAC Group and County Wide. In addition to the alleged breach of contract between The Saybrook and County Wide, the Saybrook also alleged it was a third-party beneficiary of PAC Group's contract with County Wide regarding installation of the HVAC system. PAC Group cross-claimed against County Wide, asserting one count of contractual indemnification and one count of breach of contract under the PAC Group's contract with County Wide. 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

Tacoma Construction Site Uncovers Gravestones

August 11, 2011 — CDJ STAFF

The Seattle Times reports that a transit construction project has uncovered about twenty-five gravestones. The area was historically sensitive, as it is in territory once occupied by the Puyallup Tribe. At current report, no human remains have been found and the article cites the project?s archeological consultant as describing the gravestones as “not historically significant.”

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Cal/OSHA’s Toolbox Has Significantly Expanded: A Look At Senate Bill 606

December 13, 2021 — Michael J. Studenka - Newmeyer Dillion
Governor Gavin Newsom recently signed into law Senate Bill 606, set to take effect on January 1, 2022. With proponents of the bill citing the need to hold large employers accountable for COVID-related workplace hazards, SB 606 creates two new categories of employer violations. First, SB 606 creates a rebuttable presumption that if a type of violation is discovered at one particular worksite, Cal/OSHA can extrapolate that the violation is an “enterprise-wide” violation at all of the other company worksites. Additionally, SB 606 adds a new category of “egregious violations” to Cal/OSHA’s arsenal, adding a penalty multiplier for such violations. Finally, SB 606 increases Cal/OSHA’s investigative capabilities by authorizing Cal/OSHA to issue a subpoena to employers should they fail to “promptly provide” information requested during an investigation. As further explained below, the consequences of violating Cal/OSHA regulations has become significantly greater and more expensive, particularly for larger employers with multiple worksites. ENTERPRISE-WIDE VIOLATIONS AND THE SEVERE REMEDIES THAT FOLLOW Under SB 606, employers with more than one worksite will now face a rebuttable presumption that a violation at one location is actually “enterprise-wide” if either of the following are true:

A written policy or procedure violates any Cal/OSHA standard, rule, order or regulation; OR
Cal/OSHA finds evidence of a “pattern or practice” of the same violation being committed by the employer at one or more of its worksites.

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Reprinted courtesy of Michael J. Studenka, Newmeyer Dillion
Mr. Studenka may be contacted at michael.studenka@ndlf.com

Protecting Your Business From Liability Claims Stemming From COVID-19 Exposure

June 01, 2020 — Andrew Hamelsky, Jenifer Scarcella & Joshua Tumen - White and Williams
Businesses of every nature – including grocery stores, banks, daycares, gyms and restaurants – may face increasing liability claims from customers and third parties claiming to have been exposed to the novel coronavirus, or COVID-19, while at their location. The novel virus raises issues as to whether businesses have a heightened duty of care to their customers, and what type of exposure businesses face if a customer claims to have been exposed to COVID-19 while at their premises. Recently, a lawsuit was filed against Princess Cruise lines for gross negligence in allowing passengers to be exposed to COVID-19 on a cruise ship. The lawsuit alleges that the cruise ship was allowed to go out to sea knowing that it was infected from two previous passengers who came down with symptoms of COVID-19. It further claims that the passengers were not warned of the potential exposure either before or after they boarded the ship. In other news reports around the country, business owners have reported taking extraordinary precautions to prevent customers’ risk of contracting COVID-19. For example, one grocery store recently reported that it discarded $35,000 worth of food after a customer coughed on fresh produce. Reprinted courtesy of White and Williams LLP attorneys Andrew Hamelsky, Jenifer Scarcella and Joshua Tumen Mr. Hamelsky may be contacted at hamelskya@whiteandwilliams.com Ms. Scarcella may be contacted at scarcellaj@whiteandwilliams.com Mr. Tumen may be contacted at tumenj@whiteandwilliams.com Read the court decision
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