Cambridge Massachusetts Building Expert Directory

No Coverage Under Installation Policy When Read Together with Insurance Application

January 16, 2024 — David Adelstein - Florida Construction Legal Updates
A recent case out of the Eleventh Circuit denied an underground contractor’s claim under what appears to be a commercial property installation floater policy (inland marine coverage) that covers the contractor’s materials. Whereas a builder’s risk policy is more expansive, an installation floater is narrower and can provide protection to a contractor for materials and equipment in transit, stored, or being installed subject to the terms of the installation floater policy. It can provide coverage to a trade subcontractor for materials that aren’t covered by builder’s risk. In Travelers Property Casualty Company of America v. Talcon Group, LLC, 2023 WL 8798053 (11th Cir. 2023), an underground utility contractor that had a general contractor’s license had an installation policy that provided coverage “only for underground utility operations and the site development work tied to those operations.” Talcon Group, supra, at *1. The utility contractor was constructing two residential homes that was on land owned by an affiliated family entity. During construction of the residential homes, a wildfire destroyed the homes prior to the issuance of certificates of occupancy. The utility contractor submitted a notice of loss to its insurance carrier that provided the installation policy. The carrier denied the claim because the construction of the homes was NOT the same type of work as the installation of underground utilities which was covered. An insurance coverage lawsuit ensued. 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

Ninth Circuit Rules Supreme Court’s Two-Part Test of Implied Certification under the False Claims Act Mandatory

May 13, 2019 — Meredith Thielbahr - Gordon & Rees Construction Law Blog
For those contractors in the government arena, read on. The False Claims Act (“FCA”) was enacted to deter knowingly fraudulent actions by contractors which resulted in a loss of property to the Government. Intent to defraud with resulting financial hardship was required. Contrary to popular misconception, the statute was not designed to punish all false submissions to the Government simply because those submissions, or claims, are later found to be false. The statute’s inclusion of the requisite element of knowledge is consistent with this notion:

A defendant must submit a claim for payment to the Government;
the claim must be false or fraudulent;
the defendant must have known the claim was fraudulent when it was submitted (also known as scienter); and
the claim must have caused the Government to pay out money.

See 31 U.S.C. § 3729(a). Despite these explicit elements (in addition to common law elements of fraud), over the last two decades, contractors have seen ever-expanding theories of FCA recovery presented by qui tam plaintiffs and the Government. For example, under the FCA, the false “claim” evolved over time: the claim no longer needs to be an express false claim (i.e. the truthfulness of the claim is a direct condition of payment); the claim can be “implied” misrepresentation or “half-truth”. Read the court decision
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Reprinted courtesy of Meredith Thielbahr, Gordon & Rees Scully Mansukhani
Ms. Thielbahr may be contacted at mthielbahr@grsm.com

Connecting Construction Project Information: Open Technology Databases Improve Project Communication, Collaboration and Visibility

March 14, 2018 — Andy Kayhanfar - InEight
The construction industry has been plagued for decades with projects coming in over budget and behind schedule. There are many reasons this happens, but it ultimately comes down to just one thing – a lack of connected information. Today, gigabytes and even terabytes of data are generated on a project and housed in different systems that do not talk or share information, which creates a closed approach and inhibits collaboration. Data is siloed and only accessible to certain companies, departments or disciplines, which gives each project stakeholder a very limited view into the status of the project as they are making decisions. To be successful, the construction industry needs to free project data from closed systems. There must be a way to give all project stakeholders access to accurate information within the context of how it applies to the overall project that will empower everyone from owners to engineers to contractors to make timely, fully informed decisions that bring projects in on time and within budget. INTRODUCING THE OPEN TECHNOLOGY DATABASE The need for deep visibility into project information across systems and stakeholders has given rise in the construction industry to the open technology database. This approach enables project stakeholders to link the data in their existing software systems and connect that information into one centralized location. Project stakeholders can continue to use and maintain the data in their own systems while still feeding the information to the shared environment, which brings together critical project details, provides context for decisions and makes it easier for all parties to collaborate. Project stakeholders are now able to connect business data related to estimating, cost control, scheduling, contracts, purchasing, accounting and more. This creates a common data set across the project that can be quickly accessed and can easily be put in the hands of project decision makers. Innovative companies are taking this connectivity to a new level. They see the potential to use 3D models beyond simply the design aspects of a project and bring them into the activities of construction. Innovators are taking all the project information available in the shared environment and connecting it to the 3D model to create a comprehensive view of the project. Read the court decision
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Reprinted courtesy of Andy Kayhanfar, Construction Executive, a Publication of Associated Builders and Contractors. All Rights Reserved

Hunton Insurance Partner Syed Ahmad Serves as Chair of the ABA Minority Trial Lawyer Committee’s Programming Subcommittee

January 13, 2020 — Michelle M. Spatz - Hunton Insurance Recovery Blog
Syed Ahmad, a partner in Hunton Andrews Kurth’s Insurance Coverage practice, has volunteered to serve as Chair of the ABA Minority Trial Lawyer Committee’s Programming Subcommittee. The Minority Trial Lawyer Committee (MTL) serves as a resource for minority litigators, in-house counsel and law students, aiming to foster professional development, legal scholarship, advocacy and community involvement. As Chair of the Programming Subcommittee, Syed, who was named to Benchmark Litigation’s 40 & Under Hot List earlier this year, will help advance MTL’s mission of facilitating discussions about diversity and the law and providing career network opportunities for minority trial lawyers. Read the court decision
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Reprinted courtesy of Michelle M. Spatz, Hunton Andrews Kurth
Ms. Spatz may be contacted at mspatz@HuntonAK.com

Prison Time and Restitution for Construction Fraud

February 14, 2013 — CDJ STAFF
Federal prosecutors have obtained prison sentences and fines for the two leaders of a construction kickback scheme. Others are awaiting sentencing. The Chicago Sun-Times reports that John Paderta the former president of Krahl Construction has been sentenced to five years in prison and must pay $10 million in restitution. His executive vice president, Doug Harner will be spending five years in prison and has been ordered to pay $9.6 million in restitution. Paderta and Harner overbilled two clients on renovation projects, giving kickbacks to employees at the client companies. Two employees of these client companies have pled guilty. A further five employees of the three companies have admitted that they were involved in the fraud. They are yet to be sentenced. Read the court decision
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Choice of Laws Test Mandates Application of California’s Continuous and Progressive Trigger of Coverage to Asbestos Claims

June 01, 2020 — Christopher Kendrick & Valerie A. Moore – Haight Brown & Bonesteel LLP
In Textron v. Travelers Casualty and Surety Co. (No. B262933, filed 2/25/20), a California appeals court held that the Restatement’s choice of laws factors mandated application of California’s continuous and progressive trigger of coverage to asbestos claims, overcoming an argument that a manifestation trigger should apply under Rhode Island law. Travelers insured Textron from 1966 to 1987. In 2011, Textron was sued by a California resident, Esters, for damages caused by mesothelioma resulting from asbestos exposure in California. The action was defended and settled by Travelers and other insurers under reservations of rights. Textron sued Travelers in California for a declaration that Travelers owed duties to defend and indemnify the Esters action. Travelers cross-complained, seeking reimbursement. The case turned on choice of law for trigger of coverage as between California and Rhode Island. Citing Montrose Chemical Corp. v. Admiral Ins. Co. (1995) 10 Cal.4th 645 and Armstrong World Industries, Inc. v. Aetna Casualty & Surety Co. (1996) 45 Cal.App.4th 1, the Textron court noted that California applies a continuous trigger to continuous or progressively deteriorating injury. By contrast, in Rhode Island a covered occurrence exists “when the damage … manifests itself, … is discovered or, … in the exercise of reasonable diligence is discoverable.” (Citing Textron, Inc. v. Aetna Cas. and Sur. Co. (R.I. 2002) 754 A.2d 742.) According to Travelers, the Esters action was not covered under Rhode Island law because the plaintiff’s mesothelioma was not diagnosed until 2010, after Travelers was off the risk. Reprinted courtesy of Christopher Kendrick, Haight Brown & Bonesteel LLP and Valerie A. Moore, Haight Brown & Bonesteel LLP Mr. Kendrick may be contacted at ckendrick@hbblaw.com Ms. Moore may be contacted at vmoore@hbblaw.com Read the court decision
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Red Tape Is Holding Up a Greener Future

March 13, 2023 — The Editors - Bloomberg
Seven months on, Democrats are still celebrating the Inflation Reduction Act, even though a crucial determinant of its success — permitting reform for energy projects — remains undone. Recent data shows just how imperative it is for them to stop dragging their feet. What’s now called the IRA had little to do with inflation. It was a climate bill, and a big one: It provided $370 billion to improve energy efficiency, reduce emissions and smooth the path to a clean-power economy. It came on top of a 70% surge in private investment since 2017. But the biggest impediment to the US energy transition isn’t financing: It’s building. A decade ago, between 25% and 30% of proposed wind and solar projects moved from the drawing boards to completion. But as new projects and new funding have soared, utilities have been unable to keep up, leading to an immense backlog. A recent report by BloombergNEF found that over just six years, global clean-energy investment has gone from half the level of fossil-fuel investment to near parity, an extraordinary leap that reflects the market’s appetite for clean power. Yet America’s dysfunctional regulation is preventing many needed projects from even breaking ground. Read the court decision
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Reprinted courtesy of The Editors, Bloomberg

Lake Texoma, Texas Condo Case may go to Trial

February 05, 2014 — Beverley BevenFlorez-CDJ STAFF
A lawsuit that’s created a “four-year legal battle” over alleged construction defects at the Diamond Pointe Condominium Tower in Lake Texoma, Texas may soon be going to trial, according to KTEN News. A lawyer representing the Diamond Pointe condominiums stated that “he has 15 witnesses lined up for a two-week trial.” KTEN News reported that according to court papers, “the Association alleges issues with the elevator, doors not opening properly, cracks, water leaks, and septic containment system leaks over the past decade.” Furthermore, the Association president Dan Baucum said to KTEN, “There were some foundation repairs that we needed to do and there are some problems with the building. It was not built to the specifications, at least that's what we're alleging, and that has allowed some water seepage in certain areas.” Read the court decision
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