Seattle Washington Building Expert Directory

CA Supreme Court Finds “Consent-to-Assignment” Clauses Unenforceable After Loss Occurs During the Policy Period

August 26, 2015 — Christopher Kendrick & Valerie A. Moore – Haight Brown & Bonesteel LLP
In Fluor Corporation v. Superior Court (No. S205889; filed 8/20/15), the California Supreme Court overruled its earlier decision in Henkel Corp. v. Hartford Accident & Indemnity Co. (2003) 29 Cal.4th 934, holding that notwithstanding the presence of a consent-to-assignment clause in a liability policy, Insurance Code section 520 bars an insurer from refusing to honor the insured’s assignment of coverage after a loss has taken place during the policy period. In Henkel, the Supreme Court limited the ability of corporate successors to obtain coverage under predecessors’ policies on a contract theory. The Henkel Court held that where a successor corporation contractually assumed liabilities of the predecessor corporation, the insurance benefits would not automatically follow. The Henkel Court ruled that if the predecessor company’s policy contains a consent-to-assignment clause, any assignment of insurance policy benefits to a successor corporation required the insurer’s consent. The Court said that policy benefits are not transferable choses in action unless at the time of corporate transfer they could be reduced to a monetary sum certain. The Court reasoned that historic product or environmental liabilities might not even be known to the predecessor at that time, much less reduced to a sum certain, so coverage for such risks could not be considered a transferable chose in action. Thus, where the liability was inchoate at the time of the corporate transaction, the Henkel Court said that coverage would not necessarily follow because the insurer’s duties had not yet attached. 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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Construction Law Breaking News: California Supreme Court Rules in Favor of Beacon Residential Community Association

July 09, 2014 — Steven M. Cvitanovic – Haight Brown & Bonesteel LLP
On July 3, 2014, the California Supreme Court issued its opinion affirming the First District Court of Appeal in the case of Beacon Residential Community Association v. Skidmore, Owings & Merrill (Case No. S208173). The issue in the Beacon case is whether the architects of a residential project owe a duty to future third party homeowners under SB800 and common law. In 2011, Judge Richard Kramer of the San Francisco Superior Court sustained demurrers of Skidmore, Owings & Merrill and HKS Architects to the homeowners association complaint without leave to amend. The homeowners association appealed and the First District Court of Appeal reversed Judge Kramer, ruling that the homeowners could assert SB800 and common law claims against the architects of the project even in the absence of privity of contract. Read the court decision
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Reprinted courtesy of Steven M. Cvitanovic, Haight Brown & Bonesteel LLP
Mr. Cvitanovic may be contacted at scvitanovic@hbblaw.com

Tests Find Pollution From N.C. Coal Ash Site Hit by Florence Within Acceptable Levels

October 30, 2018 — Associated Press - Engineering News-Record
RALEIGH, N.C. (AP) — Despite the gray muck that fouled the Cape Fear River near a Wilmington power plant after Hurricane Florence, water tests so far show heavy metals contained in coal ash are within state standards, North Carolina environmental officials said Thursday. Read the court decision
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Reprinted courtesy of Engineering News-Record
ENR may be contacted at ENR.com@bnpmedia.com

Tenants Who Negligently Cause Fires in Florida Beware: You May Be Liable to the Landlord’s Insurer

May 13, 2019 — Rahul Gogineni - The Subrogation Strategist
In Zurich Am. Ins. Co. v. Puccini, LLC, 2019 Fla. App. LEXIS 1487, 44 Fla. L. Weekly D 383, Florida’s Third District Court of Appeals considered whether a landlord’s carrier, Zurich American Insurance Company (Zurich), was precluded from pursuing a subrogation claim against the landlord’s tenant, Puccini, LLC (Puccini), for fire-related damages. After the fire, Zurich paid its insured, Lincoln-Drexel Waserstein, Ltd. (Lincoln), over $2.1 million. Zurich then proceeded with an action against Puccini. Puccini filed for summary judgment arguing that it was an additional insured under the Zurich policy. The trial court agreed with Puccini and dismissed the action. Zurich then appealed the case to Florida’s Third District Court of Appeals. Finding that the lease contemplated both liability on the part of the tenant and indemnification in favor of the landlord, the court held that the tenant was not an implied co-insured under Zurich’s policy. Thus, the court allowed Zurich’s subrogation action. The Sutton Doctrine Extension of the Anti-Subrogation Rule In the United States, most states have adopted an anti-subrogation rule either by statute or through common law. Under an anti-subrogation rule, an insurer may not pursue its insured for monies paid to the insured. While some states limit their anti-subrogation rule to apply only to the named insured, other states have expanded the rule to include parties listed as additional insureds, and even, in some instances, implied insureds (those parties not specifically listed, but still considered an insured under the applicable policy). Read the court decision
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Reprinted courtesy of Rahul Gogineni, White and Williams LLP
Mr. Gogineni may be contacted at goginenir@whiteandwilliams.com

Nevada Supreme Court Rejects Class Action Status, Reducing Homes from 1000 to 71

July 02, 2014 — Beverley BevenFlorez-CDJ STAFF
The Las Vegas Review-Journal reported that the “Nevada Supreme Court has rejected a request for class action status for claims of damaged stucco from faulty construction by Del Webb Communities involving nearly 1,000 Sun City Summerlin residents,” however, “the court upheld the award of damages to 71 homeowners following a jury trial in Clark County District Court in 2008.” The case began in 2003, and the Las Vegas Review-Journal referred to it as “one of the largest construction-defect cases in Nevada history.” But District Judge Allan Earl denied class action lawsuit in 2006. “Attorneys were seeking $70 million for the homeowners.” In 2008, another court “determined that only 71 homeowners merited compensation totaling $4 million for the stucco issues.” According to the Las Vegas Review-Journal, “[h]omeowners alleged that Del Webb failed to install metal screeds that would protect homes from water damage, and as a result, the homes suffered from cracked stucco, mold and weakened walls.” Read the court decision
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Court of Appeal Holds That Higher-Tiered Party on Construction Project Can be Held Liable for Intentional Interference with Contract

December 07, 2020 — Garret Murai - California Construction Law Blog
In Caliber Paving Company, Inc. v. Rexford Industrial Realty and Management, Inc., Case No. G0584406 (September 1, 2020), the 4th District Court of Appeal examined whether a higher-tiered party on a construction project can be held liable for intentional interference with contract when it interferes with the contract between lower-tiered parties even though the higher-tiered party has an economic interest in the contract between the lower-tiered parties. The Caliber Paving Case Project owner Rexford Industrial Realty and Management, Inc. owns and operates industrial property throughout Southern California. In 2017, Rexford hired contractor Steve Fodor Construction to perform repaving work at Rexford’s property in Carson, California. Fodor Construction in turn hired subcontractor Caliber Paving Company, Inc. to perform the repaving work. The subcontract divided the parking lot into four areas, with separate costs to repave each area, and Caliber completed its work in one area in June 2017. Read the court decision
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Reprinted courtesy of Garret Murai, Nomos LLP
Mr. Murai may be contacted at gmurai@nomosllp.com

Replacement of Gym Floor Due to Sloppy Paint Job is Not Resulting Loss

January 02, 2024 — Tred R. Eyerly - Insurance Law Hawaii
The court granted the insurer's motion for summary judgment finding damage to the gym floor due to a poor paint job was not a resulting loss. Bob Robinson Commercial Flooring, Inc. v. RLI Ins,. Co., 2023 U.S. Dist. LEXIS 196105 (D. Ark. Nov. 1, 2023). Bob Robinson Commercial Flooring (BRCF) submitted a bid to the general contractor, Nabholz Construction Corporation, to install a vinyl athletic floor and striping at a middle school. The job also included the painting of a "Wildcat" logo the main gym floor. Therefore, BRCF's job was to install floors with proper painting and striping. Robert Liles and Robert Lines Parking Lot Services was the subcontractor hired to do the painting and striping. BRCF did not supervise or inspect Liles' work while it was ongoing. Nabholz informed BRCF that there were problems with the floor painting, including crooked lines, incorrect markings, misplacement of the three point lines for the basketball surface, drips, smudges, etc. The gym floor was eventually rejected due to the nature of the vinyl flooring, once primer and paint were applied, the paint could not be removed and repainted. BRCF had to hire a new subcontractor to remove the flooring, install new flooring and then paint new lines. The cost for removal and replacement was $134,188.95. 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

Join: Computer Science Meets Construction

August 20, 2018 — Aarni Heiskanen - AEC Business
Increasingly, projects need to be optimized to create the most value for their clients and users. With the fragmented nature of project teams, decisions can be lost, communication sporadic, and information disjointed. In addition, the rapid pace of innovation means that it’s difficult – if not impossible – for architects and engineers to be aware of all the latest construction products and materials. It is these problems that inspired the creation of Join. Join is a smart platform that helps project teams collaborate more efficiently and effectively, whether as part of a project optimization process or throughout the entire project lifecycle. The platform connects construction teams, pulls together different types of project information, and integrates manufacturing into construction. Read the court decision
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Reprinted courtesy of Aarni Heiskanen, AEC Business
Mr. Heiskanen may be contacted at aec-business@aepartners.fi

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