FAIRFIELD CONNECTICUT BUILDING EXPERT
DIRECTORY AND CAPABILITIES

California Federal Court Finds a Breach of Contract Exclusion in a CGL Policy Bars All Coverage for a Construction Defect Action

July 19, 2021 — Robert Dennison - Traub Lieberman
The Southern District of California published a decision in May 2021 in Associated Industries Ins. Co. v. Mt. Hawley Ins. Co., 2021 WL 1921016 (S.D. Cal. 5/12/21) concerning the scope of a breach of contract exclusion in a general liability insurance policy as applied to a construction defect action. The suit was filed by Associated Industries Insurance Company against Mt. Hawley Insurance Company for equitable contribution for amounts spent to defend and indemnify the parties co-insured, referred to as JGCI in the decision. JGCI agreed to build a building for a third party pursuant to a written construction contract. The City of Davis issued a certificate of occupancy for the building on May 6, 2005. The City’s permits stated the building was final on that date. Mt. Hawley issued the first of several annual general liability insurance policies in September 2005. Read the court decision
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Reprinted courtesy of Robert Dennison, Traub Lieberman
Mr. Dennison may be contacted at rdennison@tlsslaw.com

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Nevada Lawmakers Had Private Meetings on Construction Defects

February 21, 2013 — CDJ STAFF
Both Democratic and Republican members of the Nevada legislature had closed door meetings with representatives of the construction industry. Democratic lawmakers also met with the other side of the discussion over construction defect laws, lobbyists representing trial lawyers. When asked by the Las Vegas Sun why this was done in private meetings instead of a public hearing, Speaker Marilyn Kirkpatrick didn’t have an answer, other than that “everyone in the building did it yesterday.” The meetings were described as briefings on general policy issues, offering legislators a chance to ask questions. The Sun notes that under Nevada’s open meeting law, government agencies would not be allowed to do this in a closed meeting, but that the legislature exempted itself from the law. Read the court decision
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The Condominium Warranty Against Structural Defects in the District of Columbia

July 24, 2023 — Nicholas D. Cowie - Cowie Law Group
THE CONDOMINIUM WARRANTY AGAINST STRUCTURAL DEFECTS Condominium developers in Washington DC are required by statute to warrant against structural defects in residential condominiums. District of Columbia Condominium Act (“DC Condo Act”) § 42-1903.16(b). The warranty applies to both condominium common elements and each condominium unit. It requires a developer to repair structural defects, including any resulting damage to the condominium caused by a common element structural defect. DC Condo Act § 42-1903.16(a-1)(2). The statute creating this warranty is called the “Warranty Against Structural Defects,” contained in the DC Condo Act § 42-1903.16. “Structural Defects” Defined The warranty applies to “structural defects,” which are very broadly defined to include many types of construction defects. Structural defects are not just limited to defects in the supporting structure of the building. Rather, a structural defect can be any condition that:

“(A) Reduces the stability or safety of unit or common elements below standards commonly accepted in the real estate market,” or (B) Restricts the normally intended use of all or part of the common elements of a unit and which requires repair, renovation, restoration, or replacement to serve the purpose for which it was intended.” DC Condo Act § 42-1903.16(j)(6).

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Reprinted courtesy of Nicholas D. Cowie, Cowie Law Group
Mr. Cowie may be contacted at ndc@cowielawgroup.com

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Untangling Unique Legal Issues in Modern Modular Construction

September 09, 2024 — Chad Theriot & Brad Sands - Construction Executive
Modular construction has grown significantly over the last few years and shows no signs of slowing down. This construction method is a departure from traditional approaches where all construction activity occurs onsite. Modular construction involves building standardized project components—usually in an offsite, controlled environment—which are then transported and assembled at the project site. Offsite construction generally allows for better quality control and economic efficiency, as it can utilize an assembly-line process. Modular fabrication can also centralize skilled labor in regions with lower labor costs. Establishing each party's expectations upfront is always important, but even more so in modular construction since much of the construction activity is performed away from the ultimate project site. This requires extensive coordination among designers, fabricators, installers and owners to ensure construction, testing and quality progresses accordingly. Every field change and design clash could have an exponential impact on the modular fabrication efficiencies given the assembly-line approach and remote nature of modular work. Reprinted courtesy of Chad Theriot & Brad Sands, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the court decision
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Construction Defect Class Action Lawsuit Alleges National Cover-up of Pipe Defects

December 10, 2015 — Beverley BevenFlorez-CDJ STAFF
Two Miami condominium associations have filed suit “concerning defective fire sprinkler systems and a national cover up over a significant life safety issue in multi-unit condominiums in Florida and across the country.” The attorneys representing the class action lawsuit, Gonzalez, Montoya, Siegfried, Sobel, and Hale, “believe that the problem is nationwide and that monetary damages arising from the claims will exceed $1 billion,” a press release by Colson Hicks Eidson stated. “The 56-count lawsuit filed against a dozen manufacturers, suppliers and distributors seeks compensatory, incidental and consequential damages.” According to CBS Miami, “The suit claims the companies knowingly used [a] chemical that caused cracks and leaks in pipes that affected the water pressure in sprinkler systems.” Plaintiff attorneys claim that the cost to repair each building is estimated at between $50 to $100 million each. Read the full story, Press Release... Read the full story, CBS Miami... Read the court decision
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Recent Bribery and Anti-Corruption Enforcement Trends in Global Construction Industry

August 26, 2019 — Ralph A. Finizio & Anthony Finizio - ConsensusDocs
Bribery and corruption have long plagued the construction industry, particularly in the developing world and emerging markets. Large contracts often trickle down through layers of subcontractors, presenting opportunities for corruption at each level. The risk is enhanced in certain foreign jurisdictions, where large corporations may be wholly or partially state-owned enterprises and public officials may expect payment in exchange for state-issued licenses or government contracts. Recent enforcement trends indicate that both the U.S. Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) are increasingly targeting the construction industry for anti-bribery and corruption actions under the Foreign Corrupt Practices Act (FCPA). Several former DOJ officials also recently commented that the construction industry has become a focus of anti-corruption enforcement efforts. The FCPA is a formidable tool for regulators, making it unlawful to influence a foreign government official with any type of payment or personal reward. While certain safe harbors apply — including de minimis payments made to expedite routine governmental action or the payment being lawful in the foreign jurisdiction — these exceptions are construed narrowly and can be difficult to apply in practice. Reprinted courtesy of Ralph A. Finizio, Pepper Hamilton LLP and Anthony Finizio, Pepper Hamilton LLP Mr. Finizio may be contacted at finizior@pepperlaw.com Mr. Finizio may be contacted at finizioa@pepperlaw.com Read the court decision
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A Good Examination of Fraud, Contract and Negligence Per Se

February 28, 2018 — Christopher G. Hill – Construction Law Musings
I have spoken on several occasions here at Construction Law Musings about the interplay (or lack thereof) between fraud and contract as it relates to construction in Virginia. The general rule is that fraud and contract claims don’t mix and a fraud claim in the face of a contractual one is likely to be dismissed. However, there are exceptions to this rule as there are to just about every legal rule (we construction lawyers would be out of a job without them). A good examination of the interplay between fraud and contract was set out by the Eastern District of Virginia federal court in Zuberi et al v. Hirezi et al. In that case the Zuberis purchased a home from the Hirezis and later filed suit alleging that the Hirezis concealed serious structural defects that made the house uninhabitable and unsellable. Among the many claims by the Zuberis were those fro fraud, fraudulent inducement, constructive fraud, negligence per se, violation of the Virginia Consumer Protection Act, and civil conspiracy. In short, they were out for blood. Read the court decision
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Reprinted courtesy of Christopher G. Hill, The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

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California Court Confirms Broad Coverage Under “Ongoing Operations” Endorsements

December 01, 2017 — Kevin C. Brantley - Payne & Fears
A California Court of Appeal has confirmed that additional insured endorsements (“AIE”) granting coverage for liability arising out of a named insured’s “ongoing operations,” and in effect during those “ongoing operations,” do not require that the liability arise while the named insured is performing work. McMillin Mgmt. Servs., L.P. v. Financial Pacific Ins. Co., Cal. Ct. App., November 14, 2017, Case No. D069814. In McMillin, a construction defect insurance coverage action, Lexington Insurance Company argued that McMillin had no liability to homeowners until after their homes closed escrow; thus, McMillin did not face liability while the named insureds’ work was ongoing. The Court of Appeal rejected Lexington’s argument, finding that the “ongoing operations” AIEs provide only that McMillin’s liability “be ‘linked’ through a ‘minimal causal connection or incidental relationship’ with [the named insureds’] ongoing operations.” (internal citations omitted). The Court reasoned that Lexington had not established that all of the damage in the underlying action occurred after the named insureds completed their work, thus Lexington had not established as a matter of law that there was no potential for coverage for McMillin under the policies. Read the court decision
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Reprinted courtesy of Kevin C. Brantley, Payne & Fears
Mr. Brantley may be contacted at kcb@paynefears.com

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