FAIRFIELD CONNECTICUT BUILDING EXPERT
DIRECTORY AND CAPABILITIES

Illinois Law Bars Coverage for Construction Defects in Insured's Work

September 24, 2014 — Tred R. Eyerly – Insurance Law Hawaii
Applying Illinois law, the Seventh Circuit determined there was no coverage for faulty workmanship causing property damage to the insured's project. Nautilus Ins. Co. v. Board of Directors of Regal Lofts Condominium Ass'n, 2014 U.S. App. LEXIS 16250 (7th Cir. Aug. 21, 2014). The developer converted a vacant building into a condominium. The construction was completed in 2000. The Condominium Board took control of the condo association on July 27, 2000. As early as May 2000, one homeowner was aware of water damage problems in the building. Other complaints surfaced. An investigation found that the exterior brick masonry walls were not fully waterproofed, which caused leaks. The investigation further showed that deteriorated conditions had likely developed over many years, even prior to the condominium conversion, but the present water penetration was caused by the inadequate restoration of the walls to a water-tight condition. The underlying action was filed against the developer for failure to properly construct the exterior walls. The developer's carrier, Nautilus, denied coverage. In an amended complaint, the Board added a count of negligence. Again, Nautilus denied coverage. The Board's second amended complaint alleged that the developer's negligence had caused damage to personal property within the building, in addition to the interior of the building and the building itself. For the third time, Nautilus denied coverage and filed for declaratory relief. 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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Michigan Lawmakers Pass $4.7B Infrastructure Spending Bill

April 11, 2022 — James Leggate - Engineering News-Record
Michigan lawmakers have passed legislation appropriating $4.7 billion for state infrastructure, including more than $1 billion for various water projects.About $750 million will go toward drinking water infrastructure such as projects to replace lead service lines or remove contaminants like PFA substances, potentially harmful chemicals used in industrial and consumer products that are have been found in water. Reprinted courtesy of James Leggate, Engineering News-Record Mr. Leggate may be contacted at leggatej@enr.com Read the full story... Read the court decision
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Massachusetts Business Court Addresses Defense Cost Allocation and Non-Cumulation Provisions in Long-Tail Context

March 06, 2022 — Eric B. Hermanson & Austin D. Moody - White and Williams
A business court in Massachusetts has weighed in on two key issues affecting allocation of insurance coverage for long-tail liabilities in Massachusetts. Specifically, in Crosby Valve LLC et al. v. OneBeacon America Insurance Company, et al.,[1] involving asbestos bodily injury claims, Judge Kenneth Salinger of the Suffolk County Business Litigation Session addressed:

• whether defense costs in long-tail cases were subject to the same pro rata allocation scheme the Supreme Judicial Court (SJC) adopted to govern successively triggered insurers' indemnity obligations in Boston Gas Company v. Century Indemnity Company;[2] and
• whether “non-cumulation” provisions, like those addressed by the New York Court of Appeals in Matter of Viking Pump,[3] were consistent with this pro rata allocation methodology.

As to the first issue — i.e., allocation of defense costs — Judge Salinger declined to follow Boston Gas, and found the SJC’s holding in that case was limited to an insurers’ indemnity obligations. The SJC in Boston Gas had focused on the language of the policy insuring agreement, saying “[t]his policy applies to ... property damage ... which occurs anywhere during the policy period.” The SJC had also pointed to the policy definition of “occurrence” as “an accident, including injurious exposure to conditions, which results, during the policy period, in property damage neither expected nor intended from the standpoint of the insured.”[4] Reprinted courtesy of Eric B. Hermanson, White and Williams LLP and Austin D. Moody, White and Williams Mr. Hermanson may be contacted at hermansone@whiteandwilliams.com Mr. Moody may be contacted at moodya@whiteandwilliams.com Read the court decision
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Parties to an Agreement to Arbitrate May be Compelled to Arbitrate with Non-Parties

February 28, 2022 — Paul R. Cressman Jr. - Ahlers Cressman & Sleight PLLC
In a recent case decided by Division III of the Washington Court of Appeals, David Terry Investments, LLC – PRC v. Headwaters Development Group LLC,[1] the court held that parties to an arbitration agreement can be compelled to arbitrate related claims with non-parties to the agreement based on the doctrine of equitable estoppel. The case involved six joint venture agreements to develop three separate properties in Spokane, two joint venture agreements per property. One entity, David Terry Investments, LLC – PRC (“DTI”), owned by David Terry, was a partner in each of the six joint venture agreements. DTI joint ventured with S.G. Spady Consulting (“SGSC”) and with Headwaters Development Group LLC (“HDG”) separately for each of the three properties. HDG owned the three properties, and SGSC was to provide construction management advice. Steve Spady was the principal of both HDG and SGSC. Stoneridge was a licensed general contractor, the principal of which was also Steve Spady. Read the court decision
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Reprinted courtesy of Paul R. Cressman Jr., Ahlers Cressman & Sleight PLLC
Mr. Cressman may be contacted at paul.cressman@acslawyers.com

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Is Ohio’s Buckeye Lake Dam Safe?

March 12, 2015 — Beverley BevenFlorez-CDJ STAFF
According to Columbus Business First, a report by the U.S. Army Corps of Engineers that “assessed the structural integrity of the Buckeye Lake Dam [located in Ohio] and found serious problems that present significant risks to the public.” Problems arose, allegedly, from “construction of homes [and] pools and patios that have been built into the earthen embankment.” The U.S. Army Corps of Engineers report stated (according to Columbus Business First) “there was a potential for an eight-foot wave of water, mud and debris that would inundate an area as far as Hebron, more than two miles away.” Read the court decision
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Defective Stairways can be considered a Patent Construction Defect in California

September 24, 2014 — William M. Kaufman – Construction Lawyers Blog
Stairs are not safe! At least the Court of Appeal in the Second Appellate District of California doesn’t think so. A rail station in Los Angeles was completed by the Los Angeles County Metropolitan Transportation Authority (“MTA”) in 1993. The rail station was part of the development of the Southern California Rapid Transit District Metro Rail Project. In 2011, the plaintiff fell on a stairway at the station. In August 2012, Plaintiff sued the MTA for dangerous condition of public property, statutory liability, and negligence. Among other defects, plaintiff alleged the banister of the stairwell was “too low” and the stairwell “too small” given the number, age, and volume of people habitually entering and exiting the rail station. In addition, plaintiff alleged that MTA “failed to provide adequate safeguards against the known dangerous condition by, among other acts and omissions, failing to properly design, construct, supervise, inspect and repair the Premises causing the same to be unsafe and defective for its intended purposes.” MTA, in turn, cross-complained against Hampton- the entity that provided design and construction services at the station. Hampton demurred to the first amended cross-complaint, asserting a four year statute of limitations defense pursuant to California Code of Civil Procedure section 337.1, claiming the alleged deficiencies were patent defects. On September 11, 2013, the trial court overruled the demurrer finding that the defect was not patent. Hampton appealed. The appellate court overruled the trial court’s ruling and in fact, granted Hampton’s writ of mandate and even directed the trial court to sustain the demurrer without leave to amend! (Delon Hampton & Associates v. Sup. Ct. (Los Angeles County Metropolitan Transportation Authority) (Cal. App. Second Dist., Div. 3; June 23, 2014) 227 Cal.App.4th 250, [173 Cal.Rptr.3d 407].) The appellate court found that the purpose of section 337.1 is to “provide a final point of termination, to proctect some groups from extended liability.” A “patent deficiency” has been defined as a deficiency which is apparent by reasonable inspection. See Tomko Woll Group Architects, Inc. v. Superior Court (1996) 46 Cal.App.4th 1326, 1336. The court found a patent defect can be discovery by the kind of inspection made in the exercise of ordinary care and prudence, whereas a latent defect is hidden and would not be discovered by a reasonably careful inspection. See Preston v. Goldman (1986) 42 Cal.3d 108, 123. The test to determine whether a construction defect is patent is an objective test that asks “whether the average consumer, during the course of a reasonable inspection, would discover the defect…” See Creekbridge Townhome Owners Assn., Inc. v. C. Scott Whitten, Inc. (2009) 177 Cal.App.4th 251, 256. Mr. Kaufman may be contacted at wkaufman@lockhartpark.com, and you may visit the firm's website at www.lockhartpark.com Read the court decision
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Reprinted courtesy of William M. Kaufman, Lockhart Park LP

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Courthouse Reporter Series: The Travails of Statutory Construction...Defining “Labor” under the Miller Act

August 01, 2023 — Brendan J. Witry - The Dispute Resolver
In a recent case—United States ex rel. Dickson v. Fidelity & Deposit Co. of Maryland (“Dickson”)—the U.S. Court of Appeals for the Fourth Circuit recently re-examined and defined what work qualifies as “labor” under the Miller Act. United States ex rel. Dickson v. Fidelity & Deposit Co. of Maryland, No. 21-160, 67 F.4th 182 (4th Cir. April 26, 2023) (slip op.). Unlike private projects, unpaid subcontractors cannot encumber the federal government’s property with mechanics liens. Instead, the Miller Act provides a remedy for subcontractors in the form of a payment bond on all federal public works contracts exceeding $100,000. 40 U.S.C. § 3131(b). In the Dickson case, Claimant Elliot Dickson served as a subcontractor to Forney Enterprises (“Forney”), with whom the Department of Defense (the “DOD”) contracted to renovate several staircases and the fire suppression systems at the Pentagon. Read the court decision
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Reprinted courtesy of Brendan J. Witry, Conway & Mrowiec Attorneys LLLP
Mr. Witry may be contacted at bjw@cmcontractors.com

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Pollution Exclusion Does Not Apply To Concrete Settling Dust

November 28, 2018 — Tred R. Eyerly - Insurance Law Hawaii
Applying Virginia law, the federal district court determined that the pollution exclusion did not bar coverage. Allied Prop. & Cas. Ins. Co. v. Zenith Aviation, Inc., 2018 U.S. Dist. LEXIS 14727 (E.D. Va. Aug. 29, 2018). Zenith Aviation, Inc. hired Abby Construction Company to install an elevator at its warehouse. A wet saw was used to cut away concrete, but Abby did not use any water with the wet saw. This created a significant amount of concrete dust to leave the warehouse. Surrounding businesses contacted the fire department because they thought the dust was smoke from a fire. The concrete dust settled inside Zenith's building, damaging airplane parts stored in the warehouse. 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

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