Cambridge Massachusetts Building Expert Directory

Tenants Underwater: Indiana Court of Appeals Upholds Privity Requirement for Property Damage Claims Against Contractors

April 25, 2022 — Melissa Kenney - The Subrogation Strategist
In United States Automatic Sprinkler Corp. v. Erie Ins. Exch., et al., No. 21A-CT-580, 2022 Ind. App. LEXIS 87 (Automatic Sprinkler), the Court of Appeals of Indiana (Court of Appeals) considered whether there is a privity requirement for property damage claims against contractors. The court imposed a privity requirement. The court also addressed whether a subrogation waiver in a contract with a tenant applied to damage caused by work done outside the contract, at the landlord’s request. The court held that the waiver did not apply. In this case, United States Automatic Sprinkler (Automatic Sprinkler) contracted with a tenant (Contract Tenant) to inspect and test a sprinkler system at a commercial building in Indiana. The contract included a waiver of subrogation provision. The building landlord subsequently hired Automatic Sprinkler to repair a leak in the sprinkler system. After completing the repairs, the system failed and flooded the building, causing significant property damage to several tenancies. Read the court decision
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Reprinted courtesy of Melissa Kenney, White and Williams LLP
Ms. Kenney may be contacted at kenneyme@whiteandwilliams.com

Nevada Update: Nevada Commissioner of Insurance Updates Burning Limits Statute with Emergency Regulation

September 06, 2023 — William S. Bennett - Saxe Doernberger & Vita, P.C.
Following significant backlash in reaction to its enactment of legislation prohibiting enforcement of any provisions in liability insurance policies dictating that defense costs are included within the limits of insurance, the Nevada Division of Insurance issued an emergency regulation further clarifying the law.1 The regulation modifies two key aspects of the original law:

The term “policy of liability insurance,” as used in the statute, shall only mean those casualty insurance policies offered by insurers authorized under NRS 680A.060 and NRS 694C.230 to issue third-party liability insurance. In other words, the statute’s restrictions on eroding limits will no longer apply to “non-admitted” insurers.

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Reprinted courtesy of William S. Bennett, Saxe Doernberger & Vita, P.C.
Mr. Bennett may be contacted at wsb@sdvlaw.com

How to Defend Stucco Allegations

February 07, 2014 — Beverley BevenFlorez-CDJ STAFF
Managing partner Paul McBride discusses how to defend stucco defect allegations in his article in Kring & Chung, LLP’s online publication. According to McBride, about “80% of construction defect lawsuits which [Kring & Chung] defend involve stucco-clad houses.” In the article, McBride addresses “improper building paper installation and stucco cracks.” “If you are defending the stucco subcontractor,” McBride advises to look “first, at the windows section of the plaintiffs’ defect report and cost of repair estimate.” He explains that “this is the section where the plaintiffs’ expert will allege water intrusion that will be allocation to your stucco subcontractor.” McBride declares that the “most important thing to understand about stucco cracks is that stucco cracking is common. This is both a common sense observation and a perfectly valid legal defense.” Read the court decision
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Arizona Supreme Court Holds a Credit Bid at a Trustee’s Sale Should Not be Credited to a Title Insurer Under a Standard Lender’s Title Policy To the Extent the Bid Exceeds the Collateral’s Fair Market Value

March 01, 2017 — Richard H. Herold - Snell & Wilmer Real Estate Litigation Blog
The Arizona Supreme Court recently addressed what impact, if any, a lender’s credit bid at an Arizona trustee’s sale has on an insurer’s liability under Sections 2, 7 and 9 of the standard’s lender’s title policy (“Policy”), holding in Equity Income Partners, LP v. Chicago Title Insurance Company, 241 Ariz. 334, 387 P.3d 1263 (February 7, 2017) as follows: 1. Section 2 of the Policy, entitled “Continuation of Insurance,” not Section 9, entitled “Reduction of Insurance; Reduction or Termination of Liability,” applies when a lender acquires property at a trustee sale by “either a full- or partial-credit bid” since Section 2 directly addresses the existence and amount of coverage in such circumstances. Id. at 1267. Read the court decision
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Reprinted courtesy of Richard H. Herold, Snell & Wilmer
Mr. Herold may be contacted at rherold@swlaw.com

Should CGL Insurer have Duty to Defend Insured During Chapter 558 Notice of Construction Defects Process???

September 01, 2016 — David Adelstein – Florida Construction Legal Updates
Does a CGL insurer have a duty to defend its insured-contractor during Florida Statutes Chapter 558 notice of construction defects pre-suit process? This answer is currently undecided and will be up to the Florida Supreme Court to decide. (It is on appeal stemming from a federal district court saying that an insurer does not have a duty to defend its insured-contractor in the 558 process based on the definition of the word “suit” in the CGL policy.) Why is this an important issue? The 558 pre-suit notice of construction defects process is designed to facilitate an avenue for construction defect lawsuits to get resolved without having to file a lawsuit or, at least, have issues narrowed before a lawsuit needs to be filed. (Check here for a summary of the 558 process.) It requires pre-suit notifications so that implicated parties can become aware of the defects and have an opportunity to inspect the defects / damage, test the defects / damage, and respond to the notice of construction defects; it provides an avenue for beneficial pre-suit discovery. Through participating in the 558 process, the contractor and/or design professional (and those downstream from them) can: (i) offer to remedy the defect, (ii) settle the defect, whether through money or a combination of money and repairs, (iii) dispute the defect, or (iv) advise that available insurance proceeds will be determined by its liability insurer. See Fla. Stat. s. 558.004. Read the court decision
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Reprinted courtesy of David M. Adelstein, Kirwin Norris
Mr. Adelstein may be contacted at dma@kirwinnorris.com

Lawyer Claims HOA Scam Mastermind Bribed Politicians

June 28, 2013 — CDJ STAFF
The lawyer defending one of the accused in the Las Vegas HOA scam is now claiming that the FBI investigated bribery of public officials. Chris Rasmussen represents Edith Gillespie, the half-sister of Leon Benzer. Benzer has been accused of being one of the masterminds behind the scheme to pack homeowner boards with members who would make construction defect settlements that were beneficial to the scam’s participants. Rasmussen is trying to get his client tried separately from her half-brother. Rasmussen did not name any public officials. The Justice Department did not comment on his claims. Read the court decision
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How Berlin’s Futuristic Airport Became a $6 Billion Embarrassment

October 28, 2015 — Joshua Hammer – Bloomberg
The inspectors could hardly believe what they were seeing. Summoned from their headquarters near Munich, the team of logistics, safety, and aviation experts had arrived at newly constructed Berlin Brandenburg International Willy Brandt Airport in the fall of 2011 to begin a lengthy series of checks and approvals for the €600 million ($656 million) terminal on the outskirts of the German capital. Expected to open the following June, the airport, billed as Europe’s “most modern,” was intended to handle 27 million passengers a year and crown Berlin as the continent’s 21st century crossroads. The team of inspectors, known as ORAT, for Operations Readiness and Airport Transfer, brought in a dummy plane and volunteers as test passengers. They examined everything from baggage carousels and security gates to the fire protection system. The last was an especially high priority: None could forget the 1996 fire that roared through Düsseldorf Airport’s passenger terminal, killing 17. Read the court decision
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Reprinted courtesy of Joshua Hammer, Bloomberg

Federal Judge Strikes Down CDC’s COVID-19 Eviction Moratorium

March 29, 2021 — Zachary Kessler, Amanda G. Halter & Adam Weaver - Gravel2Gavel Construction & Real Estate Law Blog
A federal judge in Texas has declared the Centers for Disease Control and Prevention (CDC) eviction moratorium unconstitutional, holding that Article I’s power to regulate interstate commerce and enact laws necessary and proper for such regulation does not include the power to suspend residential evictions on a nationwide basis. While the court stopped short of issuing immediate injunctive relief, instead relying on the CDC to “respect the declaratory judgment” and withdraw the Order, the court stated that such relief would be available if the government does not comply with the decision. With this ruling, the most significant prohibition on residential evictions for nonpayment of rent is likely to be lifted, and many residential evictions halted or delayed under the Order may begin in earnest. While additional tenant protections remain in certain locales, this federal ruling increases the likely rate and pace of residential eviction activity across the country. The CDC Eviction Moratorium was a nationwide order enacted under the Trump Administration in an effort to reduce the adverse economic impacts of the ongoing COVID-19 pandemic on residential tenants, and as a public health measure to prevent displacement of individuals into living situations conducive to the spread of the COVID-19. The Order allowed tenants facing eviction due to financial strains caused by the pandemic to certify in writing to their landlord that they are unable to pay full rent and that eviction would likely lead to homelessness or force the individual into unsafe congregate or shared living quarters. The CDC issued the order under its emergency pandemic powers under the Public Health Service Act. Initially in effect through December 31, 2020, the Order was subsequently extended through March 31, 2021. Reprinted courtesy of Zachary Kessler, Pillsbury, Amanda G. Halter, Pillsbury and Adam Weaver, Pillsbury Mr. Kessler may be contacted at zachary.kessler@pillsburylaw.com Ms. Halter may be contacted at amanda.halter@pillsburylaw.com Mr. Weaver may be contacted at adam.weaver@pillsburylaw.com Read the court decision
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