What Will the 2024 Construction Economy Look Like?
January 02, 2024 —
Grace Calengor - Construction ExecutiveCE just wrapped its "2024 Economic Update and Forecast" webinar, which revealed some interesting insights for 2023 and projections for next year. Anirban Basu, chief economist for ABC and CEO of Sage Policy Group, began his presentation by stating auspiciously: “The economy has been much stronger along more dimensions than I expected.”
Polling: good news for the supply chain
Not only did Basu's own research reveal strong construction growth in a majority of sectors, a decent number of construction job openings and wage increases, as well as supply-chain improvement and a stagnating federal rate—but webinar attendees who answered Basu's polling questions felt similarly.
Reprinted courtesy of
Grace Calengor, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Risk Management for Condominium Conversions
July 31, 2013 —
David McLain, Higgings, Hopkins, McLain & Roswell, LLCOne of the bright spots in the Colorado construction industry over the last few years has been the construction of for-rent apartments. It seems as though apartments are going up everywhere you look along the Front Range. As market forces change, it will be interesting to see whether these units will remain apartments or whether they will be converted into for-sale condominiums or townhouses. One of the risk management strategies we have recently discussed with our general contractor clients who have been asked to build apartments is to ensure that the project remains a for-rent apartment project through the applicable statute of repose, conservatively assumed to be eight years. Unfortunately this is not always feasible, usually because the owner and/or lender are not interested in encumbering the property for such a long period of time, and want to retain the ability to convert the project if and when market forces allow, even if that is before the running of the statute of repose. The purpose of this article is to discuss the insurance and risk management ramifications of converting a project too early.
I have recently heard from several sources in the insurance industry that there are owners and contractors who are currently building apartments with the idea that they will be held as apartments for two to three years and then converted to for-sale condominiums or townhomes. While this strategy may have great appeal from a business point of view, it has a very serious risk management downside. Apparently, these owners and contractors are operating under the mistaken belief that they will have no liability exposure to the ultimate purchasers of the converted units or to the homeowners association for construction defects. This is an incorrect belief.
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David M. McLainDavid M. McLain can be contacted at
mclain@hhmrlaw.com
The ABCs of PFAS: What You Need to Know About Liabilities for the “Forever Chemical”
February 22, 2021 —
Robert F. Walsh, Gregory S. Capps & R. Victoria Fuller - Complex Insurance Coverage ReporterThis article is based on a presentation the authors made at White and Williams LLP’s Virtual Coverage College® on October 22, 2020. Every year, hundreds of insurance professionals come to Philadelphia—this year via our online platform—to participate in a full day of lectures and interactive presentations by White and Williams lawyers and guest panelists about the latest issues and challenges involved in claim handling and insurance litigation. Visit coveragecollege.com for more information and stay tuned for Coverage College® 2021.
Perfluoroalkyl and polyfluoroalkyl substances, commonly referred to as PFAS or PFOS, have been a key ingredient in numerous industrial and consumer products for decades. These man-made chemicals are prevalent and are also known for their longevity in the environment. More recently, PFAS have been the focus of thousands of lawsuits alleging personal injury and property damage. Some insurers have already questioned whether PFAS could rival asbestos in scope and bottom-line impacts. It is a legacy that confronts manufacturers and other defendants and insurers today.
This article provides a primer on PFAS, including the current regulatory framework and litigation landscape. We also identify some key emerging coverage issues insurers should be aware of when dealing with PFAS claims under liability and first-party property policies.
Reprinted courtesy of
Robert F. Walsh, White and Williams LLP and
Gregory S. Capps, White and Williams LLP
Mr. Walsh may be contacted at walshr@whiteandwilliams.com
Mr. Capps may be contacted at cappsg@whiteandwilliams.com
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Melissa Dewey Brumback Invited Into Claims & Litigation Management Alliance Membership
October 14, 2013 —
CDJ STAFFMelissa Dewey Brumback has been invited to join the Claims & Litigation Management Alliance, an “invitation only” organization of insurance companies, litigation and risk managers, claims professionals, and attorneys. Ms. Brumback, an attorney at Ragsdale Ligget PPLC, has a practice that focuses on construction law and business disputes. Her clients include architects and engineers in construction-related claims. Ms. Brumbuck is respected as an author and lecturer on construction law.
The Claims & Litigation Management Alliance comprises the leaders of claims and litigation management. Members are risk and litigation managers, insurance and claims professionals, and corporate and outside counsel.
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Building a Strong ESG Program Can Fuel Growth and Reduce Company Risk
June 19, 2023 —
The Hartford Staff - The Hartford InsightsCompanies are addressing today’s evolving ESG (Environmental, Social and Governance) issues like they never have before. From climate change to diversity, equity and inclusion, these topics are at the forefront of discussion for businesses, with many seeking to understand stakeholder concerns and implement strategies to improve their ESG efforts.
Stakeholders – consumers, investors and employees alike – have recently become more vocal and united in their demand for sustainable corporate behavior. In fact, 83% of consumers think companies should be actively working on Environmental, Social and Governance (ESG) program best practices and 86% of employees prefer to support or work for companies that care about the same issues they do.1 In turn, companies are addressing these issues like they never have before, in recognition of their importance as indicators of long-term value.
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The Hartford Staff, The Hartford Insights
Intentional Mining Neighbor's Property is Not an Occurrence
October 30, 2018 —
Tred R. Eyerly - Insurance Law HawaiiThe Kentucky Supreme Court determined there was no coverage when the insured was sued for mineral trespass. Am. Mining Ins. Co. v. Peters Farms, LLC, 2018 Ky. LEXIS 287 (Ky. Aug. 16, 2018).
Beginning in 2007, Ikerd Mining. LLC removed 20,212 toms of coal from land belonging to Peters Farms, LLC. Of that amount, 10,012 tons were wrongfully mined under Ikerd's alleged mistaken belief as to the correct location of Peters' boundaries. The other 1,200 tons were mined by Ikerd knowing that the land thereunder belonged to Peters, but pursuant to a disputed oral lease agreement between the two. Peters claimed that the lease was an ongoing negotiation that was never finalized.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
THE CALIFORNIA SUPREME COURT HAS RULED THAT THE RIGHT TO REPAIR ACT (SB800) IS THE EXCLUSIVE REMEDY FOR CONSTRUCTION DEFECT CLAIMS NOT INVOLVING PERSONAL INJURIES WHETHER OR NOT THE UNDERLYING DEFECTS GAVE RISE TO ANY PROPERTY DAMAGE in McMillin Albany LL
January 24, 2018 —
Chapman, Glucksman, Dean, Roeb, & BargerRICHARD H. GLUCKSMAN, ESQ.
GLENN T. BARGER, ESQ.
JON A. TURIGLIATTO, ESQ.
DAVID A. NAPPER, ESQ.
The Construction Industry finally has its answer. The California Supreme Court ruled that the Right to Repair Act (SB800) is the exclusive remedy for construction defect claims alleged to have resulted from economic loss, property damage, or both. Our office has closely tracked the matter since its infancy. The California Supreme Court’s holding resolves the split of authority presented by the Fifth Appellate District’s holding in
McMillin Albany LLC v. Superior Court (2015) 239 Cal.App.4th 1132, which outright rejected the Fourth Appellate District’s holding in
Liberty Mutual Insurance Co. v. Brookfield Crystal Cove LLC (2013) 219 Cal.App.4th 98.
By way of background, the Fourth District Court of Appeal held in
Liberty Mutual that compliance with SB800’s pre-litigation procedures prior to initiating litigation is only required for defect claims involving violations of SB800’s building standards that have not yet resulted in actual property damage. Where damage has occurred, a homeowner may initiate litigation under common law causes of action without first complying with the pre-litigation procedures set forth in SB800. Two years later, the Fifth District Court of Appeal, in
McMillin Albany, held that the California Legislature intended that all claims arising out of defects in new residential construction sold on or after January 1, 2003 are subject to the standards and requirements of the Right to Repair Act, including specifically the requirement that notice be provided to the builder prior to filing a lawsuit. Thus, the Court of Appeal ruled that SB800 is the exclusive remedy for all defect claims arising out of new residential construction sold on or after January 1, 2003.
After extensive examination of the text and legislative history of the Right to Repair Act, the Supreme Court affirmed the Fifth District Court of Appeal’s ruling that SB800 preempts common law claims for property damage. The Complaint at issue alleged construction defects causing both property damage and economic loss. After filing the operative Complaint, the homeowners dismissed the SB800 cause of action and took the position that the Right to Repair Act was adopted to provide a remedy for construction defects causing only economic loss and therefore SB800 did not alter preexisting common law remedies in cases where actual property damage or personal injuries resulted. The builder maintained that SB800 and its pre-litigation procedures still applied in this case where actually property damages were alleged to have occurred.
The Supreme Court found that the text and legislative history reflect a clear and unequivocal intent to supplant common law negligence and strict product liability actions with a statutory claim under the Right to Repair Act. Specifically the text reveals “…an intent to create not merely
a remedy for construction defects but
the remedy.” Additionally certain clauses set forth in SB800 “…evinces a clear intent to displace, in whole or in part, existing remedies for construction defects.” Not surprisingly, the Court confirmed that personal injury damages are expressly not recoverable under SB800, which actually assisted the Court in analyzing the intent of the statutory scheme. The Right to Repair Act provides that construction defect claims not involving personal injury will be treated the same procedurally going forward whether or not the underlying defects gave rise to any property damage.
The Supreme Court further found that the legislative history of SB800 confirms that displacement of parts of the existing remedial scheme was “…no accident, but rather a considered choice to reform construction defect litigation.” Further emphasizing how the legislative history confirms what the statutory text reflects, the Supreme Court offered the following summary: “the Act was designed as a broad reform package that would substantially change existing law by displacing some common law claims and substituting in their stead a statutory cause of action with a mandatory pre-litigation process.” As a result, the Supreme Court ordered that the builder is entitled to a stay and the homeowners are required to comply with the pre-litigation procedures set forth in the Right to Repair Act before their lawsuit may proceed.
The seminal ruling by the California Supreme Court shows great deference to California Legislature and the “major stakeholders on all sides of construction defect litigation” who participated in developing SB800. A significant win for builders across the Golden State, homeowners unequivocally must proceed via SB800 for all construction defect claims arising out of new residential construction sold on or after January 1, 2003. We invite you to contact us should you have any questions.
Reprinted courtesy of Chapman Glucksman Dean Roeb & Barger attorneys
Richard Glucksman,
Glenn Barger,
Jon Turigliatto and
David Napper
Mr. Glucksman may be contacted at rglucksman@cgdrblaw.com
Mr. Barger may be contacted at gbarger@cgdrblaw.com
Mr. Turgliatto may be contacted at jturigliatto@cgdrblaw.com
Mr. Napper may be contacted at dnapper@cgdrblaw.com
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Broker Not Liable for Failure to Reveal Insurer's Insolvency After Policy Issued
March 28, 2012 —
Tred R. Eyerly - Insurance Law HawaiiFaced with an issue of first impression in California, the Court of Appeals held that a broker was not liable for failing to reveal the insurer's insolvency occurring after issuance of the policy. Pacific Rim Mechanical Contractors, Inc. v. Aon Risk Ins. Serv. West, Inc., 2012 Cal. App. LEXIS 232 (Cal. Ct. App. Feb. 28, 2012).
The developer for a construction project in downtown San Diego retained Aon as its broker to secure coverage. Aon procured a general liability policy for the project with Legion Indemnity Company. Legion was solvent when it issued the policy.
The developer hired Pacific Rim (“PacRim”) as one of several subcontractors on the project. The parties entered into a contract in which the developer agreed to provide PacRim with liability insurance through an Owner Controlled Insurance Program (“OCIP”). Aon was not a party to the contract and PacRim was never its client. PacRim, however, enrolled in the OCIP by contacting Aon and providing all necessary paperwork.
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii. Mr. Eyerly can be contacted at te@hawaiilawyer.com
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