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DIRECTORY AND CAPABILITIES

CA Supreme Court Permits Insurers to Bring Direct Actions Seeking Reimbursement of Excessive Fees Against Cumis Counsel Under Limited Circumstances

August 19, 2015 — David W. Evans & Valerie A. Moore – Haight Brown & Bonesteel LLP
The California Supreme Court held in Hartford Casualty Insurance Company v. J.R. Marketing, L.L.C. (Squire Sanders) (8/10/2015 - #S211645) that if Cumis counsel, operating under a court order which such counsel drafted and which expressly provided that the insurer would be able to recover excessive fees, sought and received fee payments from the insurer that were fraudulent or otherwise manifestly and objectively useless and wasteful when incurred, Cumis counsel have been unjustly enriched at the insurer’s expense and the insurer will be permitted under such limited circumstances to seek reimbursement directly from Cumis counsel. Certain Hartford insureds who had been issued commercial general liability policies were sued in multiple proceedings for a variety of claims, including unfair competition, defamation and intentional misrepresentation. Hartford disclaimed a duty to defend or to indemnify the defendants on the grounds that the acts complained of occurred prior to Hartford’s policy, and that some of the defendants were not Hartford insureds. A coverage action was filed by some of the insureds against Hartford; they were represented by the Squire Sanders law firm. Although Hartford subsequently agreed to defend several of the defendants subject to a reservation of rights, it declined to pay defense expenses incurred prior to the date of such agreement. Some months later, the trial court entered a summary adjudication order, finding that Hartford had a duty to have defended the liability action on the date it was originally tendered; the order required Hartford to fund the insured’s defense with independent counsel (i.e., so-called “Cumis” counsel; see San Diego Federal Credit Union v. Cumis Insurance Society, Inc. (1984) 162 Cal.App.3d 358). The insureds retained Squire Sanders as their Cumis counsel. Reprinted courtesy of David W. Evans, Haight Brown & Bonesteel LLP and Valerie A. Moore, Haight Brown & Bonesteel LLP Mr. Evans may be contacted at devans@hbblaw.com Ms. Moore may be contacted at vmoore@hbblaw.com Read the court decision
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WSDOT Seeks Retraction of Waiver Excluding Non-Minority Woman-Owned Businesses from Participation Goals

September 28, 2017 — Lindsay K. Taft - Ahlers & Cressman PLLC
If you are a regular reader of our blog, you will likely recognize that our firm has been actively involved and concerned with the results of Washington State Department of Transportation’s (“WSDOT”) Disparity Study, which impacts both Disadvantaged Business Enterprises (“DBE”) and general contractors who bid on federally-funded projects with DBE goals. On June 1, 2017, WSDOT implemented a “waiver”, which excluded Caucasian women-owned firms (“WBEs”) from qualifying for Condition of Award DBE Goals on federally-funded projects. This drastic action was the result of WSDOT’s highly criticized 2012 Disparity Study conducted by BBC Research & Consulting of Denver, Colorado, which concluded non-minority women-owned firms do not face “substantial disparities” in the federally-funded transportation contracting market. BBC’s study was criticized for a number of reasons, but most concerning was BBC’s flawed and unreliable statistical methodology that did not accurately represent true marketplace conditions. See Ahlers & Cressman letter of January 9, 2014 and Associated General Contractors of Washington article. For example, BBC’s results showed both decreasing WBE availability and availability vastly out of range with other states (e.g., the availability of women-owned construction firms in Washington was just 1.5% compared to 11.96% in Oregon). Nevertheless, based on this flawed BBC study and BBC’s assertion that women-owned firms did not face disparities, WSDOT sought and on June 1, 2017 was granted a waiver precluding general contractors from counting WBE firms towards their DBE goals on federally funded public works projects. Read the court decision
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Reprinted courtesy of Lindsay Taft, Ahlers & Cressman PLLC
Ms. Taft may be contacted at ltaft@ac-lawyers.com

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Real Estate & Construction News Roundup (09/12/23) – Airbnb’s Future in New York City, MGM Resorts Suffer Cybersecurity Incident, and Insurance Costs Hitting Commercial Real Estate

October 30, 2023 — Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
In our latest roundup, the FDIC handles the portfolio from Signature Bank, the U.S. Army Corps of Engineers funds a new center at Illinois, the Athletics take their next steps in their move to Las Vegas, and more!

1. For those looking to rent an Airbnb for future travel to New York City, it just became much harder with new rules taking effect on September 5th. (Natalie Lung, The Washington Post)
2. This past weekend MGM Resorts suffered a cybersecurity incident that affected some of the company’s systems with the extent of the incident still unknown. (ABC)
3. Among issues such as rent increases and general inflation, commercial real estate is also having to contend with rising insurance costs due to climate change. (Justin Worland, Time)

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Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team

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Bid Protests: The Good, the Bad and the Ugly (Redeux)

September 17, 2014 — Garret Murai – California Construction Law Blog
This past week I gave a presentation on a panel entitled “Bid Protests: The Good, the Bad and the Ugly” before my local bar association. Thanks to those who attended, my co-presenters and the bar association for sponsoring. Rather than letting my notes gather dust I thought I would share some of the highlights. What is a bid protest? A bid protest is the procedure by which a bidder protests the rejection of its bid or award of a public works contract to another bidder. A bid protest may occur in one of two situations: (1) A public entity rejects the bid of an apparent low bidder and the apparent low bidder protests the rejection; or (2) A public entity awards the contract to the apparent low bidder and another bidder protests the award. Read the court decision
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Reprinted courtesy of Garret Murai, Kronick Moskovitz Tiedemann & Girard
Mr. Murai may be contacted at gmurai@kmtg.com

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Carbon Monoxide Injuries Caused by One Occurrence

April 01, 2014 — Tred R. Eyerly – Insurance Law Hawaii
Injuries from carbon monoxide poisoning to two families living in the insured's apartment complex arose from a single occurrence. Kosnoski v. Rogers, No. 13-0494, Memorandum and Decision (W. Va. Feb. 18, 2014). The families lived in two apartments in the same complex owed by Marc Rogers. Members of the two families suffered serious injuries from carbon monoxide poisoning and one family member died. A gas boiler furnace in the basement of the apartment complex created the carbon monoxide. 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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U.K. Construction Resumes Growth Amid Resurgent Housing Activity

October 07, 2016 — Scott Hamilton – Bloomberg
The U.K. construction industry returned to growth in September as a measure of housing activity jumped the most since 2013. IHS Markit said on Tuesday that its Purchasing Managers Index jumped to 52.3 from 49.2 in August. It was the highest level in six months and ended a three-month run of readings below 50, the threshold that divides expansion from contraction. The figures add to evidence that the economy is performing better than many predicted following the June decision to leave the European Union. Traders increasingly expect the Bank of England to refrain from adding to its August stimulus package this year. Read the court decision
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Reprinted courtesy of Scott Hamilton, Bloomberg

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“Other Insurance” and Indemnity Provisions Determine Which Insurer Must Cover

September 01, 2011 — Tred R. Eyerly - Insurance Law Hawaii

A policy’s “other insurance” clause and a contractual indemnity provision were at the root for determining which of two insurers had to cover for injuries at a construction site. Valley Forge Ins. Co. v. Zurich Am. Ins. Co., 2011 U.S.Dist. LEXIS 76061 (N.D. Calif. July 14, 2011).

Hathaway was the general contractor at a demolition and construction project. Hathaway was insured by Zurich. Reinhardt Roofing was the roofing subcontractor. Reinhardt was insured by Valley Forge under a policy which named Hathaway as an additional insured. The subcontract also required Reinhardt to indemnify Hathaway for acts or omissions arising from Reinhardt’s work unless Hathaway was solely negligent.

Four of Reinhardt’s workers were injured when a canopy roof on which they were working collapsed. At the time of the accident, Hathaway’s on-site supervisor was inspecting a gap in the canopy roof, but did not order Reinhardt’s workers to stop working. 

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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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Construction Defect Claim not Barred by Prior Arbitration

October 28, 2015 — Beverley BevenFlorez-CDJ STAFF
According to Stan Martin of Commonsense Construction Law LLC, the Appellate Court of Connecticut ruled in favor of the owner of a twenty-two building development in a construction defect suit despite the contractor’s objection “that the lawsuit was barred by doctrines of res judicata or collateral estoppel.” When issues of “construction and alleged defects” arose in 1996, the “contractor eventually filed for arbitration, seeking the contract balance.” The contractor was awarded $82,812.81. During the arbitration, “no claims for defective construction were advanced.” Read the court decision
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