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Court Holds That Parent Corporation Lacks Standing to Sue Subsidiary’s Insurers for Declaratory Relief

May 12, 2016 — Christopher Kendrick & Valerie A. Moore – Haight Brown & Bonesteel LLP
In D. Cummins Corp. v. U.S. Fidelity & Guaranty (no. A142985, filed 3/30/16), a California Court of Appeal upheld the dismissal of a declaratory relief action filed by the parent holding company of an insured corporation seeking coverage for asbestos claims. Cummings Corp. installed asbestos containing products in California. It had been insured by USF&G between 1969 and 1992. Cummings Holding, LLC was the parent and majority shareholder of Cummings Corp., which had no assets. The holding company claimed to be “the sole entity responsible for managing the affairs of Cummins Corp., including making decisions as to litigation strategy, resolution and settlement,” and sued USF&G seeking a declaratory judgment that the insurer was obligated to defend and/or indemnify Cummins Corp., “in full, including, without limitation, payment of the cost of investigation, defense, settlement and judgment . . . , for past, present and future Asbestos Suits.” The insurer demurred on the ground that the holding company had insufficient interest in its insurance policies and, consequently, lacked standing to sue for declaratory relief. Mr. Kendrick may be contacted at ckendrick@hbblaw.com Ms. Moore may be contacted at vmoore@hbblaw.com Reprinted courtesy of Christopher Kendrick, Haight Brown & Bonesteel LLP and Valerie A. Moore, Haight Brown & Bonesteel LLP Read the court decision
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Colorado Hotel Neighbors Sue over Construction Plans

October 02, 2015 — Beverley BevenFlorez-CDJ STAFF
Neighbors of the Sky Hotel in Aspen, Colorado, filed suit against the owners “alleging that the construction project will impede access to their units and steal their airspace,” reported the Aspen Daily News Online. The problem, the plaintiff suit alleges, is that the Sky’s plan would close the “east-west alley,” which is also used by the condo complex: “Owners, renters and guests mainly use the alley, which is configured for one-way traffic entering on Durant Avenue and exiting at Original Street, to access their condos in the Chaumont, says the 12-page complaint filed by local attorney Jody Edwards.” The plaintiffs are demanding that the plan be voided or at least require the issues in the suit to be addressed. They are also seeking attorney and other costs. Read the court decision
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What If an Irma-Like Hurricane Hit the New York City Metro Area?

September 20, 2017 — Christopher Flavelle & Henry Goldman - Bloomberg
It sounds like a Hollywood disaster movie. A Category 5 hurricane churning in the mid-Atlantic suddenly veers northwest -- and heads straight for New York City. The good news is that, for now, experts agree a Cat 5-sized deluge appears to be a meteorological impossibility in the U.S. Northeast, given today’s sea temperatures and weather patterns. The bad news: A storm doesn’t need to pack the wallop of a Harvey or an Irma to knock out the region. Superstorm Sandy, whose wind speed was a relatively tame 80 miles per hour when it reached New Jersey, did $70 billion of damage in October 2012. Irma made landfall in Puerto Rico at 185 mph. Reprinted courtesy of Christopher Flavelle, Bloomberg and Henry Goldman, Bloomberg Read the court decision
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Hunton Insurance Recovery Partner Michael Levine Quoted on Why Courts Must Consider the Science of COVID-19

March 15, 2021 — Latosha M. Ellis & Matt Revis - Hunton Insurance Recovery Blog
One year into the COVID-19 pandemic, courts have issued hundreds of rulings in COVID-19 business interruption lawsuits, many favoring insurers. Yet those pro-insurer rulings are not based on evidence, much less expert opinion evidence. For insurers, ignorance is bliss. Despite early numbers in federal courts favoring insurers (state court decisions actually favor policyholders), the year ahead holds promise for policyholders. Fundamental science is the key. Indeed, as researchers continue to broaden their knowledge about COVID-19, it has become increasingly clear that scientific evidence supports coverage for policyholders’ claims. Reprinted courtesy of Latosha M. Ellis, Hunton Andrews Kurth and Matt Revis, Hunton Andrews Kurth Ms. Ellis may be contacted at lellis@HuntonAK.com Read the court decision
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Florida Federal Court Reinforces Principle That Precise Policy Language Is Required Before An Insurer Can Deny Coverage Based On An Exclusion

February 07, 2018 — Walter J. Andrews and Katherine Miller - Hunton Insurance Recovery Blog
A recent ruling by U.S. District Judge Paul Byron of the Middle District of Florida has made clear that the actual words used in an insurance contract matter. The court, in Mt. Hawley Insurance Co. v. Tactic Security Enforcement, Inc., No. 6:16-cv-01425 (M.D. FL. 2018), denied an insurance company’s motion for summary judgment attempting to rely on an exclusion to deny coverage to its policyholder. The policyholder, Que Rico La Casa Del Mofongo, operated a restaurant establishment in Orlando, Florida, and sought coverage for two negligence lawsuits filed against it for allegedly failing to prevent a shooting and another violent incident on its premises. Reprinted courtesy of Walter J. Andrews, Hunton & Williams and Katherine Miller, Hunton & Williams Mr. Andrews may be contacted at wandrews@hunton.com Ms. Miller may be contacted at kmiller@hunton.com Read the court decision
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Cracked Girders Trigger Scrutiny of Salesforce Transit Center's Entire Structure

November 21, 2018 — Nadine M. Post - Engineering News-Record
Nov. 15, 2018 Update: After calling on Nov. 8 for a “complete structural evaluation” of San Francisco's 1.2-million-sq-ft SalesForce Transit Center, following the discovery on Sept. 25 of significant, mid-span cracks in the bottom flanges of twin parallel girders spanning 80 ft over Fremont Street, the Transbay Joint Powers Authority now says the problems with girders are localized. Read the court decision
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Reprinted courtesy of Nadine M. Post, ENR
Ms. Post may be contacted at postn@enr.com

Public Policy Prevails: Homebuilders and Homebuyers Cannot Agree to Disclaim Implied Warranty of Habitability in Arizona

November 01, 2022 — Ryan Bennett - The Subrogation Strategist
In Zambrano v. M & RC II LLC, et al., 2022 Ariz. LEXIS 309, the Supreme Court of Arizona held that a homebuilder and homebuyer could not waive or disclaim the implied warranty of workmanship and habitability. While the court would normally enforce a contract between two parties – even if one side made a “bad deal” – they will not do so if the contract’s terms are against public policy. In this case, Tina Zambrano (Zambrano) signed a purchase agreement with the homebuilder to buy a newly built home. The agreement included provisions which expressly disclaimed any implied warranties, including the warranty of habitability and workmanship. After the purchase, Zambrano claimed that there were construction defects within the home, including popped nails in the drywall and issues with the home’s foundation. Zambrano sued the homebuilder for breach of the implied warranty of workmanship and habitability. The homebuilder moved for summary judgment based on the waivers within the contract and the trial court, agreeing that the waivers applied, dismissed the case. Zambrano appealed and the appellate court reversed the trial court’s decision. The appellate court specifically explained that Arizona has a public policy interest in protecting consumers. Read the court decision
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Reprinted courtesy of Ryan Bennett, White and Williams LLP
Mr. Bennett may be contacted at bennettr@whiteandwilliams.com

Insurers Dispute Sharing of Defense in Construction Defect Case

May 13, 2024 — Tred R. Eyerly - Insurance Law Hawaii
The California Court of Appeal affirmed the trial court's decision that the defending insurer was not entitled to reimbursement of defense costs from another insurer based upon a subcontract and additional insured endorsement. Zurich Am. Ins. Co. v. Old Republic Gen. Ins. Corp., 2024 Cal. App. Unpub. LEXIS 1261 (Cal. Ct. App. Feb. 28, 2024). Martin McNerney Development Company (McNerney) entered a construction contract to perform seismic upgrades and tenant improvements for condominiums. McNerney and Broadway Mechanical Contractors, Inc. (Broadway) entered a "Subcontract Agreement" under which Broadway was to perform plumbing work at the project. The agreement required Broadway to maintain general liability insurance naming McNerney as an additional insured for work performed on the project, including completed operations. The subcontract also required Broadway to indemnify and hold McNerney harmless with respect to all claims for damage to property arising out of work performed by Broadway. Broadway completed its work on the project in September 2007. Broadway issued a one-year warranty for its work on the project. 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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