New Case Alert: Oregon Supreme Court Prohibits Insurer’s Attempt to Relitigate Insured’s Liability
November 17, 2016 —
Austin D. Moody – Saxe Doernberger & Vita, P.C. BlogIn a big win for policyholders, the Oregon Supreme Court recently ruled that that insurance companies are not allowed to relitigate the nature of damages awarded against their insureds during an underlying trial.
In a coverage dispute stemming from a contractor’s faulty work on a condominium development, the insurer argued that at least a portion of the damages awarded represented the cost of repairing the contractor’s own work product. Coverage for such damages would be explicitly excluded by the policy. However, the Oregon Supreme Court found that the jury had been instructed that it could not award damages for the contractor’s own faulty workmanship. The court declined to give the insurer a chance to attempt to reclassify the nature of these damages.
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Austin D. Moody, Saxe Doernberger & Vita, P.C.Mr. Moody may be contacted at
adm@sdvlaw.com
The U.S. Tenth Circuit Court of Appeals Rules on Greystone
November 18, 2011 —
Derek J. Lindenschmidt, Higgins, Hopkins, McLain & Roswell, LLCOn November 1, 2011, the Tenth Circuit Court of Appeals ruled on the certified question of whether property damage caused by a subcontractor’s faulty workmanship is an “occurrence” for purposes of a commercial general liability (CGL) insurance policy. In Greystone Const., Inc. v. National Fire & Marine Ins. Co., No. 09-1412 (10th Cir. Nov. 1, 2011), the Tenth Circuit determined that because damage to property caused by poor workmanship is generally neither expected nor intended, it may qualify under Colorado law as an occurrence and liability coverage should apply. Id. at 2.
The short history of the Greystone case is as follows. In Greystone Const., Inc. v. National Fire & Marine Ins. Co., 649 F. Supp. 2d 1213 (D. Colo. 2009), two contractors and one of their insurers brought an action against a second insurer after the second insurer refused to fund the contractors’ defense in construction defect actions brought by separate homeowners. Id. at 1215. The U.S. District Court for the District of Colorado, relying on General Sec. Indem. Co. of Arizona v. Mountain States Mut. Cas. Co., 205 P.3d 529 (Colo. App. 2009), granted summary judgment in favor of the second insurer on the basis that the homeowners’ complaints did not allege accidents that would trigger covered occurrences under the second insurer’s policies. Id. at 1220. Notably, the Greystone, General Security, and other similar decisions prompted the Colorado General Assembly to enact C.R.S. § 13-20-808, which was designed to provide guidance for courts interpreting perceived coverage conflicts between insurance policy provisions and exclusions. The statute requires courts to construe insurance policies to favor coverage if reasonably and objectively possible. C.R.S. § 13-20-808(5).
The Tenth Circuit began its analysis by determining whether C.R.S. § 13-20-808, which defines the term “accident” for purposes of Colorado insurance law, would have a retroactive effect, and thereby settle the question before the court. The Tenth Circuit gave consideration to several Colorado district court orders issued since the enactment of C.R.S. § 13-20-808 which have suggested that the statute does not apply retroactively, including Martinez v. Mike Wells Constr., No. 09cv227 (Colo. Dist. Ct., Mar. 1, 2011), and Colo. Pool. Sys., Inv. V. Scottsdale Ins. Co., No. 09cv836 (Colo. Dist. Ct., Oct. 4, 2010). The Tenth Circuit also attempted to ascertain the General Assembly’s intent behind the term “all insurance policies currently in existence...” Greystone, No. 09-1412, at 12. The Tenth Circuit determined that the General Assembly would have more clearly stated its intentions for the term if it was supposed to apply retroactively to expired policies, rather than those still running. Id. at 12-13. Ultimately, the Tenth Circuit decided that C.R.S. § 13-20-808 did not apply retroactively, but noted that “the retrospective application of the statute is not necessarily unconstitutional.” Id. at 9, 11-14. As such, the Tenth Circuit advised that it was required to decide the question presented in the appeal under the principles of Colorado insurance law. Id. at 15.
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Reprinted courtesy of Higgins, Hopkins, McLain & Roswell, LLC. Mr. Lindenschmidt can be contacted at lindenschmidt@hhmrlaw.com
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EEOC Sues Schuff Steel, J.A. Croson in New Racial Harassment Cases
October 24, 2022 —
Richard Korman - Engineering News-RecordThe U.S. Equal Employment Opportunity Commission has renewed its effort to combat discrimination and harassment in the construction industry, filing in September four federal lawsuits against construction employers, including major specialty contractors such as erector Schuff Steel and mechanical contractor J.A. Croson. Each has been charged with violating federal laws against racial harassment in the workplace.
Reprinted courtesy of
Richard Korman, Engineering News-Record
Mr. Korman may be contacted at kormanr@enr.com
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The Biggest Change to the Mechanics Lien Law Since 1963
December 08, 2016 —
Wally Zimolong – Supplemental ConditionsThe New Year will bring with it the biggest change to Pennsylvania’s Mechanics Lien Law since the current law was passed in 1963. These changes will impact owner, contractors, and subcontractors equally. However, the biggest benefits will probably be for real estate developers and other project owners.
On December 31, 2016, Pennsylvania will go live with a website known as the State Construction Notices Directory. On that date, owners will have the option of making projects costing $1,500,000 or more “searchable projects.” An owner makes a project a searchable project by filing with the Notices Directory a “Notice of Commencement” before works begins. The Notice of Commencement must include the name, address, and email address of the contractor, full name and location of the searchable project, the county where the project is located, a legal description of the searchable property, and the name address, and email address of the searchable project owner. Importantly, the owner must also post a copy of this Notice of Commencement at the project site.
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Wally Zimolong, Zimolong LLCMr. Zimolong may be contacted at
wally@zimolonglaw.com
Eleventh Circuit Finds No “Property Damage” Where Defective Component Failed to Cause Damage to Other Non-Defective Components
October 11, 2021 —
Anthony L. Miscioscia & Margo Meta - White and WilliamsIn Florida, damage caused by faulty workmanship constitutes “property damage;” however, the cost of repairing or removing defective work does not. Amerisure Mutual Insurance Company v. Auchter Company, 673 F.3d 1294 (11th Cir. 2012) (Auchter). But what happens when the cost of repairing or removing defective work results in loss of use of the tangible property which is not physically injured?
The United States Court of Appeals for the Eleventh Circuit was recently faced with this question in Tricon Development of Brevard, Inc. v. Nautilus Insurance Company, No. 21-11199, 2021 U.S. App. LEXIS 27317 (11th Cir. Sep. 10, 2021). Tricon arose out of the construction of a condominium. Tricon was hired to serve as general contractor for the project and hired a subcontractor to fabricate and install metal railings. The railings installed by the subcontractor were defective and damaged, improperly installed, and failed to meet the project’s specifications. Tricon filed an insurance claim with Nautilus Insurance Company, the subcontractor’s commercial general liability insurer, for the cost to remove and replace the railings.[1]
Reprinted courtesy of
Anthony L. Miscioscia, White and Williams and
Margo Meta, White and Williams
Mr. Miscioscia may be contacted at misciosciaa@whiteandwilliams.com
Ms. Meta may be contacted at metam@whiteandwilliams.com
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Exclusion Does Not Bar Coverage for Injury To Subcontractor's Employee
April 28, 2014 —
Tred R. Eyerly – Insurance Law HawaiiThe Third Circuit reversed the district court and held that the additional insured was covered for injury to the subcontractor's employee despite an employee's exclusion in the policy. ArcelorMittal Plate, LLC v. Joule Technical Serv, Inc., 2014 U.S. App. LEXIS 2905 (3d Cir. Feb. 18, 2014).
ArcelorMittal Plate, LLC (AMP) owned a steel production facility. AMP contracted with Joule, an industrial staffing and engineering firm, for regular performance of maintenance and repair work at its plant. Joule was obligated to provide a CGL policy adding AMP as an additional insured "for all claims including, but not limited to, claims by Joule's employees."
Joule added AMP as an additional insured to its policy with Liberty Surplus Ins. Corp. The policy had an "employee exclusion" which stated, “This insurance does not apply to bodily injury to (1) an employee of the insured arising out of and in the course of (a) employment by the insured or (b) performing duties related to the conduct of the insured's business.”
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Client Alert: Naming of Known and Unknown Defendants in Initial Complaints: A Cautionary Tale
September 24, 2014 —
R. Bryan Martin & Whitney L. Stefko – Haight Brown & Bonesteel LLPOn September 12, 2014, the Ninth Circuit Court of Appeals, in Butler v. National Community Renaissance of California, upheld a district court's dismissal of certain defendants named in amended complaints, affirming the necessity of naming those known and unknown defendants in Plaintiff's original complaint.
In April 2009, Plaintiff Zina Butler filed an action in federal district court, naming a single defendant, National Community Renaissance Corporation ("National"), for an alleged warrantless search of Plaintiff's apartment on April 18, 2007. The single page complaint asserted that the apartment manager provided a Section 8 investigator, a City employee and Sherriff deputies keys to Plaintiff's apartment and conducted a search in violation of her Fourth Amendment rights. Shortly after, Plaintiff filed a first amended complaint, with the only change being the addition of defendant, the Housing Authority of the County of Los Angeles ("HACoLA") in the caption. In May 2009, the court (on its own accord) dismissed the first amended complaint with leave to amend as "it [was] unclear whom Plaintiff intend[ed] to sue."
In June 2009, Plaintiff filed a second amended complaint, identifying National and HACoLA in the caption as defendants, but separately identifying several other individuals and entities allegedly involved in the incident occurring in April of 2007 in the complaint's statement of facts. The Court, once again, dismissed the second amended complaint with leave to amend for the same reasons it dismissed Plaintiff's first amended complaint.
Reprinted courtesy of
R. Bryan Martin, Haight Brown & Bonesteel LLP and
Whitney L. Stefco, Haight Brown & Bonesteel LLP
Mr. Martin may be contacted at bmartin@hbblaw.com; Ms. Stefko may be contacted at wstefko@hbblaw.com
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Predicting Our Future with Andrew Weinreich
May 03, 2017 —
Aarni Heiskanen - AEC BusinessIn this podcast episode, my guest is Andrew Weinreich. We talk about the future of homebuilding against the backdrop of Andrew’s new podcast Predicting Our Future.
Is construction ripe for disruption? Andrew believes that homebuilding is much closer to a tipping point than ever before. In this interview, he explains why.
“In the United States, modular construction significantly lags behind what we see elsewhere around the world,” Andrew reminds. “When everything you can imagine today, from the paperclip to your smartphone is made in a factory, why is it that -certainly in this country- we associate homes made in factory with the lowest of low end homes.”
“The first question is: why is that? And the second question is: could that change? Could we be on the precipice of looking at the next Tesla; not for car-building, but for homebuilding.”
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Aarni Heiskanen, AEC BusinessMr. Heiskanen may be contacted at
info@aepartners.fi
