Pennsylvania Supreme Court Rules in Builder’s Implied Warranty of Habitability Case
September 03, 2014 —
Beverley BevenFlorez-CDJ STAFFAccording to an article in JD Supra Business Advisor (written by Mark S. DePillis, Carl G. Roberts, Benjamin M. Schmidt, and Matthew White of Ballard Spahr LLP), “The Pennsylvania Supreme Court ruled that a builder’s implied warranty of habitability extends only to the initial buyer of a home, and not to subsequent purchasers.” This reversed an earlier ruling in Conway v. The Cutler Group, Inc. “that created more expansive liability for home builders.”
DePillis, Roberts, Schmidt, and White suggested that “builders should monitor possible future legislation addressing the public policy issues that the Supreme Court identified as falling squarely within the legislature’s domain.”
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Los Angeles Is Burning. But California’s Insurance Industry Is Not About to Collapse.
January 14, 2025 —
Jerry Theodorou - R StreetFive fires are
raging in the Los Angeles outskirts currently – the Palisades Fire, the Eaton Fire, the Lidia Fire, the Sunset Fire, and the Hurst Fire. They have been stoked by a trifecta of 100 mph wind gusts, elevated heat, and bone-dry grass and shrubs serving as tinder. The severity of the fires has raised questions about the role of climate change in the conflagrations and insurers’ claims-paying capacity. But while we recognize the immensity of the hardship and tragedy to many Angelenos from the fires, we also must recognize that California’s insurance industry is not about to collapse.
Many have ignored or missed
recent reforms to California insurance regulation that are poised to make the private market more sustainable, and help stem an exodus of insurers from the Golden State.
Whether the intensity of wildfires is exacerbated by climate change is an open question. An R Street
study found that natural catastrophes have increased in severity, but not in frequency. And the main reason catastrophe severity has risen is an increase in the built environment – there is simply more stuff now to be destroyed.
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Jerry Theodorou, R StreetMr. Theodorou may be contacted at
jtheodorou@rstreet.org
First Suit to Enforce Business-Interruption Coverage Filed
April 20, 2020 —
Lorelie S. Masters & Michael S. Levine - Hunton Insurance Recovery BlogOn Monday, Oceana Grill, a restaurant in New Orleans, Louisiana, became the first to file a lawsuit over coverage for COVID-19 business interruption losses. The lawsuit, styled Cajun Conti, LLC, et al. v. Certain Underwriters at Lloyd’s of London, et al. (La. Dist. Court, Orleans Parish), seeks a declaratory judgment that an “all risks” property insurance policy issued by Lloyd’s of London must cover losses resulting from the closure of the restaurant following an order by the Governor of Louisiana restricting public gatherings and the Mayor of New Orleans’ order closing restaurants.
The Lloyds’ policy, like most first-party property insurance policies, affords coverage for business- interruption losses and contains an “extension of coverage in the event of the businesses closure by order of Civil Authority.” Specifically, the lawsuit seeks a declaration that “the policy provides coverage to plaintiffs for any future civil authority shutdowns of restaurants in the New Orleans area due to physical loss from Coronavirus contamination and that the policy provides business income coverage in the event that the coronavirus has contaminated the insured premises.” Furthermore, according to the complaint, “[t]he policy does not provide any exclusion due to losses, business or property, from a virus or global pandemic.”
As the complaint implies, an important issue will be whether the novel coronavirus constitutes the requisite “direct physical loss or damage” under the policy. Understanding COVID-19, its manner of transmission and its ability to live beyond a host organism helps support a conclusion that COVID-19 does indeed amount to the required direct physical loss or damage.
Reprinted courtesy of
Lorelie S. Masters, Hunton Andrews Kurth and
Michael S. Levine, Hunton Andrews Kurth
Ms. Masters may be contacted at lmasters@HuntonAK.com
Mr. Levine may be contacted at mlevine@HuntonAK.com
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Surety's Settlement Without Principal's Consent Is Not Bad Faith
January 05, 2017 —
Tred R. Eyerly – Insurance Law HawaiiThe Sixth Circuit found that the surety did not act in bad faith when it settled the general contractor's claims against the State of Michigan over delays on a construction project. Great Am. Ins. Co. v. E.L. Bailey & Co., 2016 U.S. App. LEXIS 20018 (6th Cir. Nov. 7, 2016).
Bailey, the general contractor, entered into a surety agreement under which Great American would issue surety bonds on behalf of Bailey in the construction of a kitchen at a State prison. Bailey, the principal, paid Great American (GAIC), the surety, to provide bonds guaranteeing contract performance to the State, the obligee or owner. GAIC provided a performance bond, guaranteeing performance of the contract work, and a payment bond, guaranteeing payments to subcontractors and suppliers. Under the agreement, Bailey would indemnify GAIC for all payments or other expenses GAIC incurred due on either bond, and would pay upon demand collateral in an amount to be determined by GAIC. In the event of an alleged breach by Bailey, the agreement assigned to GAIC all Bailey's rights under its contract with the State and well as all its claims against any party.
Bailey never finalized completion, and GAIC reached agreement with the State for another contractor to complete the project.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Skanska Found Negligent for Damages From Breakaway Barges
January 11, 2022 —
Jim Parsons - Engineering News-RecordA federal district court judge in Pensacola, Fla., has ruled that Skanska USA was negligent in preparing the Pensacola Bay Bridge construction site for the approach of Hurricane Sally, a September 2020 event that caused dozens of construction barges to break free of their moorings. The barges severely damaged the partly finished new crossing, closing it for months, and later washed ashore on nearby waterfront properties.
Reprinted courtesy of
Jim Parsons, Engineering News-Record
ENR may be contacted at ENR.com@bnpmedia.com
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That’s Common Knowledge! Failure to Designate an Expert Witness in a Professional Negligence Case is Not Fatal Where “Common Knowledge” Exception Applies
June 03, 2019 —
Lyndsey Torp - Snell & Wilmer Real Estate Litigation BlogIn reversing summary judgment for defendants, the California Fourth District Court of Appeal recently held that homeowners suing their real estate broker for negligence did not need an expert witness to establish the elements of their causes of action. Ryan v. Real Estate of the Pacific, Inc. (2019) 32 Cal. App. 5th 637. Typically, expert witnesses are required to establish the standard of care in professional negligence cases. But in Ryan, the court of appeal held that the “common knowledge” exception applied despite this general rule, because the conduct required by the particular circumstance of the case was within the common knowledge of a layman. The conduct in question here? The broker’s failure to disclose to his client that the client’s neighbor told him that she planned extensive renovations that would obstruct the client’s property’s ocean views.
Ryan and Patricia Ryan (the Ryans) hired defendant Real Estate of the Pacific, Inc., doing business as Pacific Sotheby’s International Realty (Sotheby’s) and defendant real estate broker to sell their residence in La Jolla, California. During an open house at the residence, a neighbor informed the Ryan’s real estate broker that she planned extensive renovations at her home that would, among other things, permanently obstruct the Ryan’s westerly ocean views and take several years to complete. The real estate broker never informed the Ryans of this, nor the subsequent buyer. The subsequent buyer purchased the property for $3.86 million, and defendants received $96,500 as commission for the sale. The day after escrow closed, the buyers learned of the renovations, and sought to rescind the purchase. Based on advice of defendants, the Ryans refused, and the dispute proceeded to arbitration. The buyer obtained a rescission of the purchase, with the Ryans order to pay damages, interest, and attorneys’ fees and costs in excess of $1 million. The Ryans then sued Sotheby’s and the real estate broker to recover these amounts and damages caused by defendants’ alleged negligence.
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Lyndsey Torp, Snell & WilmerMs. Torp may be contacted at
ltorp@swlaw.com
Venue for Miller Act Payment Bond When Project is Outside of Us
December 02, 2019 —
David Adelstein - Florida Construction Legal UpdatesThe proper venue for a Miller Act payment bond claim is “in the United States District Court for any district in which the contract was to be performed and executed, regardless of the amount in controversy.” 40 U.S.C. s. 3133(b)(3)(B).
Well, there are a number of federal construction projects that take place outside of the United States. For these projects, where is the correct venue to sue a Miller Act payment bond if there is no US District Court where the project is located? A recent opinion out of the Southern District of Florida answers this question.
In U.S. ex. rel. Salt Energy, LLC v. Lexon Ins. Co., 2019 WL 3842290 (S.D.Fla. 2019), a prime contractor was hired by the government to design and construct a solar power system for the US Embassy’s parking garage in Burkina Faso. The prime contractor hired a subcontractor to perform a portion of its scope of work.
The subcontractor remained unpaid in excess of $500,000 and instituted a Miller Act payment bond claim against the payment bond surety in the Southern District of Florida, Miami division. The surety moved to transfer venue to the Eastern District of Virginia arguing that the Southern District of Florida was an improper venue. The court agreed and transferred venue. Why?
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
Negligent Inspection Claim Against Supervising Design Professional / Consultant
August 07, 2023 —
David Adelstein - Florida Construction Legal UpdatesCan a negligence argument be created against consulting design professionals or entities that are involved in the inspection of a trade’s work? The recent opinion in Bautech USA, Inc. v. Resolve Equipment, Inc., 2023 WL 4186395 (S.D.Fla. 2023) contains an interesting fact pattern that touches upon this issue. While the case dealt with a motion to dismiss, it contains a number of issues that may be discussed in follow-up postings.
Here, a prime contractor was hired by Broward County, Florida to install offshore reef mitigation units. The contractor entered into a subcontract with a concrete fabricator to fabricate the reef mitigation units. The contractor also separately hired consultants to inspect the units. The contractor and its consultants rejected the units even after the fabricator implemented design revisions. The fabricator was then terminated and not paid for contract work plus revisions it implemented to finished units. The fabricator sued the contractor and the contractor’s consultants for non-payment under many (ten) different theories of liability claiming it was damaged to the tune of millions of dollars.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com