Seattle Washington Building Expert Directory

Liability Insurer’s Duty To Defend Insured Is Broader Than Its Duty To Indemnify

June 03, 2019 — David Adelstein - Florida Construction Legal Updates
When it comes to liability insurance, an insurer’s duty to defend its insured from a third-party claim is much broader than its duty to indemnify. This broad duty to defend an insured is very important and, as an insured, you need to know this. “A liability insurer’s obligation, with respect to its duty to defend, is not determined by the insured’s actual liability but rather by whether the alleged basis of the action against the insurer falls within the policy’s coverage.” Advanced Systems, Inc. v. Gotham Ins. Co., 44 Fla. L. Weekly D996b (Fla. 3d DCA 2019) (internal quotation omitted). This means: Even where the complaint alleges facts partially within and partially outside the coverage of a policy, the insurer is nonetheless obligated to defend the entire suit, even if the facts later demonstrate that no coverage actually exists. And, the insurer must defend even if the allegations in the complaint are factually incorrect or meritless. As such, an insurer is obligated to defend a claim even if it is uncertain whether coverage exists under the policy. Furthermore, once a court finds that there is a duty to defend, the duty will continue even though it is ultimately determined that the alleged cause of action is groundless and no liability is found within the policy provisions defining coverage. Advanced Systems, supra(internal citations and quotations omitted). Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

Antitrust Walker Process Claims Not Covered Under Personal Injury Coverage for Malicious Prosecution

May 18, 2020 — Christopher Kendrick & Valerie A. Moore – Haight Brown & Bonesteel LLP
In Travelers Property Casualty Co. of America v. KLA-Tencor Corp. (No. H044890; filed 1/16/20, ord. pub. 2/13/20), a California appeals court ruled that commercial general liability insurance for personal and advertising injury, defined to include malicious prosecution, does not cover a Walker Process antitrust cause of action under the Sherman Act and the Clayton Act for using a fraudulently procured patent to attempt to monopolize the market. Travelers insured KLA under commercial liability policies with coverage for personal and advertising injury liability, which was defined as “injury, other than ‘advertising injury’, caused by. . . (2) Malicious prosecution.” Reprinted courtesy of Christopher Kendrick, Haight Brown & Bonesteel LLP and Valerie A. Moore, Haight Brown & Bonesteel LLP Mr. Kendrick may be contacted at ckendrick@hbblaw.com Ms. Moore may be contacted at vmoore@hbblaw.com Read the court decision
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Background Owner of Property Cannot Be Compelled to Arbitrate Construction Defects

November 07, 2012 — CDJ STAFF
In Truppi v. Pasco Engineering, John Quattro sued Property Management Contractors, Inc. over construction defects in William Truppi’s home. All parties are named in the suit. The California Court of Appeals ruled that Property Management Contractors, Inc. (PMCI) could not compel Mr. Quattro to arbitration. The background of the case involves two houses built in Encinitas, California by PCMI: one for Mr. Truppi at 560 Neptune, and one for Mr. Quattro at 566 Neptune. Both contracts contained an arbitration provision. Mr. Quattro signed the contract for his residence and Mr. Truppi signed the other. Mr. Quattro then sued PCMI and its principal, William Gregory. Mr. Quattro claimed to be the true contracting party for the 560 Neptune residence and a third party beneficiary of the contract Mr. Truppi signed, and stated that PCMI was aware of this. PCMI in a demurrer stated that Quattro “had only a ‘prospective beneficial interest in the property upon its eventual sale or lease.’” Mr. Quattro amended his complaint to account for the issues raised by PCMI. The court rejected PCMI’s demurrer to the amended complaint. Finally, PCMI and Gregory asserted that Quattro was “not the real party in interest” and could not sue. PCMI continues to assert that Quattro lacks standing, but their attorney sent Quattro an e-mail stating, “While my client disputes that you are a party, and that you lack standing to assert the claim, to the extent you do so I believe you are obligated to proceed by way of arbitration.” The court did not cover the issue of Quattro’s standing in the case, only if he could be compelled to arbitration. The court affirmed the lower court’s finding that Quattro could not be compelled to arbitrate the construction defect claim as neither he nor Gregory signed the contract in an individual capacity. Further, the court noted that PCMI and Gregory “denied the existence of an agreement between themselves and Quattro on the 560 contract,” and cannot compel arbitration on a non-existent agreement. And while non-signatories can, in some situations be compelled to arbitrate, the court found that “these cases are inapplicable because here they seek to have the alleged third party beneficiary (Quattro) compelled by a nonsignatory (Gregory).” The arbitration clause in question “expressly limited its application to persons or entities that signed the 560 contract.” As Mr. Quattro was not a signatory to that agreement, the court found that he could not be held to its arbitration provision. Read the court decision
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Professor Senet’s List of 25 Decisions Every California Construction Lawyer Should Know:

January 17, 2022 — Ted Senet - Gibbs Giden

Aas v. Superior Court (2000) 24 Cal. 4th 627 – economic loss rule
Amelco Electric v. City of Thousand Oaks ( (2002) 27 Cal. 4th 228 – abandonment does not apply to public works – total cost theory is allowed
Beacon Residential Community Association v. Skidmore, Owings & Merrill (2014) 59 Cal. 4th 568 – architect liable in absence of privity
Cates Const., Inc. v. Talbot Partners (1999) 21 Cal.4th 28 – no tort recovery on bonds – performance bonds can cover contract warranties
Condon-Johnson & Associates, Inc. v. Sacramento Municipal Utility Dist., 149 Cal. App. 4th 1384 – liability for concealed conditions
Connolly Development, Inc. v. Superior Court of Merced County (1976) 17 Cal. 3d 803 – mechanic lien remedy is constitutional
Crawford v. Weather Shield Mfg. (2008) 44 Cal. 4th 541 – indemnity implies obligation to defend [now limited to commercial contracts under CCP 2782 (c)–(h)]

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Reprinted courtesy of Ted Senet, Gibbs Gidden
Mr. Senet may be contacted at tsenet@gibbsgiden.com

Texas City Pulls Plug on Fossil Fuels With Shift to Solar

March 19, 2015 — Christopher Martin – Bloomberg
(Bloomberg) -- A city in the heart of the oil state of Texas is set to become one of the first communities in the U.S. to wean its residents off fossil fuels. The municipal utility in Georgetown, with about 50,000 residents, will get all of its power from renewable resources when SunEdison Inc. completes 150 megawatts of solar farms in West Texas next year. The change was announced Wednesday. It will be the first city to completely embrace clean power in the state, which is the biggest U.S. producer and user of natural gas. More will follow as municipalities seek to insulate themselves from unpredictable prices for fossil fuels, said Paul Gaynor, SunEdison’s executive vice president of North America. Burlington, Vermont, made a similar move with its purchase of a hydroelectric plant last year. Read the court decision
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Reprinted courtesy of Christopher Martin, Bloomberg
Mr. Martin may be contacted at cmartin11@bloomberg.net

Insurer's Quote on Coverage for Theft by Hacker Creates Issue of Fact

December 16, 2019 — Tred R. Eyerly - Insurance Law Hawaii
The appellate court found that the insurer's quote created an issue of fact on whether loss caused by a computer hacker would be covered. Metal Pro Roofing, LLC v. Cincinnati Ins. Co., 2019 Ind. App. LEXIS 355 (Ind. Ct. App. Aug. 9, 2019). The insureds, Metal Pro Roofing, LLC and Cornett Restoration, LLC ("LLC's") discovered that their bank accounts had been hacked and over $78,000 stolen. They submitted claims to their insurer, Cincinnati. Coverage was denied, and the LLCs filed suit. Cross-motions for summary judgment were filed, and the court granted summary judgment to Cincinnati. The "Forgery or Alternation" coverage applied to losses resulting directly from the "'forgery' or alteration of checks, drafts, promissory notes, or similar written promises, order or directions to pay a sum of money." "Forgery" was defined as "the signing of the name of another person or organization with the intent to deceive." The LLCs did not cite any evidence that the hacker "signed" anything, let alone that they signed "the name of another person or organization." 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

Court Dismisses Cross Claims Against Utility Based on Construction Anti-Indemnity Statute

August 14, 2018 — David R. Cook - Autry, Hall & Cook, LLP
When a plane crashed and several passengers and crew died or were injured, their representatives sued several defendants, including a nearby plant owner, Milliken & Company (“Plant Owner”), based on claims that transmission lines on Plant Owner’s property were too close to the runways, were too high, and encroached on the airport easements. Plant Owner cross claimed against utility owner, Georgia Power Company (“Utility”). Plant Owner’s claim was based on an easement it granted to Utility, which required Utility to indemnify it for any claims arising out of Utility’s construction or maintenance of the transmission lines. In defense, Utility argued that the easement’s indemnity provision violated Georgia’s construction anti-indemnity statute. Read the court decision
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Reprinted courtesy of David R. Cook, Autry, Hall & Cook, LLP
Mr. Cook may be contacted at cook@ahclaw.com

California Supreme Court Declines to Create Exception to Privette Doctrine for “Known Hazards”

September 13, 2021 — Tracy D. Forbath - Lewis Brisbois
In Gonzalez v. Mathis (Aug. 19, 2021, S247677) __ Cal.5th___, the California Supreme Court reversed an appellate decision holding that a landowner may be liable to an independent contractor, or the contractor’s workers, for injuries resulting from “known hazards,” as running contrary to the Privette doctrine. In Gonzalez, the contractor, who specialized in washing skylights, slipped and fell while accessing the landowner’s particularly hard to reach skylight from a narrow retaining wall that was allegedly covered in loose gravel and slippery. (Slip opn., p. 3.) While the trial court initially granted the landowner summary judgment pursuant to the Privette doctrine, the appellate court reversed and held that the landowner had a responsibility to take reasonable safety precautions where there was a known safety hazard on the landowner’s premises. (Id. at p. 6.) Whether the landowner could have taken various safety precautions also raised disputed issues of material fact precluding summary judgment. (Ibid.) However, the California Supreme Court concluded that no broad, third exception to the Privette doctrine lies; “unless a landowner retains control over any part of the contractor’s work and negligently exercises that retained control in a manner that affirmatively contributes to the injury [citation], it will not be liable to an independent contractor or its workers for an injury resulting from a known hazard on the premises.” (Slip opn., p. 2.) Read the court decision
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Reprinted courtesy of Tracy D. Forbath, Lewis Brisbois
Ms. Forbath may be contacted at Tracy.Forbath@lewisbrisbois.com

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