Microsoft Said to Weigh Multibillion-Dollar Headquarters Revamp
September 17, 2015 —
Dina Bass & Hui-Yong Yu - BloombergMicrosoft Corp. is considering a multibillion-dollar revamp of its headquarters campus in suburban Seattle, seeking to foster more collaboration among employees and attract young engineers, according to people with knowledge of the plans.
The software giant has hired architecture firm Skidmore, Owings & Merrill LLP as part of the effort at its Redmond, Washington, offices, said the people, who asked not to be named because the plans aren’t public. Skidmore Owings designed Dubai’s Burj Khalifa, the world’s tallest building, and is helping Microsoft with a makeover of its much smaller campus in Mountain View, California.
Microsoft hasn’t yet decided whether to move forward with the Redmond overhaul, said one of the people familiar with the matter.
Reprinted courtesy of
Dina Bass, Bloomberg and
Hui-Yong Yu, Bloomberg
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Health Officials Concerned About Lead-Tainted Dust Created by Detroit Home Demolitions
August 20, 2018 —
Engineering News-RecordDETROIT (AP) — The nation's largest home-demolition program, which has torn down more than 14,000 vacant houses across Detroit , may have inadvertently created a new problem by spreading lead-contaminated dust through some of the city's many hollowed-out neighborhoods.
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Engineering News-RecordENR may be contacted at
ENR.com@bnpmedia.com
Appeals Court Affirms Civil Engineer Owes No Duty of Care to General Contractor
August 20, 2014 —
Beverley BevenFlorez-CDJ STAFFAccording to Shareholder Karen Holmes and Law Clerk Justin Reid of Balestreri Potocki & Holmes, in Atlas-Allied v. SD Community College District, the California Court of Appeal “confirmed that a civil engineer owes no duty of care to the General Contractor absent privity of contract.” The Appellate court considered Beacon Residential Community Association v. Skidmore, Owings & Merrill LLP to reach that conclusion.
Holmes and Reid commented that the Atlas-Allied decision “can assist in clarifying the extent liability is owed when no contract exists. Here, while unpublished, the 4th District clearly refused to extend a duty by the civil engineer to the general contractor on a public works project, giving counsel guidance on the application of Beacon and prior decisions on design professionals’ liability.”
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Read Before You Sign: Claim Waivers in Project Documents
July 06, 2020 —
William E. Underwood - ConsensusDocsNot all claim waivers are appropriately titled “Waiver of Claims.” In fact, claim waivers can be found “hiding” without any advertisement or fanfare in a number of project documents, including change orders and applications for payment. So although getting work quickly approved and paid for is important, taking time to read the specific language in your project documents is just as important. Failure to pay close attention to this language could result in the waiver of key, unresolved project claims.
Further, and although it should go without saying, it is also just as important to read all of the terms of your contract. Important waiver language might not exist on the face of form project documents, but rather might be contained in the general and/or supplemental conditions of your contract and automatically incorporated into your form project documents. And these types of incorporated waivers can be just as enforceable.
So it is critically important to understand what you are signing and the implications it might have on future claims. This article will explore some of the common types of claim waivers that can be found in project documents so that you are better positioned to avoid inadvertently waiving claims in the future.
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William E. Underwood, Jones Walker LLPMr. Underwood may be contacted at
wunderwood@joneswalker.com
Ruling Closes the Loop on Restrictive Additional Insured Endorsement – Reasonable Expectations of Insured Builder Prevails Over Intent of Insurer
July 31, 2019 —
Theodore L. Senet, Esq., Jason M. Adams, Esq. and Clayton Calvin - Gibbs GiddenOn June 5, 2019, the Court of Appeal in
McMillin Homes Construction, Inc. v. National Fire & Marine Insurance Company, 35 Cal. App. 5th 1042 (Cal. Ct. App. 2019) issued an important opinion on the scope of additional insured insurance coverage for developers and general contractors in California. Specifically, the “care, custody and control” (“CCC”) exclusion will be read to only exclude coverage for additional insureds who exercised exclusive control over the damaged property. Thus, general contractors who share control of the property with their subcontractors, as is typical on most projects, will not be denied coverage under this exclusion.
I. Facts & Procedural History
McMillin Homes Construction, Inc. was a Southern California developer and general contractor. In 2014, homeowners sued McMillin for roofing defects in a case called
Galvan v. McMillin Auburn Lane II, LLC. Pursuant to a subcontract, the roofer, Martin Roofing Company, Inc., provided McMillin with additional insured coverage under Martin’s general liability insurance policy. The insurer, National Fire and Marine Insurance Company, covered McMillin under an ISO Form CG 20 09 03 97 Additional Insured (“AI”) endorsement. After McMillin tendered its defense of the Galvan lawsuit under the AI endorsement, National Fire declined to provide McMillin with a defense to the homeowners’ lawsuit, relying on a CCC exclusion contained in the AI endorsement for property in the care, custody or control of the additional insured. McMillin then sued National Fire for breach of the policy, bad faith and declaratory relief in
McMillin Homes Construction, Inc. v. National Fire & Marine Insurance Company.
In
McMillin Homes, the trial court found the CCC exclusion in the AI endorsement applied and held in favor of the insurer, National Fire. The trial court found the exclusion for damage to property in McMillin’s “care, custody, or control” precluded coverage for the roofing defect claims, as well as any duty on the part of the insurer to defend the home builder, McMillin. McMillin filed an appeal from the trial court’s ruling.
II. Case Holding
The Court of Appeal reversed to hold in favor of McMillin, interpreting the CCC exclusion narrowly and finding a duty on the part of the insurer to defend the general contractor pursuant to the AI endorsement on the roofer’s insurance policy. It held that for the CCC exclusion to attach, it would require the general contractor’s exclusive control over the damaged property, but here, the general contractor shared control with the roofer. The Court of Appeal noted that where there is ambiguity as to whether a duty to defend exists, the court favors the reasonable belief of the insured over the intent of the insurer. Here, that reasonable belief was that the coverage applied and the exclusion was narrow.
The Court of Appeal relied upon
Home Indemnity Co. v. Leo L. Davis, Inc., 79 Cal. App. 3d 863 (Ct. App. 1978) (“Davis”), as a judicial interpretation of the CCC exclusion. That case synthesized a string of case law into a single conclusion: that courts may hold the exclusion inapplicable where the insured’s control is not exclusive. In the opinion in McMillin Homes, coverage turned upon whether control was exclusive: “[t]he exclusion is inapplicable where the facts at best suggest shared control.” The Court of Appeal stated the “need for painstaking evaluation of the specific facts of each case. Here, McMillin coordinated the project’s scheduling, but Martin furnished the materials and labor and oversaw the work; they therefore shared control.
Even if the rule in Davis did not apply and the exclusion was found to be ambiguous, the court stated that “control” requires a higher threshold than merely acting as a general contractor. Liability policies are presumed to include defense duties and exclusions must be “conspicuous, plain, and clear.” Furthermore, because “construction defect litigation is typically complex and expensive, a key motivation [for the endorsement] is to offset the cost of defending lawsuits where the general contractor’s liability is claimed to be derivative.” This is especially true because the duty to defend is triggered by a mere potential of coverage. Under the insurer’s construction of the exclusion, coverage would be so restrictive under the AI endorsement that it was nearly worthless to the additional insured.
III. Reasonable Expectation of the Insured Prevails over the Intent of the Insurer
Like most commercial general liability policies, National Fire’s policy excluded coverage for property damage Martin was contractually obliged to pay, with an exception for “insured contracts.” Typically, “insured contracts” include prospective indemnification agreements for third party claims. The National Fire policy contained a form CG 21 39 Contractual Liability Limitation endorsement, which deleted indemnity agreements from the definition of “insured contracts” to effectively preclude coverage for the indemnity provision between McMillin and Martin. National Fire argued that this endorsement demonstrated its intent to exclude coverage to McMillin for the homeowners’ defect lawsuit. The Court of Appeal stated that the insurer’s intent is not controlling and that the insureds reasonable expectation under the AI endorsement would control. As a result of its ruling, the Court also dealt a significant blow to the argument that the CG 21 39 endorsement is effective as a total bar to additional insured coverage for all construction defect claims.
IV. Conclusion
The decision is good news for developers and general contractors who rely on subcontractors to provide additional insured coverage. Unless the general contractor exercises exclusive control over a given project, the CCC exclusion in the CG 20 09 03 97 additional insured endorsement may not preclude the duty to defend. Demonstrating that a general contractor exercised exclusive control over the project would be extremely difficult to show under normal project circumstances because the any subcontractor participation appears to eliminate the general contractor’s exclusive control.
The case also highlights the need for construction professionals to regularly review their insurance programs with their risk management team (lawyers, brokers, and risk managers). As is often the case, a basic insurance policy review at the outset of the McMillin project could likely have avoided the entire dispute. For owners and general contractors, CG 20 10 (ongoing operations) and CG 20 37 (completed operations) additional insured forms are preferable to the CG 20 09 form at issue in the McMillin case because they do not contain the CCC exclusion. The CG 20 10 and 20 37 forms are readily available in the marketplace and are commonly added to most policies upon request. Had those forms been added, AI coverage likely would have been extended to McMillin without the need for litigation. Similarly, carriers will routinely delete the CG 21 39 Contractual Liability Limitation endorsement upon request. Deletion of the CG 21 39 would have circumvented National Fire’s second argument in its entirety.
Additionally, insurance policies, endorsements, and exclusions are subject to revision and are not always issued on standard forms. As a result, it is incumbent upon developers, contractors, and subcontractors to specify the precise overage requirements for construction projects and to review all endorsements, certificates, and policies carefully. Due to the difficulty in monitoring compliance with insurance requirements, project owners and general contractors are finding that it is better to insure projects under project specific wrap-up insurance programs which eliminate many of the issues pertaining to additional insured coverage. Wrap-up programs vary greatly as to their terms and conditions, so however a project is insured, insurance requirements and evidence of coverage should be carefully reviewed by experienced and qualified risk managers, brokers, and legal counsel to assure that projects and parties are sufficiently covered.
Gibbs Giden is nationally and locally recognized by U. S. News and Best Lawyers as among the “Best Law Firms” in both Construction Law and Construction Litigation. Chambers USA Directory of Leading Lawyers has consistently recognized Gibbs Giden as among California’s elite construction law firms. The authors can be reached at tsenet@gibbsgiden.com (Theodore Senet); jadams@gibbsgiden.com (Jason Adams) and ccalvin@gibbsgiden.com (Clayton Calvin). Read the court decisionRead the full story...Reprinted courtesy of
Jason Smith and Teddie Arnold Co-Author Updated “United States – Construction” Chapter in 2024 Legal 500: Country Comparative Guides
May 28, 2024 —
Jason Smith & Edward (Teddie) Arnold - The Construction SeytJason Smith and
Teddie Arnold, partners in Seyfarth’s Washington, DC office, have co-authored an updated “United States – Construction” chapter in the 2024 edition of The Legal 500: Country Comparative Guides. Seyfarth continues to participate as an exclusive contributor for this comprehensive overview of construction-specific laws and regulations in the United States. Topics covered include, but are not limited to, requirements and obligations, permits and licencing, procurement, financing and security, and disputes, as well as insight and opinion on current challenges and opportunities. To access and download a copy of the chapter, click
here.
Reprinted courtesy of
Jason N. Smith, Seyfarth and
Edward V. Arnold, Seyfarth
Mr. Smith may be contacted at jnsmith@seyfarth.com
Mr. Arnold may be contacted at earnold@seyfarth.com
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Under the Hood of U.S. Construction Spending Is Revised Data
January 06, 2016 —
Vince Golle – BloombergHere’s one key takeaway from the Commerce Department’s report Monday on U.S. construction spending. The
0.4 percent decrease in November, which itself was weaker than the most pessimistic Bloomberg survey forecast, was accompanied by downward revisions to prior months. The combination suggests some economists may revise down their fourth-quarter GDP tracking forecasts.
* October construction spending rose 0.3 percent, compared with a prior estimate of 1 percent, while September outlays advanced 0.2 percent versus a previous estimate of a 0.6 percent gain
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Vince Golle, Bloomberg
NY Is Set To Sue US EPA Over ‘Completion’ of PCB Removal
June 25, 2019 —
Mary B. Powers - Engineering News-RecordNew York state intends to sue the U.S. Environmental Protection Agency for issuing a certificate to General Electric Co. affirming the company completed its $1.7-billion cleanup of about 40 miles of the upper Hudson River, contaminated with PCBs from two former factories. State Attorney General Letitia James said April 11 that a December state study showed elevated PCB levels in river sediment and concentrations in fish, which were not recovering at the rate EPA anticipated.
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Mary B. Powers, ENRENR may be contacted at
ENR.com@bnpmedia.com
