New York Restrictions on Flow Through Provision in Subcontracts
August 14, 2023 —
Bill Wilson - Construction Law ZoneMost subcontracts include a flow through provision (also called flow down and incorporation clauses) stating that the subcontractor and contractor are bound by the same obligations as set forth in the prime contract between the contractor and owner. Many jurisdictions interpret such provisions narrowly, as illustrated in a recent case out of New York. In Amerisure Insurance Company v. Selective Insurance Group, Inc., 2023 WL 3311879, the U.S. Court of Appeals for the Second Circuit affirmed the District Court’s interpretation of a flow through clause in a construction subcontract. The Amerisure case involved a dispute over insurance coverage for a personal injury to a subcontractor’s employee on a construction project. The owner of the project sought defense and indemnity from the general contractor (GC) and its insurance company, who in turn sought coverage for the owner as an additional insured under the subcontractor’s policy. The GC based its argument for coverage on the flow through provision in the subcontract.
The prime contract required the GC to procure commercial liability insurance including the owner as an additional insured for claims caused by the GC’s negligent acts or omissions. The subcontract likewise required the subcontractor to procure commercial general liability insurance but required only that the GC be named as an additional insured. However, the subcontract also included a flow through clause, binding the subcontractor to the terms of the prime contract and assuming toward the GC all the obligations and responsibilities that the GC assumed toward the owner. However, the subcontract did not expressly require that the subcontractor name the owner as an additional insured, and in order for the owner to qualify as an additional insured under the subcontractor’s insurance policy, the subcontractor must have agreed in the subcontract to name the owner as an additional insured.
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Bill Wilson, Robinson & Cole LLPMr. Wilson may be contacted at
wwilson@rc.com
Loss of Use From Allegedly Improper Drainage System Triggers Defense Under CGL Policy
February 28, 2018 —
Katherine E. Miller and Michael S. Levine – Hunton Insurance Recovery BlogThe Eleventh Circuit, in
Mid-Continent Casualty Co. v. Adams Homes of Northwest Florida, Inc., No. 17-12660, 2018 WL 834896, at * 3-4 (11th Cir. Feb. 13, 2018) (per curiam), recently held under Florida law that a homebuilder’s alleged failure to implement a proper drainage system that allowed for neighborhood flooding triggered a general liability insurer’s duty to defend because the allegations involved a potentially covered loss of use of covered property.
Reprinted courtesy of
Katherine E. Miller, Hunton & Williams and
Michael S. Levine, Hunton & Williams
Ms. Miller may be contacted at kmiller@hunton.com
Mr. Levine may be contacted at mlevine@hunton.com
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Lost Productivity or Inefficiency Claim Can Be Challenging to Prove
May 02, 2022 —
David Adelstein - Florida Construction Legal UpdatesOne of the most challenging claims to prove is a lost productivity or inefficiency claim. There is an alluring appeal to these claims because there are oftentimes intriguing facts and high damages. But the allure of the presentation of the claim does not compensate for the actual burden of proof in proving the lost productivity or inefficiency claim, which will require an expert. And they really are challenging to prove.
Don’t take it from me. A recent Federal Claims Court opinion, Nova Group/Tutor-Saliba v. U.S., 2022 WL 815826, (Fed.Cl. 2022), that I also discussed in the preceding
article, exemplifies this point.
To determine lost productivity or inefficiency, the claimant’s expert tried three different methodologies.
First, the expert looked at industry standard lost productivity factors such as those promulgated by the Mechanical Contractor’s Association. However, the claimant was not a mechanical contractor and there is a bunch of subjectivity involved when using these factors. The expert decided not to use such industry standard factors correctly noting they provide value when you are looking at a potential impact prospectively, but once you incur actual damages and have real data, it is not an accurate measure.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
Construction Defect Bill Introduced in California
June 10, 2011 —
CDJ STAFFLinda Halderman (R-Fresno) has introduced a bill which would require lawyers soliciting clients for construction defect cases to provide their prospective clients with a statement including that sellers may be required to disclose that they were engaged in a construction lawsuit. Further, the bill would require lawyers to disclose that they cannot guarantee financial recovery.
Halderman was quoted by The Business Journal as saying, “Lawsuit abuse has been very damaging, especially to homeowners in the Valley.” Halderman hopes that her bill will discourage class action lawsuits against builders and that this will protect jobs in the construction industry.
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Hunton Insurance Practice Receives Top (Tier 1) National Ranking by US News & World Report
June 27, 2022 —
Hunton Insurance Recovery BlogHunton Andrews Kurth LLP’s insurance practice has received U.S. News & World Report’s highest national ranking (Tier 1) in its ranking of Best Law Firms for Insurance Law. Law firms are ranked in tiers from 1 (highest) to 3 (lowest) based on quantitative data that speaks to general demographic and background information on the practice group, attorneys, and other data that speaks to the strengths of a law firm’s practice as well as qualitative client feedback about:
- the practice group’s expertise,
- responsiveness,
- understanding of a business and its needs,
- cost-effectiveness,
- civility, and
- whether the client would refer another client to the firm.
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Hunton Andrews Kurth LLP
Ahlers Cressman & Sleight PLLC Recognized Among The Top 50 Construction Law Firms by Construction Executive
June 20, 2022 —
Scott R. Sleight - Ahlers Cressman & Sleight PLLCACS is proud to announce it has once again been ranked among The Top 50 Construction Law FirmsTM in the Construction Executive 2022 rankings. ACS is the highest ranked law firm in the US practicing out of a single office.
ACS specializes in delivering the highest quality construction law services. ACS prides itself on providing excellent services to clients in matters relating to contract documents, construction dispute resolution, and government contracts. If resolution efforts fail, ACS has the experience and ability to represent clients in high-stakes litigation. Since 2018, ACS has obtained three significant jury verdicts in favor of its general contractor clients, including awards of prevailing party attorneys’ fees and costs and expenses.
Founded in 2007, ACS’ vast knowledge and industry experience led our lawyers to hold many leadership positions. Three of our lawyers are past chairs of the Washington State Bar Association’s Construction Law Section, five of our lawyers have served as the Chair of the Associated General Contractors of Washington’s Legal Affairs Committee, and many of our lawyers are recognized as Super Lawyers and Rising Stars in Super Lawyers Magazine/Thomson Reuters. We have represented construction firms before the Supreme Court and the Court of Appeals in numerous precedent-setting cases, and have testified before the Legislature. ACS’ commitment to the construction industry shows in our results.
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Scott R. Sleight, Ahlers Cressman & Sleight PLLCMr. Sleight may be contacted at
scott.sleight@acslawyers.com
Chambers USA 2023 Recognizes Six Partners and Three Practices at Lewis Brisbois
June 19, 2023 —
Lewis Brisbois NewsroomNew York, N.Y. (June 6, 2023) – Six Lewis Brisbois partners and three Lewis Brisbois practices were recently ranked by Chambers in its 2023 USA rankings list.
Kansas City & Wichita Managing Partner Alan L. Rupe and Phoenix Managing Partner Carl F. Mariano were both ranked Band 1 for “Labor & Employment – Kansas” and “Insurance – Arizona,” respectively. Phoenix Partner Gina M. Bartoszek was ranked Band 2 for “Insurance – Arizona.” Washington, D.C. Managing Partner Jane C. Luxton and Minneapolis Partner Tina A. Syring were both ranked Band 4 for “Environment – District of Columbia” and “Labor & Employment – Minnesota,” respectively. Additionally, Washington, D.C. & Fort Lauderdale Partner J. Mario Fontes, Jr. was ranked Band 5 for “Corporate/M&A & Private Equity – Florida: South.”
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Lewis Brisbois
When it Comes to Trials, it’s Like a Box of Chocolates. Sometimes You Get the Icky Cream Filled One
October 14, 2019 —
Garret Murai - California Construction Law BlogAccording to the California Judicial Council you have about a one in three chance your case will go to trial. In 2018, of the 210,028 unlimited civil cases that were filed (i.e., cases with an amount at issue of more than $25,000) only 33 percent made it all the way to trial. The odds are even less if you’re involved in a limited civil case (i.e., cases with an amount at issue of less than $25,000) where only 15 percent make it all the way to trial.
The reason: Lawyers are expensive. The other reason: Trials are risky. As well prepared as your counsel may be for trial, when it comes to trials, like boxes of chocolates, “Ya never know what you’re gonna get.” And sometimes you really, really don’t know what you’re going to get.
I had a client involved in a trial once. The defendant’s representative at trial was a well-to-do young man and heir to a hotel fortune. He was young, athletic and had a confident, carefree way about himself that reminded me of “Dickie” Greenleaf from the Talented Mr. Ripley. And I wasn’t the only one who noticed.
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Garret Murai, Wendel, Rosen, Black & Dean LLPMr. Murai may be contacted at
gmurai@wendel.com