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    “Wait! Do You Have All Your Ducks in a Row?” Filing of a Certificate of Merit in Conjunction With a Complaint

    January 13, 2020 —
    In Barrett v. Berry Contr. L.P., No. 13-18-00498-CV, 2019 Tex. LEXIS 8811, the Thirteenth District Court of Appeals of Texas considered, among other things, the procedural timing requirements of filing a certificate of merit in conjunction with a complaint. The court concluded that the proper reading of the statute requires a plaintiff to file a certificate of merit with the first complaint naming the defendant as a party. In Barrett, after sustaining injuries while working at a refinery, David Barrett (Barrett) filed suit against Berry Contracting, LP and Elite Piping & Civil, Ltd. on July 6, 2016. In Barrett’s first amended complaint, which he filed on August 23, 2016, Barrett added Govind Development, LLC (Govind) as another defendant. Barrett subsequently filed a second amended complaint (omitting Govind) and, on December 27, 2017, shortly before the statute of limitations ran, a third amended complaint (reasserting claims against Govind). On January 28, 2018, after the statute of limitations period ran, Barrett filed a certificate of merit. Govind filed a motion to dismiss the claim, asserting that Barrett violated the statute that required a certificate of merit to be filed with the complaint, Tex. Civ. Prac & Rem. Code §150.002.
    Tex. Civ. Prac. & Rem. Code §150.002(a) states, In any action or arbitration proceeding for damages arising out of the provision of professional services by a licensed or registered professional, a claimant shall be required to file with the complaint an affidavit of a third-party licensed architect, licensed professional engineer, registered landscape architect or registered professional land surveyor…
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    Reprinted courtesy of Rahul Gogineni, White and Williams LLP
    Mr. Gogineni may be contacted at goginenir@whiteandwilliams.com

    Become Familiar With Your CGL Policy Exclusions to Ensure You Are Covered: Wardcraft v. EMC.

    December 31, 2014 —
    In a recent case arising out of a denial of coverage for alleged construction defect claims concerning a pre-fabricated home, the U.S. District Court for the District of Colorado applied the 10th Circuit’s determination of what can constitute an “occurrence” under a commercial general liability (“CGL”) policy. See Wardcraft Homes, Inc. v. Employers Mutual Cas. Co., 2014 WL 4852117 (D. Colo. September 29, 2014). William and Grace Stuhr sued Wardcraft, which manufactured pre-fabricated homes at a facility in Fort Morgan, Colorado, because their home was not completed as scheduled and contained various defects. The Stuhrs filed suit against Wardcraft alleging negligence, breach of warranty, and deceptive trade practices in violation of the Colorado Consumer Protection Act. Wardcraft tendered the Stuhrs’ complaint to Employers Mutual Casualty Company (“EMC”), which denied coverage under its policy and denied any duty to defend. According to EMC, the Stuhrs’ alleged construction defects were not property damages and there was no occurrence in connection with faulty workmanship. Approximately two and a half years after they filed their initial complaint, the Stuhrs filed an amended complaint. Wardcraft did not tender this amended complaint to EMC, and first informed EMC about the amended complaint about a year after it was filed. A month prior, Wardcraft settled with the Stuhrs. Read the court decision
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    Reprinted courtesy of Heather M. Anderson, Higgins, Hopkins, McLain & Roswell, LLC
    Ms. Anderson may be contacted at Anderson@hhmrlaw.com

    Insurer Must Defend Contractor Against Claims of Faulty Workmanship

    May 30, 2018 —
    The magistrate judge recommended that the insurer's motion for summary judgment seeking to determine there was no coverage for claims of faulty workmanship be denied. Greystone Multi-Family Builders v. Gemini Ins. Co., 2018 U.S. Dist. LEXIS 56770 (S.D. Tex. Feb. 26, 2018). TPG (Post Oak) purchased an OCIP policy to cover construction of an apartment complex. TPG was sued by the contractor, Greystone, after TPG cancelled the construction contract. TPG filed a counterclaim against the contractor, alleging that Greystone had failed to properly perform in building a luxury apartment complex which resulted in monetary damages to TPG. The complaint further alleged that the project was nine months behind its substantial completion date, far from complete, and over budget when TPG cancelled the contract. The cost to fix the mismanagement caused by Greystone was $18.9 million. Read the court decision
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    Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
    Mr. Eyerly may be contacted at te@hawaiilawyer.com

    Tacoma Construction Site Uncovers Gravestones

    August 11, 2011 —

    The Seattle Times reports that a transit construction project has uncovered about twenty-five gravestones. The area was historically sensitive, as it is in territory once occupied by the Puyallup Tribe. At current report, no human remains have been found and the article cites the project?s archeological consultant as describing the gravestones as “not historically significant.”

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    Illinois Law Bars Coverage for Construction Defects in Insured's Work

    September 24, 2014 —
    Applying Illinois law, the Seventh Circuit determined there was no coverage for faulty workmanship causing property damage to the insured's project. Nautilus Ins. Co. v. Board of Directors of Regal Lofts Condominium Ass'n, 2014 U.S. App. LEXIS 16250 (7th Cir. Aug. 21, 2014). The developer converted a vacant building into a condominium. The construction was completed in 2000. The Condominium Board took control of the condo association on July 27, 2000. As early as May 2000, one homeowner was aware of water damage problems in the building. Other complaints surfaced. An investigation found that the exterior brick masonry walls were not fully waterproofed, which caused leaks. The investigation further showed that deteriorated conditions had likely developed over many years, even prior to the condominium conversion, but the present water penetration was caused by the inadequate restoration of the walls to a water-tight condition. The underlying action was filed against the developer for failure to properly construct the exterior walls. The developer's carrier, Nautilus, denied coverage. In an amended complaint, the Board added a count of negligence. Again, Nautilus denied coverage. The Board's second amended complaint alleged that the developer's negligence had caused damage to personal property within the building, in addition to the interior of the building and the building itself. For the third time, Nautilus denied coverage and filed for declaratory relief. Read the court decision
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    Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
    Mr. Eyerly may be contacted at te@hawaiilawyer.com

    Justice Didn’t Ensure Mortgage Fraud Was Priority, IG Says

    March 19, 2014 —
    The U.S. Justice Department failed to pursue mortgage fraud in the years following the 2008 financial crisis with the same level of commitment that it publicly touted, an internal watchdog said. While Attorney General Eric Holder said mortgage-fraud cases were among the department’s top priorities, the Federal Bureau of Investigation internally ranked them the lowest of six criminal threats, according to a report released today by Inspector General Michael Horowitz. The FBI devoted fewer resources to such cases even though Congress allocated $196 million for fiscal years 2009 to 2011 to pursue such conduct. The Justice Department has been criticized by lawmakers and judges for not bringing more criminal cases against individuals following the collapse in housing prices and ensuing market turmoil. In August, Holder retracted a public statement after Bloomberg News reported that the department had inflated its track record of mortgage-fraud prosecutions. Mr. Schoenberg may be contacted at tschoenberg@bloomberg.net; Mr. Mattingly may be contacted at pmattingly@bloomberg.net Read the court decision
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    Reprinted courtesy of Tom Schoenberg and Phil Mattingly, Bloomberg

    Motion to Dismiss Denied Regarding Insureds' Claim For Collapse

    October 29, 2014 —
    The federal district court denied the insurer's motion to dismiss claims for loss due to the imminent collapse of the insureds' basement walls. Belz v. Peerless Ins. Co., 2014 WL 4364914 (D. Conn. Sept. 2, 2014). The insureds noticed cracks throughout their basement walls. It was discovered that the condition was the result of a chemical compound used in the concrete of certain basement walls in the late 1980s and early 1990s. The insureds contended that due to the cracking, the basement walls suffered a substantial impairment to their structural integrity making it only a matter of time until the walls collapsed. The insureds notified their insurer, Peerless. An engineer hired by Peerless determined the walls' condition was caused by poor workmanship and defective materials. On this basis, Peerless denied coverage. Read the court decision
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    Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
    Mr. Eyerly may be contacted at te@hawaiilawyer.com

    Commercial Development Nearly Quadruples in Jacksonville Area

    December 04, 2013 —
    Construction is up in the Jacksonville area, and no sector is doing better than commercial construction. During the first ten months of 2012, there was $21.2 million of commercial construction, but during the first ten months of 2013, there was been $73.2 million of commercial construction, helped along by a $13.7 million medical complex. In addition to the massive growth in commercial construction, residential construction is up, but by a comparatively modest 52%. Read the court decision
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    Reprinted courtesy of