FAIRFIELD CONNECTICUT BUILDING EXPERT
DIRECTORY AND CAPABILITIES

Wildfire Insurance Coverage Series, Part 3: Standard Form Policy Exclusions

July 11, 2022 — Scott P. DeVries & Yosef Itkin - Hunton Insurance Recovery Blog
Even when claims are within the scope of coverage, insurers often rely on exclusions in an attempt to avoid coverage for wildfire claims. In this post in the Blog’s Wildfire Insurance Coverage Series, we discuss the interplay between coverage grants and exclusions, and the “anti-concurrent cause” provision. Insurers may cite exclusions in an attempt to reduce or avoid liability. The insurance industry has long relied on the Insurance Services Office (ISO) to draft standard form policy language and secure approval as required by state regulatory agencies. ISO Form HO 00 03 10 00 (Section I—Exclusions, Part B) provides the following form exclusionary language: We do not insure for loss to property described in Coverages A and B caused by any of the following. However, any ensuing loss to property described in Coverages A and B not precluded by any other provision in this policy is covered. Reprinted courtesy of Scott P. DeVries, Hunton Andrews Kurth and Yosef Itkin, Hunton Andrews Kurth Mr. DeVries may be contacted at sdevries@HuntonAK.com Mr. Itkin may be contacted at yitkin@HuntonAK.com Read the court decision
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When Employer’s Liability Coverage May Be Limited in New York

June 28, 2021 — Robert S. Nobel & Craig Rokuson - Traub Lieberman
New York recognizes that coverage under Workers’ Compensation (“WC”) and Employer’s Liability (“EL”) policies is generally unlimited. See Tully Const. Co. v. Illinois Nat. Ins. Co., 131 A.D.3d 598 (2d Dept. 2015); Oneida Ltd. v. Utica Mut. Ins. Co., 263 A.D.2d 825, 694 N.Y.S.2d 221 (3d Dept. 1999). However, there is case holding that EL coverage may be limited in certain instances, such as when the primary EL carrier is listed as scheduled underlying insurance on an excess policy. In Liberty Mut. Ins. Co. v. Ins. Co. of State of Pennsylvania, 43 A.D.3d 666, 841 N.Y.S.2d 288 (1st Dept. 2007), an employee of General Industrial Service Corporation (“General”), a subcontractor on a construction project, sought to recover under New York’s Labor Law against the project’s owner and construction manager. Those defendants, in turn, brought a third-party action for indemnification against General. The employee’s personal injury claim was ultimately settled for $2.5 million. After the settlement, the excess insurer, Liberty, filed suit against the primary employer’s liability insurers, The Insurance Company of the State of Pennsylvania and American International Group of Companies (collectively, “AIG”), which had refused to participate in the defense or settlement of the underlying personal injury litigation. Although the issue of whether the plaintiff in the underling action had sustained a “grave injury” (necessary to support the common law indemnity claim against General and trigger coverage under the Employer’s Lability policy) had not yet been determined, the court held that “[i]n the event the existence of a grave injury is proven, AIG’s liability will be limited to $1 million.” Reprinted courtesy of Robert S. Nobel, Traub Lieberman and Craig Rokuson, Traub Lieberman Mr. Nobel may be contacted at rnobel@tlsslaw.com Mr. Rokuson may be contacted at crokuson@tlsslaw.com Read the court decision
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New York Court Permits Asbestos Claimants to Proceed Against Insurers with Buyout Agreements

December 06, 2021 — Patricia B. Santelle & Frank J. Perch, III - White and Williams LLP
A recent New York federal district court decision addresses a number of issues in the context of asbestos coverage involving an insolvent insured, holding that policy buyout agreements between the insured and its insurers did not bar actions by certain tort judgment creditors against some of the settling insurers, and further finding that such agreements can constitute fraudulent conveyances, especially where the proceeds of the settlement are not reserved for payment of insured claims. In the litigation pending in the Western District of New York (Mineweaser v. One Beacon Insurance Company, et al., No. 14-CV-0585A), certain asbestos plaintiffs sought recovery from excess insurers for judgments obtained against an insolvent asbestos supplier (Hedman Resources, formerly known as Hedman Mines), which ceased operations in 2007 due to insolvency. Hedman had at one time been a subsidiary of Gulf & Western. As of 2009-2011, the excess insurers of Gulf & Western were advised of exhaustion of primary insurance as well as Hedman’s insolvency. Reprinted courtesy of Patricia B. Santelle, White and Williams LLP and Frank J. Perch, III, White and Williams LLP Ms. Santelle may be contacted at santellep@whiteandwilliams.com Mr. Perch may be contacted at perchf@whiteandwilliams.com Read the court decision
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ASHRAE Approves Groundbreaking Standard to Reduce the Risk of Disease Transmission in Indoor Spaces

July 10, 2023 — ASHRAE
ATLANTA, June 27, 2023 (GLOBE NEWSWIRE) -- ASHRAE announced the approval for publication of its highly anticipated standard to reduce the risk of airborne infectious aerosol transmission in buildings, bringing numerous benefits to occupants and promoting healthier environments. ASHRAE Standard 241, Control of Infectious Aerosols establishes minimum requirements to reduce the risk of disease transmission by exposure to infectious aerosols in new buildings, existing buildings, and major renovations. Infectious aerosols are tiny, exhaled particles that can carry pathogens that cause infections or disease. These particles are so small that they can remain in the air for long periods of time. Use of this standard could reduce exposure to the SARS-COVID-2 virus, which causes COVID-19, the flu virus and other pathogens. Standard 241 provides requirements for many aspects of air system design, installation, operation, and maintenance. Standard 241 available now for presale in the ASHRAE Bookstore. About ASHRAE Founded in 1894, ASHRAE is a global professional society committed to serve humanity by advancing the arts and sciences of heating ventilation, air conditioning, refrigeration, and their allied fields. For more information and to stay up-to-date on ASHRAE, visit ashrae.org and connect on Instagram, LinkedIn, Facebook, Twitter and YouTube. Read the court decision
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Insured's Failure to Prove Entire Collapse of Building Leads to Dismissal

July 19, 2021 — Tred R. Eyerly - Insurance Law Hawaii
The Fifth Circuit affirmed the district court's dismissal of the insured's claim for damage to her home caused by collapse. Stewart v. Metropolitan Lloyds Ins. Co. of Texas, 2021 U.S. App. LEXIS 14221 (5th Girl May 13, 2021). One evening, the insured was awakened by a loud bang that shook her house. The next morning, she noticed the damage to her home, cracked sheetrock and sunken floors. She cut a hole through her floor and discovered that a couple of joists below her subfloor had broken and fallen away. The insured filed a claim with Metropolitan. Metropolitan hired an expert who found broken and deteriorated floor joists, deteriorated floor decking, walls not plumb and gaps in the wall-to-ceiling interface. It was determined that the rot in the floor joists and subfloor decking were caused by a combination of termite damage and exposure to moisture over the lifespan of the structure, resulting in the broken floor joists and unlevel floors. The insured's own expert agreed that termite damage and wood rot were the cause of the foundation collapse failure. 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

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Insurance Law Alert: Ambiguous Producer Agreement Makes Agent-Broker Status a Jury Question

September 10, 2014 — Valerie A. Moore & Christopher Kendrick - Haight Brown & Bonesteel LLP
In Douglas v. Fidelity National Ins. (No. A137645; filed 8/29/14), a California appeals court held that it was a jury question whether a retail insurance service with limited binding authority should be deemed a broker or an agent for the purpose of determining if application misrepresentations would void coverage. In Douglas, the homeowners needed insurance for a house they had used as a group home. They sought coverage from Cost-U-Less, which provided personal lines insurance from, among others, Fidelity National Insurance Company. According to the couple’s wife, she went to a Cost-U-Less office where she answered application questions from a person on the telephone, who was later identified as an employee of another company, InsZone. InsZone had a producer contract with Fidelity. In practice, InsZone would be contacted by Cost-U-Less via telephone, at which point an InsZone employee would verbally solicit information from the client, with the information being entered into a computer by the InsZone employee and then transmitted electronically to Fidelity. Reprinted courtesy of Valerie A. Moore, Haight Brown & Bonesteel LLP and Christopher Kendrick, Haight Brown & Bonesteel LLP Ms. Moore may be contacted at vmoore@hbblaw.com; Mr. Kendrick may be contacted at ckendrick@hbblaw.com Read the court decision
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Contractor Sentenced to Seven Years for Embezzling $3 Million

July 20, 2020 — Garret Murai - California Construction Law Blog
Michael Medeiros was not a good guy. Ok, on a scale of 1 to 10, maybe not a 9 or 10 (when you’re including guys like Charles Manson), but a solid 6 or 7 at least. The next case, People v. Medeiros, Case No. A155648, 1st District Court of Appeals (March 26, 2020), is less important for its legal holding than as a reminder that while most legal disputes on construction projects end up with one party owing the other party money, sometimes, when a party’s conduct has been really bad, it can end in a loss of liberty (i.e., jail time) as well. People v. Medeiros Medeiros was a painting contractor operating under the name Professional Painting Company, Inc. In the early 1990s, Medeiros met Susan Lambert, who served as the property manager for a homeowners’ association, Woodlake Association, in Hayward, California. Lambert was an alcoholic. Following a series of surgeries in 2005 and 2007 she became addicted to opiates as well. She also had a gambling problem. As a result, Lambert regularly found herself in financial difficulty. And this is where Lambert and Medeiros found that they shared common ground. At some point, Medeiros confided to Lambert that he was having cash flow and tax problems. Read the court decision
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Reprinted courtesy of Garret Murai, Nomos LLP
Mr. Murai may be contacted at gmurai@nomosllp.com

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Second Circuit Court Differentiates the Standard for Determining Evident Partiality for a Neutral Arbitrator and a Party-Appointed Arbitrator

August 07, 2018 — Celia B. Waters - Saxe Doernberger & Vita, P.C.
On June 7, 2018, the Second Circuit Court in Certain Underwriting Members of Lloyds of London v. Fla., Dep’t of Fin. Servs.,1 held that a party-appointed arbitrator should not be held to the same standard as a neutral arbitrator. The Court vacated a district court’s order vacating an arbitral award in a reinsurance dispute between Insurance Company of Americas (“ICA”) and Certain Underwriting Members of Lloyds of London (“Underwriters”). The case was one of first impression for the Second Circuit on how to determine the standard of evident partiality challenged to a party-appointed arbitrator. Underwriters reinsured ICA under a series of treaties. The treaties each contained an arbitration clause requiring that disputes be adjudicated by an arbitration panel consisting of three members: one party-appointed arbitrator for each party, and a neutral. The clause required only that the arbitrators “be active or retired disinterested executive officers of insurance or reinsurance companies or Lloyd’s London Underwriters.” Read the court decision
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Reprinted courtesy of Celia B. Waters, Saxe Doernberger & Vita, P.C.
Ms. Waters may be contacted at cbw@sdvlaw.com

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