New York Court Discusses Evidentiary Standards for Policy Rescission Based on Material Misrepresentation
August 10, 2020 —
Robert S. Nobel - Traub LiebermanOn July 27, 2020, in the case of Mt. Hawley Ins. Co. v. AKI Renovations Group, Inc., (Sup. Ct. NY Co. 2020), Index No. 159421/2017 (unpublished), the trial court issued an Order granting summary judgment permitting rescission of a CGL policy based upon material misrepresentations in a policy application. The insured submitted an application in which it failed to disclose its demolition operations despite specific questions seeking this information. Mt. Hawley issued a primary and excess policy for the period of December 29, 2016 to December 29, 2017 (collectively, the policy).
Subsequently, the insured sought coverage for a claim in which it was alleged that the insured was acting as a general contractor for demolition of a three-story building when the plaintiff was injured. The insurer advised the defendants that it was rescinding the policy ab initio, and also returned defendants’ premium in its entirety. The insurer asserted that it would not have issued the policy had defendants disclosed their demolition operations, then filed the coverage action seeking a judicial declaration ratifying its rescission of the policy.
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Robert S. Nobel, Traub LiebermanMr. Nobel may be contacted at
rnobel@tlsslaw.com
Being deposed—not just for dictators! Depositions in the construction lawsuit (Law & Order: Hard Hat files Part 5)
January 17, 2013 —
Melissa Dewey Brumback, Construction Law in North CarolinaMy husband always finds it amusing when I talk about going “to depose” somebody. He wants to know just exactly what sort of coup d’etat I am planning. Despite the awkward language, the deposition process is not supposed to feel like water boarding, although if you don’t know what to expect it can be more miserable than truly necessary.
Simply put, a deposition is a chance for the other side’s lawyer to make you answer a whole bunch of questions (some relevant, some seemingly irrelevant) under oath. That is, first you put your hand on the Bible and swear (or affirm) to tell the truth, the whole truth, and nothing but the truth. In reality, depositions serve a variety of purposes– they educate the lawyers about the facts of the case, they give a preview of how you would “present” to a jury (i.e., would a jury like and believe you?), and they can be used to position a case for certain later dispositive motions (that is, summary judgment– stay tuned for Part 8 of the series on that issue).
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Melissa Dewey BrumbackMs. Brumback can be contacted at
mbrumback@rl-law.com
Congress Relaxes Several PPP Loan Requirements
June 15, 2020 —
Greg Tross & Michael Krueger – Newmeyer DillionOn June 3, 2020, Congress passed the Paycheck Protection Program Flexibility Act ("Act") which does exactly what it means to do: provide flexibility for PPP loan recipients. President Trump is expected to sign the bill into law within the week.
The Act extends the "covered period" for Paycheck Protection Program ("PPP") loans from the original eight weeks to 24 weeks or December 31, 2020, whichever is earlier. This extension provides much needed reprieve to small businesses who can utilize these funds to weather the economic effects of the Coronavirus Pandemic through 2020.
The Act also revises the limitations on how small businesses utilize their PPP loans. While the CARES Act originally required 75% of the PPP loan to be used for payroll costs, this number has now been reduced to 60%. This means that up to 40% of the PPP loan can be used to cover mortgage obligations, rent, and other covered utility payments.
The PPP loan payment deferral period has also been extended to align with the date on which the PPP loan's forgiveness amount is remitted to the lender. This should provide more certainty to small businesses on their payback obligations, if any.
Recently, the Small Business Administration also released loan forgiveness applications to assist a business in calculating their loan forgiveness. While the SBA will likely revise it with the Act's passing, small businesses should look at the application's framework to prepare for submitting their loan forgiveness requests in the future.
Newmeyer Dillion continues to follow COVID-19 and its impact on your business and our communities. Feel free to reach out to us at NDcovid19response@ndlf.com or visit us at www.newmeyerdillion.com/covid-19-multidisciplinary-task-force/.
Reprinted courtesy of
Greg Tross, Newmeyer Dillion and
Michael Krueger, Newmeyer Dillion
Mr. Tross may be contacted at greg.tross@ndlf.com
Mr. Krueger may be contacted at michael.krueger@ndlf.com
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4 Ways the PRO Act Would Impact the Construction Industry
October 24, 2021 —
Andrew M. MacDonald - ConsensusDocsThe Protecting the Right to Organize Act (the “PRO Act”) is a proposed law that would dramatically rewrite the National Labor Relations Act (“NLRA”). Breathtakingly broad in scope, the PRO Act targets several longstanding features of existing law perceived by unions and labor activists to be unfair to labor and too favorable to employers. The proposed legislation is essentially a grab-bag of grievances that the labor movement has compiled over decades and sought to change through legislation and before the National Labor Relations Board (“NLRB”) without success in the past.
While the PRO Act would affect virtually all private sector employers, it would alter the labor dynamic in the construction industry in four major ways:
1. Removing the current prohibitions on secondary, jurisdictional, and other forms of picketing. Current law attempts to balance the rights of employers to operate their businesses without unnecessary interference with the rights of unions to protest concerning wages and working conditions. As part of this balancing act, the NLRA prohibits unions from picketing under certain conditions or with certain aims. These restrictions include the prohibition on “secondary” picketing by unions of neutral employers, which are employers with which the union does not have a direct labor dispute, and “jurisdictional” picketing by unions to force an employer to assign certain work to a specific trade or group of employees. The elimination of these restrictions in the PRO Act would have a significant impact on the construction industry.
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Andrew M. MacDonald, Fox Rothschild LLPMr. MacDonald may be contacted at
amacdonald@foxrothschild.com
Golden Gate Bridge's $76 Million Suicide Nets Near Approval
June 30, 2014 —
Alison Vekshin – BloombergOfficials of the agency that runs San Francisco’s Golden Gate Bridge today approved a $76 million funding plan to erect a suicide barrier along the span, where people plunge to their deaths at a rate of about once a week.
The Golden Gate Bridge Highway and Transportation District’s 19-member board voted unanimously to approve the funding, which includes $20 million from district reserves.
“We must fight mental illness on many fronts and this budget action is a critical component of saving the lives of people who might not see that their brightest days are ahead of them,” Senator Mark Leno, a Democrat from San Francisco, said in a news release yesterday ahead of the meeting.
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Alison Vekshin, BloombergMs. Vekshin may be contacted at
avekshin@bloomberg.net
U.S. Department of Defense Institutes New Cybersecurity Maturity Model Certification
July 13, 2020 —
Joseph N. Frost - Peckar & AbramsonContractors doing business with the Federal Government, particularly with the Department of Defense (“DoD”), commonly handle sensitive information that is not intended to be disseminated. Controlled Unclassified Information (“CUI”) is one such type and is more specifically defined as “information that requires safeguarding or dissemination controls pursuant to and consistent with laws, regulations and government-wide policies.”1 Because some DoD contracts require contractors to handle CUI, certain safeguards have been put in place to ensure its security. This article briefly touches on the current cybersecurity protocols, followed by a discussion of the new system being developed by the DoD, and what contractors most need to know about the new system.
The Defense Federal Acquisition Regulation Supplement (“DFARS”) has long required contractors to comply with certain cybersecurity standards, as published by the National Institute of Standards and Technology (“NIST”). Specifically, DFARS sought to implement the cybersecurity framework found in NIST Special Publication (“SP”) 800-171, entitled “Protecting Controlled Unclassified Information in Nonfederal Systems and Organizations.” NIST SP 800-171 sets forth fourteen (14) families of recommended security requirements for protecting the confidentiality of CUI in nonfederal systems and organizations, including, among others, access control, audit and accountability, incident response, personnel security, and system and information integrity. However, after a series of data breaches, the DoD reassessed the efficacy of the continued use of NIST SP 800-171 and ultimately decided to institute a new methodology to ensure the security of CUI.
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Joseph N. Frost, Peckar & AbramsonMr. Frost may be contacted at
jfrost@pecklaw.com
Flying Solo: How it Helps My Construction Clients
February 18, 2015 —
Christopher G. Hill – Construction Law MusingsTwo and a half years ago, on July 1, 2010, I opened my solo practice. At the time, I really had no insight into how big this change would be from a positive, customer service, perspective.
When I made the decision to go solo with my construction law practice, I knew I wanted to have flexibility to serve my client base of contractors and subcontractors in Virginia. I started some flat rate billing and had the ability to take cases that were below the dollar value of those that my old firm was willing to take. I also knew that I would be a master of my own destiny for better or worse (and it has been much more of the former than the latter).
What I did not realize is the impact that owning my own business would have on my perspective. I have always believed that, in most cases where construction disputes occur, mediation is a great option. However mediation only occurs with conflict. For any business, whether construction or otherwise, conflict creates expenses that were not likely to have been anticipated or built in to the budget. Litigation is not something that most businesses can, or should, build into their operating budgets.
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Christopher G. Hill, Law Office of Christopher G. Hill, PCMr. Hill may be contacted at
chrisghill@constructionlawva.com
Reservation of Rights Letter Merely Citing Policy Provisions Inadequate
February 14, 2023 —
Tred R. Eyerly - Insurance Law HawaiiIn an unpublished opinion, the Fourth Circuit affirmed the district court's finding that the insurers' reservation of rights letters did not provide a basis for denial of coverage. Stoneiedge At Lake Keowee Owners Ass'n Inc. v. Cincinnati Ins. Co., 2022 US. App. LEXIS 34292 (4th Dist. Dec. 13, 2022).
The Stoneledge AOAO sued the general contractor Marlick Home Builders, LLC and other defendants after construction of 37 units. The complaint alleged construction defects that resulted in water intrusion and other physical damage. Marlick notified its insurers, Cincinnati Insurance Company and Builders Mutual. Various reservation of rights letter were sent by the insurers.
In the underlying case, a judgment was entered against Marlick totalling approximately $1.6 million. As a judgment creditor of Marlickm, Stoneledge sued Cincinnati and Builders Mutual. The district court granted Stonelege's motion for summary judgment, primarily on the ground that the insurers failed to reserve the right to contest coverage.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
