Mealey's Construction Defects Insurance : Mealey's : Legal News & Analysis

Mealey's Construction Defects Insurance

September 08, 2023
Builders Risk Insurer’s JMOL, New Trial Motions Denied; $7.62M Judgment Entered

DENVER — A federal judge in Colorado denied a builders risk insurer’s renewed motion for judgment as a matter of law (JMOL) and motion for a new trial following a jury’s award of $2.54 million in breach of contract damages to its condominium developer insured, rejecting the insurer’s arguments that the developer failed to prove that it suffered “resulting loss” damages and that the jury rendered an inconsistent verdict.
September 08, 2023
Insurer: All-Sums Applies In Case To Recoup Costs To Settle Roof Repair Suit

NEW ORLEANS — An insurer seeking to recover costs it paid to settle a roof repair and water damage suit tells the Fifth Circuit U.S. Court of Appeals that another insurer’s opposition to paying the costs fails to address an applicable all-sums approach requiring full payment up to policy limits for covered damages.
September 07, 2023
Insurer’s Motion To Dismiss Third-Party Claims Under Direct Action Statute Denied

BATON ROUGE, La. — Finding it “plausible that the $4 million aggregate limit may yet apply” to damages resulting from a sprinkler leak, a federal judge in Louisiana denied a commercial general liability insurer’s motion to dismiss third-party complaints filed against it under the state’s direct action statute seeking to recover for the alleged negligence of a general contractor and subcontractors.
September 07, 2023
Stay Of Judgment Denied After Insurer Appeals Judgment In Property Damage Dispute

MOBILE, Ala. — A federal judge in Alabama has denied an insurer’s motion for stay of execution without bond of a judgment issued in the wake of a nearly $170,000 verdict against it in an insurance dispute over the handling of a property damage claim after Hurricane Sally pending its appeal to the 11th Circuit U.S. Court of Appeals.
September 07, 2023
Insurer Seeks Reconsideration Of Ruling Finding It Has Duty To Defend Builder

FORT WORTH, Texas — A federal judge in Texas erred in determining that a commercial general liability insurer had a duty to defend in a coverage dispute over a homebuilder’s alleged failure to disclose to homebuyers that a home it built was subject to flooding because it didn’t give the insurer the opportunity to respond before ruling in favor of the builder, which had not sought such a ruling, the insurer argues in seeking reconsideration.
September 07, 2023
Insurer’s Subrogation Suit Against Contractor And Fireplace Installer Dismissed

NEW HAVEN, Conn. — A federal judge in Connecticut has dismissed with prejudice an insurer’s suit seeking reimbursement from a contractor and the installer of a fireplace for a fire that damaged an insured home after the parties filed a joint stipulation of dismissal.
September 01, 2023
Homeowners Insurer Failed To Show Negligent Installation Cause Of Water Damage

PHILADELPHIA — A Pennsylvania federal judge denied a homeowners insurer’s motion for summary judgment in a dispute over water damage in an insured’s home because the insurer failed to show that the parties who installed and serviced a water supply line were negligent in their work and caused the failure of the water supply line.
September 01, 2023
Contractor’s Insurer Appeals Denial Of New Trial In Coverage Suit To 5th Circuit

NEW ORLEANS — A contractor’s commercial general liability insurer has appealed to the Fifth Circuit U.S. Court of Appeals a ruling by federal judge in Louisiana denying its motion for a new trial or reconsideration of his April ruling dismissing its suit against a subcontractor’s insurer to recover damages the contractor’s insurer paid stemming from water damage caused by the subcontractor’s negligence in performing work on a home’s roof.
August 31, 2023
Insurer Appeals Judgment After Verdict On Property Damage Dispute To 11th Circuit

MOBILE, Ala. — An insured has appealed to the 11th Circuit U.S. Court of Appeals the judgment issued in the wake of a nearly $170,000 verdict against it in an insurance dispute over the handling of a property damage claim after Hurricane Sally and moved a federal court in Alabama to stay execution of the judgment pending appeal.
August 30, 2023
Insurer’s Motion For Default Judgment Against Stucco Installer Insured Granted

TAMPA, Fla. — Noting the lack of any objection, a federal judge in Florida on Aug. 29 adopted the report and recommendation of a magistrate judge and granted a surplus lines commercial liability insurer’s motion for entry of a default judgment against its stucco installer insured because the policy’s “Condominium, Townhome, Tract or Track Exclusion bars coverage for property damage arising out of ‘construction of, or work performed on’ the ‘original construction of a . . . tract or track home.’”
August 25, 2023
Contractor Appeals Rulings In Faulty Work Coverage Suit To 11th Circuit

WEST PALM BEACH, Fla. — A contractor has appealed to the 11th Circuit U.S. Court of Appeals a Florida federal court’s rulings granting summary judgment to its commercial general liability insurer, denying summary judgment to the contractor on its counterclaim for reformation and dismissing the claim and awarding the insurer final judgment in the insurer’s declaratory judgment suit stemming from a subcontractor’s alleged faulty installation of cladding and glazing systems in a construction project.
August 25, 2023
Insurer, Paver Settle Faulty Asphalt Installation Coverage Suit

NEW HAVEN, Conn. — A paving company and its insurer have stipulated in Connecticut federal court to the dismissal of the insured’s declaratory judgment suit against the insurer relating to coverage for an underlying construction defects lawsuit stemming from the insured’s allegedly faulty paving work in a parking lot after reaching a settlement.
August 25, 2023
Washington Panel Affirms Ruling For Insurer In Shower Leak Coverage Suit

SEATTLE — A homeowners insurer provided sufficient evidence that rot damage from a leaking shower was caused by construction defects and, therefore, not covered, a Washington appellate panel found in affirming a trial court’s summary judgment ruling and findings of fact and conclusions of law following a bench trial.
August 22, 2023
Mold Exclusion Bars Coverage For Negligence Suit Filed Against Plumber, Judge Says

TAMPA, Fla. — An insurer has no duty to defend its insured in an underlying suit alleging that the insured’s negligence in performing plumbing services caused a water leak that resulted in mold growth in the underlying plaintiff’s home because a mold exclusion in the insurer’s policies clearly bars coverage for the underlying suit, a Florida federal judge said.
August 22, 2023
Rescission Row Stayed Pending Resolution Of Underlying Suit Against Contractor

SAN FRANCISCO — A California federal judge granted a painting contractor’s motion for a stay in an insurer’s suit against the contractor seeking rescission of the contractor’s insurance policy and a declaratory judgment that it is not required to provide coverage to the contractor in an underlying breach of contract case, finding that a stay pending resolution of the underlying case is warranted in part due to the overlap between the cases such that issuing a stay “increases judicial efficiency.”
August 21, 2023
Judge Orders Insurer To Join Contractor, Subcontractor To Declaratory Suit

MIAMI — A federal judge in Florida on Aug. 18 ordered a commercial general liability insurer to join a general contractor and a subcontractor to its declaratory action against the subcontractor’s CGL insurers related to the defense and indemnification of the general contractor in an underlying construction defects suit, agreeing with a magistrate judge that they are indispensable parties and should be joined to the action.
August 21, 2023
Stucco Subcontractor Appeals Faulty Workmanship Coverage Ruling To 3rd Circuit

PHILADELPHIA — An insured stucco subcontractor has appealed to the Third Circuit U.S. Court of Appeals a ruling by a Pennsylvania federal judge granting judgment on the pleadings to two insurers that sought a declaration that they do not have to defend the insured against underlying litigation over water damage to homes in a residential community because the damages are alleged to have been caused by faulty workmanship and not an “occurrence.”
August 21, 2023
Parties In Roof Collapse Coverage Suit Agree To Dismissal After Reaching Settlement

NASHVILLE, Tenn. — The parties in a coverage dispute over a roof collapse that occurred at a vehicle manufacturer’s assembly plant during a re-roofing project have stipulated to the dismissal of the suit with prejudice after reaching a settlement.
August 17, 2023
Subcontractor, Insurer Precluded From Mentioning Alternative Insurance Sources

LAKE CHARLES, La. — Less than a month after denying summary judgment to a subcontractor’s commercial general liability insurer in a general contractor’s breach of contract and negligence suit stemming from the subcontractor’s allegedly faulty work, a federal judge in Louisiana granted the general contractor’s motion to exclude any mention of potential alternative sources of insurance during the trial, which is scheduled to begin Sept. 18.
August 15, 2023
All-Risk Policies Provide Coverage For Wind-Driven Rain, Federal Judge Says

SEATTLE — A Washington federal judge granted an insured condominium association’s motion for summary judgment in a coverage dispute over millions of dollars of hidden water damage sustained by the association’s buildings by wind-driven rain after determining that coverage is owed under two sets of policies for wind-driven rain when interpreting the policies’ language based on an ensuing loss provision and the efficient proximate rule.
August 15, 2023
Insurer Says District Court’s Ruling On Misrepresentations Must Be Reversed

ATLANTA — A district court’s ruling that an insurer could not demonstrate reliance upon its insureds’ fraudulent misrepresentations regarding mold damage in an insured hotel must be reversed because the district court failed to view the evidence in the insurer’s favor as the nonmoving party, an insurer argues in a cross-appeal reply brief filed in the 11th Circuit U.S. Court of Appeals.
August 10, 2023
Judge Dismisses Suit Over Fire Suppression Leak Coverage After Notice Of Settlement

TAMPA, Fla. — A federal judge in Florida has dismissed without prejudice a property owner and its general contractor’s suit seeking coverage for the repair of leaks in a fire suppression system installed in a mixed-use building and the resulting water damage after the parties indicated that they had reached a settlement.
August 10, 2023
Insurer’s Coverage Suit, Contractor’s Third-Party Claims Dismissed After Settlement

DENVER — A federal judge in Colorado has terminated an excess insurer’s contribution suit against a general contractor and others stemming from the settlement of an underlying arbitration arising from the alleged negligent design and construction of a residential and commercial building and the contractor’s third-party claims against its subcontractors after the parties notified the court that they had reached a global settlement.
August 10, 2023
3rd Circuit Dismisses Glass Installer’s Appeal Of Ruling For CGL, Umbrella Insurers

PHILADELPHIA — The Third Circuit U.S. Court of Appeals ordered the dismissal of a glass installer’s appeal of a June ruling that its commercial general liability and umbrella insurers are not liable to cover defense and indemnity costs it incurred in settling an underlying action alleging that a glass curtain wall it installed became visibly obstructed by a dark “dripping” material because there was no property damage caused by an occurrence during the policy periods.
August 10, 2023
Judge Grants Insurer’s Motion To Set Aside Default In Contractor’s Coverage Suit

FLORENCE, S.C. — Noting, among other things, that the South Carolina Department of Insurance, which accepted service on behalf of an insurer, has no confirmation that it received the complaint and summons, a federal judge in the state on Aug. 9 granted the insurer’s motion to set aside a default entered against it in a contractor’s coverage suit stemming from water intrusion and other construction defect issues at a mixed-use development project.