Mealey's Construction Defects Insurance

  • September 18, 2020

    Travelers: No Insurance For California Apartment Complex's Alleged Defects

    SAN FRANCISCO — Travelers Casualty Insurance Company of America alleges in a Sept. 16 complaint in a California federal court that it has no duty to defend or indemnify two insureds against allegations of construction defects in an apartment complex (Travelers Casualty Insurance Company of America v. 2541 California Street, LLC, et al., No. 20-6509, N.D. Calif.).

  • September 17, 2020

    Insurer:  No Indemnity Owed For Any Judgment In Defects Dispute Sent To Arbitration

    FORT WORTH, Texas — Evanston Insurance Co. filed a complaint on Sept. 16 in a Texas federal court against its insureds, a condominium association, a primary insurer and an excess insurer, seeking a declaration that it has no duty or indemnify a construction defects lawsuit that has been stayed in favor of proceeding in arbitration (Evanston Insurance Company v. Villas of Stone Glen Condominium Association, Inc., et al., No. 20-1028, N.D. Texas).

  • September 17, 2020

    Magistrate Judge Declines Dismissal Of Insurer's Suit Over Construction Defects

    BIRMINGHAM, Ala. — A federal magistrate judge in Alabama on Sept. 16 refused to dismiss an insurer's coverage dispute over two construction defect lawsuits because the insurer's potential amount of indemnification exceeds the $75,000 jurisdictional threshold as one of the suits seeks damages of $283,872 for repairs (American Builders Insurance Co. v. Riverwood Construction LLC, et al., No. 19-1757, N.D. Ala., 2020 U.S. Dist. LEXIS 169531).

  • September 15, 2020

    Judge:  Insurer Can Use Its Own Counsel For Insured's Faulty Work Claim Defense

    CHICAGO — An insurer may proceed with its chosen counsel in the defense of a subcontractor against allegations that the subcontractor's faulty work caused an apartment building's structural column to fail, an Illinois federal judge ruled Sept. 14 because the subcontractor failed to show that there would be a conflict of interest from the insurer (Builders Concrete Services, LLC v. Westfield National Insurance Company, No. 19-7792, N.D. Ill., 2020 U.S. Dist. LEXIS 167145).

  • September 11, 2020

    Conn. High Court:  Exclusions Don't Relieve Insurer's Duty For Home Collapse Damages

    HARTFORD, Conn. — A lower court was wrong to find that two business risk exclusions relieved a commercial general liability insurer of its duty to defend property damage from the collapse of a house following repairs from hurricanes, the Connecticut Supreme Court ruled Sept. 9, reversing the entry of summary judgment to the insurer (Nash Street, LLC v. Main Street America Assurance Company, et al., No. SC 20389, Conn. Sup., 2020 Conn. LEXIS 197).

  • September 10, 2020

    Questions Of Fact Exist On Insured's Knowledge Of Ongoing Water Damage

    PORTLAND, Ore. — An Oregon federal judge on Sept. 4 denied two insurers' motions for summary judgment on the applicability of the known loss doctrine and late notice because questions of fact exist regarding when the insured became aware of the ongoing water damage in its apartment buildings (Great American Alliance Insurance Co. v. SIR Columbia Knoll Associates Ltd. Partnership, et al., No. 18-908, D. Ore., 2020 U.S. Dist. LEXIS 162401).

  • September 09, 2020

    Insurer Owes No Duty For Hangar Defects, Federal Judge Rules

    PHILADELPHIA — An insurer has no duty to defend or indemnify allegations of defects in an insured's design and construction of a hangar to store an airship because faulty workmanship is not an "occurrence," a Pennsylvania federal judge held Sept. 4 (The Burlington Insurance Company v. Shelter Structures, Inc., No. 19-4857, E.D. Pa., 2020 U.S. Dist. LEXIS 162237).

  • September 04, 2020

    Judge Denies Dismissal Of Insurance Coverage Dispute Over Hampton Inn Defects

    CHARLOTTE, N.C. — A North Carolina federal judge on Sept. 1 refused to dismiss an insured architectural firm and architect's coverage dispute with their insurer regarding allegations of faulty construction and design of a Hampton Inn hotel in Louisiana (A.P. Architecture, Inc., et al. v. Admiral Insurance Co., et al., No. 20-350, W.D. N.C., 2020 U.S. Dist. LEXIS 159978).

  • September 03, 2020

    Insurer Seeks Declaration That It Need Not Defend Contractors Over Water Damage

    PHILADELPHIA — An insurance company says in a lawsuit filed Aug. 5 in federal court in Pennsylvania that it has no duty to defend or indemnify an insured stucco subcontractor and a general contractor in a couple's 2018 state court action over water damage allegedly caused by improperly installed stucco because the damage was not the result of an occurrence and because the alleged damage occurred outside the periods of two businessowners liability policies held by the subcontractor (NGM Insurance Co. v. Cill Dara Plastering Inc., et al., No. 20-3807, E.D. Pa.).

  • September 02, 2020

    No Coverage For $456,000 In Damages From Improper Construction, Allstate Says

    PORTLAND, Ore. — Allstate Insurance Co. filed a declaratory judgment complaint on Aug. 31 in an Oregon federal court regarding its duty to defend and indemnify against homeowners' allegations of improper construction and remodeling for a single-family residence that caused damages of $456,000 (Allstate Insurance Company v. Ni Xu, et al., No. 20-1488, D. Ore.).

  • September 02, 2020

    Judge Decides Insurers' Duties For 6 Out Of 15 Construction Defect Cases

    SACRAMENTO, Calif. — Addressing coverage for subcontractors in six out of 15 underlying construction defect cases, a California federal judge on Aug. 31 ruled that an insurer had a duty to defend four of them, a duty to indemnify only three and owed equitable contribution to another insurer for two of them (Interstate Fire & Casualty Insurance Company v. First Specialty Insurance Company, et al., No. 17-1795, E.D. Calif., 2020 U.S. Dist. LEXIS 158229).

  • September 01, 2020

    Subrogated Insurer Allowed To Reassert Negligence Claim In Faulty Sprinkler System Suit

    WHITE PLAINS, N.Y. — A subrogated insurer was granted leave by a New York federal magistrate judge on Aug. 28 to file a third amended complaint to reassert a direct claim of negligence in its lawsuit over an alleged defectively designed and installed sprinkler system for Trump Park Residences Condominium (Community Association Underwriters of America, Inc. v. Main Line Fire Protection Corp., et al., No. 18-4273, S.D. N.Y., 2020 U.S. Dist. LEXIS 156882).

  • August 31, 2020

    No Coverage For $1M Of Defects In Condominiums, English Underwriters Say

    AUSTIN, Texas — English underwriters filed a declaratory relief complaint on Aug. 28 in a Texas federal court alleging that a prior completed work endorsement precludes coverage for an underlying lawsuit and a separate arbitration proceeding seeking more than $1 million in damages from alleged defects in a gated community of 300 detached condominiums (Certain Underwriters at Lloyd's, London v. Stick Built, LLC, et al., No. 20-899, W.D. Texas).

  • August 28, 2020

    Magistrate Judge Dismisses Counterclaims In Defects Insurance Coverage Dispute

    DENVER — A homeowners association's breach of contract and bad faith counterclaims were dismissed with prejudice by a Colorado federal magistrate judge on Aug. 27 in a coverage dispute with an insurer regarding a $1.85 million jury award entered in favor of the association in a construction defects case (Clarendon National Insurance Company v. Brooktree Village Homeowners Association, Inc., No. 19-2324, D. Colo., 2020 U.S. Dist. LEXIS 155660).

  • August 28, 2020

    Insurer Breached Duty To Defend Subcontractor In Defects Case, Judge Says

    WEST PALM BEACH, Fla. — A sub-subcontractor's insurer has a duty to defend and breached that duty toward a subcontractor in a construction defects case regarding an apartment building project, a Florida federal judge ruled Aug. 25, granting partial summary judgment to the subcontractor and the subcontractor's insurer (Orange & Blue Construction, Inc., et. al. v. HDI Global Specialty SE, No. 19-81707, S.D. Fla.,2020 U.S. Dist. LEXIS 155160).

  • August 27, 2020

    11th Circuit Affirms Partial Attorney Fees Award To Insurer In Defects Dispute

    ATLANTA — An 11th Circuit U.S. Court of Appeals panel on Aug. 18 affirmed a federal judge in Florida's ruling granting in part a motion for attorney fees filed by a plaintiff insurance company for a homebuilder seeking a declaration that it had no duty to defend or indemnify the policyholder, finding that complete diversity between the parties was restored after a defendant insurance company for the homeowner was dismissed as a dispensable party under Federal Rule of Civil Procedure 21 after it settled with the plaintiff company (Mid-Continent Casualty Insurance Co. v. JWN Construction Inc., et al., No. 20-10079, 11th Cir., 2020 U.S. App. LEXIS 26151).

  • August 27, 2020

    Insurer Says It Has No Duty To Defend Builder In Homeowner's Defects Suit

    BILLINGS, Mont. — An insurance company filed a lawsuit in federal court in Montana on Aug. 19 against a home construction company, its owner and a homeowner suing the company over defects in his home, seeking a declaratory judgment that it has no duty to defend or indemnify the policy holder because questions exist as to whether the damages allegedly sustained by the homebuilder occurred while a policy issued to the builder was in effect and whether the lawsuit qualifies as an occurrence (Acuity Insurance Co. v. Paul Oakland Jr., et al., No. 20-129, D. Mont.).

  • August 27, 2020

    Judge:  No Covered Property Damage From Insured's Faulty Work For Nightclub

    LAS VEGAS — A contractor failed to allege property damage from negligent remodeling work at a Las Vegas nightclub that triggered an "occurrence," a Nevada federal judge ruled Aug. 25, dismissing breach of contract and bad faith claims against an insurer (Arizona Civil Constructors, Inc. v. Colony Insurance Company, et al., No. 20-10, D. Nev., 2020 U.S. Dist. LEXIS 154467).

  • August 25, 2020

    Insured Seeks Reversal Of Rulings In Construction Defects Coverage Dispute

    SANTA ANA, Calif. — An insured recently asked a California appeals court to reverse two summary judgments rulings in favor of a commercial general liability insurer and an insurance broker, arguing that the insurer failed to present compelling evidence or eliminate triable issues of material fact regarding whether rescission of the policy was warranted in a coverage dispute arising from a construction defects lawsuit (Michael Favreau v. Navigators Insurance Company, et al., Nos. G056718 and G056938, Calif. App., 4th Dist.).

  • August 25, 2020

    Insurers Breached Contract, Acted In Bad Faith Over 13 Defect Claims, Builders Say

    PHOENIX — Homebuilders sued three subcontractor insurers in Arizona federal court on Aug. 21 for breach of contract and bad faith for refusing to defend 13 construction defect claims and causing them to incur $542,000 in out-of-pocket defense costs (Centex Real Estate Construction Company, et al. v. Clarendon National Insurance Company, et al., No. 20-1640, D. Ariz.).