Mealey's Construction Defects Insurance

  • February 21, 2017

    Insurer, Homeowners Debate Coverage For Contractor’s Judgment In Texas High Court

    AUSTIN, Texas — In briefs filed with the Texas Supreme Court, a couple and their contractor’s insurer dispute whether coverage for an underlying construction defects judgment against the insurer is precluded under an adversarial trial rule that an appeals court deemed inapplicable (Great American Insurance Co., et al. v. Glen Hamel, et al., No. 14-1007, Texas Sup.).

  • February 17, 2017

    Judge Converts Motion To Dismiss, Orders Further Briefing In Bad Faith Suit

    ALBUQUERQUE, N.M. — Unable to determine from the evidence provided whether an insured’s disability benefits plan is governed by the Employee Retirement Income Security Act of 1974 (ERISA), a federal judge in New Mexico on Feb. 14 converted the insurer’s motion to dismiss to a motion for summary judgment and ordered supplemental briefing (Sherry Evans-Carmichael v. Liberty Mutual Group Inc., No. 16-276, D. N.M., 2017 U.S. Dist. LEXIS 20599).

  • February 17, 2017

    9th Circuit: Insurance Policy Bars Damage Caused By ‘Subsidence’

    SAN FRANCISCO — Claims against a mutually insured subcontractor for damage caused by “subsidence” are excluded under an insurance policy, the Ninth Circuit U.S. Court of Appeals ruled Feb. 14, finding that an insurer had no duty to defend and thus was not responsible to share in costs incurred by a defending insurer (St. Paul Mercury Insurance Co. v. Navigators Specialty Insurance Co., No. 14-56723, 9th Cir., 2017 U.S. App. LEXIS 2586).

  • February 17, 2017

    10th Circuit Panel Says No Breach Of Contract For Denying Claim For Damages

    DENVER — Because an insured failed to establish that it suffered water damage to “covered property” at a renovation project under a builders risk policy, the 10th Circuit U.S. Court of Appeals on Feb. 16 affirmed a Colorado federal judge’s finding that the insurer properly denied coverage and did not breach its contract (Gerald H. Phipps, Inc. d/b/a GH Phipps Construction Co. v. Travelers Property Casualty Company of America, No. 16-1039, 10th Cir.).

  • February 15, 2017

    Insured’s Breach Of Contract Is Barred By 2-Year Statute Of Limitations, Judge Says

    DENVER — A two-year statute of limitations precludes an insured’s breach of contract claim against its insurer for denied coverage for property damage to commercial properties, a Colorado federal judge ruled Feb. 13 (The Pinewood Townhome Association Inc. v. Auto-Owners Insurance Co., No. 15-01604, D. Colo.; 2017 U.S. Dist. LEXIS 19999).

  • February 13, 2017

    Judge: ‘Vacancy Provision’ Does Not Exclude Insured’s Water Damage Claim

    SCRANTON, Pa. — Because more than 31 percent of an insured condominium development's common areas were in use at the time a loss for water damage occurred, a Pennsylvania federal judge ruled Feb. 10 that an insurance policy’s “Vacancy Provision” does not apply to exclude coverage for the insured’s claim (Village Heights Condominium Association v. The Cincinnati Insurance Co., No. 16-554, M.D. Pa., 2017 U.S. Dist. LEXIS 19425).

  • February 10, 2017

    Panel Finds Insured’s Flood Loss Barred, Affirms Judgment Notwithstanding Verdict

    DES MOINES, Iowa — Finding that a church’s cause of loss was a flood and, consequently, that the loss was excluded under its insurance policy, an Iowa appeals panel on Feb. 8 affirmed a trial judge’s granting of an insurer’s motion for judgment notwithstanding a $717,000 verdict in favor of the church (Salem United Methodist Church of Cedar Rapids, Iowa v. Church Mutual Insurance Co., No. 16-0170, Iowa App., 2017 Iowa App. LEXIS 122).

  • February 9, 2017

    Judge Certifies Question On Statute Of Limitation In Contractor’s Bad Faith Suit

    DENVER — In a bad faith lawsuit between a contractor and insurer, a Colorado federal judge on Feb. 8 certified a question to the state’s high court on whether a claim under Colorado Revised Statutes Section 10-3-1116 is subject to a one-year statute of limitations and applicable to “All actions for any penalty of forfeiture of any penal statutes” (Rooftop Restorations Inc. v. American Family Mutual Insurance Co., No. 15-2560, D. Colo., 2017 U.S. Dist. LEXIS 17787).

  • February 8, 2017

    Judge: Fact Issues Exist On If Roofing Limitation Bars Coverage For Insured

    CHARLESTON, S.C. — A genuine issue of material fact exists as to the suitability of a roof covering on a homeowner’s roof in order to trigger a roofing limitation endorsement in a commercial general liability insurance policy that would preclude coverage for damages, a South Carolina federal judge held Feb. 6 (Williford Roofing Inc. v. Endurance American Specialty Insurance Co., et al., No. 16-01830, D. S.C., 2017 U.S. Dist. LEXIS 16033).

  • February 7, 2017

    Parties Ask 5th Circuit To Determine Whether Duty To Defend Was Owed

    NEW ORLEANS — Parties in an insurance dispute recently asked the Fifth Circuit U.S. Courts of Appeals to determine whether a federal district court erred in determining that an insurer owed an additional insured a duty to defend in an underlying construction defects lawsuit (Lyda Swinerton Builders Inc. v. Oklahoma Surety Co., No. 16-20195, 5th Cir.).

  • February 7, 2017

    New York Justice: Insurer’s Claims Against Sprinkler Company Must Be Dismissed

    ITHACA, N.Y. — A New York justice on Feb. 1 determined that an insurer’s claims against a company with which the insured contracted to install a sprinkler system must be dismissed because the applicable contract between the insured and the defendant included a subrogation waiver that bars the insurer from seeking reimbursement from the defendant (Philadelphia Indemnity Insurance Co., as subrogee of Country Club of Ithaca, NY Inc. v. Buffalo Hotel Supply Co. Inc., et al., No. EF2015-0101, N.Y. Sup., Tompkins Co., 2017 N.Y. Misc. LEXIS 346).

  • February 7, 2017

    Judge Finds Subcontractor Exception Negates ‘Your Work’ Exclusion In Insurance Policy

    ORLANDO, Fla. — On reconsideration, a Florida federal judge ruled Feb. 6 that a commercial general liability insurer had a duty to defend a lawsuit over damage to a condominium complex because the subcontractor exception negates application of the “your work” exclusion (Evanston Insurance Co. v. DiMucci Development Corporation of Ponce Inlet Inc. and Towers Grande Condominium Association, No. 15-486, M.D. Fla., 2017 U.S. Dist. LEXIS 16154).

  • February 7, 2017

    Oregon High Court Finds Insured Is Owed Attorney Fees In Coverage Dispute

    SALEM, Ore. — Addressing the state’s requirements for a plaintiff to recover attorney fees from an insurer in a coverage lawsuit, the Oregon Supreme Court ruled Feb. 2 that a homeowner pursuing a claim for a leaky sink can be awarded attorney fees without a formal judgment (Cary Long v. Farmers Insurance Company of Oregon, No. S063701, Ore. Sup.).

  • February 3, 2017

    Progressive Injury Exclusion Bars Coverage For Water Damage Suits, Judge Says

    SAN FRANCISCO — A policy’s continuous or progressive injury exclusion bars coverage for two underlying suits filed against an insured because the insured’s repair work to address the water intrusion problems was completed more than four years before the inception of the policy, a California federal judge said Jan. 31 (Saarman Construction Ltd. v. Ironshore Specialty Insurance Co., No. 15-3548, N.D. Calif., 2017 U.S. Dist. LEXIS 13633).

  • February 3, 2017

    Failure To Perform Claim Is Not An ‘Occurrence’ Under Insurance Policy, Judge Says

    EAST ST. LOUIS, Ill. — Allegations of an insured’s failure to perform do not constitute an “occurrence” triggering coverage under a commercial general liability insurance policy, an Illinois federal judge ruled Jan. 31, agreeing with the insurer that they “are nothing more than claims of disappointed expectations in the performance of a construction contract” (Owners Insurance Co. v. James C. Warren d/b/a Warren Exterior and Remodeling, et al., No. 15-00349, S.D. Ill., 2017 U.S. Dist. LEXIS 13171).

  • February 2, 2017

    Insured Argues Florida Statute Constitutes ‘Suit’ Under Policies To Florida Supreme Court

    TALLAHASSEE, Fla. — A process under Florida Statutes Chapter 558 is a civil proceeding and, therefore, a “suit” under commercial general liability insurance policies, an insured argues in its Jan. 23 reply brief to the Florida Supreme Court because the Chapter 558 process is a required part of construction defect litigation and is “tied directly to any litigation that follows the process” (Altman Contractors, Inc. v. Crum & Forster Specialty Insurance Co., No. SC16-1420, Fla. Sup.).

  • February 1, 2017

    ‘Damage To Your Work’ Exclusion Bars Coverage To Insured, Judge Finds

    SOUTH BEND, Ind. — An insurer has no duty to defend or indemnify an insured against claims regarding damage from its glass-cleaning work to homeowners’ windows and doors, an Indiana federal judge ruled Jan. 30 because the “damage to your work” exclusion eliminates coverage for claims of damage to the windows and doors and their replacement (The Celina Mutual Insurance Co. v. Daniel L. Gallas, et al., No. 14-1616, N.D. Ind., 2017 U.S. Dist. LEXIS 12166).

  • February 1, 2017

    Judge: Insured Vs. Insured Exclusion Bars Directors, Officers Liability Coverage

    MIAMI — A Florida federal judge on Jan. 30 found that a directors and officers liability insurance policy’s insured vs. insured exclusion precludes coverage for underlying claims against a condominium association insured and one of its board of directors arising from the installation of hurricane impact windows and doors, granting the insurer’s motion for judgment on the pleadings (The Marbella Condominium Association, et al. v. RSUI Indemnity Co., No. 16-80987, S.D. Fla., 2017 U.S. Dist. LEXIS 12363).

  • January 31, 2017

    Maryland Federal Judge Finds Issue Of Fact Exists On Additional Living Expenses

    BALTIMORE — Because an issue of fact exists regarding whether insureds seeking additional coverage for water and mold damages to their home were fully compensated for additional living expenses, a Maryland federal judge on Jan. 23 denied an insurer’s motion for summary judgment as it pertained to the issue of additional living expenses (Richard Kurland, et al. v. ACE American Insurance Co., et al., No. 15-2668, D. Md.; 2017 U.S. Dist. LEXIS 10065).

  • January 30, 2017

    Judge: No Defense Owed For Breach Of Contract Claim Against Insured

    GEORGETOWN, Del. — A comprehensive general liability insurer has no duty to defend a contractor against a town’s allegations of breach of contract and breach of warranty because the town does not allege that its soils had been damaged by the contractor’s defective irrigation system, a Delaware trial judge ruled Jan. 20 (David A. Bramble Inc. v. Old Republic General Insurance Corp., No: S16C-06-025 ESB, Del. Super., Sussex Co.; 2017 Del. Super. LEXIS 34).