Mealey's Construction Defects Insurance

  • July 14, 2020

    Insurer: Exclusions Bar Coverage For $250,000 Arbitration Over Defects

    LUBBOCK, Texas — There is no coverage for homeowners’ underlying arbitration demand of $250,000 in damages from alleged construction defects, a commercial general liability insurer says in a July 13 complaint filed in a Texas federal court, citing various exclusions such as ones for “professional liability” and “fungi or bacteria” (National Builders Insurance Company v. Architects, Developers & Contractors, Inc., et al., No. 20-00162, N.D. Texas).

  • July 14, 2020

    No Payment Owed Under Surety Bonds, 7th Circuit Panel Says In Affirming

    CHICAGO — The Seventh Circuit U.S. Court of Appeal on June 30 affirmed a district court’s ruling that no payment is owed under surety bonds to a subcontractor that performed work on a federal government project because the subcontractor did not provide notice of nonpayment of services within 90 days of its last day of work as required under the Miller Act (A&C Construction & Installation Co. WLL v. Zurich American Insurance Co., et al., No. 19-3325, 7th Cir., 2020 U.S. App. LEXIS 20347).

  • July 10, 2020

    Insurer: No Coverage For Defects Arbitration Award, Confessed Judgment

    DENVER — “Your work” exclusions and an “earth movement” exclusion preclude coverage for any part of a $791,766.92 arbitration award or a $502,606.64 confessed judgment connected to allegations of construction defects in a single family home, a commercial general liability insurer says in a July 7 complaint filed in a Colorado federal court (Mesa Underwriters Specialty Insurance Company v. Kersting Construction Group, Inc., et al., No. 20-01984, D. Colo.).

  • July 08, 2020

    Insurer: No Coverage For $1M Arbitration Demand Over Home’s Defects

    NEW ORLEANS — There is no coverage for a doctor’s $1 million arbitration demand concerning allegations of defective construction in his home, a commercial general liability insurer says in a July 2 complaint filed in a Louisiana federal court (Mesa Underwriters Specialty Insurance Company v. Boudreaux Builders, Inc., et al., No. 20-1884, E.D. La.).

  • July 08, 2020

    Judge Dismisses Action Over Insurer’s Duty To Indemnify Mold Claim

    PHILADELPHIA — A Pennsylvania federal judge on July 7 dismissed a lawsuit against an insurer over coverage for homeowners’ personal injuries resulting from mold contamination because the homeowners lack standing to sue and the insured’s declaratory judgment claim regarding the insurer’s duty to indemnify is unripe (Joseph Oliver Construction, LLC, et al. v. Utica First Insurance Company, No. 19-4352, E.D. Pa., 2020 U.S. Dist. LEXIS 118595).

  • July 06, 2020

    9th Circuit Certifies Burden Of Proof Question For Defects Insurance Coverage Case

    SAN FRANCISCO — In a construction defects insurance coverage dispute, the Ninth Circuit U.S. Court of Appeals on July 2 asked the Nevada Supreme Court for guidance on whether an insurer or an insured has the burden of proving the applicability of an exception to a policy exclusion and whether that party can rely on extrinsic evidence, and if so, whether only extrinsic evidence available at the time the insured tendered the defense of the lawsuit to the insurer is relevant for proving the exception (Zurich American Insurance Co., et al. v. Ironshore Specialty Insurance Company, No. 18-16937, 9th Cir., 2020 U.S. App. LEXIS 20815).

  • July 06, 2020

    Insurer: No Coverage For Floor Damages In Senior Housing Facility

    MINNEAPOLIS — Coverage does not exist for damages from a subcontractor’s installation of gypcrete flooring in a 177-unit senior housing facility project that occurred before a commercial lines policy’s effective date, an insurer alleges in a June 30 complaint filed in Minnesota federal court (West Bend Mutual Insurance Company v. KMAC, Inc., et al., No. 20-1493, D. Minn.).

  • July 02, 2020

    Michigan High Court Defines Faulty Work Under CGL Policy’s ‘Accident’

    LANSING, Mich. — In a $1.4 million coverage dispute, the Michigan Supreme Court on June 29 ruled that an “accident” as defined by a commercial general liability insurance policy may include unintentionally faulty subcontractor work that damages an insured’s work product (Skanska USA Building Inc. v M.A.P. Mechanical Contractors, Inc., et al., Nos. 159510 and 15951, Mich. Sup., 2020 Mich. LEXIS 1194).

  • June 30, 2020

    Insurer Seeks Subrogation, Contribution For Defense, Settlement Of Defects

    DENVER — An Irish insurer sued subcontractors and their insurers on June 12 in a Colorado federal court alleging subrogation and contribution claims regarding its defense and settlement of underlying construction defect claims by homeowners against a general contractor (AmTrust International Underwriters DAC v. Winchester Co., et al., No. 20-1728, D. Colo.).

  • June 30, 2020

    Insurer Says No Duty To Indemnify Alleged Defects In Florida Community

    FORT MYERS, Fla. — There is no duty to indemnify alleged construction defects in an insured’s drywall and stucco work for 60 single-family home in a Naples, Fla., community, an insurer says in a June 17 complaint filed in a Florida federal court, citing various exclusions. including a condominium, apartment, townhouse or tract housing coverage limitation endorsement (Accident Insurance Company, Inc. v. V&A Drywall and Stucco, Inc., et al., No. 20-425, M.D. Fla.).

  • June 18, 2020

    Insurer Has No Duty To Defend Conversion Claim, Illinois Appeals Panel Says

    ELGIN, Ill. — A conversion claim against insureds regarding their work on a construction project alleges intentional conduct and, thus, was not an “occurrence,” an Illinois appeals panel held June 16, finding that an insurer has no duty to defend (Pekin Insurance Company v. McKeown Classic Homes, Inc., et al., No. 2-19-0631, Ill. App., 2nd Dist., 2020 Ill. App. Unpub. LEXIS 1037).

  • June 24, 2020

    Panel: Defense Owed By Insurer For Damages Caused By Faulty Steel

    TROY, Mich. — Damages from allegedly defective steel supplied by a metal fabrication contractor constitute an “occurrence,” a Michigan appeals panel ruled June 18, affirming that a commercial general liability insurer had a duty to defend the contractor (Cardinal Fabricating, Inc. v. Cincinnati Insurance Company, No. 348339, Mich. App., 2020 Mich. App. LEXIS 3912).

  • June 22, 2020

    Insurer:  No Coverage Based On ‘Your Product,’ ‘Your Work’ Exclusions

    CHARLESTON, S.C. — A commercial general liability policy’s “your work” and “your product” exclusion preclude any coverage for an underlying construction defects case filed against a contractor, an insurer says in a June 18 complaint filed in South Carolina federal court (Accident Insurance Company, Inc. v. Morillo Construction, LLC, No. 20-2314, D. S.C.).

  • June 22, 2020

    Judge: Defects In Home Remodeling Work Are Not Covered By Insurance

    SEATTLE — A designated work exclusion precludes coverage for $250,000 in construction defect damages tied to a contractor’s home remodeling work, a Washington federal judge ruled June 17, granting a default judgment to an insurer (Developers Surety and Indemnity Company v. View Point Builders, Inc., et al., No. 20-0221, W.D. Wash., 2020 U.S. Dist. LEXIS 107201).

  • June 19, 2020

    Insurer Owes Defense For Water Intrusion Claim, Roofing Contractor Says

    WEST PALM BEACH, Fla. — A roofing contractor alleges in a June 17 complaint filed in a Florida federal court that insurance coverage exists for water intrusion allegations concerning its work on condominium buildings for a Florida association (Republic Roofing & Insulation Contractors, LLC v. James River Insurance Company, No. 20-80955, S.D. Fla.).

  • June 17, 2020

    Insured Does Not Owe Reimbursement For Insurers’ Settlement

    AKRON, Ohio — Insurance policies do not require a garage door manufacturer to reimburse its insurers for $245,000 spent in settling another insurer’s contribution lawsuit for defense of a construction defect suit, an Ohio federal magistrate judge ruled June 16 (Hartford Fire Insurance Company, et al. v. HRH Door Corp., No. 18-2366, N.D. Ohio, 2020 U.S. Dist. LEXIS 104823).

  • June 16, 2020

    Chubb:  No Defense Owed For $10M In Defects To Residential Property

    ATLANTA — Chubb Custom Insurance Co. filed a declaratory judgment complaint on June 12 in a Georgia federal court regarding its coverage obligations for damages from construction defects in excess of $10 million for a South Carolina multiunit residential property (Chubb Custom Insurance Company v. Vista Realty Partners, LLC, et al., No. 20-02508, N.D. Ga.).

  • June 15, 2020

    Magistrate Judge Orders Subcontractor To Comply With Insurers’ Subpoena

    SPRINGFIELD, Ill. — A federal magistrate judge in Illinois on June 12 denied a heating and air conditioning subcontractor’s attempt to quash a subpoena from insurers in their coverage dispute over defects in a facility for The Salvation Army (The Phoenix Insurance Company, et al. v. S.M. Wilson & Co., et al., No. 20-3063, C.D. Ill., 2020 U.S. Dist. LEXIS 103093).

  • June 12, 2020

    Damage To Property, Product Exclusions Bar Coverage, Insurer Says

    GULFPORT, Miss. — Citing various policy exclusions that include “damage to property” and “damage to your product,” an insurer alleges in a June 10 complaint in Mississippi federal court that there is no coverage for homeowners’ construction defect case (Accident Insurance Company, Inc. v. Dennis Collier Construction, LLC, et al., No. 20-191, S.D. Miss.).

  • June 11, 2020

    Panel: Insurer Equitably Subrogated To Defense Costs In 2 Defect Cases

    RIVERSIDE, Calif. — A California appeals panel on June 10 reversed a lower court’s decision on an insurer’s equitable subrogation claim against six subcontractors over defense costs spent for a general contractor against two construction defect actions and remanded for a determination on the amount of defense costs to shift to each subcontractor (Pulte Home Corporation v. CBR Electric, Inc., et al., No. E068353, Calif. App., 4th Dist., Div. 2, 2020 Cal. App. LEXIS 519).