Mealey's Construction Defects Insurance

  • August 15, 2017

    Florida Majority Reverses Ruling In Bad Faith Suit Over Sinkhole Damage

    DAYTONA BEACH, Fla. — A majority of a Florida appeals panel on Aug. 11 held that no Florida statute or case law precludes an insured from filing a civil remedy notice (CRN) while a demand for appraisal is outstanding, reversing and remanding a lower court’s ruling in favor of the insurer in a bad faith lawsuit arising from the insured’s claim for sinkhole damage (Phillip Landers v. State Farm Florida Insurance Co., No. 5D15-4032, Fla. App., 5th Dist., 2017 Fla. App. LEXIS 11543).

  • August 15, 2017

    Couple’s Upgrades To Construction Project Are Not An Accident, Judge Says

    HUNTSVILLE, Ala. — A general contractor’s insurance company was awarded summary judgment by a federal judge in Alabama on Aug. 10 after the judge found that the insurer was not obligated to defend the contractor against counterclaims brought by a couple who refused to pay for upgrades that increased the price of a home improvement project (Canal Indemnity Company v. Frankie Carbin, et al., No. 16-cv-00630-ABK, N.D. Ala., 2017 U.S. Dist. LEXIS 126662).

  • August 14, 2017

    8th Circuit: Faulty Fire System Is Not An ‘Accident’ Under Insurance Policy

    ST. LOUIS — Replacing drywall and insulation as a result of a subcontractor’s faulty fire suppression system did not constitute an “accident” under a general liability insurance policy, the Eighth Circuit U.S. Court of Appeals held Aug. 11, affirming the dismissal of breach of contract and bad faith claims against an insurer (McShane Construction Company LLC v. Gotham Insurance Co., No. 16-2632, 8th Cir., 2017 U.S. App. LEXIS 14875).

  • August 11, 2017

    7th Circuit Reverses Ruling, Finds Insurers Owe Defense For Insured’s Leaky Windows

    CHICAGO — Insurers have a duty to defend an insured against class action claims of leaks in windows because neither the economic loss doctrine nor the “your work” exclusion precludes coverage, the Seventh Circuit U.S. Court of Appeals held Aug. 8, reversing an underlying judgment and remanding with instructions to vacate that judgment (Mary Haley, et al. v. Kolbe & Kolbe Millwork Co., et al., Nos. 16-3563 & 16-3648, 7th Cir., 2017 U.S. App. LEXIS 14572).

  • August 10, 2017

    Judge Says Insured’s Faulty Work Is Not An ‘Occurrence’ Triggering Duty To Defend

    PHILADELPHIA — An insured subcontractor’s faulty workmanship is not an “occurrence” under a special business owner’s policy, a Pennsylvania federal judge ruled Aug. 8, finding that the insurer had no duty to defend and indemnify an underlying lawsuit (MMG Insurance Co. v. Floor Associates Inc., No. 15-4814, E.D. Pa., 2017 U.S. Dist. LEXIS 124883).

  • August 3, 2017

    Split Georgia Appeals Court: No Bad Faith By Insurer In Failing Stucco Suits

    ATLANTA — A divided Georgia Court of Appeals on June 30 upheld a trial court’s summary judgment ruling for an insured on its breach of contract and declaratory claims and on the insurer’s counterclaims; however, the majority reversed denial of summary judgment for the insurer on a claim for bad faith, finding that “[t]he question of whether the previous reservations of rights were still effective had not been squarely answered in Georgia” (American Safety Indemnity Co. v. Sto Corp., No. A17A0453, Ga. App., 2017 Ga. App. LEXIS 339).

  • August 2, 2017

    Panel Says Synthetic Stucco Exclusion Bars Insurance Coverage For Water Damage

    MILWAUKEE — A commercial general liability insurance policy’s synthetic stucco exclusion precludes coverage in a dispute between a condominium association and the insurer of a general contractor over water damage caused by subcontractors’ defective work, a Wisconsin appeals panel affirmed July 31 (Kaitlin Woods Condominium Association Inc. v. Kaitlin Woods LLC, et al., No. 2015AP423, Wis. App., Dist. 1, 2017 Wisc. App. LEXIS 565).

  • July 27, 2017

    Florida Federal Judge Allows Insurer’s Declaratory Judgment Claim To Proceed

    ORLANDO, Fla. — A Florida federal judge on July 13 denied a contractor’s motion to dismiss an insurer’s suit seeking a declaration that the contractor is not an additional insured after determining that allowing the insurer’s declaratory judgment claim to proceed is the best way to resolve the coverage issue (Mid-Continent Casualty Co. v. New South Industries Inc., et al., No. 17-175, M.D. Fla., 2017 U.S. Dist. LEXIS 108590).

  • July 27, 2017

    Massachusetts Federal Judge Grants Surety Insurer’s Motion For Summary Judgment

    BOSTON — A Massachusetts federal judge on July 14 accepted a magistrate judge’s recommendation that a surety insurer’s motion for summary judgment be granted because the contractor failed to file suit within the applicable one-year statute of limitations (Endicott Constructors Corp. v. E. Amanti & Sons Inc., et al., No. 14-12807, D. Mass., 2017 U.S. Dist. LEXIS 110215).

  • July 27, 2017

    Negligence Claim Is Barred Under Florida Law, Florida Federal Judge Determines

    ORLANDO, Fla. — A Florida federal judge on July 18 determined that an insurer’s negligence claim is barred under Florida law because the negligence stems from a contractual relationship between its insured and the company responsible for maintaining a building damaged when a sprinkler system malfunctioned (Certain Underwriters at Lloyd’s of London, UK, v. Ocean Walk Resort Condominium Association Inc., No. 16-258, M.D. Fla., 2017 U.S. Dist. LEXIS 111233).

  • July 26, 2017

    Insurer Gets Summary Judgment In Declaratory Action Stemming From Deck Collapse

    ABERDEEN, Miss. — A Mississippi federal judge on July 21 granted an insurer summary judgment in a declaratory action against two victims of a deck collapse, saying there is no injury or damage caused by an occurrence under the policy and therefore no duty to defend a subcontractor who built the deck (Employers Mutual Casualty Company v. Brytni West, et al., No. 16-4, N.D. Miss., Aberdeen Div., 2017 U.S. Dist. LEXIS 113951).

  • July 25, 2017

    Michigan Panel Affirms Exclusion Does Not Apply To Insured’s Water Damage

    GRAND RAPIDS, Mich. — A Michigan appeals panel on July 20 affirmed a lower court’s ruling in favor of an insured in a coverage dispute arising from water damage to the insured’s Ann Arbor, Mich., property (Cincinnati Insurance Co. v Thomas Kaeding II, No. 332559, Mich. App., 2017 Mich. App. LEXIS 1185).

  • July 25, 2017

    Judge Finds Damage To Welds Is Covered, Reserves Indemnity Ruling

    TACOMA, Wash. — A Washington federal judge on July 20 partially granted a motion for summary judgment filed by insurers to the extent that it sought declaratory judgment that only property damage to welds was covered under an insurance policy, but found that an underlying complaint could impose liability on a pipe company that may be also covered under the policy (Travelers Property Casualty Company of America, et al. v. Northwest Pipe Company, et al., No. 17-5098, W.D. Wash., 2017 U.S. Dist. LEXIS 113325).

  • July 17, 2017

    10th Circuit: Insurers Not Required To Pay Judgments Against Contractors

    DENVER — A federal judge in Utah did not err when awarding summary judgment to two insurance companies that were sued by a couple seeking to recover $2.2 million in judgments they are owed by two contractors over faulty framing, a 10th Circuit U.S. Court of Appeals panel ruled July 13, holding that the insurers are not required to provide coverage under policies issued to the contractors (Auto-Owners Insurance Company v. George Fleming, et al, No. 16-4118, 10th Cir., 2017 U.S. App. LEXIS 12533).

  • July 14, 2017

    Insured’s Negligent Work Constitutes An ‘Occurrence’ Under Policy, 1st Circuit Says

    CHICAGO — A condominium association’s claim that a painting subcontractor acted negligently is sufficient under Illinois law to constitute an “occurrence” under a commercial general liability policy, the Seventh Circuit U.S. Court of Appeals affirmed July 13 (Westfield Insurance Co. v. National Decorating Service, Inc., et al., No. 16-1439, 7th Cir., 2017 U.S. App. LEXIS 12516).

  • July 14, 2017

    Federal Judge Stays Surety’s Declaratory Judgment Action Over Construction Dispute

    HOUSTON — A Texas federal judge on June 30 stayed a surety’s declaratory judgment action pending resolution of an underlying state court action between the principal and the obligee as to a dispute over a construction project (Travelers Casualty and Surety Company of America v. Rosenberger Construction LLC, No. 17-45, S.D. Texas, 2017 U.S. Dist. LEXIS 102231).

  • July 12, 2017

    Judge Allows First-Party Insured’s Bad Faith Claim To Proceed To Trial

    SIOUX CITY, Iowa — While dismissing an insured’s third-party bad faith claim against an insurer for denied coverage of water damage, an Iowa federal judge on June 30 allowed the insured’s first-party bad faith and punitive damages claims to proceed to trial (Tim Van Der Weide v. Cincinnati Insurance Co., No. 14-4100, N.D. Iowa; 2017 U.S. Dist. LEXIS 101735).

  • July 10, 2017

    Maryland Federal Judge Denies Motion To Dismiss In Pier Collapse Suit

    BALTIMORE — A Maryland federal judge on July 5 denied a third-party defendant’s motion to dismiss an insured’s third-party complaint alleging claims arising out of a collapsed pier after determining that the insured stated a plausible negligence claim against the third-party defendant  (The Hartford Fire Insurance Co. v. The Harborview Marina & Yacht Club Community Association Inc., No. 16-769, D. Md.; 2017 U.S. Dist. LEXIS 103260).

  • June 30, 2017

    Judge Grants Insured’s Motion To Transfer Venue Of Declaratory Judgment Suit

    ATLANTA — A Georgia federal judge on June 29 granted an insured’s motion to transfer the venue of an insurer’s declaratory judgment lawsuit challenging coverage for an underlying action brought against its insured (Owners Insurance Co. v. Comfort Air Corp., No. 17-1092, N.D. Ga., 2017 U.S. Dist. LEXIS 100874).

  • June 28, 2017

    No Coverage Afforded For Home’s Foundation Damage, Federal Judge Says

    HARTFORD, Conn. — No coverage is afforded for foundation damage to an insured home because no coverage is afforded for collapse or for latent defects under the policy at issue, a Connecticut federal judge said June 26 in granting an insurer’s motion for summary judgment (Gueng-Ho Kim, et al., v. State Farm Fire and Casualty Co., No. 15-879, D. Conn., 2017 U.S. Dist. LEXIS 97871).