Mealey's Construction Defects Insurance

  • February 22, 2019

    Judge: Ensuing Loss Clause Restores Coverage For Insureds’ Indemnity Claim

    WILLIAMSPORT, Pa. — Under a builder’s “all-risk” insurance policy, an ensuing loss clause restores coverage to insureds’ indemnification claim despite a faulty workmanship exclusion, a Pennsylvania federal judge ruled Feb. 21 (Griggs Road, L.P., et al. v. Selective Way Insurance Company of America, No. 17-00214, M.D. Pa., 2019 U.S. Dist. LEXIS 27170).

  • February 20, 2019

    Judge Grants Insurer’s Motion; Duty To Defend Damage Owed By Different Insurer

    JACKSONVILLE, Fla. — A federal judge in Florida on Feb. 14 ruled in favor of Amerisure Insurance Co. in its declaratory judgment action against Landmark American Insurance Co. regarding the duty to defend a claim for damage from water intrusion on a construction project, ruling that the damage was an occurrence that took place when Landmark was the primary insurer (Amerisure Insurance Company v. The Auchter Company, et al., No. 15-235, M.D. Fla.).

  • February 20, 2019

    Judge Dismisses Declaratory Judgment, Reformation Claims Against Insurers

    CHARLESTON, S.C. — A South Carolina federal judge on Feb. 19 dismissed claims for declaratory judgment for unreasonable failure to settle, a violation of the South Carolina Unfair Trade Practices Act (SCUTPA) and reformation against insurers in a dispute over coverage for an underlying $33.8 million construction defects judgment (Church Creek Construction LLC, et al. v. Mt. Hawley Insurance Co., et al., No. 17-1339, D. S.C., 2019 U.S. Dist. LEXIS 25711).

  • February 14, 2019

    No Indemnity Owed For $1.1M Arbitration Award For Defects, Insurer Says

    AUSTIN, Texas — An insurer alleges in a Feb. 4 complaint filed in a Texas federal court that it does not owe an insured complete indemnity for an underlying $1.1 million arbitration award regarding damages from the insured’s construction work to a custom home (Mid-Continent Casualty Co. v. Zbranek & Holt Custom Homes Ltd., No. 19-00083, W.D. Texas).

  • February 14, 2019

    No Coverage Owed For Mold Found In Attic Insulation, Insurer Says In Complaint

    SALT LAKE CITY — No coverage is owed to an insured for an underlying claim alleging that the insured’s installation of attic insulation caused mold to develop in attics of condominium buildings because the policy’s fungi or bacteria exclusion clearly precludes coverage, the insurer says in a Feb. 7 complaint filed in Utah federal court (Cincinnati Specialty Underwriters Insurance Co. v. Green Property Solutions LLC, et al., No. 19-100, C.D. Utah).

  • February 13, 2019

    Judge Declines To Resolve Arbitration Umpire Dispute Between Insurers, Insured

    NEW YORK — A New York federal judge on Feb. 6 denied insurers’ request to appoint a neutral umpire and an insured’s request to disqualify two candidates as umpires in a coverage dispute concerning water damage to a Florida condominium building (Certain Underwriters at Lloyd’s, London, et al. v. Vintage Grand Condominium Association Inc., No. 18-10382, S.D. N.Y., 2019 U.S. Dist. LEXIS 22709).

  • February 11, 2019

    Judge Denies Insurer’s Judgment Motion Based On Wrap-Up Exclusion

    OAKLAND, Calif. — Because a subcontractor was not enrolled in a general contractor’s wrap-up policy, a California federal judge on Feb. 7 denied summary judgment to the subcontractor’s insurer on its duty to defend or indemnify the subcontractor against the contractor’s breach of contract claims concerning water damage to a project (Employers Mutual Casualty Co. v. Fast Wrap Reno One LLC, et al., No. 17-03837, N.D. Calif., 2019 U.S. Dist. LEXIS 20298).

  • February 08, 2019

    Subcontractor Insurer’s Defense Of Defects Barred Under Exclusion, Judge Says

    MIAMI — In a coverage dispute between a contractor’s insurer and a subcontractor’s insurer over the duty to defend a construction defects lawsuit on a primary and noncontributory basis, a Florida federal judge on Feb. 5 ruled that the subcontractor insurer’s policy precludes additional insured coverage under the completed-operations hazard exclusion (Scottsdale Insurance Co. v. Granada Insurance Co., No. 18-21207, S.D. Fla., 2019 U.S. Dist. LEXIS 19240).

  • February 07, 2019

    No Duty To Defend Or Indemnify Construction Defects Case, Insurer Says

    PHILADELPHIA — A commercial general liability insurer alleges in a Jan. 24 complaint filed in a Pennsylvania federal court that it has no duty to defend or indemnify a contractor and subcontractor in an underlying construction defects case (Seneca Specialty Insurance Co. v. Top Class Construction Inc., et al., No. 19-363, E.D. Pa.).

  • February 05, 2019

    Judge Declines To Dismiss Subcontractor From Insurer’s Coverage Case Over Defects

    ST. LOUIS — A Missouri federal judge on Feb. 1 denied an insured subcontractor’s motion to dismiss its insurer’s dispute regarding coverage for an underlying breach of contract and breach of express warranty case brought by homeowners (Great Lakes Insurance SE v. AMCO Insurance Co., et al., No. 18-631, E.D. Mo., 2019 U.S. Dist. LEXIS 16040).

  • February 04, 2019

    Insured Must Reimburse Deductibles For Settlement Of Defects Suits, Panel Says

    SAN DIEGO — A commercial general liability insurer showed that its insured must reimburse it $50,000 in deductibles for payments it made in settlement of two construction defects actions, a California appeals panel held Jan. 31 (Lexington Insurance Co. v. Timber Ridge Framing Inc., No. D073412, Calif. App., 4th Dist. Div. 1, 2019 Cal. App. Unpub. LEXIS 802).

  • February 01, 2019

    Insured: Coverage Owed For Defective Concrete At 2 New Jersey Projects

    NEWARK, N.J. — A commercial general liability insurer is responsible for paying damages for defective concrete delivered to two New Jersey projects, a concrete producer claims in its Jan. 30 complaint filed in New Jersey federal court (County Concrete Corp. v. Greenwich Insurance Co., No. 19-03449, D. N.J.).

  • February 01, 2019

    Pennsylvania Federal Judge: Insurer Owes Defense For Products-Related Tort Claims

    PHILADELPHIA — An insurer has a duty to defend two construction defect actions because there are sufficient allegations of products-related tort claims such that there may have been an “occurrence,” a Pennsylvania federal judge ruled Jan. 30 (Nautilus Insurance Co. v. 200 Christian Street Partners LLC, et al., Nos. 18-1364 & 18-1545, E.D. Pa., 2019 U.S. Dist. LEXIS 15060).

  • January 31, 2019

    Oklahoma High Court Majority: Insured’s Water Damage Is Covered

    OKLAHOMA CITY — An insurance policy covers damage to a school caused by the rupture of a water pipe beneath the school, a majority of the Oklahoma Supreme Court held Jan. 29, reversing the entry of summary judgment to an insurer (Oklahoma Schools Risk Management Trust v. McAlester Public Schools, No. 114553, Okla. Sup., 2019 Okla. LEXIS 2).

  • January 30, 2019

    Subrogated Insurer Files Breach Of Contract Case, Seeks Defense Costs

    DALLAS — A subrogated insurer sued another insurer on Jan. 7 in a Texas federal court asserting breach of contract and declaratory judgment claims and seeking recovery of costs in the defense of a mutual insured in an underlying construction defects lawsuit (Employers Mutual Casualty Co. v. Philadelphia Indemnity Insurance Co., No. 19-32, N.D. Texas).

  • January 30, 2019

    Texas High Court Refuses To Review Coverage Suit Over Defective HVAC Units

    AUSTIN, Texas — According to its Jan. 25 orders pronounced, the Texas Supreme Court denied an insurer’s petition for writ of mandamus seeking to clarify a party's right to object to an assigned judge when the party first learns of the assignment the day of the first hearing or trial, also lifting the stay of the coverage lawsuit over the installation of defective heating ventilation and air conditioning units (In re Union Insurance Co., No. 18-0353, Texas Sup.).

  • January 29, 2019

    Insured’s Property Damage Occurred Outside Policy Period, 8th Circuit Finds

    ST. LOUIS — An insurer has no duty to defend or indemnify allegations that defective construction caused water infiltration in condominium units, the Eighth Circuit U.S. Court of Appeals held Jan. 28, because the property damage occurred outside the policy period (Clarke Company Ltd. v. American Family Mutual Insurance Co., No. 17-2418, 8th Cir., 2019 U.S. App. LEXIS 2760).

  • January 28, 2019

    Insurer Argues It Has No Duty To Defend Defect Case Against Builder

    TAMPA, Fla. — An insurer on Jan. 7 sued a home builder and the owners of the property in a Florida federal court, seeking a declaration that it has no duty to defend or indemnify them in relation to an underlying lawsuit in which the owners allege the property contains defects (Southern-Owners Insurance Co. v. Russ Building Concepts, et al., No. 19-00042, M.D. Fla.).

  • January 28, 2019

    Wisconsin High Court Majority Says Costs Must Be Allocated Between 2 Insurers

    MADISON, Wis. — The Wisconsin Supreme Court majority on Jan. 25 determined that a pollution liability insurer breached its duty to defend an additional insured for underlying property damage claims arising out of a sewage backup and said that the additional insured’s defense costs, which were paid by another insurer, must be allocated on a pro rata basis between the two insurers (Steadfast Insurance Co. v. Greenwich Insurance Co., No. 2016AP1631, Wis. Sup., 2019 Wisc. LEXIS 9).

  • January 25, 2019

    Judge Denies Insurer’s Bid For Reconsideration Of Orders In Defects Coverage Dispute

    SAN FRANCISCO — A California federal judge on Jan. 22 addressed the change in a cited case as it pertains to four orders issued in an insurance coverage lawsuit concerning underlying construction defects lawsuits and denied the insurer’s motion for leave to file motions for reconsideration (Travelers Property Casualty Company of America, et al. v. Centex Homes, No. 11-03638, Related Case Nos. 12-00371 & 13-00088, N.D. Calif., 2019 U.S. Dist. LEXIS 10261).