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Mealey's Construction Defects Insurance

  • June 18, 2018

    Judge Certifies Question On Collapse In Insureds’ Breach Of Contract Suit

    HARTFORD, Conn. — In a breach of contract dispute over coverage for cracking in a basement, a Connecticut federal judge certified on June 15 a question to the state’s high court on what constitutes “substantial impairment of structural integrity” for purposes of applying a collapse provision in a homeowners insurance policy (Steven L. Vera, et al. v. Liberty Mutual Fire Insurance Co., No. 16-72, D. Conn., 2018 U.S. Dist. LEXIS 100548).

  • June 11, 2018

    3rd Circuit: Insurer Has No Duty To Defend, Indemnify Faulty Workmanship Claim

    PHILADELPHIA — A commercial general liability insurer has no duty to defend or indemnify faulty workmanship allegations against an insured subcontractor for problems experienced by a condominium development, the Third Circuit U.S. Court of Appeals ruled June 6, because the faulty work is not covered as an “occurrence” (Lenick Construction Inc. v. Selective Way Insurance, 16-1891, 3rd Cir., 2018 U.S. App. LEXIS 15197).

  • June 6, 2018

    Insureds, Insurer Accuse Contractor Of Faulty Work On Solar Panel System

    WILMINGTON, Del. — Homeowners and their insurer filed an amended complaint on June 1 in a Delaware trial court against a general contractor allegedly responsible for the defective installation of a solar panel system for their home (Domenic P. DiStefano, et al. v. KW Solar Solutions Inc., et al., No. N16C-11-015, Del. Super.).

  • June 6, 2018

    Judge Stays Association’s Suit To Appraise Damage Caused By Burst Sprinkler

    MIAMI — A condominium association’s lawsuit against its insurer seeking to recover the full cost of damages it claimed resulted from a sprinkler pipe rupture was stayed by a federal judge in Florida on May 24, finding that a provision in the policy allows for the damage to be appraised (Almeria Park Condominium Association Inc. v. Empire Indemnity Insurance Co., No. 18-20609-CIV-ALTONAGA/Goodman, S.D. Fla., 2018 U.S. Dist. LEXIS 88260).

  • June 5, 2018

    Iowa High Court Reverses Rejection Of $1.4M Appraisal Award In Hailstorm Dispute

    DES MOINES, Iowa —The Iowa Supreme Court on June 1 reversed a lower court’s judgment that rejected a $1.4 million appraisal award in favor of a townhome association insured for its hailstorm damage, remanding for the lower court to address the extent of pre-existing shingle damage excluded from coverage through the insurance policy's anti-concurrent-cause provision (Walnut Creek Townhome Association v. Depositors Insurance Company, No. 16-0121, Iowa Sup., 2018 Iowa Sup. LEXIS 57).

  • June 5, 2018

    Texas High Court Declines To Hear Case Over Insurer’s Judgment For Water Damage

    AUSTIN, Texas — The Texas Supreme Court on June 1 refused to rehear its denial of a petition to review a lower court’s reversal of an insurer’s take-nothing judgment in a homeowners’ action seeking coverage for damages to their home’s foundation and in directing a verdict on their breach of contract claim (State Farm Lloyds v. Charles R. Allen, et al., No. 17-0912, Texas Sup.).

  • June 5, 2018

    Judge Finds Fact Issues In Excess Coverage Dispute Over $9M Defects Judgment

    DENVER — Genuine issues of material fact exist on whether an excess insurance policy covers a $9 million construction defects judgment, a Colorado federal judge ruled June 1, denying summary judgment on breach of contract and bad faith claims (Hansen Construction Inc., et al. v. Everest National Insurance Co., No. 16-02902, D. Colo., 2018 U.S. Dist. LEXIS 92944).

  • June 1, 2018

    No Coverage Owed For Suit Over Subdivision, California Panel Affirms

    SAN DIEGO — A California appeals panel on May 29 affirmed a lower court’s ruling that an insurer has no duty to defend or indemnify its general contractor insured against an underlying lawsuit arising from the unsuccessful development of a 16-home residential subdivision (THV Investments, LLC v. Certain Underwriters at Lloyds of London, et al., No. D073601, Calif. App., 4th Dist., Div. 1, 2018 Cal. App. Unpub. LEXIS 3671).

  • May 31, 2018

    Judge: Exclusions Do Not Apply To Bar Man’s Bad Faith, Contract Claims

    PITTSBURGH — An insurance company’s request for summary judgment on a man’s claims for breach of contract and bad faith was denied by a federal judge in Pennsylvania May 11 after the judge found that exclusions in the man’s commercial line policy were inapplicable and the claim adjuster did not know Pennsylvania law when denying the claim (Jim Burgunder v. United Specialty Insurance Co., No. 17-1295, W.D. Pa., 2018 U.S. Dist. LEXIS 79477).

  • May 31, 2018

    Condominium Conversion Exclusion Does Not Apply To Bar Coverage, Judge Rules

    BOSTON — A federal judge in Massachusetts on May 16 dismissed an insurance company’s declaratory judgment lawsuit seeking an order stating that it has no duty to defend an elevator services company for an accident that occurred while an apartment building was being converted into condominiums, holding that a condominium conversion exclusion in a policy between the parties was ambiguous (Admiral Insurance Company v. Keystone Elevator Service & Modernization LLC, et al., No. 17-11524-LTS, D. Mass., 2018 U.S. Dist. LEXIS 82156).

  • May 30, 2018

    Panel Says Expert’s Testimony In Stucco, Water Damage Suit Should Not Be Barred

    TRENTON, N.J. — The New Jersey Superior Court Appellate Division on May 25 reversed a trial court's ruling barring a portion of an expert witness's testimony in a defective stucco and water damage coverage suit after determining that the trial court precluded testimony about the damage to a number of homes that the witness should not be prohibited from providing (Bob Meyer Communities Inc., v. Ohio Casualty Insurance Co. et al., No. A-2171-17T2, N.J. Super., App. Div., 2018 N.J. Super. Unpub. LEXIS 1227).

  • May 23, 2018

    Judge Limits Liberty Mutual’s Defenses Against Window Maker’s Bad Faith Suit

    TAMPA, Fla. — A federal judge in Florida on May 18 granted in part motions for partial summary judgment filed by a window and door manufacturer seeking recovery of $3 million it paid to resolve five defects lawsuits in Alabama state court, finding that its insurer, Liberty Mutual Fire Insurance Co., could not raise defenses of res judicata, contributory bad faith, comparative bad faith and mitigation (MI Windows & Doors LLC, et al. v. Liberty Mutual Fire Insurance Co., No. 14-cv-3139-T-23MAP, M.D. Fla., 2018 U.S. Dist. LEXIS 83918).

  • May 21, 2018

    Judge Denies Insured’s Motion For Attorney Fees In Product Defect Suit

    MINNEAPOLIS — A Minnesota federal judge on May 16 denied an insured’s motion to alter a judgment in a products liability suit to include payment of $1.5 million in attorney fees and expenses because the insurer’s duty to defend ended when the underlying claim was settled on the insured’s behalf (National Union Fire Insurance Company of Pittsburgh, et al. v. Donaldson Company Inc., No. 10-4948, D. Minn., 2018 U.S. Dist. LEXIS 82484).

  • May 17, 2018

    Kentucky High Court: Faulty Workmanship Is Not An Occurrence

    FRANKFORT, Ky. — The Kentucky Supreme Court held April 26 that courts must use the doctrine of fortuity to determine whether an event constitutes an accident that triggers coverage under a commercial general liability (CGL) policy and found that an appeals court panel properly applied its ruling in Cincinnati Ins. Co. v. Motorist Mitt. Ins. Co. to find that a contractor’s faulty workmanship did not constitute an occurrence that warranted coverage (Martin/Elias Properties LLC v. Acuity Mutual Insurance Company, No. 2016-SC-0000195-DG, Ky. Sup., 2018 Ky. LEXIS 188).

  • May 17, 2018

    Federal Magistrate Judge Says Surety Is Entitled To Reimbursement For Paid Claims

    SAN FRANCISCO — A California federal magistrate judge on May 15 determined than a surety is entitled to reimbursement of more than $4 million for claims it paid on behalf of a construction company that contracted with the government on a number of construction projects (Travelers Casualty and Surety Company of America v. K.O.O. Construction Inc., et al., No. 16-518, N.D. Calif., 2018 U.S. Dist. LEXIS 81914).

  • May 14, 2018

    Nationwide Seeks Declaration That It Owes No Coverage To Railing Installer

    CHARLESTON, S.C. — Nationwide Mutual Fire Insurance Co. says in a May 4 lawsuit filed in South Carolina federal court that it should not be required to provide coverage to a railing subcontractor that is a named defendant in a construction defects lawsuit, arguing that it doubts that the damages in the defects suit are for property damage caused by an occurrence (Nationwide Mutual Fire Insurance Co. v. Floyd Stanley Jr., et al., No. 18-cv-01232-MBS, D. S.C.).

  • May 11, 2018

    Federal Magistrate Judge: Insurance Policy Covers Church’s Ceiling Collapse

    BOSTON — A church’s loss when its ceiling fell is covered by the collapse coverage part of an insurance policy, a Massachusetts federal magistrate judge ruled May 10, finding that “faulty construction” and “wear and tear” exclusions do not apply (Easthampton Congregational Church v. Church Mutual Insurance Co., No. 17-30061, D. Mass., 2018 U.S. Dist. LEXIS 78777).

  • May 11, 2018

    No Coverage Owed Under Collapse Provisions, 9th Circuit Panel Affirms

    SEATTLE — A district court did not err in finding that an insurer owes no coverage for damage to apartments from hidden decay under its policies’ “collapse” provisions because the damage has not rendered the apartment building unfit or unsafe for occupancy, the Ninth Circuit U.S. Court of Appeals said May 9 (American Economy Insurance Co. v. CHL LLC, No. 16-35606, 9th Cir., 2018 U.S. App. LEXIS 12159).

  • May 10, 2018

    Magistrate Judge Denies Extension On Deadlines In Defects Insurance Coverage Case

    ORLANDO, Fla. — In an insurance coverage dispute for a construction defects case, a Florida federal magistrate judge on May 9 denied homeowners’ request for an extension to comply with case management deadlines and for a protective order on the depositions (Mid-Continent Casualty Co. v. Stanley Homes Inc., et al., No. 17-1512, M.D. Fla., 2018 U.S. Dist. LEXIS 77841).

  • May 9, 2018

    Subrogated Insurer Seeks Reimbursement For Faulty Installation Of Solar Panels

    WILMINGTON, Del. — In a May 4 complaint filed in a Delaware court, a subrogated homeowners insurer seeks reimbursement of $65,300.83 paid to insureds for property damage caused by defective installation of a solar panel system (Nationwide Mutual Fire Insurance Co., et al. v. KW Solar Solutions Inc., et al., No. N18C-05, Del. Super., New Castle Co.).