Mealey's Construction Defects Insurance

  • June 18, 2019

    Insurer Sues Insurer For Equitable Contribution Of Construction Defect Case

    LOS ANGELES — A general contractor’s insurer sued a subcontractor’s insurer on June 14 in a California federal court, asserting claims for declaratory relief and equitable contribution regarding coverage for an underlying construction defect case against the general contractor and subcontractor (Kinsale Insurance Co. v. HDI Global Specialty SE, No. 19-05219, C.D. Calif.).

  • June 17, 2019

    Majority Affirms Allocation Of $6M Settlement In Product Liability Coverage Dispute

    ST. LOUIS — A majority of the Eighth Circuit U.S. Court of Appeals on June 14 affirmed a lower federal court’s ruling that an excess insurer owes a designer and manufacturer insured $2.76 million for an underlying $6 million settlement of an underlying product liability lawsuit involving defective air ducts, rejecting the excess insurer’s argument that the lower court improperly interpreted the batch clause endorsement (National Union Fire Insurance Company of Pittsburgh, PA, et al. v. Donaldson Company Inc. v. Federal Insurance Co., No. 18-1063, 8th Cir., 2019 U.S. App. LEXIS 17897).

  • June 13, 2019

    South Carolina High Court Issues Test For Privilege In Insurance Bad Faith Cases

    COLUMBIA, S.C. — Addressing a certified question in an insurance bad faith action against an insurer for its failure to defend an insured in a construction defect action, the South Carolina Supreme Court on June 12 answered in the negative and held that “denying liability and/or asserting good faith in the answer does not, standing alone,” waive the attorney-client privilege for claim files (Mt. Hawley Insurance Co. v. ContraVest Inc., et al., No. 2018-001170, S.C. Sup., 2019 S.C. LEXIS 53).

  • June 11, 2019

    Judge Dismisses Insurer’s Duty-To-Indemnify Case Over Defects Judgment

    FORT MYERS, Fla. — Because a construction defects action has not addressed a revocable trust’s motion for proceedings supplementary, a Florida federal judge on June 7 dismissed an insurer’s case regarding a duty to indemnify a $672,853.48 judgment (Mid-Continent Casualty Co. v. G.R. Construction Management Inc., et al., No. 18-688, M.D. Fla., 2019 U.S. Dist. LEXIS 96714).

  • June 11, 2019

    Insurers: No Coverage For Construction Defects In Baseball Stadium

    NEW HAVEN, Conn. — Insurers allege in a June 4 complaint filed in a Connecticut federal court that a general contractor and a developer are owed no defense or indemnity against allegations of construction defects in a baseball stadium (Selective Insurance Company of America, et al. v. Centerplan Construction Company LLC, et al., No. 19-00866, D. Conn.).

  • June 10, 2019

    Panel:  Exclusion Does Not Bar Coverage For Suit Over ‘Dangerous’ Soccer Field

    PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on June 7 reversed a lower federal court’s finding that a policy exclusion barred coverage for an underlying lawsuit alleging personal injury and damages for the "dangerous condition” of a soccer field, finding that the terms of the exclusion are ambiguous (Oak Park Unified School District v. Philadelphia Indemnity Insurance Company, No. 18-55033, 9th Cir., 2019 U.S. App. LEXIS 17182).

  • June 10, 2019

    Judge:  Fact Issues Remain On Whether Insurer’s Work Product Exclusions Apply

    NEW ORLEANS — There is a genuine question of fact as to when covered property damage occurred and, thus, whether coverage for an underlying arbitration demand arising out of an insured’s alleged faulty workmanship is barred by work product exclusions, a federal judge in Louisiana held June 6, denying summary judgment to an insurer (JEI Solutions Inc. v. Burlington Insurance Co., No. 19-156, E.D. La., 2019 U.S. Dist. LEXIS 95068).

  • June 06, 2019

    Panel: Insurer Not Relieved Of Duty Based Upon Care, Custody, Control Exclusion

    SAN DIEGO — A California appeals panel on June 5 reversed a lower court’s ruling that an insurer had no duty to defend a general contractor in a construction defect case based upon the exclusion in an additional insured endorsement for damage to “property in the care, custody or control of the additional insured” (McMillin Homes Construction Inc. v. National Fire & Marine Insurance Co., No. D074219, Calif. App., 4th Dist., Div. 1, 2019 Cal. App. LEXIS 514).

  • June 05, 2019

    Federal Judge Dismisses Insurer’s Defects Coverage Case To Avoid Duplication

    PHOENIX — An Arizona federal judge on May 31 dismissed an insurer’s coverage dispute concerning defects in repair work to a deck for a condominium association because it “would avoid needless determination of state law issues” (Houston Specialty Insurance Co. v. Providence Builders Inc., et al., No. 18-01297, D. Ariz., 2019 U.S. Dist. LEXIS 92403).

  • June 04, 2019

    Claims, Counterclaims In Insurance Coverage Dispute Are Not Ripe, Judge Says

    DENVER — In a coverage dispute over a $2.4 million judgment in an underlying construction defects case, a Colorado federal judge on May 30 dismissed third-party statutory and common-law bad faith counterclaims against an insurer as well as the insurer’s declaratory relief claim because the underlying matter is not ripe for review (Auto-Owners Insurance Co. v. Bolt Factory Lofts Owners Association Inc., et al., No. 18-01725, D. Colo., 2019 U.S. Dist. LEXIS 90196).

  • May 30, 2019

    Panel: Insurance Policy Excludes Damage Caused By Faulty Workmanship

    TOPEKA, Kan. — Claims for damages caused by negligent wiring in a generator are not covered under a homeowners insurance policy, a Kansas appeals panel affirmed May 24, finding that the policy excludes faulty workmanship (Stephen M. Deters, et al. v. Nemaha-Marshall Electric Cooperative Association Inc., et al., No. 119,200, Kan. App., 2019 Kan. App. LEXIS 33).

  • May 30, 2019

    Judge:  Insurer Has Duty To Defend Engineering Firm Against Negligent Design Suit

    CINCINNATI — An Ohio federal judge on May 28 held that a professional liability insurer has a duty to defend its engineering and construction firm insured against an underlying lawsuit alleging negligent design, negligent construction and breach of contract but stayed the indemnification issue pending resolution of the underlying action (Allied World Surplus Lines Insurance Company v. Richard Goettle, Inc., No. 17-670, S.D. Ohio, 2019 U.S. Dist. LEXIS 88545).

  • May 29, 2019

    Panel Reverses $1.9M Judgment Against Insurer On Breach Of Contract Cross-Claim

    HARTFORD, Conn. — In an opinion officially released May 28, a Connecticut appeals court panel reversed and remanded a lower court’s $1.9 million judgment against an insurer, finding that the builder’s risk insurance policy’s "Defects, Errors, And Omissions" exclusion unambiguously bars coverage for the insured’s more than $4 million loss to replace approximately 1,800 windows that were damaged during a building renovation (Viking Construction, Inc. v. 777 Residential, LLC, et al., No. AC 41450, Conn. App., 2019 Conn. App. LEXIS 216).

  • May 29, 2019

    Judge Awards Default Judgment To Insurer In Defect Coverage Dispute

    CHARLOTTE, N.C. — Citing insureds’ failure to notify of construction defect cases, a federal judge in North Carolina on May 23 granted a default judgment to an insurer in its declaratory judgment action concerning coverage (Pennsylvania National Mutual Casualty Insurance Co. v. JJA Construction Inc., et al., No. 18-00266, W.D. N.C., 2019 U.S. Dist. LEXIS 86637).

  • May 28, 2019

    Alabama High Court:  No ‘Occurrence’ Caused By Insured’s Faulty Work

    MONTGOMERY,Ala. — An arbitrator did not find that homeowners suffered damages because of an “occurrence” caused by an insured’s faulty workmanship, the Alabama Supreme Court held May 24, reversing a lower court’s ruling that the insured was entitled to coverage and indemnification under a commercial general liability insurance policy (Nationwide Mutual FireInsuranceCo. v. The David Group Inc., No. 1170588, Ala. Sup., 2019 Ala. LEXIS 52).

  • May 23, 2019

    Judge Vacates Trial Date After Finding Insurer’s Expert’s Testimony Unreliable

    SOUTH BEND, Ind.— A federal judge in Indiana on May 20 vacated a trial in a suit brought by an insurance company against a subcontractor that installed furnaces in a building’s roof trusses shortly before the roof partially collapsed after finding that the testimony proffered by the company’s structural engineering expert was unreliable (Affinity Mutual Insurance v. Thacker Air Conditioning-Refrigeration-Heating Inc., No. 16-CV-279 JD, N.D. Ind., 2019 U.S. Dist. LEXIS 84713).

  • May 21, 2019

    Exclusions Serve To Bar Insurance Coverage For Pipeline Damage, Judge Says

    TUCSON, Ariz. — An insured contractor is not entitled to coverage for repairs to pipeline damage in a water main collector system, an Arizona federal judge ruled May 16, because exclusions combine to preclude coverage the property damage (Sunwestern Contractors Inc. v. Cincinnati Indemnity Co., No. 16-00649, D. Ariz., 2019 U.S. Dist. LEXIS 82642).

  • May 21, 2019

    2nd Circuit Upholds Dismissal Of Insureds’ Complaint In Defective Concrete Suit

    NEW YORK — The Second Circuit U.S. Court of Appeals on May 16 affirmed a district court’s dismissal of an amended complaint filed by insureds seeking damages as a result of defective concrete used in their home’s foundation because the insureds failed to carry their burden of proving that coverage is afforded under the policy and that the insurer acted in bad faith when it denied their claim (Joseph Mazzarella, et al. v. Amica Mutual Insurance Co., No. 18-1269, 2nd Cir., 2019 U.S. App. LEXIS 14719).

  • May 17, 2019

    No Defense, Indemnity Owed For Construction Defect Cases, Insurer Says

    BOSTON — Citing a “damage to your work” exclusion, an insurer seeks declarations on May 9 from a Massachusetts federal court that it has no duty to defend or indemnify two construction defect cases (Union Insurance Co. v. Gengel C & S Builders Inc., et al., No. 19-11075, D. Mass.).

  • May 13, 2019

    Judge Grants, Denies Motions To Dismiss Insurers’ Claims Over 52 Defects Lawsuits

    LOS ANGELES — Addressing whether claims meet the $75,000 amount-in-controversy requirement, a California federal judge on April 26 granted and denied in part motions to dismiss insurers’ claims for declaratory relief, equitable reimbursement and accounting relating to the cost of defending more than 52 construction defects cases (The Travelers Indemnity Company of Connecticut, et al. v. Pulte Group, Inc., et al., No. 18-08994, C.D. Calif., 2019 U.S. Dist. LEXIS 74861).