Lexis Legal News : Mealey's Construction Defects Insurance : Lawsuit Filings, Litigation, Settlements, Verdicts and Court News

Mealey's Construction Defects Insurance

April 03, 2019
Excess Insurer Denied Summary Judgment In Remanded Defective Reactors Suit

KANSAS CITY, Kan. — Following a reversal and remand of an insurance coverage dispute from the 10th Circuit U.S. Court of Appeals, a Kansas federal judge on March 29 denied an excess insurer’s motion for summary judgment as to whether certain policy exclusions precluded coverage for defective jet bubble reactors (JBRs) that were constructed by subcontractors, with the judge finding many of the insurer’s arguments foreclosed by the appeals court’s ruling (Black & Veatch Corp. v. Aspen Insurance [UK] Ltd., et al., No. 2:12-cv-02350, D. Kan., 2019 U.S. Dist. LEXIS 54021).
April 02, 2019
Judge Issues Expert, Evidentiary Rulings Ahead Of Construction Defect Trial

MIAMI — A federal judge in Florida issued a slew of evidentiary and expert witness rulings on March 29 as an insurer defends claims that it improperly failed to defend its insured from construction defect claims (MI Windows & Doors LLC, et al. v. Liberty Mutual Fire Insurance Co., No. 14-3139, M.D. Fla., 2019 U.S. Dist. LEXIS 54058).
April 02, 2019
Insured’s Foundation Damage Is Barred By Policy Exclusion, Federal Judge Says

BOSTON — A Massachusetts federal judge on March 31 found that a commercial general liability insurer has no duty to defend its construction company insured against an underlying lawsuit, finding that the damage to the insured’s foundation, whether an accident or not, falls under the scope of a policy exclusion (Mills Construction Corporation, Inc., et al. v. Nautilus Insurance Company, No. 18-10549, D. Mass., 2019 U.S. Dist. LEXIS 55256).
April 01, 2019
Judge Grants Default Judgment To Insurer In Defects Coverage Dispute

CHARLOTTE, N.C. — A commercial general liability insurer was granted a default judgment against its insureds on March 25 by a North Carolina federal judge in its declaratory judgment lawsuit regarding two construction defect cases (Pennsylvania National Mutual Casualty Insurance Co. v. Jose Castillo, et al., No. 18-00271, W.D. N.C., 2019 U.S. Dist. LEXIS 49319).
April 01, 2019
Magistrate Judge: No ‘Occurrence’ For Insured’s Damage To Equipment

ROANOKE, Va. — Because there was no “occurrence,” a Virginia federal magistrate judge on March 29 found that an insurer has no duty to defend or indemnify its insured for any award over damage to a piece of equipment the insured provided for a construction project (Western World Insurance Co. v. Air Tech Inc., No. 17-518, W.D. Va., 2019 U.S. Dist. LEXIS 53683).
April 01, 2019
No Coverage Owed Under 2 Homeowners Policies For Cracking In Basement Walls

NEW HAVEN, Conn. — No coverage is afforded under two homeowners policies for cracking and deteriorating basement walls caused by the use of defective concrete because one of the policies includes an exclusion for cracking caused by the use of defective construction materials and the other policy provides coverage only for sudden and abrupt collapses, a Connecticut federal judge said March 29 (Frank V. Huschle, et al. v. Allstate Insurance Co., et. al., No. 18-248, D. Conn., 2019 U.S. Dist. LEXIS 53978).
April 01, 2019
Judge Says Insurer Owes No Defense, Indemnity For Costs As No ‘Suit’ Was Filed

SAN DIEGO — A commercial general liability insurer has no duty to defend or indemnify insureds for costs incurred to investigate and repair alleged defects at a military training facility, a California federal judge ruled March 28, finding that no “suit” had been filed (Harper Construction Company Inc., et al. v. National Union Fire Insurance Company of Pittsburgh, PA, No. 18-00471, S.D. Calif., 2019 U.S. Dist. LEXIS 53183).
March 22, 2019
Panel: No Fact Issues On Whether Insured’s Faulty Work Is An ‘Occurrence’

GRAND RAPIDS, Mich. — A trial court erred in denying summary disposition to an insurer on the basis that there were factual issues as to whether faulty installation caused an “occurrence,” a Michigan appeals panel ruled March 19 (Skanska USA Building Inc. v M.A.P. Mechanical Contractors Inc., et al., Nos. 340871 & 341589, Mich. App., 2019 Mich. App. LEXIS 529).
March 22, 2019
Insured’s Work Did Not Fall Within Exclusion, Appeals Panel Concludes

BOSTON — A trial judge erred in finding that an insured’s work on concrete slab was inseparable from other subcontractors’ work on other layers of a flooring system and in ruling that an insurer had no duty to defend or indemnify, the Massachusetts Appeals Court held March 19, vacating judgment and remanding for further proceedings (All America Insurance Co. v. Lampasona Concrete Corp., No. 18-P-247, Mass. App., 2019 Mass. App. LEXIS 34).
March 22, 2019
Judge: Breach Of Contract Exclusion Relieves Insurer’s Duty For Defects Lawsuit

HOUSTON — A commercial general liability insurer has no duty to defend or indemnify an underlying construction defects action, a Texas federal judge ruled March 19, finding that a breach of contract exclusion applied to preclude coverage (Mt. Hawley Insurance Co. v. Huser Construction Company Inc., No. 18-0787, S.D. Texas, 2019 U.S. Dist. LEXIS 44611).
March 19, 2019
Insurer Owes Additional Insured Defense Of Negligence Suit Arising From Fatal Fall

SPRINGFIELD, Ill. — An Illinois appeals court on March 15 affirmed a lower court’s finding that an electrical subcontractor’s insurer has a duty to defend a general contractor against an underlying lawsuit arising from an electrician’s fatal fall at a project site, finding that the general contractor is vicariously liable for torts that the electrical subcontractor committed in the scope of it being the general contractor’s agent (Pekin Insurance Company v. Twin Shores Management, LLC, et al., No. 18-0513, Ill. App., 4th Dist., 2019 Ill. App. Unpub. LEXIS 431).
March 18, 2019
Judge Rules Against CGL Insurer In Dispute Over Defective Thermal T-Panel Systems

MISSOULA, Mont. — A Montana federal judge on March 6 denied a commercial general liability insurer’s motion for summary judgment in its lawsuit disputing coverage for an underlying $441,770.83 award against its contractor insured over claims that thermal T-panel systems that were installed by the insured were not effective and caused additional damage to condominium units (Western Heritage Insurance Co. v. Slopeside Condominium Association, Inc., et al., 17-162, D. Mont., 2019 U.S. Dist. LEXIS 36009).
March 14, 2019
Judge: Replacement Of Hotel’s Curtainwall Was Defect, Not Property Damage

OAKLAND, Calif. — A California federal judge on March 12 granted summary judgment in a construction defect insurance coverage lawsuit, finding that the underlying issue was not one of property damage but one of defective construction (Webcor Construction, LP, et al. v. Zurich American Insurance Company, et al., No. 17-2220, N.D. Calif., 2019 U.S. Dist. LEXIS 39834).
March 12, 2019
Arbitration Agreement Does Not Require Arbitration Of Insurer’s Subrogation Claim

SACRAMENTO, Calif. — An insurer’s subrogation claim against a company accused of manufacturing a faulty valve that caused an insured to sustain water damages is not subject to arbitration because the insurer’s subrogation claim was filed after a change was made to the arbitration agreement that excluded product liability claims from mandatory arbitration, the Third District California Court of Appeal said March 8 (State Farm General Insurance Co. v. Watts Regulator Co., No. C082125, Calif. App., 3rd Dist., 2019 Cal. App. Unpub. LEXIS 1653).
March 12, 2019
Insurer Owes Defense To Contractor Against Construction Defects Case, Judge Finds

DENVER — A commercial general liability insurer had a duty to defend a general contractor against a construction defects case, a Colorado federal judge ruled March 7 (KB Home Colorado Inc. v. Peerless Indemnity Insurance Co., No. 17-2441, D. Colo., 2019 U.S. Dist. LEXIS 36827).
March 11, 2019
Panel: Insurer’s Duty-To-Indemnify Issue Not Ripe Until Resolution Of Defects Case

ATLANTA — The 11th Circuit U.S. Court of Appeals on March 8 affirmed a lower judge’s dismissal of a commercial general liability insurer’s declaratory relief lawsuit regarding its duty to indemnify an insured against construction defect claims because that duty is not ripe for adjudication until the underlying case is resolved (Mid-Continent Casualty Co. v. Delacruz Drywall Plastering & Stucco Inc., et al., No. 18-14195, 11th Cir., 2019 U.S. App. LEXIS 6976).
March 08, 2019
Judge Exercises Discretion Not To Issue Declaration As To Insurer’s Duty To Defend

ORLANDO, Fla. — A Florida federal judge on March 5 held that “considerations of practicality and wise judicial administration” persuade him to exercise hi discretion not to issue a declaration on a commercial general liability insurer’s duty to defend and duty to indemnify a general contractor against an underlying design and construction defects lawsuit (Harleysville Worcester Insurance Company v. CB Contractors, LLC, et al., No: 17-258, M.D. Fla., 2019 U.S. Dist. LEXIS 34988).
March 08, 2019
Judge Declines Dismissal Of Breach Of Contract, Bad Faith Claims Against Insurer

PITTSBURGH — A Pennsylvania federal judge on March 6 refused to dismiss an assignee’s breach of contract and bad faith claims against an insurer in a coverage dispute regarding a $2.4 million settlement over defective concrete used in a bridge construction project (Brayman Construction Corp. v. Westfield Insurance Company Inc., No. 18-CV-00457, W.D. Pa., 2019 U.S. Dist. LEXIS 36432).
March 07, 2019
Judge: Insurer Has Duty To Defend, Indemnify Water Damage Settlement

PHOENIX — Finding that one insurer had a duty to indemnify a settlement of a water damage claim while another insurer did not, an Arizona federal judge on March 4 held that the second insurer is entitled to amounts paid to settle the claim against the mutual insured (Amerisure Mutual Insurance Co. v. Houston Casualty Co., No. 17-02269, D. Ariz., 2019 U.S. Dist. LEXIS 33873).
March 07, 2019
Panel Affirms Ruling In Dispute Between Insurers Over Default Judgment

LOS ANGELES — A California appeals panel on March 1 upheld judgment to a subrogated insurer in its case seeking recovery from another insurer for a $1.5 million default judgment against a subcontractor regarding an arbitration dispute over construction defects in homeowners’ property (The Insurance Company of the State of Pennsylvania v. American Safety Indemnity Co., B283684, Calif. App., 2nd Dist., Div. 8, 2019 Cal. App. LEXIS 171).