Mealey's Construction Defects Insurance

  • September 10, 2019

    Coverage May Exist For Water, Mold Damages Under Homeowners Policy, Judge Says

    TACOMA, Wash. — A Washington federal judge on Sept. 9 determined that no coverage is owed under one homeowners policy for an insured's water and mold damages caused by a leak in an exterior water pipe, but said coverage may be afforded under a second homeowners policy because a question of fact exists as to whether the damages were caused by a latent defect in the exterior water pipe (Vanessa Camper v. State Farm Fire and Casualty Co. et al., No.18-5486, W.D. Wash., 2019 U.S. Dist. LEXIS 153337).

  • September 09, 2019

    Insurers Have Duty To Defend 83 Construction Defect Cases, Judge Says

    JACKSONVILLE, Fla. — Two commercial general liability insurers have a joint duty to defend an additional insured against 83 underlying construction defect cases, a federal judge in Florida ruled Sept. 5 (KB Home Jacksonville LLC v. Liberty Mutual FireInsuranceCo., et al., No. 18-371, M.D. Fla., 2019 U.S. Dist. LEXIS 151235, 2019 U.S. Dist. LEXIS 151230).

  • September 06, 2019

    No Coverage Owed For Deterioration Of Basement Walls; Suit Dismissed

    NEW HAVEN, Conn. — A Connecticut federal judge on Sept. 4 dismissed a breach of contract and bad faith suit filed against a homeowners insurer after determining that the policy at issue clearly excludes coverage for the deterioration of the insureds’ foundation walls as a result of the use of defective concrete when the home was built (Marianne Gilmore, et al. v. Teachers Insurance Co., No. 18-1856, D. Conn., 2019 U.S. Dist. LEXIS 151006).

  • September 06, 2019

    Judge Rejects Insured’s ‘Ensuing Loss’ Argument Over Water Intrusion

    SEATTLE — A Washington federal judge on Sept. 4 denied summary judgment to an insured on its “ensuing loss” argument over water intrusion damage because Washington law supports the position that an insurer can protect from an “ensuing loss” provision where an excluded peril such as defective work is the cause of the damage (Belmain Place Condominium Owners Association v. American InsuranceCo., No. 19-156, W.D. Wash., 2019 U.S. Dist. LEXIS 150555).

  • September 05, 2019

    Breach Of Contract, Bad Faith Claims To Proceed Against Insurer In Water Damage Suit

    PHOENIX —An Arizona federal judge on Sept. 4 said claims for breach of contract and bad faith in a water damage coverage suit can proceed because issues of fact exist as to whether additional coverage is afforded under a commercial general liability policy and as to whether the insurer reasonably adjusted the insured’s claim for damages (Adams Craig Acquisitions LLC, et al. v. Atain Specialty Insurance Co., et al., No. 18-00817, D. Ariz., 2019 U.S. Dist. LEXIS 150227).

  • September 05, 2019

    CGL Insurer Says Insurer’s Argument Is ‘Red Herring’ In Suit Seeking Contribution

    BOSTON — A commercial general liability insurer on Aug. 19 argued to the First Circuit U.S. Court of Appeals that another insurer’s argument that it is estopped from enforcing its policy terms because its notification of a coverage decision was untimely is a “red herring” and that the appeals court should affirm a lower federal court’s ruling that it has no duty to defend an apartment management company insured against an underlying property damage lawsuit (Clarendon National Insurance Company v. Philadelphia Indemnity Insurance Company, No. 19-1212, 1st Cir.).

  • September 04, 2019

    Judge: No New Evidence To Reconsider In Coverage Dispute Over Defective Construction

    GREENVILLE, S.C. — Finding no new evidence or legal error, a federal judge in South Carolina on Aug. 21 refused to reconsider his entry of summary judgment to a condominium association on the basis that some damages arising out of construction defects are covered by commercial general liability insurance policies and because the insurers did not effectively reserve their right to contest coverage (Stoneledge at Lake Keowee Owners Association Inc. v. Cincinnati Insurance Co., et al., No. 14-01906, D. S.C., 2019 U.S. Dist. LEXIS 141652).

  • September 04, 2019

    Earth Movement Exclusion Bars Coverage For Insured’s Damage, Federal Judge Says

    BISMARCK, N.D. — An inland marine insurance policy’s earth movement exclusion precludes coverage for damage to an office building because earth movement was a cause of the damage to the building’s foundations and superstructure, a federal judge in North Dakota ruled Aug. 16, granting summary judgment to an insurer (Lexstar Construction, LLC v. AGCS Marine Insurance Co., No. 16-423, D. N.D., 2019 U.S. Dist. LEXIS 138768).

  • September 03, 2019

    Insureds’ Claims Arising Out Of Crumbling Walls Survive Dismissal, Judge Says

    BRIDGEPORT, Conn. — Insureds seeking coverage for the cracking of their basement walls as a result of the use of defective concrete sufficiently alleged claims for breach of contract and violations of Connecticut law against a homeowners insurer, a Connecticut federal judge said Aug. 29 in denying the insurer’s motion to dismiss (Jose and Maria Oliveira v. Safeco Insurance Company of America et al., No. 18-338, D. Conn., 2019 U.S. Dist. LEXIS 147256).

  • August 30, 2019

    Judge Awards Prejudgment Interest, Denies Attorney Fees In Insurers’ Contribution Suit

    LAS VEGAS — While denying an award of attorney fees in a contribution case among insurers over 16 construction defect cases, a federal judge in Nevada on Aug. 26 awarded prejudgment interest of $132,989.12 to defending insurers (Assurance Company of America, et al. v. Ironshore Specialty Insurance Co., No. 13-2191, D. Nev., 2019 U.S. Dist. LEXIS 146211).

  • August 27, 2019

    Judge:  Exclusions Bar Coverage For Insured’s Faulty Roofing Work

    OKLAHOMA CITY — A combination construction related endorsement (CCRE) and a roofing endorsement preclude coverage for underlying contract and tort claims arising out of damages from a contractor’s allegedly faulty roofing work, a federal judge in Oklahoma ruled Aug. 22, finding that the contractor’s insurer has no duty to defend or indemnify (Evanston Insurance Co. v. A&S Roofing LLC, et al., No. 17-870, W.D. Okla., 2019 U.S. Dist. LEXIS 142828).

  • August 16, 2019

    Judge Refuses To Dismiss Insurer’s Coverage Dispute Over Construction Defects

    TAMPA, Fla. — A commercial general liability insurer established by a preponderance of the evidence that the amount in controversy exceeds $75,000, a federal judge in Florida ruled Aug. 15, denying an insured’s motion to dismiss the declaratory judgment action regarding coverage for an underlying construction defects action (Mt. Hawley Insurance Co. v. Adams Homes of Northwest Florida Inc., et al., No. 19-01069, M.D. Fla., 2019 U.S. Dist. LEXIS 137828).

  • August 15, 2019

    Insurer Says No Duty To Defend, Indemnify Alleged Misrepresentations Of Defects

    SAN ANTONIO — Citing exclusions for “defective work” and “mold,” a commercial general liability insurer alleges in an Aug. 12 complaint filed in a Texas federal court that it has no duty to defend or indemnify allegations of misrepresentations in the sale of a home with alleged defects (Mid-Continent Casualty Co. v. Dabney Homes LLC, No. 19-975, W.D. Texas).

  • August 14, 2019

    Insurer Has No Duty To Indemnify For Costs To Replace Roofs, Judge Says

    CONCORD, N.H. — An insurer has no duty to indemnify an insured for the costs of replacement roofs and the cost of shingles, a federal judge in New Hampshire ruled July 23; however, the insurer has a duty to indemnify the insured for attorney fees awarded against it in arbitration (John Wallace, et al. v. Nautilus Insurance Co., No. 18-747, D. N.H., 2019 U.S. Dist. LEXIS 122219).

  • August 08, 2019

    Questions Of Fact Exist On Collapse Provision In Policy, Judge Says

    TOLLAND, Conn. — Questions of fact exist as to whether an insured home’s basement walls experienceda sudden falling or caving in as the result of defective concrete used when the foundation walls were built, a Connecticut judge said July 11 in denying the homeowners insurer’s motion for summary judgment (Alan J. Gnann, et al. v. United Services Automobile Association, No. CV166010517S , Conn. Super., 2019 Conn. Super. LEXIS 1955).

  • August 08, 2019

    Insurer Seeks Declaration Of Duties As To Defective Restoration Work On Roof

    TAMPA, Fla. — A commercial general liability insurer on July 29 sued its insured contractor and an organization that fights homelessness, seeking a declaration from a Florida federal court of its duties against claims arising out of defective restoration work and installation of a roof (Evanston Insurance Co. v. Coast to Coast Construction Specialties Inc., et al., No. 19-01845, M.D. Fla.).

  • August 07, 2019

    Judge Refuses To Bar Expert Testimony In Insurance Case Over Water Damage Repairs

    PHOENIX — Testimony from an attorney with experience in legal fields related to construction-related insurance claims “passes muster” under Federal Rule of Evidence 702, a federal judge in Arizona ruled Aug. 2, denying an insurer’s motion to preclude the expert testimony in its dispute with contractors over repairs to water damage (Adams Craig Acquisitions LLC, et al. v. Atain Specialty Insurance Co., et al., No. 18-00817, D. Ariz., 2019 U.S. Dist. LEXIS 129537).

  • August 06, 2019

    Panel Upholds Denial Of Insurer’s Motion To Intervene In Construction Defects Case

    DENVER — A Colorado appeals panel on Aug. 1 affirmed a lower court’s denial of an insurer’s motion to intervene in a construction defects case following an insured’s settlement agreement because the insured was entitled to protect itself with the potential of coverage being denied and the settlement offer having been refused by the insurer (Bolt Factory Lofts Owners Association Inc. v. Auto-Owners Insurance Co., No. 18CA1201, Colo. App., 2019 Colo. App. LEXIS 1126).

  • August 02, 2019

    Judge:  Ongoing Operations Exclusion Bars Insurance For Defects Arbitration Demand

    TRENTON, N.J. — A commercial general liability policy’s ongoing operations exclusion precludes coverage for construction defects to a swim club and pavilion building, a federal judge in New Jersey ruled July 31, also finding that a subcontractor exception to the “your work” exclusion does not apply to the ongoing operations exclusion (PJR Construction of New Jersey Inc. v. Valley Forge Insurance Co., et al., No. 17-4219, D. N.J., 2019 U.S. Dist. LEXIS 127973).

  • July 31, 2019

    4th Circuit Remands Insurance Bad Faith Case In Light Of Discovery Ruling

    RICHMOND, Va. — In an insurance bad faith action against an insurer for its failure to defend an insured in a construction defect action, the Fourth Circuit U.S. Court of Appeals on July 25 remanded to a district court for instructions in accordance with the South Carolina Supreme Court’s ruling that “denying liability and/or asserting good faith in the answer does not, standing alone,” waive attorney-client privilege for claim files addressing the insurer’s reinsurance and reserves (In re:  Mt. HawleyInsuranceCo., No. 18-1401, 4th Cir., 2019 U.S. App. LEXIS 22356).