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

Mealey's Construction Defects Insurance

November 04, 2020
Insurer: No Coverage For $1.25M Damages From Mold Caused By Faulty Roof Work

JACKSON, Miss. — There is no coverage for homeowners’ damages of $1.25 million caused by water damage and mold resulting from a faulty roof installation, an insurer alleges in an Oct. 30 complaint, citing various policy exclusions, including “expected or intended injury” and pollution (National Trust Insurance Company v. Reed’s Metals, Inc., et al., No. 20-204, S.D. Miss.).
November 04, 2020
No Coverage For Faulty Work To French Drain System, Insurer Says

PHILADELPHIA — Atain Insurance Co. filed a complaint on Oct. 30 in a Pennsylvania federal court alleging that it has no duty to defend or indemnify for damages in excess of $100,000 caused by an insured’s alleged defective workmanship in a new French drain system (Atain Insurance Company v. Basement Waterproofing Specialist Inc., No. 20-5440, E.D. Pa.).
November 03, 2020
S.C. High Court Upholds Ruling Barring Insurers From Intervening In Defects Suits

COLUMBIA, S.C. — The South Carolina Supreme Court on Oct. 21 sustained a trial court judge’s ruling denying a motion filed by nine insurance companies seeking to intervene in four construction defects lawsuits, finding that the companies have aright to contest coverage under commercial general liability policies issued to Centex Homes in subsequent declaratory judgment actions.
November 03, 2020
Insurers: Reimbursement Should Be Made For BP’s Faulty Pipe Suit Settlement

LOS ANGELES — A commercial general liability insurer and an umbrella insurer filed suit Nov. 2 in a California federal court seeking reimbursement from a pipe manufacturer for their settlement of BP America Production Co.’s defective pipe products lawsuit (American Home Assurance Company, et al. v. Ameron International Corporation, No. 20-10049, C.D. Calif.).
November 02, 2020
Insurer Breached Duty To Defend Damages From Leaks, Federal Magistrate Judge Says

OAKLAND, Calif. — A commercial general liability insurer breached its contractual duty to defend a window manufacturer regarding property damage caused by leaks from windows that were installed in a mixed-use residential community, a California federal magistrate judge held on Oct. 29 granting partial summary judgment to the manufacturer (Ply Gem Industries Inc. v. James River Insurance Company, No. 20-2475, N.D. Calif., 2020 U.S. Dist. LEXIS 203137).
October 29, 2020
Hawaii Federal Judge: No Insurance Coverage For Faulty Work To Pond, Residence

HONOLULU — Allegations of a contractor’s faulty work on a pond and residential structures do not constitute an “occurrence” under a commercial general liability insurance policy, a Hawaii federal judge ruled Oct. 28, finding that the insurer owes no coverage (Nautilus Insurance Company v. RMB Enterprises, Inc., No. 19-00496, D. Hawaii, 2020 U.S. Dist. LEXIS 200468).
October 28, 2020
No Coverage Owed For Water Damage Caused By Faulty Workmanship

OKLAHOMA CITY — A homeowners insurer did not breach its contract or act in bad faith in denying a water damage claim caused by a leak in the heating, ventilation and air conditioning system’s condensate drainpipe because the policy’s exclusion for faulty workmanship or defective design applies as a bar to coverage, an Oklahoma federal judge said Oct. 23 (Tammy Covington, et al. v. CSAA Fire and Casualty Insurance Co., et al., No. 19-718, W.D. Okla., 2020 U.S. Dist. LEXIS 197486).
October 22, 2020
Insurer Owes Coverage For Settlement Of Construction Defects Case, Panel Finds

CHICAGO — An insurer of two subcontractors on a residential condominium complex project has a duty to defend and indemnify a general contractor and a developer’s insurer for settling a construction defects case, an Illinois appeals panel ruled Oct. 19, also finding that prejudgment interest was properly awarded (West Bend Mutual Insurance Company v. Trapani Construction Company, Inc., No. 1-19-1772, Ill. App., 1st Dist., Div. 1, 2020 Ill. App. Unpub. LEXIS 1783).
October 21, 2020
Judge Compels Arbitration Of Rain-Damage Claims Under ‘Broad’ Clause

NEW ORLEANS — A federal judge in Louisiana on Sept. 29 denied a construction company and property owner’s motions to remand a lawsuit seeking more than $1.3 million from their insurers to state court and granted the insurers’ motion to compel arbitration of the dispute, ruling that the “broad” language of the insurance coverage’s arbitration clause encompassed all of the insureds’ claims, including its bad faith state law claims (Woodward Design + Build, LLC, et al. v. Certain Underwriters At Lloyd's London, et al., No. 19-14017, E.D. La. 2020 U.S. Dist. LEXIS 178799).
October 20, 2020
Insured’s Property Damage Suit Must Be Remanded To Oklahoma State Court

TULSA, Okla. — An insured’s suit seeking coverage for storm-related damages and alleging claims for breach of contract and bad faith against two insurers must be remanded to Oklahoma state court because diversity of citizenship does not exist, an Oklahoma federal judge said Oct. 16 (Regent Preparatory School of Oklahoma v. Travelers Property Casualty Company of America, et al., No. 20-0512, N.D. Okla., 2020 U.S. Dist. LEXIS 192073).
October 15, 2020
Exclusions Relieve Insurer Of Coverage For $1.5M In Repair Costs, Judge Finds

CHARLESTON, S.C. — A commercial general liability insurance policy precludes coverage for $1.5 million in repair costs to an insured’s defective stucco work, a South Carolina federal judge ruled Oct. 13, granting summary judgment to the insurer (The Cincinnati Insurance Company v. Charlotte Paint Company, Inc., et al., No. 18-657, D. S.C., 2020 U.S. Dist. LEXIS 188710).
October 14, 2020
Entry In Insurer’s Claims Notes Does Not Have To Be Produced, Judge Says

PHOENIX — An entry in an insurer’s redacted claims notes pertaining to underlying construction defects lawsuits does not have to be produced because the entry is protected by the attorney-client privilege as it pertains to legal advice and not an adjustment of the claim, an Arizona federal judge said Sept. 30 in partially granting the insurer’s motion for reconsideration (Centex Homes, et al. v. NGM Insurance Co., No. 19-1392, D. Ariz., 2020 U.S. Dist. LEXIS 181204).
October 14, 2020
Contractor Claims Defense Against Arbitration Owed, Says Insurer Breached Contract

LOS ANGELES — A general contractor claims in an Oct. 9 complaint filed in California federal court that an insurer breached its contract and acted in bad faith by refusing to defend the contractor in an arbitration arising out of a construction defects dispute (Tutor Perini Building Corp. v. First Mercury Insurance Co. et al., No. 20-9329, C.D. Calif.)
October 12, 2020
Additional Defendants Added In Construction Defects, Collapse Dispute

BALTIMORE — A Maryland federal judge on Oct. 2 partially granted an insurer’s motion to amend its complaint to add three additional defendants who were directly involved in a renovation project that resulted in the collapse of the insured’s roof because none of the three additional proposed defendants objected to the addition (Arch Insurance Co. v. Costello Construction of Maryland Inc., et al., No. 19-1167, D. Md., 2020 U.S. Dist. LEXIS 183451).
October 12, 2020
Defense Owed To Insured Over Alleged Defectively Installed Pipes, Judge Says

SEATTLE — An insurer’s duty to defend was triggered for $1.4 million in damages for allegedly defectively installed piping in a construction project, a Washington federal judge ruled Oct. 9, granting partial summary judgment to an insured (The Phoenix Insurance Company v. Diamond Plastics Corporation, No. 19-1983, W.D. Wash., 2020 U.S. Dist. LEXIS 188222).
October 12, 2020
Counterclaims Against Construction Company To Proceed, Federal Judge Says

CENTRAL ISLIP, N.Y. — A New York federal judge on Sept. 29 denied a construction company’s motion to dismiss counterclaims asserted against it by a general contractor and a subcontractor after determining that an arbitration award entered in favor of the construction company and against an insurer did not resolve the counterclaims because the general contractor and subcontractor were not a party to the arbitration (Catlin Syndicate 2003, et al. v. Traditional Air Conditioning Inc., et al., No. 17-2406, E.D. N.Y., 2020 U.S. Dist. LEXIS 178829).
October 12, 2020
Suit Seeking To Collect Judgment From Insurer Transferred To North Carolina

CHARLESTON, S.C. — A South Carolina federal judge on Sept. 30 transferred a suit arising out of coverage for a judgment entered against an insured in a construction defects lawsuit to North Carolina federal court after determining that the interest of justice favors the transfer as the insurer filed a similar suit in the North Carolina federal court (Summer Wood Property Owners Association Inc. v. Pennsylvania National Mutual Casualty Insurance Co., No. 19-3548, D. S.C., 2020 U.S. Dist. LEXIS 179766).
October 09, 2020
Insurers Say No Further Coverage Owed For Construction Defects Suit

KANSAS CITY, Mo. — Primary and umbrella liability insurers filed suit on Oct. 5 in Kansas federal court against their insured contractor, seeking a declaration that no further coverage is owed for an underlying judgment entered against the insured contractor in a construction defects dispute (Continental Casualty Co., et al. v. Complete Construction LLC, et al., No. 20-2493, D. Kan.).
October 08, 2020
Oregon Federal Magistrate Judge Says Policies’ Use Of Term ‘Occurred’ Is Ambiguous

PORTLAND, Ore. — An Oregon federal magistrate judge on Oct. 5 denied an insurer’s motion for summary judgment in a coverage dispute over when hidden property damage to a townhome development occurred after determining that a ruling could not be made on whether the policies’ two-year suit limitations provision applies because the term “occurred” as used in the policies is ambiguous (Silver Ridge Homeowners’ Association Inc. v. State Farm Fire and Casualty Co., No. 19-01218, D. Ore., 2020 U.S. Dist. LEXIS 184205).
October 08, 2020
Magistrate Judge Recommends No Dismissal Of Coverage Case Over Construction Defects

MIAMI — Insurers can proceed with a coverage dispute over alleged defects in a fire protection system in a luxury condominium building, a federal magistrate judge in Florida said Oct. 5, recommending denial of motions to dismiss because a determination on the duty to defend and indemnify can ignore any extrinsic facts (Westchester Surplus Lines Insurance Company, et al. v. Summers Fire Sprinklers, Inc., et al., No. 20-21770, S.D. Fla., 2020 U.S. Dist. LEXIS 186159).