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

Mealey's Construction Defects Insurance

October 5, 2018
Judge Denies Remand Of Defective Drywall Suit, Finds Insurer Improperly Joined

NEW ORLEANS — A federal judge in Louisiana on Oct. 3 denied a couple’s motion to remand their lawsuit seeking damages for Chinese-made drywall that was installed in their home following Hurricane Katrina, finding that they improperly joined their insurer as a defendant (Cedric Richmond, et al. v. National Gypsum Services Co., No. 17-7453, E.D. La., 2018 U.S. Dist. LEXIS 170814).
October 3, 2018
Judge: Policy Precludes Coverage For Insured’s New Construction Work

CAMDEN, N.J. — An insurer has no duty to defend or indemnify an insured subcontractor for construction defects allegations because the policy excludes coverage for residential new construction work, a New Jersey federal judge ruled Sept. 28 (Colony Insurance Co. v. Troensa Construction Inc., et al., No. 17-03577, D. N.J., 2018 U.S. Dist. LEXIS 167683).
October 3, 2018
Judge: Some Defective Construction Is Covered Under Insurance Policies

GREENVILLE, S.C. — Because some damages arising out of construction defects are covered by commercial general liability insurance policies and because insurers did not effectively reserve their right to contest coverage, a South Carolina federal judge on Sept. 28 granted summary judgment to a condominium association (Stoneledge at Lake Keowee Owners Association Inc. v. Cincinnati Insurance Co., et al., No. 14-01906, D. S.C., 2018 U.S. Dist. LEXIS 167792).
September 26, 2018
No Coverage Owed For Continuous, Repeated Water Damage, Judge Says

SPRINGFIELD, Ill. — No coverage is owed to insureds for water damage discovered in their hotel property because the policy’s exclusion for continuous water leakage precludes coverage, an Illinois federal judge said Sept. 24, noting that the evidence shows that there were years of leaks and dampness in the room where the water damage was discovered (Tracy Holdings LLC v. West Bend Mutual Insurance Co., No. 16-3100, C.D. Ill., 2018 U.S. Dist. LEXIS 162363).
September 25, 2018
Judge Dismisses Insurer’s Duty-To-Indemnify Suit As Being Premature

FORT MYERS, Fla. — A Florida federal judge on Sept. 24 dismissed a commercial general liability insurer’s coverage dispute regarding its duty to indemnify an insured against construction defect claims because the matter is not ripe for review (Mid-Continent Casualty Co. v. Delacruz Drywall Plastering & Stucco Inc., et al., No. 16-720, M.D. Fla., 2018 U.S. Dist. LEXIS 162864).
September 24, 2018
Insurer’s Duty To Defend Lawsuit Should Proceed, Magistrate Judge Finds

ALBUQUERQUE, N.M. — A commercial general liability insurer’s declaratory judgment case against an insured contractor and homeowners should proceed regarding coverage for noxious gas found in a home after spray foam insulation work, a New Mexico federal magistrate judge held Sept. 20 (International Insurance Company of Hannover SE v. Connors & Sons Classy Construction LLC, et al., No. 17-0825, D. N.M., 2018 U.S. Dist. LEXIS 161805).
September 24, 2018
No Coverage Due For Deterioration Of Foundation Walls, Judge Determines

HARTFORD, Conn. — No coverage is owed to a homeowner seeking coverage for the deterioration of her home’s foundation as a result of a chemical reaction in the concrete used to build the home because the damage gradually occurred over time and was not sudden and accidental as required by the policy, a Connecticut federal judge said Sept. 20 (Maureen E. Carney v. Allstate Insurance Co., No. 16-592, D. Conn., 2018 U.S. Dist. LEXIS 161401).
September 20, 2018
Insurer Denied Attorney Fees In Construction Defect Summary Judgment Win

LAS VEGAS — A Nevada federal judge on Sept. 18 denied reconsideration of his judgment in a construction defect insurance case and denied a motion by the winner for $302,214.50 in attorney fees (Assurance Co. of America, et al. v. Ironshore Specialty Ins. Co., No. 15-460, D. Nev., 2018 U.S. Dist. LEXIS 159454).
September 19, 2018
Judge: Insureds’ Losses Fall Within Definition Of ‘Caving In’ Under Policy

HARTFORD, Conn. — In a coverage dispute over damages to insureds’ basement walls from cracking, a Connecticut federal judge on Sept. 18 denied summary judgment to a homeowners insurer on a breach of contract claim because the insureds’ damages fall within their reasonably proposed definition of “caving in” under the policy (Michael M. Sirois, et al. v. USAA Casualty Insurance Co., No. 16-1172, D. Conn., 2018 U.S. Dist. LEXIS 158508).
September 19, 2018
Judge Dismisses Insureds’ Bad Faith Claim, Allows Breach Of Contract To Remain

HARTFORD, Conn. — A Connecticut federal judge on Sept. 17 dismissed claims for bad faith and declaratory judgment against an insurer regarding its refusal to pay for damages to basement walls; however, the insureds’ breach of contract claim survived (James T. Ainsworth, et al. v. Amica Mutual Insurance Co., No. 16-01139, D. Conn., 2018 U.S. Dist. LEXIS 157886).
September 14, 2018
Coverage Barred For Water Damage; Loss Was Not Sudden And Accidental

DENVER — No coverage is owed for water damage discovered within an exterior insulation finishing system because the damage was not sudden and accidental as required for coverage to exist under the policy, a Colorado federal magistrate judge said Sept. 13 (Mark Mock, et al. v. Allstate Insurance Co., No. 17-2592, D. Colo., 2018 U.S. Dist. LEXIS 156256).
September 14, 2018
Pennsylvania Federal Judge: Insurer Has No Duty To Defend Faulty Work Claims

ALLENTOWN, Pa. — An insurer had no duty to provide a defense for a mutual insured in a construction defects case, a Pennsylvania federal judge ruled Sept. 11, finding that claims for faulty workmanship do not constitute a covered “occurrence” (Union Insurance Co. v. Selective Insurance Company of America, No. 17-2674, E.D. Pa., 2018 U.S. Dist. LEXIS 154359).
September 12, 2018
Judge: Water Exclusion Bars Coverage For Insureds’ Damages From Wall Collapse

SEATTLE — Coverage for damages caused by the collapse of a home’s retaining wall are precluded under a homeowners insurance policy’s water exclusion, a Washington federal judge ruled Sept. 7; however, the judge declined to grant summary judgment to the insurer on claims for bad faith and violation of Washington’s Consumer Protection Act (CPA) (Stephen Jones, et al. v. State Farm Fire and Casualty Co., No. 17-1058, W.D. Wash., 2018 U.S. Dist. LEXIS 153102).
September 12, 2018
Insurer Owes No Coverage For Faulty Laminate Suit, 7th Circuit Affirms

CHICAGO — The Seventh Circuit U.S. Court of Appeals on Sept. 10 affirmed a lower federal court’s finding that an insurer has no duty to provide coverage for an underlying lawsuit alleging that its plastics company insured manufactured a faulty laminate (Berry Plastics Corp. v. Illinois National Insurance Co., No. 17-1815, 7th Cir., 2018 U.S. App. LEXIS 25576).
September 11, 2018
Insurer Has No Duty To Indemnify Liquidated Damages, Panel Finds

DETROIT — A commercial general liability insurer has no duty to indemnify liquidated damages or damages arising from a professional negligence claim, the Michigan Court of Appeals ruled Sept. 6, upholding summary disposition to the insurer (Westfield Insurance Co. v. Jenkins Construction Inc., et al., No. 337968, Mich. App., 2018 Mich. App. LEXIS 3109).
September 11, 2018
Insurer Has Duty To Defend Insured In Underlying Mold, Water Damages Suit

FORT LAUDERDALE, Fla. — A Florida federal magistrate judge on Sept. 7 recommended denying an insurer’s motion for summary judgment after determining that the insurer has a duty to defend its insured in an underlying suit seeking damages as a result of mold and water damages caused by the insured’s negligent installation of windows because the damages occurred during the policy periods at issue (National Builders Insurance Co. v. RQ Building Products Inc. et al., No. 17-61474, S.D. Fla., 2018 U.S. Dist. LEXIS 153900).
September 11, 2018
11th Circuit Upholds Denial Of Motion For Relief In Insurance Coverage Dispute

ATLANTA — Having previously held that an insurer had no duty to defend or indemnify claims that an insufficient inspection failed to discover defective conditions prior to a home sale, the 11th Circuit U.S. Court of Appeals on Sept. 6 affirmed the denial of homeowners’ motion for relief from final judgment in their coverage dispute with the insurer (Auto-Owners Insurance Co. v. Ralph Gage Contracting Inc., et al., No. 18-10401, 11th Cir., 2018 U.S. App. LEXIS 25309).
September 7, 2018
Insurer Did Not Breach Its Contract, Act In Bad Faith, Judge Concludes

HARTFORD, Conn. — In a dispute over insureds’ damages from cracking in their basement walls from the use of defective concrete, a Connecticut federal judge on Sept. 5 granted summary judgment to an insurer on breach of contract and bad faith claims against it (Kenneth T. Courteau, et al. v. Teachers Insurance Co., No. 16-00580, D. Conn., 2018 U.S. Dist. LEXIS 150784).
September 7, 2018
Subrogated Insurer’s Negligence Claim Fails, Federal Judge Rules

HARTFORD, Conn. — A subrogated insurer failed to prove negligence because it did not disclose any experts to prove duty, breach and causation, a Connecticut federal judge ruled Sept. 4, granting summary judgment to a contractor (Great Northern Insurance Co. v. 5K Development LLC v. DiFulvio Construction LLC, No. 16-01359, D. Conn., 2018 U.S. Dist. LEXIS 150298).
September 5, 2018
Insurance Policies Do Not Cover Defective Work Claims, Federal Judge Says

BOSTON — Insurance policies do not provide defense and indemnity coverage for third-party claims for defective workmanship and dishonest acts, a Massachusetts federal judge ruled Sept. 4, granting summary judgment to an insurer (689 Charles River v. American Zurich Insurance Co., No. 18-10118, D. Mass., 2018 U.S. Dist. LEXIS 149798).