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

Mealey's Construction Defects Insurance

July 06, 2020
9th Circuit Certifies Burden Of Proof Question For Defects Insurance Coverage Case

SAN FRANCISCO — In a construction defects insurance coverage dispute, the Ninth Circuit U.S. Court of Appeals on July 2 asked the Nevada Supreme Court for guidance on whether an insurer or an insured has the burden of proving the applicability of an exception to a policy exclusion and whether that party can rely on extrinsic evidence, and if so, whether only extrinsic evidence available at the time the insured tendered the defense of the lawsuit to the insurer is relevant for proving the exception (Zurich American Insurance Co., et al. v. Ironshore Specialty Insurance Company, No. 18-16937, 9th Cir., 2020 U.S. App. LEXIS 20815).
July 06, 2020
Insurer: No Coverage For Floor Damages In Senior Housing Facility

MINNEAPOLIS — Coverage does not exist for damages from a subcontractor’s installation of gypcrete flooring in a 177-unit senior housing facility project that occurred before a commercial lines policy’s effective date, an insurer alleges in a June 30 complaint filed in Minnesota federal court (West Bend Mutual Insurance Company v. KMAC, Inc., et al., No. 20-1493, D. Minn.).
July 02, 2020
Michigan High Court Defines Faulty Work Under CGL Policy’s ‘Accident’

LANSING, Mich. — In a $1.4 million coverage dispute, the Michigan Supreme Court on June 29 ruled that an “accident” as defined by a commercial general liability insurance policy may include unintentionally faulty subcontractor work that damages an insured’s work product (Skanska USA Building Inc. v M.A.P. Mechanical Contractors, Inc., et al., Nos. 159510 and 15951, Mich. Sup., 2020 Mich. LEXIS 1194).
June 30, 2020
Insurer Seeks Subrogation, Contribution For Defense, Settlement Of Defects

DENVER — An Irish insurer sued subcontractors and their insurers on June 12 in a Colorado federal court alleging subrogation and contribution claims regarding its defense and settlement of underlying construction defect claims by homeowners against a general contractor (AmTrust International Underwriters DAC v. Winchester Co., et al., No. 20-1728, D. Colo.).
June 30, 2020
Insurer Says No Duty To Indemnify Alleged Defects In Florida Community

FORT MYERS, Fla. — There is no duty to indemnify alleged construction defects in an insured’s drywall and stucco work for 60 single-family home in a Naples, Fla., community, an insurer says in a June 17 complaint filed in a Florida federal court, citing various exclusions. including a condominium, apartment, townhouse or tract housing coverage limitation endorsement (Accident Insurance Company, Inc. v. V&A Drywall and Stucco, Inc., et al., No. 20-425, M.D. Fla.).
June 18, 2020
Insurer Has No Duty To Defend Conversion Claim, Illinois Appeals Panel Says

ELGIN, Ill. — A conversion claim against insureds regarding their work on a construction project alleges intentional conduct and, thus, was not an “occurrence,” an Illinois appeals panel held June 16, finding that an insurer has no duty to defend (Pekin Insurance Company v. McKeown Classic Homes, Inc., et al., No. 2-19-0631, Ill. App., 2nd Dist., 2020 Ill. App. Unpub. LEXIS 1037).
June 24, 2020
Panel: Defense Owed By Insurer For Damages Caused By Faulty Steel

TROY, Mich. — Damages from allegedly defective steel supplied by a metal fabrication contractor constitute an “occurrence,” a Michigan appeals panel ruled June 18, affirming that a commercial general liability insurer had a duty to defend the contractor (Cardinal Fabricating, Inc. v. Cincinnati Insurance Company, No. 348339, Mich. App., 2020 Mich. App. LEXIS 3912).
June 22, 2020
Insurer: No Coverage Based On ‘Your Product,’ ‘Your Work’ Exclusions

CHARLESTON, S.C. — A commercial general liability policy’s “your work” and “your product” exclusion preclude any coverage for an underlying construction defects case filed against a contractor, an insurer says in a June 18 complaint filed in South Carolina federal court (Accident Insurance Company, Inc. v. Morillo Construction, LLC, No. 20-2314, D. S.C.).
June 22, 2020
Judge: Defects In Home Remodeling Work Are Not Covered By Insurance

SEATTLE — A designated work exclusion precludes coverage for $250,000 in construction defect damages tied to a contractor’s home remodeling work, a Washington federal judge ruled June 17, granting a default judgment to an insurer (Developers Surety and Indemnity Company v. View Point Builders, Inc., et al., No. 20-0221, W.D. Wash., 2020 U.S. Dist. LEXIS 107201).
June 19, 2020
Insurer Owes Defense For Water Intrusion Claim, Roofing Contractor Says

WEST PALM BEACH, Fla. — A roofing contractor alleges in a June 17 complaint filed in a Florida federal court that insurance coverage exists for water intrusion allegations concerning its work on condominium buildings for a Florida association (Republic Roofing & Insulation Contractors, LLC v. James River Insurance Company, No. 20-80955, S.D. Fla.).
June 17, 2020
Insured Does Not Owe Reimbursement For Insurers’ Settlement

AKRON, Ohio — Insurance policies do not require a garage door manufacturer to reimburse its insurers for $245,000 spent in settling another insurer’s contribution lawsuit for defense of a construction defect suit, an Ohio federal magistrate judge ruled June 16 (Hartford Fire Insurance Company, et al. v. HRH Door Corp., No. 18-2366, N.D. Ohio, 2020 U.S. Dist. LEXIS 104823).
June 16, 2020
Chubb: No Defense Owed For $10M In Defects To Residential Property

ATLANTA — Chubb Custom Insurance Co. filed a declaratory judgment complaint on June 12 in a Georgia federal court regarding its coverage obligations for damages from construction defects in excess of $10 million for a South Carolina multiunit residential property (Chubb Custom Insurance Company v. Vista Realty Partners, LLC, et al., No. 20-02508, N.D. Ga.).
June 15, 2020
Magistrate Judge Orders Subcontractor To Comply With Insurers’ Subpoena

SPRINGFIELD, Ill. — A federal magistrate judge in Illinois on June 12 denied a heating and air conditioning subcontractor’s attempt to quash a subpoena from insurers in their coverage dispute over defects in a facility for The Salvation Army (The Phoenix Insurance Company, et al. v. S.M. Wilson & Co., et al., No. 20-3063, C.D. Ill., 2020 U.S. Dist. LEXIS 103093).
June 12, 2020
Damage To Property, Product Exclusions Bar Coverage, Insurer Says

GULFPORT, Miss. — Citing various policy exclusions that include “damage to property” and “damage to your product,” an insurer alleges in a June 10 complaint in Mississippi federal court that there is no coverage for homeowners’ construction defect case (Accident Insurance Company, Inc. v. Dennis Collier Construction, LLC, et al., No. 20-191, S.D. Miss.).
June 11, 2020
Panel: Insurer Equitably Subrogated To Defense Costs In 2 Defect Cases

RIVERSIDE, Calif. — A California appeals panel on June 10 reversed a lower court’s decision on an insurer’s equitable subrogation claim against six subcontractors over defense costs spent for a general contractor against two construction defect actions and remanded for a determination on the amount of defense costs to shift to each subcontractor (Pulte Home Corporation v. CBR Electric, Inc., et al., No. E068353, Calif. App., 4th Dist., Div. 2, 2020 Cal. App. LEXIS 519).
June 10, 2020
Subrogated Insurer’s $1.8M Negligence Suit Allowed To Proceed

BOSTON — A Massachusetts federal magistrate judge on June 1 denied summary judgment to a contractor and subcontractor, holding that the anti-subrogation doctrine does not bar a subrogated insurer’s $1.8 million negligence suit against them (Factory Mutual Insurance Company v. Skanska USA Building, Inc., et al., No. 18-11700, D. Mass., 2020 U.S. Dist. LEXIS 95403).
June 10, 2020
Judge Denies Remand Of Insureds’ Bad Faith, Breach Of Contract Suit

NASHVILLE, Tenn. — A Tennessee federal judge on June 9 refused to remand a contractor and its president’s breach of contract and bad faith suit against an insurer over coverage for a residential construction defects case (Cornerstone Construction Company of Tennessee, LLC, et al. v. Builders Mutual Insurance Co., No. 19-01056, M.D. Tenn., 2020 U.S. Dist. LEXIS 100336).
June 05, 2020
Judge: No Insurance For Miami Dolphins Stadium Renovation

NEW YORK — A professional liability insurer owes no coverage for claims against a construction management firm related to design and construction services on the Miami Dolphins stadium, a New York federal judge ruled June 4, finding that the claims were not timely reported (Berkley Assurance Company v. Hunt Construction Group, Inc., No. 19- 2879, S.D. N.Y.).
June 03, 2020
10th Circuit: Faulty Work Exclusion Bars Insurance Coverage

DENVER — A defective workmanship exclusion under a building owner’s insurance policy precludes coverage for a subcontractor’s costs of repairing its faulty work at the property, the 10th Circuit U.S. Court of Appeals ruled June 2 (Rocky Mountain Prestress, LLC v. Liberty Mutual Fire Insurance Company, No. 19-1169, 10th Cir., 2020 U.S. App. LEXIS 17309).
June 02, 2020
Judge: Insurer Owes No Coverage For Homeowners’ Negligent Design Claim

COLUMBUS, Ga. — Auto-Owners Insurance Co. has no duty to defend or indemnify an underlying negligent home design dispute because an insured breached the policy’s notice of occurrence and notice of suit provisions, a Georgia federal judge ruled June 1, also finding that several exclusions apply (Auto-Owners Insurance Company v. Wayne Frier Home Center of Byron LLC, et al., No. 19-95, M.D. Ga., 2020 U.S. Dist. LEXIS 95108).