Mealey's Construction Defects Insurance

  • May 18, 2018

    Defective Shingles Caused Leaks, Kitchen Damage, Couple Complains

    CLEVELAND — An Ohio couple filed a lawsuit in state court on May 16 against the maker of shingles that were installed on their home, claiming that they were defective because they allowed the roof to leak, causing damage to their kitchen (Blanche Forman, et al. v. IKO Industries Inc., No. CV 18 897861, Ohio Comm. Pls., Cuyahoga Co.).

  • May 17, 2018

    Kentucky High Court: Faulty Workmanship Is Not An Occurrence

    FRANKFORT, Ky. — The Kentucky Supreme Court held April 26 that courts must use the doctrine of fortuity to determine whether an event constitutes an accident that triggers coverage under a commercial general liability (CGL) policy and found that an appeals court panel properly applied its ruling in Cincinnati Ins. Co. v. Motorist Mitt. Ins. Co. to find that a contractor’s faulty workmanship did not constitute an occurrence that warranted coverage (Martin/Elias Properties LLC v. Acuity Mutual Insurance Company, No. 2016-SC-0000195-DG, Ky. Sup., 2018 Ky. LEXIS 188).

  • May 17, 2018

    Federal Magistrate Judge Says Surety Is Entitled To Reimbursement For Paid Claims

    SAN FRANCISCO — A California federal magistrate judge on May 15 determined than a surety is entitled to reimbursement of more than $4 million for claims it paid on behalf of a construction company that contracted with the government on a number of construction projects (Travelers Casualty and Surety Company of America v. K.O.O. Construction Inc., et al., No. 16-518, N.D. Calif., 2018 U.S. Dist. LEXIS 81914).

  • May 14, 2018

    Nationwide Seeks Declaration That It Owes No Coverage To Railing Installer

    CHARLESTON, S.C. — Nationwide Mutual Fire Insurance Co. says in a May 4 lawsuit filed in South Carolina federal court that it should not be required to provide coverage to a railing subcontractor that is a named defendant in a construction defects lawsuit, arguing that it doubts that the damages in the defects suit are for property damage caused by an occurrence (Nationwide Mutual Fire Insurance Co. v. Floyd Stanley Jr., et al., No. 18-cv-01232-MBS, D. S.C.).

  • May 11, 2018

    Federal Magistrate Judge: Insurance Policy Covers Church’s Ceiling Collapse

    BOSTON — A church’s loss when its ceiling fell is covered by the collapse coverage part of an insurance policy, a Massachusetts federal magistrate judge ruled May 10, finding that “faulty construction” and “wear and tear” exclusions do not apply (Easthampton Congregational Church v. Church Mutual Insurance Co., No. 17-30061, D. Mass., 2018 U.S. Dist. LEXIS 78777).

  • May 11, 2018

    No Coverage Owed Under Collapse Provisions, 9th Circuit Panel Affirms

    SEATTLE — A district court did not err in finding that an insurer owes no coverage for damage to apartments from hidden decay under its policies’ “collapse” provisions because the damage has not rendered the apartment building unfit or unsafe for occupancy, the Ninth Circuit U.S. Court of Appeals said May 9 (American Economy Insurance Co. v. CHL LLC, No. 16-35606, 9th Cir., 2018 U.S. App. LEXIS 12159).

  • May 10, 2018

    Magistrate Judge Denies Extension On Deadlines In Defects Insurance Coverage Case

    ORLANDO, Fla. — In an insurance coverage dispute for a construction defects case, a Florida federal magistrate judge on May 9 denied homeowners’ request for an extension to comply with case management deadlines and for a protective order on the depositions (Mid-Continent Casualty Co. v. Stanley Homes Inc., et al., No. 17-1512, M.D. Fla., 2018 U.S. Dist. LEXIS 77841).

  • May 9, 2018

    Subrogated Insurer Seeks Reimbursement For Faulty Installation Of Solar Panels

    WILMINGTON, Del. — In a May 4 complaint filed in a Delaware court, a subrogated homeowners insurer seeks reimbursement of $65,300.83 paid to insureds for property damage caused by defective installation of a solar panel system (Nationwide Mutual Fire Insurance Co., et al. v. KW Solar Solutions Inc., et al., No. N18C-05, Del. Super., New Castle Co.).

  • May 8, 2018

    Judge Says No Bad Faith By Insurer In Denial Of Entire Roof’s Replacement

    CINCINNATI — A homeowners insurer did not breach its contract or act in bad faith in refusing to replace an entire roof of its insureds’ home, which suffered damages during a storm, an Ohio federal judge ruled May 7, granting summary judgment to the insurer (Tracy Avery, et al. v. Erie Insurance Co., No. 17-562, S.D. Ohio, 2018 U.S. Dist. LEXIS 76351).

  • May 7, 2018

    Judge Refuses To Dismiss Counterclaim Against Insurer In Construction Defect Dispute

    FLORENCE, S.C. — A South Carolina federal judge on May 4 declined to dismiss a counterclaim against a commercial general liability insurer seeking a declaration on coverage for an underlying construction defect lawsuit (American Southern Insurance Co. v. Affordable Home Improvements, et al., No. 17-02366, D. S.C., 2018 U.S. Dist. LEXIS 75524).

  • May 4, 2018

    Judge: 8 Insurers Owe No Reimbursement For Faulty Windows Settlement

    HARRISBURG, Pa. — Eight insurers under 27 insurance policies owe no reimbursement to an aluminum products manufacturer against costs from an underlying settlement over the sale of faulty windows, a Pennsylvania federal judge ruled May 1, finding that the policies do not cover damages caused by the insured’s intentional conduct (Sapa Extrusions Inc. v. Liberty Mutual Insurance Co., et al., No. 13-2827, M.D. Pa., 2018 U.S. Dist. LEXIS 73162).

  • May 3, 2018

    No Coverage Owed For Deterioration Of Insureds’ Basement Foundation Walls

    BRIDGEPORT, Conn. — No coverage is afforded for insureds’ claims arising out of the cracking and deterioration of their home’s basement walls as a result of a chemical reaction in the foundation’s concrete because the policy’s collapse provision provides coverage only for abrupt collapses, a Connecticut federal judge said May 2 in granting the insurer’s motion to dismiss (John Enderle, et al. v. Amica Mutual Insurance Co., No. 17-1510, D. Conn., 2018 U.S. Dist. LEXIS 74186).

  • May 2, 2018

    Judge Declines To Alter Dismissal Of Insurer’s Breach Of Contract Case

    KANSAS CITY, Kan. — A Kansas federal judge on April 30 refused to alter or amend his ruling dismissing a breach of contract claim against an insured for its alleged failure to pay per-occurrence deductibles that would have offset an amount an insurer paid to settle underlying water damage claims filed by townhome owners and an association (Mid-Continent Casualty Co. v. Greater Midwest Builders Ltd., et al., No. 17-2561, D. Kan., 2018 U.S. Dist. LEXIS 71857).

  • May 1, 2018

    Federal Judge Certifies Question On Collapse To Connecticut High Court

    BRIDGEPORT, Conn. — A Connecticut federal judge on April 30 certified to the state high court a question that asks what constitutes a “substantial impairment of structural integrity” such that the policy’s collapse provision would apply to the loss (Steven Karas, et al. v. Liberty Insurance Corp., No. 13-1836, D. Conn., 2018 U.S. Dist. LEXIS 71844).

  • May 1, 2018

    Magistrate Judge: Fact Issues Exist On Collapse’s Cause For Insurance Coverage

    PHILADELPHIA — There are genuine issues of material fact as to whether a homeowners insurance policy covered a collapse, a Pennsylvania federal magistrate judge held April 26, noting that there is competing testimony on whether the collapse was caused by improper construction or long-term deterioration (Jocelyn Desvarieux, et al. v. Allstate Property & Casualty Insurance Co., No. 17-2564, E.D. Pa., 2018 U.S. Dist. LEXIS 71230).

  • April 26, 2018

    Excess Insurer Has No Duty To Indemnify Chinese Drywall Claims, Judge Says

    MIAMI — In a coverage dispute over the installation of Chinese drywall, a subcontractor failed to establish that an excess insurer has a duty to indemnify it for its damages, a Florida federal judge ruled April 25, granting summary judgment to the excess insurer on claims for declaratory judgment, breach of contract and bad faith (Peninsula II Developers Inc., et al. v. Westchester Fire Insurance Co., No. 09-23691, S.D. Fla., 2018 U.S. Dist. LEXIS 69479).

  • April 25, 2018

    Texas High Court Stays Coverage Suit To Decide If Judge Abused His Discretion

    AUSTIN, Texas — The Texas Supreme Court on April 24 granted an insurer’s motion for temporary relief to stay a coverage lawsuit over the installation of defective heating ventilation and air conditioning units pending its ruling on the insurer’s petition for writ of mandamus seeking to clarify a party’s right to object to an assigned judge when the party first learns of the assignment the day of the first hearing or trial (In re Union Insurance Co., No. 18-0353, Texas Sup.).

  • April 23, 2018

    Insurers Fail To Show Number Of ‘Occurrences’ In Defects Dispute, Judge Says

    LAS VEGAS — A primary insurer and an excess insurer failed to demonstrate the number of proximate causes and the number of occurrences regarding coverage of a construction defects case against their mutual insured, a Nevada federal judge ruled April 18 (AIG Specialty Insurance Co. v. Liberty Mutual Fire Insurance Co., No. 17-01260, D. Nev., 2018 U.S. Dist. LEXIS 65198).

  • April 20, 2018

    Subrogation Waiver Bars Insurer’s Breach Of Contract, Negligence Claims, Panel Says

    BALTIMORE — A settlement agreement did not extinguish a waiver of subrogation provision in a prime contract, a Maryland appellate panel ruled April 17, finding no error in the entry of summary judgment to a contractor and subcontractors on a subrogated insurer’s negligence and breach of contract claims because the claims were barred by the subrogation waiver (National Surety Corp. v. K&C Framing Inc., et al., No. 1711, Md. Spec. App., 2018 Md. App. LEXIS 358).

  • April 19, 2018

    11th Circuit Vacates Ruling On Water Exclusion, Says District Court Erred

    ATLANTA — The 11th Circuit U.S. Court of Appeals on April 16 vacated a district court’s ruling that coverage is barred for water damage caused by a collapsed pipe after determining that the policy’s water exclusion does not apply to water damage caused by a failure within the property’s plumbing system (Ken Cameron and Michelle Cameron v. Scottsdale Insurance Co., No. 17-11907, 11th Cir., 2018 U.S. App. LEXIS 9800).