Mealey's Construction Defects Insurance : Mealey's : Legal News & Analysis

Mealey's Construction Defects Insurance

November 08, 2022
CGL Insurer Appeals Sewer Line Collapse Coverage Lawsuit To 2nd Circuit

NEW HAVEN, Conn. — A commercial general liability insurer filed a notice of appeal in Connecticut federal court appealing to the Second Circuit U.S. Court of Appeals a federal judge’s grant of summary judgment in favor of a contractors pollution liability (CPL) insurer, in which the judge ruled that the insurer did not owe a subcontractor a duty to defend in a lawsuit stemming from the collapse of a sewer line the subcontractor installed because the subcontractor was covered under the CPL and CGL policies and that the “other insurance” clauses in both policies required the CPL policy to provide only excess coverage.
November 08, 2022
Judge Finds Settlement In Tile Defects Suit Was Reached In Good Faith

OAKLAND, Calif. — A federal judge in California issued an order in a breach of contract insurance action filed by an insurer against additional insured subcontractors and others related to an underlying action against a general contractor alleging defective tile installation at a housing development dismissing claims against an additional insurer, granting a settlement reached between the parties and dismissing the additional insurer from the litigation.
November 08, 2022
Claims Against Insurer In Rec Center Construction Coverage Suit Dismissed

LAS VEGAS — Without providing detail, a federal judge in Nevada dismissed claims brought by two homebuilders against an insurance company, in which the homebuilders alleged that the insurer breached the terms of the policies issued to subcontractors who built a community recreation center by refusing to defend the subcontractors in a construction lawsuit brought by a homeowners association or by not fully reimbursing the builders for defense costs.
November 04, 2022
Subcontractor Appeals Property Damage Coverage Lawsuit To 11th Circuit

ATLANTA — An insured subcontractor will appeal a federal judge in Georgia’s ruling granting summary judgment in favor of a commercial general liability insurer in a coverage dispute stemming from a lawsuit filed against the subcontractor related to faulty welding work performed at a construction project, according to a notice of appeal the subcontractor filed in Georgia federal court (Middlesex Insurance Co. v. Dixie Mechanical Inc., et al., No. 20-4971, N.D. Ga.).
November 03, 2022
Professional Services Exclusion Bars Coverage For Subcontractor, Judge Rules

TAMPA, Fla. — A commercial general liability insurer has no duty to defend its insured subcontractor on claims that the insured breached the terms of a contract and was negligent in performing its construction management services duties in the construction of an apartment complex because the insured’s policies contained an exclusion for “professional services,” a federal judge in Florida ruled Nov. 2, granting the insurer’s motion for judgment on the pleadings.
November 03, 2022
Magistrate: Experts On Cost, Scope Of Roof Repair Can Testify In Insurance Row

SAN ANTONIO — An insurer failed to persuade a Texas federal magistrate judge to ban two experts retained in a breach of contract suit from testifying after she found that many of its objections are not grounds for dismissal or are based on inapplicable rules.
November 02, 2022
Subrogee’s Negligence Claim Against Roofer Barred By Economic Loss Doctrine

CHICAGO — A federal judge in Illinois dismissed claims in a subrogation lawsuit stemming from a roofing contractor’s alleged improper installation of a roof at a condominium development, ruling that the subrogee insurer’s negligence claim was barred by the economic loss doctrine and that the insurer failed to properly plead the elements of its contract breach claim.
November 01, 2022
Attorney Fee Award In Defective Stucco Coverage Suit Appealed To 11th Circuit

ORLANDO, Fla. — An insurer has appealed a reduced attorney fee award in favor of a contractor’s counsel in a coverage lawsuit stemming from the law firm’s representation of the contractor in an underlying lawsuit over a subcontractor’s alleged defective stucco work on several homes in a subdivision, according to a notice of appeal filed in Florida federal court.
November 01, 2022
Default Judgment Granted Against Contractors In Consulting Coverage Suit

CHARLESTON, S.C. — A federal judge in South Carolina granted an insurer’s motion for default judgment against a general contractor and an insured subcontractor in a coverage lawsuit seeking a declaration that the insurer owes no duty to defend or indemnify the defendants in an underlying construction defects lawsuit, ruling that while the defendants were properly serviced with summonses and the complaint, they failed to timely respond to the lawsuit.
October 31, 2022
Condo Owners Association Takes Water Damage Coverage Suit To 9th Circuit

SEATTLE — A condominium owners association has appealed a federal judge’s order granting summary judgment in favor of the association’s insurers on claims that the insurers erred in denying coverage for water damage repairs to the Ninth Circuit U.S. Court of Appeals, according to a notice of appeal filed in Washington federal court.
October 28, 2022
Insurer Denied Summary Judgment In Duty To Defend Suit Over Roof Repair Coverage

KANSAS CITY, Kan. — A commercial general liability insurer is not entitled to summary judgment on claims brought by a church alleging that although the insurer had a duty to defend and indemnify its insured contractor on claims in a lawsuit related to the contractor’s defective roof work on a building the church later purchased because genuine issues of material fact exist as to whether the insurer breached its duty to defend the contractor, a federal judge in Kansas ruled Oct. 27.
October 27, 2022
2 Of 3 Counterclaims Against CGL Insurer Dismissed In Faulty Work Coverage Suit

MIAMI — A federal judge in Florida on Oct. 26 substantially granted a commercial general liability insurer’s motion to dismiss counterclaims brought by a general contractor in a coverage dispute stemming from a subcontractor’s alleged faulty installation of cladding and glazing systems in a construction project, ruling that the contractor failed to state a claim for relief in bringing two of the three counterclaims.
October 25, 2022
Contractor Appeals Indemnification Reimbursement Ruling To 2nd Circuit

NEW YORK — A design-build contractor appealed a ruling by a federal judge in New York that an insurer is entitled to reimbursement of $5 million it paid to the contractor under the rectification indemnity coverage provision of the contractor’s policy because a policy provision governing subrogation located in the policy required that the contractor repay the insurer for money the contractor obtained in an arbitration proceeding, according to a notice of appeal filed in New York federal court.
October 25, 2022
4th Circuit Affirms Denial Of Water Damage Claim Based On Policy Exclusion

RICHMOND, Va. — A federal district court did not err in ruling that an insurer is entitled to summary judgment in a coverage dispute with an insured hotel over the insurer’s denial of a water damage claim based on alleged faulty workmanship because the lower court properly concluded that the faulty workmanship claim was “an excluded cause of loss,” a Fourth Circuit U.S. Court of Appeals panel affirmed.
October 21, 2022
Condo’s Insurance Policies Provide Coverage For Water Intrusion Damages

SEATTLE — A federal judge in Washington ruled that a condominium’s apartment owners association is entitled to summary judgment in a coverage dispute with its insurers over water intrusion damage caused by defects in the construction of the property because the association has shown that the coverage sought is covered under the policies.
October 21, 2022
Developer, Contractor Appeal Remediation Coverage Dispute To D.C. Circuit

WASHINGTON, D.C. — A real estate developer and contractor appealed to the District of Columbia Circuit U.S. Court of Appeals a judge’s grant of summary judgment in favor of two builders risk insurers on claims that the insurers breached the terms of policies they issued the plaintiffs by failing to provide remediation coverage for condensation damage discovered during the building of a residential development.
October 20, 2022
Parties Debate Whether Subcontractor’s Insurer Owed Duty To Defend, Indemnify

DENVER — Parties in a coverage dispute stemming from construction defects arbitration proceedings brought by four homeowners in a country club development have asked a federal judge in Colorado to determine whether a subcontractor’s insurer owed the construction project’s general contractor a duty to defend in the arbitration proceedings and whether the insurer is responsible for its insured’s equitable contribution to the arbitration awards granted to the homeowners.
October 19, 2022
Judge Dismisses More CGL Insurers From Home Builder’s Faulty Work Coverage Suit

ALBUQUERQUE, N.M. — Without providing detail, a federal judge in New Mexico issued an order dismissing with prejudice claims brought by a contractor against commercial general liability insurers in a coverage dispute stemming from allegedly defective work performed by insured subcontractors on a residential subdivision.
October 14, 2022
Judge: No Prejudice Suffered From Contractor’s Refusal To Work With Counsel

LOS ANGELES — A federal judge in California granted summary judgment in favor of a construction company in a lawsuit filed by an insurer that claimed it was not required to provide a defense to the company based on its refusal to cooperate with the insurer’s counsel and insistence on using its own counsel, ruling that the insurer failed to provide evidence that it was prejudiced by the company’s termination of the counsel.
October 13, 2022
Pa. Panel Overturns Legal Counsel’s Joinder In Builder’s Coverage Dispute

PHILADELPHIA — A Pennsylvania Superior Court panel on Oct. 12 ruled that a state trial court erred in relying on Superior Court precedent to find that attorneys and their law firm, who represented a home builder in an underlying construction defects lawsuit, may be joined in the home builder’s coverage dispute with its insurers because the “necessary identities” set forth in the precedent to establish whether joinder is possible were not met.
October 12, 2022
Insurer Has Duty To Defend Developer In Underlying Construction Defects Suit

DALLAS — A federal judge in Texas ruled that no genuine issues of material fact exist as to whether Certain Underwriters at Lloyd’s of London has a duty to defend a developer in a construction defects lawsuit, rejecting the insurer’s argument that reconsideration of the judge’s March 23 denial of summary judgment was proper based on a policy exclusion the insurer argued barred coverage.
October 12, 2022
Collapse Extension Does Not Provide Coverage, 4th Circuit Affirms

RICHMOND, Va. — The Fourth Circuit U.S. Court of Appeals on Oct. 11 affirmed a lower federal court’s ruling that there is no genuine dispute of material fact that an insured’s collapse claim was not covered under an insurance policy, rejecting the insured’s argument that the Collapse Extension provides coverage for its loss.
October 07, 2022
Insurer Entitled To $5M Reimbursement In Coverage Suit Over Highway Project

NEW YORK — An insurer is entitled to reimbursement of $5 million it paid to its insured contractor under the rectification indemnity coverage provision of the contractor’s policy because a policy provision governing subrogation located in the policy required that the contractor repay the insurer for money the contractor obtained in an arbitration proceeding, a federal judge in New York ruled.
October 07, 2022
Insurer Admonished By Magistrate Over Motion In CGL Coverage Suit

MIAMI — A federal magistrate judge in Florida denied a commercial general liability insurer’s motion to compel better responses to two requests for production from a general contractor in a coverage dispute stemming from a subcontractor’s alleged faulty installation of cladding and glazing systems in a construction project, ruling that the insurer’s motion violates local rules and the court-ordered discovery procedure.
October 07, 2022
Exterior Glazing Contractor Lacks Coverage Under Additional Insured Endorsement

ATLANTA — A federal district court did not err in ruling that allegations made in an underlying negligence and property damage lawsuit against an exterior glazing contractor did not trigger an insurer’s duty to defend the contractor in the underlying suit because the policy’s additional insured endorsement does not provide coverage to the contractor, an 11th Circuit U.S. Court of Appeals panel affirmed Oct. 6.