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DIRECTORY AND CAPABILITIES

Top 10 Insurance Cases of 2023

January 29, 2024 — Jeffrey J. Vita & Michael A. Amato - Saxe Doernberger & Vita, P.C.
Federal and state courts tackled many interesting insurance-related issues this past year. Perhaps no state had a more impactful year than Illinois, which held that construction defects could constitute an occurrence, that a LEG 3 “extension” attempting to preclude coverage for faulty or defective workmanship was ambiguous as a matter of law (applying Illinois law), and that ostensibly prohibitive “catch-all exclusions” can render policy language ambiguous in favor of coverage. Other courts wrestled with procedural inquiries, such as the legal duty of a broker in providing notice to an insurer or the ability of an insured to recoup its attorneys’ fees in pursuing a coverage action against its insurer. These are merely a sampling of the impactful insurance decisions rendered in 2023. Each year, we endeavor to identify cases of general interest to our clients and the broader insurance community. Specifically, we attempt to identify trends, cases of first impression, cases illustrating conflicts among the courts, or cases dealing with emerging issues. We now proudly unveil the top 10 most influential coverage decisions of 2023 and look ahead to a few cases to watch as 2024 unfolds. Reprinted courtesy of Jeffrey J. Vita, Saxe Doernberger & Vita, P.C. and Michael A. Amato, Saxe Doernberger & Vita, P.C. Mr. Vita may be contacted at JVita@sdvlaw.com Mr. Amato may be contacted at MAmato@sdvlaw.com Read the full story...

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More Clear, But Not Yet Crystal: Virginia Amends its Prompt Payment Law and Legislation Banning “Pay-If-Paid Clauses in Construction Contracts Effective July 1, 2023

November 16, 2023 — Hanna Lee Blake - ConsensusDocs
The Virginia General Assembly has joined a minority of jurisdictions that ban pay-if-paid clauses in construction contracts on public and private projects. Senate Bill 550 went into effect applying to contracts executed after January 1, 2023, and most recently has been amended effective July 1, 2023. This update highlights the recent amendments to Virginia’s prohibition against pay-if-paid provisions, of which owners and contractors should be aware to ensure that their contracts comply with developing law in the Commonwealth. Recap on Senate Bill 550 On April 27, 2022, the Virginia General Assembly passed Senate Bill 550, which amended Virginia Code §§ 2.2-4354 and 11-4.6, which govern both public and private sector contracts. In short, SB 550 (as the bill is commonly known) prohibited pay-if-paid clauses, and established fixed deadlines for the payment of invoices on private projects. Previously, Virginia’s Prompt Payment Act only applied to public projects. Read the full story...
Reprinted courtesy of Hanna Lee Blake, Watt Tieder
Ms. Blake may be contacted at hblake@watttieder.com

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Graham & Who May Trigger The Need To Protest

December 23, 2023 — Hugo Fraga - Ahlers Cressman & Sleight PLLC
On May 30, 2023, the Washington Court of Appeals, Division I, issued a decision that appears to expand a contractor’s obligation with respect to WSDOT notice and claim procedures. In Graham Contracting, Ltd. v. City of Federal Way, No. 83494-1-I, 2023 WL 3721171 (Wash. Ct. App. May 30, 2023) (Unpublished), the Court held that under the 2016 WSDOT Standard Specifications for Road, Bridge, and Municipal Construction (“Standard Specifications”), a Contractor must protest the actions of not only the “Engineer” but also the actions of any person or organization acting on behalf of the Owner. This case arises out of a public construction contract in which Graham Contracting Ltd (“Graham”) built a multi-million dollar roadway improvement for the City of Federal Way along a stretch of Pacific Highway. The appeal was from the trial court’s granting of the City’s motion for summary judgment to dismiss claims by Graham for extra time and money due to delays and impacts to Graham’s construction of the Project. Read the full story...
Reprinted courtesy of Hugo Fraga, Ahlers Cressman & Sleight PLLC
Mr. Fraga may be contacted at hugo.fraga@acslawyers.com

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Real Estate & Construction News Roundup (1/30/24) – Life Science Construction to Increase, Overall Homeownership Is Majority Female, and Senators Urge Fed Chair to Lower Interest Rates

February 26, 2024 — Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
In our latest roundup, hospitality and real estate companies create living options, SEC questions some financial institutions on exposure to risks from CRE, renting shows signs of overtaking buying in the housing market, and more!

• For generations, buying has almost always been favored over renting when it comes to housing, but with a tough real estate market, that might be changing. (Geoff Bennett and Dorothy Hastings, PBS)
• Single women own more homes than single men, and overall homeownership is now majority female. (Brianna Crane and Alice Feng, Axios)
• The SEC is asking smaller financial institutions, including community and regional banks, about their exposure to risks from commercial real estate in their loan portfolios. (S.J. Steinhardt, The New York State Society of CPAs)

Read the full story...
Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team

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Sweat the Small Stuff – Don’t Overlook These Three (3) Clauses When Negotiating Your Construction Contract

April 08, 2024 — Bill Shaughnessy - ConsensusDocs
Reviewing and understanding the terms of your construction contract before signing on the dotted line (ideally with counsel involved) is an obvious best practice – whether you are owner, general contractor, design-professional or down-tier subcontractor or supplier. Typically, during this review process, parties pay closest attention to terms relating to price, scope, schedule, insurance, indemnification, and damages. And rightfully so, as these are just some of the most fundamental and important clauses of any construction contract. But during this review and understanding process, parties often overlook and fail to fully review and understand several notably important contract provisions (other than the examples above) which can have just as significant an impact on the project and even unintended consequences once construction starts. This article discusses three (3) of these often-overlooked provisions which should also be carefully reviewed to ensure the project runs smoothly and to avoid unintended consequences or even disputes (and litigation) during construction:

1. Incorporation by reference clause;
2. Order of precedence or higher standard clause; and
3. Choice of law clause.

Read the full story...
Reprinted courtesy of Bill Shaughnessy, Jones Walker LLP (ConsensusDocs)
Mr. Shaughnessy may be contacted at bshaughnessy@joneswalker.com

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Future Army Corps Rulings on Streams and Wetlands: Changes and Delays Ahead

November 06, 2023 — Mark Sudol - Engineering News-Record
New regulations published by the U.S. Environmental Protection Agency and U.S. Army Corps of Engineers dramatically reduce federal protections of previously regulated streams and wetlands. This change will lead to further controversy and litigation as the legal terms are applied to physical features on the ground leading to conflicting interpretations by the regulated public, environmentalists and federal agencies. Reprinted courtesy of Mark Sudol, Engineering News-Record ENR may be contacted at enr@enr.com Read the full story...

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Reasonable Expectations – Pennsylvania’s Case by Case Approach to the Sutton Rule

February 12, 2024 — Melissa Kenney - The Subrogation Strategist
In Mutual Benefit Ins. Co. a/s/o Michael Sacks v. Koser, No. 1340 MDA 2023, 2023 Pa. Super. LEXIS 574, 2023 PA Super 252 (Mutual Benefit), the Superior Court of Pennsylvania discussed whether a landlord’s property insurer could file a subrogation action against tenants that had negligently damaged the landlord’s property. Despite there being more than one clause in the lease holding the tenants liable for the damages, the court held that because there was a provision requiring the landlord, not the tenants, to insure the leased building, the insurer could not subrogate against the tenants. In Pennsylvania, a tenant’s liability for damage to a leased premises in a subrogation action brought by a landlord’s insurer is determined by the reasonable expectation of the parties to the lease agreement. Under this approach, to determine if subrogation is permitted, the court considers the circumstances of the case and examines the terms of the lease agreement. In Mutual Benefit, the tenants leased and resided in a residential home pursuant to a lease agreement. The lease specifically addressed insurance, stating that landlord was responsible for obtaining insurance on the dwelling and the landlord’s personal property, and tenants were encouraged to procure separate insurance for their personal property. The lease also addressed liability for damage to the leased property, stating generally that the tenants were responsible for damage caused by the tenants’ negligence. Read the full story...
Reprinted courtesy of Melissa Kenney, White and Williams
Ms. Kenney may be contacted at kenneyme@whiteandwilliams.com

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Finding an "Occurrence," Appellate Court Rules Insurer Must Defend

March 11, 2024 — Tred R. Eyerly - Insurance Law Hawaii
Reversing the trial court, the Wisconsin Court of Appeals found the insurer must defend a cross-claim against the insured owner of a building after an explosion occurred. LBC, LLC v Spectrum Brands, Inc., 2023 Wis. App. LEXIS 1251 (Wis. Ct. App, Nov. 30, 2023). LBC leased commercial property to Spectrum. Spectrum stored lithium on the property. The lithium exploded when it came into contact with water that entered the premises during historic flooding in August 2018. Spectrum remediated the premises, vacated the premises prior to the lease's termination date, and stopped paying rent. LBC sued Spectrum, alleging that Spectrum negligently stored the lithium and that Spectrum breached the lease. Spectrum counterclaimed, alleging that LCB breached the lease in various respects, that LCB negligent allowed water to infiltrate the premises, and that Spectrum was constructively evicted. LCB tendered the counterclaim to its insurer, General Casualty. The tender was denied and LCB sued. Read the full story...
Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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