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    Construction Expert Witness Builders Information
    Coolidge, Arizona

    Arizona Builders Right To Repair Current Law Summary:

    Current Law Summary: (HB 2620; ARS §12-1363, 1361, 1364) Current laws on the books require a purchaser of a home to provide written notice at least 90 days before commencing legal action. This gives the homebuilder time to inspect, repair or replace the defect if it falls within the specifications of the warranty. Homebuilder has 60 days to respond to written notice which may include offer to replace, repair or offer monetary compensationSB 1311 is a similar statute that covers multi-family dwellings. If no resolution is met through alternative dispute resolution procedures and a civil lawsuit is filed, the seller’s insurance company must treat a notice of a dwelling action as a notice of a claim subject to the insurance policy without affecting available coverage under the policy


    Construction Expert Witness Contractors Licensing
    Guidelines Coolidge Arizona

    Commercial and Residential Contractors License required to bid or contract.


    Construction Expert Witness Contractors Building Industry
    Association Directory
    Home Builders Association of Central Arizona
    Local # 0310
    16430 N Scottsdale Road Suite 150
    Scottsdale, AZ 85254
    http://www.hbaca.org

    Southern Arizona Home Builders Association
    Local # 0335
    2840 N Country Club Rd Ste 100
    Tucson, AZ 85716
    http://www.sahba.org

    Northern Arizona Builders Association
    Local # 0315
    1500 E Cedar Ave Suite 86
    Flagstaff, AZ 86004
    http://www.nazba.org


    Construction Expert Witness News and Information
    For Coolidge Arizona

    Couple Sues Attorney over Construction Defect Case, Loses

    Courts Are Conflicted As To Whether "Good Faith" Settlement Determinations Can Be Reviewed Via Writ Petition Or Appeal

    DA’s Office Checking Workers Comp Compliance

    Colorado Statutes of Limitations and Repose, A First Step in Construction Defect Litigation

    Surveyors Statute Trumps Construction Defect Claim in Tennessee

    Homeowner Loses Suit against Architect and Contractor of Resold Home

    Late Filing Contractor Barred from Involving Subcontractors in Construction Defect Claim

    Ensuing Loss Provision Found Ambiguous

    Insurer Must Defend Claims for Diminution in Value of Damaged Property

    Exclusions Bar Coverage for Damage Caused by Chinese Drywall

    Construction on the Rise in Washington Town

    “Details Matter” is the Foundation in a Texas Construction Defect Suit

    SB800 Cases Approach the Courts

    Nevada Supreme Court Reverses Decision against Grader in Drainage Case

    Lawsuit over Construction Defects Not a Federal Case

    Preparing for Trial on a Cause of Action for Violation of Civil Code section 895, et seq.

    Texas Law Bars Coverage under Homeowner’s Policy for Mold Damage

    No Third-Quarter Gain for Construction

    Developer’s Fraudulent Statements Are His Responsibility Alone in Construction Defect Case

    Australian Developer Denies Building Problems Due to Construction Defects

    New Households Moving to Apartments

    Sometimes It’s Okay to Destroy Evidence

    Builder to Appeal Razing of Harmon Tower

    Construction Bright Spot in Indianapolis

    Time to Repair Nevada’s Construction Defect Laws?

    Increased Expenditure on Injuries for New York City School Construction

    Defective Shingle Claims Valid Despite Bankruptcy

    Save A Legal Fee? Sometimes You Better Talk With Your Construction Attorney

    Court Strikes Down Reasonable Construction Defect Settlement

    Des Moines Home Builders Building for Habitat for Humanity

    Landmark San Diego Hotel Settles Defects Suit for $6.4 Million

    Unit Owners Have No Standing to Sue under Condominium Association’s Policy

    New Jersey Court Rules on Statue of Repose Case

    Seller Cannot Compel Arbitration for Its Role in Construction Defect Case<

    Homeowner’s Policy Excludes Coverage for Loss Caused by Chinese Drywall

    Florida Property Bill Passes Economic Affairs Committee with Amendments

    Massachusetts Couple Seek to Recuse Judge in Construction Defect Case

    Construction Company Head Pleads Guilty to Insurance and Tax Fraud

    California Posts Nation’s Largest Gain in Construction Jobs

    Good Signs for Housing Market in 2013

    Architect Not Liable for Balcony’s Collapse

    Condominium Exclusion Bars Coverage for Construction Defect

    Will They Blow It Up?

    Australian Group Seeks Stronger Codes to Combat Dangerous Defects

    Builder Cannot Receive Setoff in Construction Defect Case

    Businesspeople to Nevada: Revoke the Construction Defect Laws

    Insurers Reacting to Massachusetts Tornadoes

    Amerisure Case to be Heard by Texas Supreme Court

    Williams v. Athletic Field: Hugely Important Lien Case Argued Before Supreme Court

    Insurer Unable to Declare its Coverage Excess In Construction Defect Case

    Pier Fire Started by Welders

    Seven Former North San Diego County Landfills are Leaking Contaminants

    School Sues over Botched Pool

    After Breaching its Duty to Defend, Insurer Must Indemnify

    A Performance-Based Energy Code in Seattle: Will It Save Existing Buildings?

    Federal District Court Predicts Florida Will Adopt Injury In Fact Trigger

    Court Orders House to be Demolished or Relocated

    One World Trade Center Due to Be America’s Tallest and World’s Priciest

    Construction Workers Unearth Bones

    Good and Bad News on Construction Employment

    Ensuing Loss Provision Does Not Salvage Coverage

    Irene May Benefit Construction Industry

    Contract Not So Clear in South Carolina Construction Defect Case

    Construction Spending Dropped in July

    Georgia Law: “An Occurrence Can Arise Where Faulty Workmanship Causes Unforeseen or Unexpected Damage to Other Property”

    Safety Officials Investigating Death From Fall

    Policing Those Subcontractors: It Might Take Extra Effort To Be An Additional Insured

    Plans Go High Tech

    No Resulting Loss From Deck Collapsing Due to Rot

    OSHA Extends Temporary Fall Protection Rules

    Construction Defects: 2010 in Review

    Is There a Conflict of Interest When a CD Defense Attorney Becomes Coverage Counsel Post-Litigation?

    Subcontractor Not Liable for Defending Contractor in Construction Defect Case

    Homeowners Not Compelled to Arbitration in Construction Defect Lawsuit

    Coverage for Construction Defects Barred by Business Risk Exclusions

    Summary Judgment in Construction Defect Case Cannot Be Overturned While Facts Are Still in Contention in Related Cases

    No-Show Contractor Can’t Hide from Construction Defect Claim

    Insurance Company Prevails in “Chinese Drywall” Case

    South Carolina “occurrence” and allocation

    Texas “Loser Pays” Law May Benefit Construction Insurers

    No Coverage for Property Damage That is Limited to Work Completed by Subcontractor

    Mandatory Arbitration Provision Upheld in Construction Defect Case

    MGM Seeks to Demolish Harmon Towers

    Kentucky Court Upholds Arbitration Award, Denies Appeal

    CC&Rs Not the Place for Arbitration Agreement, Court Rules

    Residential Construction Down in San Diego

    Texas Court of Appeals Conditionally Grant Petition for Writ of Mandamus to Anderson

    Unlicensed Contractors Nabbed in Sting Operation

    Statutes of Limitations May be the Colorado Contractors’ Friend

    Florida Chinese drywall, pollution exclusion, “your work” exclusion, and “sistership” exclusion.
    Corporate Profile

    COOLIDGE ARIZONA CONSTRUCTION EXPERT WITNESS
    DIRECTORY AND CAPABILITIES

    The Coolidge, Arizona Construction Expert Witness Group at BHA, leverages from the experience gained through more than 5,500 construction related expert witness designations encompassing a wide spectrum of construction related disputes. Leveraging from this considerable body of experience, BHA provides construction related trial support and expert services to Coolidge's most recognized construction litigation practitioners, commercial general liability carriers, owners, construction practice groups, as well as a variety of state and local government agencies.

    Construction Expert Witness News & Info
    Coolidge, Arizona

    Ensuing Loss Provision Does Not Salvage Coverage

    August 2, 2012 — Tred Eyerly, Insurance Law Hawaii

    The Minnesota Court of Appeals affirmed the trial court's decision finding no coverage due to exclusions from the all-risk policy for losses related to mold, rot and condensation. Koskovich v. Am Family Mut. Ins. Co., 2012 Minn. App. Unpub. LEXIS 581 (Minn. Ct. App. June 25, 2012).

    In 1978, the insureds purchased a home that was built in 1904. From 1991 to 1995, they remodeled, which included rotating the house 45 degrees, removing a wing and adding a new section. Polypropylene vapor barriers were installed, with pinholes for ventilation.

    In 2008, water was observed on an interior floor. An investigation revealed that the sheathing under the siding and the house's framing were wet and rotten, requiring removal and replacement of the siding and studs. Repairs were made and a claim was submitted to American Family Mutual Insurance Company.

    American's structural engineer inspected and determined that moisture was likely caused by condensation of water vapor where the vapor barrier was held tight to the sheathing and by inward water migration from wet siding during rainy periods through the vapor-barrier perforations. The structural engineer opined that, although the home's framing was deteriorated and structurally compromised, it did not appear as though the home was in imminent danger of collapse.

    American denied coverage.

    Read the full story…

    Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii. Mr. Eyerly can be contacted at te@hawaiilawyer.com


    Nevada Assembly Bill Proposes Changes to Construction Defect Litigation

    April 14, 2011 — April 14, 2011 Beverley BevenFlorez - Construction Defect Journal

    Assemblyman John Oceguera has written a bill that would redefine the term Construction Defect, set statutory limitations, and force the prevailing party to pay for attorney’s fees. Assembly Bill 401 has been referred to the Committee on Judiciary.

    Currently, the law in Nevada states that “a defect in the design, construction, manufacture, repair or landscaping of a new residence, of an alteration of or addition to an existing residence, or of an appurtenance, which is done in violation of law, including in violation of local codes or ordinances, is a constructional defect.” However, AB401 “provides that there is a rebuttable presumption that workmanship which exceeds the standards set forth in the applicable law, including any applicable local codes or ordinances, is not a constructional defect.”

    The Nevada courts may award attorney fees to the prevailing party today. However, AB401 mandates that attorney fees must be awarded, and the exact award is to be determined by the Court. “(1) The court shall award to the prevailing party reasonable attorney’s fees, which must be an element of costs and awarded as costs; and (2) the amount of any attorney’s fees awarded must be determined by and approved by the court.”

    AB401 also sets a three year statutory limit “for an action for damages for certain deficiencies, injury or wrongful death caused by a defect in construction if the defect is a result of willful misconduct or was fraudulently concealed.”

    This Nevada bill is in the early stages of development.

    Read the full story...

    A Performance-Based Energy Code in Seattle: Will It Save Existing Buildings?

    August 11, 2011 — Douglas Reiser, Builders Counsel

    The City of Seattle has one of the most stringent energy codes in the nation. Based upon the Washington State Energy Code (which has been embroiled in litigation over its high standards), the code demands a lot from commercial developers. But, does it prevent developers from saving Seattle?s classic and old buildings? Perhaps.

    The general compliance procedure requires buildings to be examined during the permitting process. This means that buildings are examined before they begin operating. The procedure is not malleable and is applicable to all buildings, old and new, big and small.

    The downside of this procedure is that it eliminates awarding compliance to those buildings exhibiting a number of passive features, such as siting, thermal mass, and renewable energy production. This problem has prevented a number of interesting and architecturally pleasing existing building retrofits from getting off the ground. The cost of complying with the current system can be 20% more, and it might prevent builders from preserving a building?s historical integrity.

    Read the full story…

    Reprinted courtesy of Douglas Reiser of Reiser Legal LLC. Mr. Reiser can be contacted at info@reiserlegal.com

    Was Jury Right in Negligent Construction Case?

    September 30, 2011 — CDJ Staff

    Yes, said the South Carolina Court of Appeals in Pope v. Heritage Communities, Inc. Heritage Communities developed Riverwalk, a community in South Carolina. During the earlier trial, HCI “conceded that construction defects existed at Riverwalk, and repairs needed to be made.” The trial court found that the construction was negligent, awarding the property owners association $4.25 million in actual damages and $250,000 in punitive damages, with the class of owners awarded $250,000 in actual damages and $750,000 in punitive damages. HCI appealed on nine issues. All were rejected by the appeals court.

    The court rejected HCI’s claim that the judge’s instruction to the jury suggested to the jury that “the court had already determined that Appellants were willful, wanton, and reckless.” But here, the appeals court found “no reversible error.”

    The general contractor for Riverwalk was BuildStar. Off-site management and sale were managed by Heritage Riverwalk, Inc., which also owned title to the property. Both these companies were owned by Heritage Communities, Inc. During the trial, an HCI employee testified that “the three corporations shared the same officers, directors, office, and telephone number.” The trial court found that the three entities were amalgamated. This was upheld by the appeals court.

    Nor did the appeals agree with the HCI that the trial court had improperly certified a class. The owners were seen as properly constituting a class. Further, the court held that the property owners’ losses were properly included by the trial court. HCI objected at trial to the inclusion of evidence of subsequent remedial measures, however, as they did not object that it was inadmissible, the issue could not be addressed at appeal.

    HCI argued on appeal that the trial court should not have allowed evidence of defects at other HCI developments. The appeals court noted that “the construction defects at the other HCI developments were substantially similar to those experienced by Riverwalk.”

    The court additionally found that the negligence claims, the estimated damages (since full damage could not be determined until all defective wood was removed), and the award of punitive damages were all properly applied.

    Read the court’s decision…


    Changes to Arkansas Construction and Home Repair Laws

    September 30, 2011 — CDJ Staff

    A new law, set to take effect in 2012, lowers the ceiling on when work must be done by a licensed contractor. Through the end of the year, projects costing $20,000 or more had to be done by an Arkansas licensed contractor. As of January 1, 2012, that new limit will be $2,000.

    This will apply to all single-family residences and according to Lovely County Citizen, covers “construction, alteration, renovation, repair, modification, improvement, removal, demotion, or addition to a pre-existing structure.” Residential building contractors will be required to have workers compensation insurance, as will home improvement contactors if they take jobs worth more than $20,000.

    Morris Dillow, a building inspector in Holiday Island, said, “It will get these scammers out of here who are ripping people off.” He cited the example of a contractor who after getting paid for roof repairs and painting, left the job unfinished.

    Read the full story…


    Preparing For the Worst with Smart Books & Records

    November 7, 2012 — Douglas Reiser, Builders Counsel

    Contractors are often too caught up in keeping the wheel of business churning to recognize deficiencies in how their records are managed. Working hard and working often tend to leave little time for consideration of your documents. But all too often I see the unthinkable, a contractor gets into trouble and has to call on its surety for help. At that point, you might finally get your first dose of reality about your records ?Äì and it can cost you.

    Read the full story…

    Reprinted courtesy of Douglas Reiser of Reiser Legal LLC. Mr. Reiser can be contacted at info@reiserlegal.com


    Insurance Company Must Show that Lead Came from Building Materials

    August 17, 2011 — CDJ Staff

    The Fourth Circuit Court of Appeals for Louisiana has reversed the summary judgment of a lower court in the case of Widder v. Louisiana Citizens Property Insurance Company. Judge Roland L. Belsome wrote the opinion for the panel of three judges. Ms. Widder discovered that her home and its content were contaminated by lead. She applied to her insurer, Louisiana Citizens Property Insurance, which denied her claim.

    In response to Ms. Widder’s suit, LCPIC applied for a summary judgment on the grounds that there was no physical loss and that the policy did not cover defective material, latents defects, and pollution damage.

    The appeals court found that the lead contamination of Widder’s home did meet the standards of a direct physical loss, citing a recent Chinese Drywall case. There, it was found, “when a home has been rendered unusable or uninhabitable, physical damage is not necessary.”

    The lower court addressed only one of LCPIC’s exclusions, addressing only the exclusion on basis of “faulty, inadequate or defective material.” The appeals court noted that the evidence offered at trial does not show that the building materials were the source of the lead. This provided the appeals court with a matter of fact to remand to the lower court.

    Read the court’s decision…


    2011 West Coast Casualty Construction Defect Seminar – Recap

    June 1, 2011 — CDJ Staff
    Event exhibitors and sponsors contribute to an informative and engaging environment
    Event exhibitors and sponsors contribute to an informative and engaging environment

    This year’s meeting was the best yet for the industry-leading construction defect and claims event.

    This year’s seminar concluded on May 13, 2011 with the Construction Defect Community Charitable Foundation Golf Tournament, held at Strawberry Farms Golf Course.

    The Disneyland Hotel in Anaheim, California was the place where more than 1,500 attendees convened for two days of professional development activities and seminars that included CLE workshops and panel discussions of special interest to legal and insurance professionals concerned with construction defect and claims litigation. Key events included “Challenges for Experts in Construction Defect Claims and Litigation,” “Keeping Up with Construction Defect Coverage,” and “Tips for Avoiding the ‘Perfect Storm’ in Handling of Wrap Claims.”

    Supporting the golf tournament at the 15th hole
    Supporting the golf tournament at the 15th hole

    This year’s Ollie award was given to George D. Calkins II, Esq. The West Coast Casualty Jerrold S. Oliver Award of Excellence was named in honor of the late Judge Jerrold S. Oliver, and recognizes an individual who is outstanding or has contributed to the betterment of the construction community.

    In addition to being the most comprehensive professional development seminar in the area of construction defects, this year’s seminar was equally valuable as a networking opportunity for members of the industry. People participated in professional development events during the day and then continued networking in the evening at numerous social events. The Lawn Party as well as the legendary Wood, Smith, Henning & Berman events were very well attended. Additional valuable networking events were hosted by a number of industry professionals at the House of Blues, and Tortilla Joe’s.

    As of this writing the 2011, West Coast Casualty's Construction Defect Seminar has applied for or has already received the following continuing education accreditation in the following areas;

    Read the full story…

    For more information about next year’s event, visit West Coast Casualty.


    Appeals Court Upholds Decision by Referee in Trial Court for Antagan v Shea Homes

    May 10, 2012 — CDJ Staff

    In the case Antangan v. Shea Homes Ltd. Partnership (Cal. App., 2012), Plaintiffs appealed “an order vacating a judgment and entering a modified judgment in their construction defect action against defendants Shea Homes, Inc. and Shea Homes Limited Partnership,” while the Defendant, Shea Homes Limited Partnership (Shea Homes) appealed “an order of the judicial referee denying its motion to strike and tax costs.”

    On the Antagon issue, the appeals court concluded that “the trial court did not err by vacating and modifying its judgment so that the cost of referee’s fees would be equally divided by the parties and consistent with a prior stipulation they filed in court.”

    On the Shea Homes issue, the appeals court concluded: “1) the judicial referee did not err by ruling that plaintiffs’ offers to compromise (§ 998) were validly served on Shea Homes’ counsel, 2) the offers substantially complied with statutory requirements, 3) the offers were not required to be apportioned, and 4) the referee’s award of $5,000 as costs for a person assisting plaintiffs’ counsel was not an abuse of discretion.” The appeals court affirmed the judgment.

    Here is a brief history of the trial case: “Plaintiffs Chito Antangan, Jimmy Alcova and other homeowners brought an action against defendants Shea Homes, Inc. and Shea Homes Limited Partnership for damages alleging that the properties they purchased from these ‘developer defendants’ were defective. Plaintiffs claimed numerous construction defects required them ‘to incur expenses’ for ‘restoration and repairs’ and the value of their homes had been diminished.”

    In response, Shea Homes filed a motion for an order to appoint a judicial referee. The motion was granted and it was ruled that “a referee would ‘try all issues’ and ‘report a statement of decision to this court.’”

    On May 10, 2010 the judicial referee (Thompson) “awarded plaintiffs damages and various costs, and ruled that ‘Shea Homes shall bear all of the Referee’s fees.’” The latter ruling would become a matter for contention later on.

    In July of 2010, the plaintiffs “sought, among other things, $54,409.90 for expert fees, and $14,812.50 for the services of Melissa Fox for ‘exhibit preparation & trial presentation.’ Shea Homes filed a motion to strike and/or tax costs claiming: 1) Fox was a paralegal, 2) plaintiffs were not entitled to attorney’s fees, and 3) the fees for Fox’s services were an indirect and improper method to obtain attorney’s fees. The referee disagreed and awarded $5,000 for Fox’s services. The referee also ruled that plaintiffs had properly served valid offers to compromise (§ 998) on Shea Homes’ counsel in 2009. He said those offers to defendants in the case at that time did not have to be apportioned.”

    “Antangan contends the trial court erred when it vacated and modified its original judgment, which ordered Shea Homes to pay all the referee’s fees. We disagree.”

    Antagon contended that the trial court erred when it vacated and modified its original judgment regarding Shea Homes paying the referee’s fees. The appeals court disagreed: “A trial court has inherent authority to vacate or correct a judgment that is void on its face, incorrect, or entered by mistake. (§ 473; Rochin v. Pat Johnson Manufacturing Co. (1998),67 Cal.App.4th 1228; Olivera

    Read the court’s decision…


    New Households Moving to Apartments

    December 20, 2012 — CDJ Staff

    The New York Times reports that multifamily construction?Äîapartment buildings?Äîis leading the recovery in construction. Construction of single-family homes is only a third of the way up from its fall from its earlier heights, while multifamily construction has recovered two-thirds of its peak. Young adults are moving out of their parents’ homes, but instead of buying homes, they’re renting apartments.

    Houston is adding thousands of new units, leading to a fear of overbuilding. Rents have been rising, but as the supply of apartment units rises, higher rents may be unsustainable. However, during the recession, young adults did not move out of their parents’ homes, leading to about two million doubled-up households. David Crowe, the chief economist of the National Association of Home Builders, noted that “all of the net addition to households since 2004 has been in rentals.”

    Read the full story…


    Rihanna Finds Construction Defects Hit a Sour Note

    August 2, 2012 — CDJ Staff

    The pop singer Rihanna is suing the former owners of her Beverley Hills home among others in a construction defect lawsuit. She contends that Adriana and Heather Rudomin concealed defects in the home that lead to water leaks and flooding during a 2010 storm. The Beverly Hills Patch noted that the dollar amount of the singer’s suit was not specified.

    The most recent court ruling denied a motion from the owners to be dismissed from the lawsuit. They remain part of it, along Landmark Design Group, LLC, which renovated the home before the sale, and Prudential California Realty which sold the home.

    Read the full story…


    Court Grants Summary Judgment to Insurer in HVAC Defect Case

    August 4, 2011 — CDJ Staff

    The US District Court in Colorado has determined in the case of RK Mechanical, Inc. v. Travelers Property Casualty Company of America that Travelers did not breach its insurance contract when it refused to cover RK Mechanical.

    RK Mechanical performed an HVAC installation for a residential project for which J.E. Dunn Rocky Mountain was the general contractor. As part of the work, RK “installed approximately one hundred seventy-one CPVC flanges, which were manufactured by Charlotte Pipe and Foundry Company.” Two of these flanges failed in June, 2009 leading to water damage. RK replaced the cracked flanges and engaged in water remediation. “Travelers paid Dunn and RK for the costs associated with the water damage associated with the Flange Failure.” The court notes that Travelers did not pay for the cracked flanges, however.

    Subsequently, RK examined the remaining flanges, finding many cracked ones. These were replaced with new ones. Later, all the Charlotte flanges were replaced with ones from another manufacturer. RK applied for coverage.

    All sides brought in their experts: “Microbac Laboratories, Inc. prepared a report on behalf of RK concluding that the Flange Failure was due, in part, to an assembly or workmanship defect in addition to manufacturing defects in the flanges. Higgins & Associates prepared a report on behalf of Travelers concluding that the flanges failed due to improper installation. Plastic Failure Labs prepared a report on behalf of the flange manufacturer concluding that the flanges failed due to improper installation by RK.”

    At this point, Travelers denied coverage. RK sued alleging that the coverage for flange failure and water damage implicitly includes mitigation costs. The court rejected this claim, noting it would do so even if Travelers had paid for the replacement of the first two flanges. Nor did the court find that replacement of the faulty flanges is not "a covered cause of loss." RK also argued that as it was required to mitigate, Travelers was obligated to cover costs. However, the court found that “the mitigation costs expended by RK were not incurred in an effort to avoid damages from a potential breach of contract by Travelers.” The court additionally noted that despite RK’s claims, the Colorado courts have not found a common law duty to mitigate. Finally, the court found that the exclusions in the policy were not in violation of public policy.

    Read the court’s decision…


    No Coverage For Construction Defects When Complaint Alleges Contractual Damages

    September 1, 2011 — Tred Eyerley, Insurance Law Hawaii

    The underlying plaintiff’s allegations contended the contractor was in breach of contract for construction defects caused in building her home. Accordingly, the court found no coverage.See Nat’l Builders and Contractors Ins. Co. v. Slocum, 2011 U.S. Dist. LEXIS 81694 (S.D. Miss. July 26, 2011).

    Slocum Construction LLC sold a home it built to Laura Peterson. Subsequently, Peterson filed suit, alleging a breach of the contract and seeking rescission and cancellation of the contract. Peterson further alleged at least thirty-three specific defects in the construction of the house.

    Slocum tendered to its insurer, National Builders and Contractors Insurance Company (NBCI). NBCI filed suit for a declaratory judgment.

    Read the full story…

    Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii. Mr. Eyerly can be contacted at te@hawaiilawyer.com


    Florida Construction Defect Case Settled for $3 Million

    June 19, 2012 — CDJ Staff

    The Runaway Beach Club Condominium Association of Kissimmee, Florida has settled its construction defect claims against the parties involved in the construction and development of the buildings. The association claimed that defective roofs and improperly installed windows had lead to leaks and associated damages. A trial date had been set, but parties involved were able to reach this settlement instead.

    Read the full story…


    Timing of Insured’s SIR Payment Has No Effect on Non-Participating Insurer’s Equitable Contribution to Co-Insurer

    April 25, 2012 — Aarti Kewalramani, Gatzke Dillon & Balance LLP

    In a case of first impression, the California Court of Appeal, Fourth District, Division One, examined whether a non-participating insurer can evade its defense and indemnity obligations because the insured only paid the policy’s self-insured retention ("SIR") as part of a settlement. In Axis Surplus Lines Insurance Company v. Glencoe Insurance LTD. (April 11, 2012, D058963) __ Cal.App.4th __ [2012 WL 11903203], the critical issue for the Court was whether an insurer, with full notice and continued investigation of a claim, can "hide behind the SIR requirement in its policy." The Court declined to "sanction such gamesmanship."

    The dispute involved an equitable contribution claim between two insurers. Axis Surplus Insurance Company provided commercial general liability insurance to Pacifica Pointe L.P. During the same time period, Glencoe Insurance Ltd. provided an owner-controlled insurance policy (i.e., wrap policy) to Pacifica Pointe L.P. Both policies included provisions requiring co-carriers to split the defense and indemnity on equal shares. Pacifica was sued in a construction defect lawsuit, involving alleged resultant damages to condominiums it converted and sold. Pacifica tendered the claim to both Axis and Glencoe. While Axis agreed to defend Pacifica, subject to a reservation of rights, Glencoe declined to participate until Pacifica satisfied the $250,000 SIR on the policy. Glencoe continued to monitor the litigation from the sidelines.

    Axis and Pacifica settled the underlying construction defect lawsuit for $1 million. Pacifica advised Glencoe of the settlement, and received Glencoe’s approval to contribute its $250,000 SIR towards the settlement. Axis contributed $750,000 towards the settlement. After the settlement, Axis sued Glencoe for declaratory relief and equitable contribution, to recover a portion of the defense and indemnity it paid. The trial court found in favor of Axis and allocated Glencoe 60% of the settlement payment. Glencoe appealed.

    On appeal, the Court scrutinized whether Glencoe, as the non-participating insurer, had a legal obligation to provide a defense and indemnity to the insured, despite the timing of the SIR’s satisfaction. The Court determined that in an equitable contribution action, the participating insurer has the burden of proving merely the potential for coverage under the non-participating insurer’s policy. On this showing, the burden of proof shifts to the non-participating insurer to prove the absence of actual coverage under its policy. The Court emphasized that the timing of the SIR’s payment was inconsequential to either insurer’s burden. Because Glencoe admitted coverage existed under its policy, the Court affirmed the trial court’s decision.

    As a result, the result ultimately turned on whether the non-participating carrier had full notice of the claim and cannot use the timing of the satisfaction of the SIR to shield itself from an equitable contribution claim from the participating co-carrier.

    Published courtesy of Aarti Kewalramani of Gatzke Dillon & Balance LLP. Ms. Kewalramani can be contacted at akewalramani@gdandb.com.


    The Year 2010 In Review: Design And Construction Defects Litigation

    February 25, 2011 — Candace Matson, Harold Hamersmith, and Helen Lauderdale - Construction & Infrastructure Law Blog - February 25, 2011

    This article is the first in a series summarizing construction law developments for 2010

    1. Centex Homes v. Financial Pacific Life Insurance Co., 2010 U.S. Dist. LEXIS 1995 (E.D. Cal. 2010)

    After settling numerous homeowners’ construction defect claims — and more than ten years after the homes were substantially completed — a home developer brought suit against one of the concrete fabrication subcontractors for the development seeking indemnity for amounts paid to the homeowners, as well as for damages for breach of the subcontractor’s duties to procure specific insurance and to defend the developer against the homeowners’ claims. The subcontractor brought a motion for summary adjudication on the ground the developer’s claims were barred by the ten year statute of repose contained in Code of Civil Procedure Section 337.15.

    The District Court agreed the developer’s claim for indemnity was barred by Section 337.15. And it held that because the damages recoverable for breach of the subcontractor’s duty to purchase insurance are identical to the damages recoverable through the developer’s indemnity claim, the breach of duty to procure insurance claim also was time-barred. The District Court, however, allowed the claim for breach of the duty to defend to proceed. The categories of losses associated with such a claim (attorneys’ fees and other defense costs) are distinct from the damages recoverable through claims governed by Section 337.15 (latent deficiency in the design and construction of the homes and injury to property arising out of the latent deficiencies).

    2. UDC — Universal Development v. CH2M Hill, 181 Cal. App. 4th 10 (6th Dist. Jan. 2010)

    Indemnification clauses in construction agreements often state that one party to the agreement — the “indemnitor” — will defend and indemnify the other party from particular types of claims. Of course, having a contract right to a defense is not the same as actually receiving a defense. Any indemnitor attempting to avoid paying for defense costs can simply deny the tender of defense with the hope that when the underlying claim is resolved the defense obligations will be forgotten. In the past, when parties entitled to a defense — the “indemnitees” — had long memories and pressed to recover defense costs, indemnitors attempted to justify denying the tender by claiming their defense obligations coincided with their indemnity obligations and neither arose until a final determination was made that the underlying claim was one for which indemnity was owed.

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    Reprinted courtesy of Candace Matson, Harold Hamersmith, and Helen Lauderdale, Sheppard Mullin Richter & Hampton LLP. Ms. Matson can be contacted at cmatson@sheppardmullin.com, Mr. Hamersmith can be contacted at hhamersmith@sheppardmullin.com, and Ms. Lauderdale can be contacted at hlauderdale@sheppardmullin.com.


    Colorado “occurrence”

    January 6, 2012 — CDCoverage.com

    In Greystone Construction, Inc. v. National Fire & Marine Insurance Co., No. 09-1412 (10th Cir. November 1, 2011), general contractors Greystone and Branan were each sued by purchases of homes built by each alleging defective construction performed by subcontractors. CGL insurer American Family Mutual Insurance Company defended both Greystone and Brannon while co-insurer National Fire & Marine Insurance Company denied a defense. Greystone, Branan, and American Family sued National Fire for contribution towards defense costs. The federal district trial court entered summary judgment for National Fire.

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    Reprinted courtesy of CDCoverage.com


    West Coast Casualty Promises Exciting Line Up at the Nineteenth Annual Conference

    March 28, 2012 — CDJ Staff

    West Coast Casualty has announced the lineup for the annual WCC Construction Defect Seminar. This year’s seminar will be the nineteenth anniversary, and it will be held on May 17th and 18th, 2012 in Anaheim, California. They are the largest construction defect event in the world and this year’s seminar will again bring the top people in the field to address many of the current issues and where the construction defect community will be going in the future.

    The event, anticipated to be even larger than prior years, will have numerous panels and presentations on the current state of construction defect litigation. Among the topics that will be presented are “Arbitrate? Let’s See You Make Me!” “Defending Construction Defect Failure Mechanisms?An Expert’s Perspective,” and “Current Trends in Effectively Handling SB800 Cases.”

    Speakers at the event will include judges, lawyers, and representatives of the insurance industry. One event, “Meet Your Judges, A Candid Discussion on Construction Defect Claims and Litigation from the Bench?” will include judges from five states, including the Honorable Nancy M. Saitta, Chief Justice of the Nevada Supreme Court, the Honorable Clifton Newman of the South Carolina Circuit Court, and the Honorable Rex Heeseman of the Los Angeles County Superior Court.

    Daniel A. Berman, Esq. and Stephen Henning, Esq. will be talking on the topic of “Social Networking Sites: Strategies, Ethical Pitfalls, and Practice Pointers for Litigating and Winning Your Construction Defect Case.” Mr. Berman is a Founding and Managing Partner of Wood, Smith, Henning & Berman LLP. He has been named a Southern California Super Lawyer for eight consecutive years. Mr. Henning is a Founding Partner of Wood, Smith, Henning & Berman, LLP and Fellow of the Litigation Counsel of America. Mr. Henning will also be one of the presenters on the panel “Important Court Decisions Impacting Construction Defect Claims.”

    The panel “Why Do We Need to Know Certain Things and How Decisions Are Made” will be presented by important figures in the construction claims industry, including Phyllis Modlin, Todd Schweitzer, Teresa D. Wolcott, and Lee Wright. Ms. Modlin is a Construction Defect Claims Supervisor responsible for nationwide claims for Markel Corporation. Mr. Schweitzer is an Assistant Vice President of Major Case for Construction Defect and Professional Liability Claims Services at Zurich North America. Ms. Wolcott is the National Product Manager for Construction Defect Claims within the Construction Claims Organization at Travelers Insurance. Mr. Wright is an Assistant Vice President and Senior Claims Consultant for XL Specialty Insurance.

    The event will also include a Science and Technology Fair in which exhibitors will be presenting technological problem solving and decision making as they relate to resolving ongoing construction and post construction-defect related issues while reducing costs for all those involved in claims and litigation. The fair is dedicated to these novel applications of science and technology that benefit the construction defect community but are not yet commonly available. This will be the third time the Construction Defect Seminar will include a Science and Technology Fair.

    Sessions at the event are approved for MCLE credit in Arizona, California, Colorado, Illinois, Maine, Minnesota, New York, Ohio, and Pennsylvania. MCLE credits vary by state; attendees can obtain up to 10.25 hours of credit in Arizona, California, Maine, and New York. Applications for several other states are still pending. Additionally, the event is also worth continuing education credits with the Florida Department of Insurance and for Registered Professional Adjusters. West Coast Casualty has applications pending for adjuster continuing education in an additional thirty-six states.

    West Coast Casualty recommends this event for anyone involved in construction or construction defect claims, whether they are a claims adjuster, a member of a homeowner board, a judge, a property manager, a construction claims attorney, a general contractor, or anyone else with an interest in this area. The event typically has more than 1,600 attendees. Those interested can register online.

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