BERT HOWE
  • Nationwide: (800) 482-1822    
    mid-rise construction Anaheim California institutional building Anaheim California custom homes Anaheim California production housing Anaheim California townhome construction Anaheim California custom home Anaheim California hospital construction Anaheim California condominium Anaheim California landscaping construction Anaheim California high-rise construction Anaheim California casino resort Anaheim California low-income housing Anaheim California concrete tilt-up Anaheim California retail construction Anaheim California structural steel construction Anaheim California office building Anaheim California housing Anaheim California industrial building Anaheim California condominiums Anaheim California multi family housing Anaheim California Subterranean parking Anaheim California parking structure Anaheim California
    Arrange No Cost Consultation
     
    Construction Expert Witness Builders Information
    Anaheim, California

    California Builders Right To Repair Current Law Summary:

    Current Law Summary: SB800 (codified as Civil Code §§895, et seq) is the most far-reaching, complex law regulating construction defect litigation, right to repair, warranty obligations and maintenance requirements transference in the country. In essence, to afford protection against frivolous lawsuits, builders shall do all the following:A homeowner is obligated to follow all reasonable maintenance obligations and schedules communicated in writing to the homeowner by the builder and product manufacturers, as well as commonly accepted maintenance practices. A failure by a homeowner to follow these obligations, schedules, and practices may subject the homeowner to the affirmative defenses.A builder, under the principles of comparative fault pertaining to affirmative defenses, may be excused, in whole or in part, from any obligation, damage, loss, or liability if the builder can demonstrate any of the following affirmative defenses in response to a claimed violation:


    Construction Expert Witness Contractors Licensing
    Guidelines Anaheim California

    Commercial and Residential Contractors License Required.


    Construction Expert Witness Contractors Building Industry
    Association Directory
    Building Industry Association Southern California - Desert Chapter
    Local # 0532
    77570 Springfield Ln Ste E
    Palm Desert, CA 92211
    http://www.desertchapter.com

    Building Industry Association Southern California - Riverside County Chapter
    Local # 0532
    3891 11th St Ste 312
    Riverside, CA 92501


    Building Industry Association Southern California
    Local # 0532
    17744 Sky Park Circle Suite 170
    Irvine, CA 92614
    http://www.biasc.org

    Building Industry Association Southern California - Orange County Chapter
    Local # 0532
    17744 Skypark Cir Ste 170
    Irvine, CA 92614
    http://www.biaoc.com

    Building Industry Association Southern California - Baldy View Chapter
    Local # 0532
    8711 Monroe Ct Ste B
    Rancho Cucamonga, CA 91730
    http://www.biabuild.com

    Building Industry Association Southern California - LA/Ventura Chapter
    Local # 0532
    28460 Ave Stanford Ste 240
    Santa Clarita, CA 91355


    Building Industry Association Southern California - Building Industry Association of S Ca Antelope Valley
    Local # 0532
    44404 16th St W Suite 107
    Lancaster, CA 93535



    Construction Expert Witness News and Information
    For Anaheim California

    Homeowners May Not Need to Pay Lien on Defective Log Cabin

    New Construction Laws, New Forms in California

    Construction Defect Bill Introduced in California

    Construction Defect Not a RICO Case, Says Court

    Celebrities Lose Case in Construction Defect Arbitration

    District Court’s Ruling Affirmed in TCD v American Family Mutual Insurance Co.

    Reference to "Man Made" Movement of Earth Corrects Ambiguity

    Nebraska Man Sentenced for Insurance Fraud in Construction Projects

    Changes to Arkansas Construction and Home Repair Laws

    Although Property Damage Arises From An Occurrence, Coverage Barred By Business Risk Exclusions

    Homeowner may pursue negligence claim for construction defect, Oregon Supreme Court holds

    FHA Lists Bridges and Overpasses that May Have Defective Grout

    Insurance Firm Under No Duty to Defend in Hawaii Construction Defect Case

    Follow Up on Continental Western v. Shay Construction

    Insurer Unable to Declare its Coverage Excess In Construction Defect Case

    Eleventh Circuit Asks Georgia Supreme Court if Construction Defects Are Caused by an "Occurrence"

    School Sues over Botched Pool

    Arbitrator May Use Own Discretion in Consolidating Construction Defect Cases

    Guilty Pleas Draw Renewed Interest In Nevada’s Construction Defect Laws

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

    California Supreme Court to Examine Arbitration Provisions in Several Upcoming Cases

    Harmon Tower Construction Defects Update: Who’s To Blame?

    Increased Expenditure on Injuries for New York City School Construction

    Who Is To Blame For Defective — And Still LEED Certified — Courthouse Square?

    HOA Has No Claim to Extend Statute of Limitations in Construction Defect Case

    Tampa Condo Owners Allege Defects

    Gilroy Homeowners Sue over Leaky Homes

    Bound by Group Builders, Federal District Court Finds No Occurrence

    All Risk Policy Only Covers Repair to Portion of Dock That Sustains Damage

    Construction Workers Unearth Bones

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

    Battle of “Other Insurance” Clauses

    Rihanna Finds Construction Defects Hit a Sour Note

    Contractor Burns Down Home, Insurer Refuses Coverage

    2011 Worst Year Ever for Home Sales

    Public Relations Battle over Harmon Tower

    Judge Rejects Extrapolation, Harmon Tower to Remain Standing

    Boston’s Tunnel Project Plagued by Water

    Australian Group Seeks Stronger Codes to Combat Dangerous Defects

    Allowing The Use Of a General Verdict Form in a Construction Defect Case Could Subject Your Client to Prejudgment Interest

    A Call to Washington: Online Permitting Saves Money and the Environment

    Texas covered versus uncovered allocation and “legally obligated to pay.”

    Court Voids Settlement Agreement in Construction Defect Case

    The Year 2010 In Review: Design And Construction Defects Litigation

    Know the Minnesota Statute of Limitations for Construction Defect Claims

    Pipes May Be Defective, But Owners Lack Standing

    New Safety Standards Issued by ASSE and ANSI

    Court Sends Construction Defect Case from Kansas to Missouri

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

    Statute of Limitations Upheld in Construction Defect Case

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

    OSHA Cites Construction Firm for Safety Violations

    Florida Property Bill Passes Economic Affairs Committee with Amendments

    Time to Repair Nevada’s Construction Defect Laws?

    Failure to Meet Code Case Remanded to Lower Court for Attorney Fees

    Recent Case Brings Clarity and Questions to Statute of Repose Application

    Plans Go High Tech

    Louisiana Politicians Struggle on Construction Bills, Hospital Redevelopment

    Policyholder Fails to Build Adequate Record to Support Bad Faith Claim

    Avoid Gaps in Construction Defect Coverage

    Construction Job Opening Rise in October

    Ensuing Loss Provision Does Not Salvage Coverage

    Construction Company Head Pleads Guilty to Insurance and Tax Fraud

    Construction Defects Are Occurrences, Says South Carolina High Court

    Court Strikes Down Reasonable Construction Defect Settlement

    Don MacGregor To Speak at 2011 West Coast Casualty Construction Defect Seminar

    Denver Court Rules that Condo Owners Must Follow Arbitration Agreement

    A Loud Boom, But No Serious Injuries in World Trade Center Accident

    Can Negligent Contractors Shift Blame in South Carolina?

    Boston Tower Project to Create 450 Jobs

    Court Clarifies Sequence in California’s SB800

    Hovnanian Increases Construction Defect Reserves for 2012

    Good Signs for Housing Market in 2013

    Montrose Language Interpreted: How Many Policies Are Implicated By A Construction Defect That Later Causes a Flood?

    Insurance Firm Defends against $22 Million Claim

    Insurer’s Motion for Summary Judgment Based on Earth Movement Exclusion Denied

    BUILD Act Inching Closer To Reality

    Construction Defects as Occurrences, Better Decided in Law than in Courts

    Defective Drains Covered Despite Water Intrusion Exclusion

    Judge Okays Harmon Tower Demolition, Also Calls for More Testing

    Texas contractual liability exclusion

    Tennessee Court: Window Openings Too Small, Judgment Too Large

    Consumer Protection Act Whacks Seattle Roofing Contractor

    Construction Workers Face Dangers on the Job

    No Coverage For Damage Caused by Chinese Drywall

    US Courts in Nevada Busy with Yellow Brass

    Unlicensed Contractors Nabbed in Sting Operation

    Ohio Adopts Energy-Efficient Building Code

    Claims Under Colorado Defect Action Reform Act Count as Suits

    Condo Buyers Seek to Void Sale over Construction Defect Lawsuit
    Corporate Profile

    ANAHEIM CALIFORNIA CONSTRUCTION EXPERT WITNESS
    DIRECTORY AND CAPABILITIES

    Leveraging from more than 5500 construction defect and claims related expert witness designations, the Anaheim, California Construction Expert Witness Group provides a wide range of trial support and consulting services to Anaheim's most acknowledged construction practice groups, CGL carriers, builders, owners, and public agencies. Drawing from a diverse pool of construction and design professionals, BHA is able to simultaneously analyze complex claims from the perspective of design, engineering, cost, or standard of care.

    Construction Expert Witness News & Info
    Anaheim, California

    Ohio Court Finds No Coverage for Construction Defect Claims

    March 28, 2012 — Tred Eyerly, Construction Law Hawaii

    Charles and Valerie Myers hired Perry Miller to build their home. Myers v. United Ohio Ins. Co., 2012 Ohio App. LEXIS 287 (Ohio Ct. App. Jan. 26, 2012). After completion of the home, Miller was again hired to construct an addition which included a full basement, staircases, bathroom, bedroom, hallway and garage.

    After the addition was completed, one of the basement walls began to crack and bow. Miller began to make repairs, but eventually stopped working on the project. Other contractors were hired to make repairs, but further problems developed. A second basement wall began to bow and crack, allowing water into the basement. The wall eventually had to be replaced. Subsequently, the roof over the addition began to leak in five or six places before the drywall could be painted. The leaks caused water stains on the drywall and caused it to separate and tear. It was discovered the roof needed to be replaced.

    The Myers sued Miller and his insurer, United Ohio Insurance Company. The trial court ruled that the policy did not provide coverage for faulty workmanship, but did provide coverage for consequential damages caused by repeated exposure to the elements. United Ohio conceded liability in the amount of $2,000 to repair water damage to the drywall. United Ohio was also found liable for $51,576, which included $31,000 to repair the roof and ceiling and $18,576 to replace the basement wall.

    Read the full story…

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


    Construction Defects and Contractor-Owners

    July 10, 2012 — CDJ Staff

    On the expert advice site Avvo.com, a user asks if he can be sued for construction defects by the new owner of a building for which he served as general contractor and then owned for four years. He had construction insurance, but does not think he had construction defect insurance.

    A lawyer responding to his question says that “you could be sued.” In the event of a suit, “you would have to bring claims against all of your subcontractors.”

    Read the full story…


    Ohio Casualty’s and Beazer’s Motions were Granted in Part, and Denied in Part

    May 10, 2012 — CDJ Staff

    The case Trinity Homes LLC and Beazer Homes Investments LLC has reached the summary judgment stage. The remaining plaintiffs are Trinity Homes LLC (Trinity) and Beazer Homes Investments LLC (Beazer), and the only defendant remaining is Ohio Casualty Insurance Company (Ohio Casualty). “Ohio Casualty has filed a motion for summary judgment (Dkt. #409) on all claims against it, and Trinity and Beazer have filed a cross-motion seeking partial summary judgment (Dkt. #431) in their favor.” Ohio Casualty’s Motion for Summary Judgment was granted in part and denied in part, and Beazer’s motion was granted in part and denied in part.

    The court’s ruling presented a bit of background on the companies involved in the litigation: “Trinity is an Indiana limited liability company with its principal place of business in Indiana and is one of several construction related companies owned by Beazer, which is a limited liability company incorporated under the laws of Delaware having its principal place of business in Atlanta, Georgia. Beazer’s predecessor, Beazer Homes Investment Corporation, acquired the stock of Crossman Communities, Inc. in 2002. Crossman and its subsidiary owned all interests in Trinity. Beazer and Trinity are in the business of residential real estate development and construction.”

    Furthermore, “Ohio Casualty’s home office is in Ohio, where it is incorporated. It sells insurance policies to commercial entities such as Plaintiffs. It purchased a book of business from Great American Insurance Company, a subsidiary of which had sold commercial general liability policies (‘CGL’) and umbrella liability policies to Trinity, covering the period of time between May 1, 1994 through May 1, 1999. For ease of reference, we will refer to these policies as the Ohio Casualty policies. Trinity sold and acted as a general contractor for the construction of new homes in Central Indiana throughout the period of time in which the Ohio Casualty policies were in place.”

    The court disagreed with almost every argument put forth by Ohio Casualty. However, they did concede “that Ohio Casualty is obligated to indemnify Trinity only for damages arising during its policy periods for pro rata liability as opposed to several and indivisible, by reason of its having limited its indemnity obligation to ‘those sums’ that Trinity becomes liable to pay for property damage which ‘occurs during the policy period.’”

    Finally, the court ruled that “Ohio Casualty Company’s Motion For Summary Judgment (Dkt. #409) is GRANTED IN PART, that is, to the extent that Beazer is not an insured under the Ohio Casualty insurance policies, but the motion is DENIED in all other respects.”

    The court further ruled that “Trinity and Beazer’s Motion For Partial Summary Judgment (Dkt. #431) is GRANTED IN PART, that is: (1) Trinity is an insured under the Ohio Casualty CGL and umbrella policies in effect for the time period from May 1, 1994 to May 1, 1999; (2) the claims at issue in the Underlying Lawsuits are "property damage" claims resulting from an "occurrence" and are therefore within the policy coverage provided under the Ohio Casualty Policy; and (3) none of the exclusions in the Ohio Casualty Policy bars coverage. Trinity and Beazer’s Motion is DENIED in all other respects. Moreover, material questions of fact remain with respect to whether payments made to the 54 homeowners, who were part of the putative class in the underlying Colon class action but were not included in the certified settlement class, were voluntary payments and as such do not qualify for indemnification. Material questions of fact also preclude a summary ruling on the issue of whether Ohio Casualty is estopped from raising their voluntary nature as a defense to indemnity.”

    Read the court’s decision…


    Construction Defect Lawsuit Stayed by SB800

    September 13, 2012 — CDJ Staff

    The California Court of Appeals has reversed the decision of the lower court and has stayed, instead of dismissed, a claim of construction defects. A group of Victorville homeowners sued their homebuilder, K. Hovnanian Communities on a claim of construction defects. Hovnanian argued that under the procedures set forth in SB800, the suit should be dismissed, and that the claims should undergo arbitration. The trial agreed, dismissing the claims of 82 plaintiffs under a first motion, and then granted a second motion to dismiss, which affected a further 21 plaintiffs. The homeowners appealed.

    The Court noted that “the parties disagree about the standard of review,” with the Court determining that as the facts were not in dispute, they would use “an independent standard of review.”

    Reviewing the relevant statues, the Court concluded that the terms of the limited warranty set out the pre-litigation procedure, noting that “plaintiffs admit they did not comply with the limited warranty because they challenge its validity and enforceability.” The Court concluded that “plaintiffs’ action was premature.”

    The Court further noted that “a civil action will not be filed until after the contractual procedures have been followed.” Until these procedures have been followed, the Court said that they “decline to resolve issues about validity and enforceability.” However, as these issues could arise after the limited warranty procedures, the court stayed, rather than dismissed the claims.

    Read the court’s decision…


    Insurer Not Liable for Construction Defect Revealed by Woodpecker

    September 13, 2012 — CDJ Staff

    The Eighth Circuit Court of Appeals has ruled that an insurance provision that excluded construction defects must stand in Friedberg v. Chubb, granting a summary judgment to the insurance firm.

    The Friedbergs discovered extensive water damage to their home after a woodpecker drilled a hole in a vertical support. They sought insurance coverage under their Chubb “Masterpiece” policy. The decision quotes the policy as covering “all risk of physical loss” “unless stated otherwise or an exclusion applies.” These exclusions included “gradual or sudden loss,” “structural movement,” and “faulty planning, construction or maintenance,” but the policy covered “ensuing covered loss unless another exclusion applies.”

    Chubb’s expert determined that the Friedbergs’ home had defective construction, and “attributed the damage to the beams and walls below the beam to a failure to install control joints.” After Chubb denied coverage, the Friedbergs sued, although the court ruled that “even under the Friedbergs’ theory, the water damage was a loss caused by faulty construction and therefore excluded under the policy.”

    On appeal, the Friedbergs argued that “the loss resulted from the combination of both faulty construction and the presence of water” and that Minnesota’s “concurrent causation” doctrine must apply, which according to the decision, “when a loss results from both a covered peril and an excluded peril, coverage exists unless the excluded peril is the ‘overriding cause’ of the loss.” The court rejected this reasoning, noting that “once the house was plagued with faulty construction, it was a foreseeable and natural consequence that water would enter.”

    The Friedbergs also contended that “the damage caused by the intrusion of water into their home is an ‘ensuing covered loss’ for which they are due coverage.” The court also rejected this claim, noting that Minnesota law excludes defective construction from the ensuing loss provision. The court said that “the Friedbergs’ reading of their ensuing-loss clause, by contrast, would dramatically limit their policy’s faulty-construction exclusion, because almost ‘any loss cause by’ faulty construction could also be characterized as an ensuing loss under an all-risk policy.”

    Read the court’ decision…


    Federal Court Denies Summary Judgment in Leaky Condo Conversion

    August 4, 2011 — CDJ Staff

    In the US District Court for Illinois, Judge William Hibber has rejected the request for summary judgment sought by the developers of a condominium building in the case of Nautilus Ins. Co. v. 1735 W. Diversey, LLC (the insureds). The insureds renovated a building at 1735 W. Diversey, Chicago, converting it into condominiums. After the project was completed and all units sold, and a condominium association form, one of the owners found that unit suffered leaks during rainstorms. The condo board hired a firm, CRI, to investigate the cause of the leakage. CRI found “water infiltration through the exterior brick masonry walls, build-up of efflorescence on the interior surfaces of the masonry, and periodic spalling of portions of the brick masonry.”

    The redevelopment firm had purchased coverage from Nautilus. “Shortly after the Board filed its first complaint, the Insureds tendered the mater to Nautilus and requested that it indemnify and defend them from the Board's underlying claims. Nautilus, however, rejected the Insureds’ tender and denied coverage under both insurance policies.” Nautilus stated that the water leakage did not constitute an occurrence under the policies. The court cited these policies in which an occurrence is defined as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions.” The Illinois courts have determined that construction defects are not accidents.

    The court concluded that the insured did not bring forth claims within the coverage of the policies and denied the motion for summary judgment.

    Read the court’s decision…


    Contractor Liable for Soils Settlement in Construction Defect Suit

    February 10, 2012 — CDJ Staff

    The California Court of Appeals ruled on January 9 in Burrow v. JTL Dev. Corp., a construction defect case in which houses suffered damage due to improperly compacted soil, upholding the decision of the lower court.

    Turf Construction entered into a deal with JTL to develop a parcel they acquired. A third firm, Griffin Homes, withdrew from the agreement “when a geotechnical and soils engineering firm reported significant problems with soil stability on 14 of the lots.” Turf Construction then took over compacting and grading the lots. Turf “had never compacted or graded a residential tract before.” Robert Taylor, the owner of Turf, “testified he knew there was a significant problem with unstable soils.”

    After homes were built, the plaintiffs bought homes on the site. Shortly thereafter, the homes suffered damage from soil settlement “and the damage progressively worsened.” They separately filed complaints which the court consolidated.

    During trial, the plaintiff’s expert said that there had been an inch and a half in both homes and three to five inches in the backyard and pool areas. “He also testified that there would be four to eight inches of future settlement in the next fifteen to twenty years.” The expert for Turf and JTL “testified that soil consolidation was complete and there would be no further settlement.”

    Turf and JTL objected to projections made by the plaintiffs’ soil expert, William LaChappelle. Further, they called into question whether it was permissible for him to rely on work by a non-testifying expert, Mark Russell. The court upheld this noting that LaChappelle “said that they arrived at the opinion together, through a cycle of ‘back and forth’ and peer review, and that the opinion that the soil would settle four to eight inches in fifteen to twenty years was his own.”

    Turf and JTL contended that the court relied on speculative damage. The appeals court disagreed, stating that the lower court based its award “on evidence of reasonably certain damage.”

    Turf also that it was not strictly liable, since it did not own or sell the properties. The court wrote that they “disagree because Turf’s grading activities rendered it strictly liable as a manufacturer of the lots.” The court concluded that “Turf is strictly liable as a manufacturer of the lots.”

    Judge Coffee upheld the decision of the lower court with Judges Yegan and Perren concurring.

    Read the court’s decision…


    Irene May Benefit Construction Industry

    September 1, 2011 — CDJ Staff

    Noting that while it wasn’t the $15 billion disaster some predicted, Hurricane Irene still caused quite a bit of damage on its path up the Eastern Seaboard. Martha White, reporting for MSNBC cites Kinetc Analysis Corp. with an estimate of $7 billion in damage. Carl Van Horn, a professor of public policy at Rutgers University expected an initial decline in construction jobs, due to projects delayed due to the storm’s arrival, but he said, “a few weeks later, employment picks up as people rebuild.”

    Kinetic says that one unknown is how much of the damage is insured. They expect only $3 billion of damage will be covered by insurance. This would likely put a drag on consumer spending, as homeowners would have to dig into their own pockets to pay for repairs, according to Karl Smith, associate professor of economics and government at the University of North Carolina at Chapel Hill.

    Read the full story…


    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


    Mississippi exclusions j(5) and j(6) “that particular part”

    June 7, 2011 — CDCoverage.com

    In Lafayete Ins. Co. v. Peerboom, No. 3:10cv336 (S.D. Miss. June 2, 2011), claimant homeowner Peerboom hired insured contractor Absolute to raise Peerboom’s house two feet to avoid future flooding. While Absolute was raising the house, it fell, resulting in physical injury to the home. Peerboom sued Absolute for negligence, breach of contract, and fraud, seeking damages for the destruction of the home. Absolute’s CGL insurer Lafayette defended under a reservation of rights and filed a declaratory judgment action.

    Read the full story…

    Reprinted courtesy of CDCoverage.com


    Changes To Indemnification Statute Are Here! Say Hello To Defense Duties

    June 19, 2012 — Douglas Reiser, Builders Counsel

    A months back, I discussed the passage of SHB 1559. The law changes the existing statutory indemnification regulation to include the costs of defense and to rid contracts of unfair indemnification for someone else’s sole negligence. The law went into effect last week!

    Check back to my recent article on the changes set forth in the new law. The amendments to RCW 4.24.115 will broaden the existing law and clarify what types of indemnification are unenforceable. In short, an “up the chain” contractor (such as a general contractor) cannot expect to pass 100% of the defense and indemnification obligations downward if it is partially liable.

    Read the full story…

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


    Colorado Court of Appeals Finds Damages to Non-Defective Property Arising From Defective Construction Covered Under Commercial General Liability Policy

    December 20, 2012 — Heidi Gassman, Higgins, Hopkins, McLain & Roswell

    The recently decided case of Colorado Pool Systems, Inc. v. Scottsdale Insurance Company (Colo. Ct. App. 10CA2638, October 25, 2012), confirms that absent specific exclusions in the policy, a commercial general liability (“CGL”) policy covers damages to non-defective property arising from a builder’s own defective workmanship.

    Colorado Pool Systems, Inc. (“Colorado Pool”) was hired as a subcontractor to install a swimming pool at Founders Village Pool and Community Center (“Founders Village”) in Castle Rock, Colorado.  After the concrete shell of the pool was placed, some of the rebar frame was found to be too close to the surface.  Founders Village demanded that Colorado Pool remove and replace the pool, and Colorado Pool contacted its insurance carrier, Scottsdale Insurance Company (“Scottsdale”), with which Colorado Pool held a CGL policy.  After inspecting the pool, Scottsdale’s claims adjuster stated that the insurance policy would cover losses associated with removing and replacing the pool.

    Read the full story…

    Reprinted courtesy of Heidi Gassman, Higgins, Hopkins, McLain & Roswell, LLC. Ms. Gassman can be contacted at gassman@hhmrlaw.com


    Court Rules on a Long List of Motions in Illinois National Insurance Co v Nordic PCL

    May 10, 2012 — CDJ Staff

    The case Illinois National Insurance Co. v Nordic PCL, et al. “involves a dispute about whether insurance benefits are available to a general contractor who built structures that allegedly have construction defects. Plaintiffs Illinois National Insurance Company (‘Illinois National’) and National Union Fire Insurance Company of Pittsburgh, PA (‘National Union’) (collectively, the ‘Insurers’), commenced this action for declaratory relief against Defendant Nordic PCL Construction, Inc., f/k/a Nordic Construction, Ltd. ("Nordic"), on August 23, 2011.”

    The court was asked to rule on a long list of motions: “Counterclaim Defendants’ Request for Judicial Notice in Support of Their (1) Motion to Dismiss the Counterclaim and (2) Motion to Strike Portions of the Counterclaim, ECF No. 16 (‘Request for Judicial Notice’); Counterclaim Defendants’ Motion to Dismiss Counterclaim Filed October 24, 2011, ECF No. 14 (‘Motion to Dismiss Counterclaim’); Counterclaim Defendants’ Motion to Strike Portions of the Counterclaim Filed October 24, 2011, ECF No. 15 (‘Motion to Strike’); Third-Party Defendant Marsh USA, Inc.’s Motion to Dismiss or, in the Alternative, Stay Proceedings in Favor of Pending State Action, ECF No. 33 (‘Marsh’s Motion To Dismiss Or Stay’); Defendant and Third-Party Plaintiff Nordic PCL Construction, Inc., f/k/a Nordic Construction Ltd.’s Substantive Joinder to Third-Party Defendant Marsh USA Inc.’s Motion to Dismiss or, in the Alternative, Stay Proceedings in Favor of Pending State Action, ECF No. 36 (‘Nordic’s Joinder’); and Third-Party Defendant Marsh USA, Inc.’s Motion for Judgment on the Pleadings on Counts V and VI of Defendant/Third-Party Plaintiff Nordic PCL Construction, Inc.’s Third-Party Complaint, ECF No. 29 (‘Marsh’s Motion for Judgment on the Pleadings’).”

    In result, the court reached the following decisions: “The court GRANTS IN RELEVANT PART the Insurers’ Request for Judicial Notice to the extent it covers matters relevant to these motions; GRANTS IN PART the Insurers’ Motion to Dismiss Counterclaim, but gives Nordic leave to amend the Counterclaim in certain respects; DENIES the Insurers’ Motion to Strike; DENIES Marsh’s Motion To Dismiss Or Stay and Nordic’s Joinder; and GRANTS Marsh’s Motion for Judgment on the Pleadings.”

    The court provides a bit of background on the case: “This action arises out of alleged construction defects involving two projects on which Nordic acted as the general contractor. Nordic is a defendant in a pending state court action with respect to one of the projects and says it spent more than $400,000 on repairs with respect to the other project. Nordic tendered the defense of the pending state court action to the Insurers and sought reimbursement of the cost of repairs already performed. The Insurers responded by filing this action to determine their rights under the insurance policies issued to Nordic.”

    Furthermore, the court presented a brief procedural history: “The Insurers commenced this declaratory action in this court on August 23, 2011. The Complaint asserts two claims, one seeking a declaration that the Insurers have no duty to provide a defense or indemnification regarding the Safeway Action, the other seeking such a declaration regarding the Moanalua Claims. Along with its Answer, Nordic filed a Counterclaim against the Insurers. The Counterclaim asserts breach of contract, breach of the covenant of good faith and fair dealing, misrepresentations and omissions of material fact, and bad faith, and seeks declaratory relief against the Insurers.”

    The procedural history continues: “Nordic also filed a Third-Party Complaint against Marsh, the broker that had procured the Policies from the Insurers for Nordic. Nordic alleges that it reasonably believed that the Policies would provide completed operations insurance coverage for the types of construction defects alleged in the Safeway Action and Moanalua Claims. The Third-Party Complaint asserts breach of contract, negligence, promissory estoppel, breach of fiduciary duties, implied indemnity, and contribution and equitable subrogation.”

    In conclusion, “The court GRANTS IN RELEVANT PART the Insurers’ Request for Judicial Notice. With regard to the Insurers’ Motion to Dismiss Counterclaim, the court GRANTS the motion as to Count I (breach of contract), Count II (duty of good faith and fair dealing), Count III (fraudulent and negligent misrepresentation), the portion of Count IV (bad faith) premised on fraud, and Count IV (declaratory relief). The court DENIES the motion as to Count IV (bad faith) that is not premised on fraud. Except with respect to the "occurrence" issue, which the court disposes of here on the merits, and Count V, which concerns only a form of relief, Nordic is given leave to amend its Counterclaim within three weeks of the date of this order. The court DENIES the Insurers’ Motion to Strike, DENIES Marsh’s Motion to Dismiss or Stay and Nordic’s Joinder, and GRANTS Marsh’s Motion for Judgment on the Pleadings with respect to Counts V and VI of the Third-Party Complaint.”

    Read the court’s decision…


    Construction Defect Journal Marks First Anniversary

    January 6, 2012 — CDJ Staff

    November 2011 marked the first anniversary of the Construction Defect Journal. During the first year our staff and contributors in the insurance and legal communities have compiled several hundred articles of interest to the construction defect and claims community.

    Each of these articles are maintained in the CDJ archives, and are accessible at http://www.constructiondefectjournal.com/archives.html. Each story in the archives is listed in the order it was posted to the archives. Each story in the archives opens up in its own page, so you can easily locate topics and articles of interest.

    If you’re new to Construction Defect Journal, or just want peruse past articles, please take a moment to visit the CDJ Archives page. Also please feel encouraged to submit your firm’s articles or legal publications of interest to the CD community at http://www.constructiondefectjournal.com/submitStory.html.


    Public Relations Battle over Harmon Tower

    October 23, 2012 — CDJ Staff

    Tutor Pernini claims that CityCenter is portraying the construction firm as “the scum of the earth” in an attempt to influence eventual jurors, according to an article at Vegas Inc. The contractor’s attorneys have requested information regarding the public relations efforts of MGM Resorts and CityCenter, characterizing CityCenter’s PR as a “litigation spin doctor.”

    CityCenter has requested that at least one subpoena be canceled. Judge Elizabeth Gonzales has already allowed one to go through, although she has noted that Perini cannot request documents from CityCenter’s lawyers to the litigation consultants under attorney/client privilege. Tutor Perini claims that in 2010, Patricia Glaser, who has represented CityCenter, said her goal was to portray Perini as “the scum of the earth,” and make that certain that judges and juries would not “adopt the world view espoused by the opposing party.”

    Read the full story…


    Guilty Pleas Draw Renewed Interest In Nevada’s Construction Defect Laws

    December 9, 2011 — CDJ Staff

    A report this week by David McGrath Schwarz of the Las Vegas Sun suggests that Nevada’s construction defect laws will be a point of much contention in upcoming legislative sessions. The report cites renewed interest in the state’s construction defect laws due to ongoing federal investigations of construction defect attorney Nancy Quon and construction company owner Leon Benzer. Guilty pleas have been entered by at least ten individuals including an attorney, property managers, straw purchasers, and former HOA board members.

    The article suggests that Nevada’s Chapter 40 laws are easily manipulated to the detriment of Nevada’s homebuilding industry. Construction industry lobbyists have tried unsuccessfully to change the laws in past legislative sessions.

    The Sun’s article speculates that the building industry might be able to gain legislative concessions due to the volume of guilty pleas and what it refers to as examples of Chapter 40 abuses. ”With federal authorities collecting guilty pleas, the construction industry has prime examples of the system being abused, and how lucrative it can be for attorneys.”

    Read the full story…


    School Sues over Botched Pool

    October 23, 2012 — CDJ Staff

    The Daily American reports that the Somerset Area School District has alleged that the contractor who repaired and renovated the district’s swimming pool “botched” the job. Now the school has filed a civil case in the Somerset County Court of Common Pleas. The contractor, Wilson Construction Co. would prefer the matter to be settled in binding arbitration.

    The school district alleges that the surface installed by Wilson Construction cracked and bubbled due to improper installation. The manufacturer of the waterproofing system, Dryvit Systems, tested the installation and concluded it was an installation failure instead of a product defect. Dryvit told the district that the exterior walls would have be removed.

    The school district paid Wilson Construction $591,081 for their work. In their lawsuit, they are seeking $594,596 to cover the cost of draining the pool and repairing it.

    Read the full story…


    Texas Construction Firm Files for Bankruptcy

    December 20, 2012 — CDJ Staff

    A Texas construction firm, founded in 1937, filed for bankruptcy, bringing twenty-two projects to a sudden halt, and resulting in the loss of jobs for hundreds of employees. Ballenger Construction told its employees to go home, as it could not complete the jobs. In some cases, work will need to be done to ensure that the work sites do not cause public safety hazards.

    Read the full story…