Defense for Additional Insured Not Barred By Sole Negligence Provision
August 11, 2011 — Tred Eyerly, Insurance Law Hawaii
A general contractor was entitled to a defense as an additional insured when the underlying complaint did not allege it was solely negligent. A-1 Roofing Co. v. Navigators Ins. Co., 2011 Ill. App. LEXIS 656 (Ill. Ct. App. June 24, 2011).
A-1 was the general contractor for a roof resurfacing job at a high school. Jack Frost Iron Works Inc. (“Frost”) was one of A-1’s subcontractors. Frost had a CGL policy with Navigators Insurance Company under which A-1 was an additional insured.
An employee of Frost’s subcontractor Midwest Sheet Metal Inc. was killed at the job site when a boom-lift he was operating flipped over. The boom-lift had been leased by another Frost subcontractor, Bakes Steel Erectors, Inc. (BSE). The deceased's estate filed suit against A-1, BSE and two other defendants.
Read the full story…
Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii. Mr. Eyerly can be contacted at te@hawaiilawyer.com
Underpowered AC Not a Construction Defect
November 7, 2012 — CDJ Staff
After buying a home in Louisiana, Mike Gines determined that the home’s air conditioning unit was insufficient to maintain an appropriate temperature. He contacted the home builder, D.R. Horton, Inc., which worked with the air conditioning installer, Reliant Heating & Air Conditioning, in order to repair the system. When the problems persisted, Gines filed a class action petition against Horton and Reliant in state court. Horton and Reliant moved the case to the federal courts, whereupon Gines asserted the defendants were in violation of the Louisiana New Home Warranty Act (NHWA). Horton stated that the claim under the NHWA was invalid, because Gines had not alleged actual physical damage to his home.
The district court granted Horton’s motion to dismiss. Gines sought a reversal from the Fifth Circuit Court of Appeals and sought to have two questions of state law addressed by the Louisiana Supreme Court.
The district court ruled that the NHWA was the “sole remedy under Louisiana law for a purchaser of a new home with construction defects. Gines argued that court erred in this, but also conceded that this was the conclusion of the Louisiana Supreme Court.
Further, Gines argued that a provision in the NHWA that allows the inclusion of construction defects that do not cause damage was satisfied by paragraph 6 of the contract. The court noted that Gines did not attach a copy of the contract to either the original or amended complaint, and so the court does not need to address these claims. However, the court cautioned that if a copy had been included, they still would have rejected the claim, as “the cited language does not indicate a waiver of the physical damage requirement.” They also note that “paragraph 13 of the contract shows that Gines was aware to the absence of any such waiver in the contract.”
The court concludes that “the moral of this story is that in order to avoid the harsh result that has obtained here, the buyer of a newly constructed home in Louisiana should seek to obtain in the contract of sale an express waiver of the actual damage requirement of the NHWA.” The appeals court affirmed the decision of the circuit court and denied the application to certify questions to the Louisiana Supreme Court.
Read the court’s decision…
Homeowners Sue Over Sinkholes, Use Cash for Other Things
January 6, 2012 — CDJ Staff
Quoting one homeowner as saying that his house “can fall in the ground for all I care, I made my money,” the Tampa Bay Times looks at the issue of sinkhole claims in Florida. Homeowners “have paid off mortgages, put in pools, replaced roofs, or otherwise used money from sinkhole claims to do something besides fix sinkhole damage.
It’s been tough for insurance companies. Citizens Property Insurance took in $32 million in premiums for sinkhole coverage in 2010, but paid out $245 million in sinkhole claims. The Tampa Bay Times notes that some of those claims come from settling problems caused by their repairs, including one settlement of $350,000 for repairs to a house worth $39,000.
One couple, after receiving $217,000 from Citizens, sold the house to a company that bought unrepaired sinkhole homes for $190,000. The home has been sold since and remains unrepaired.
Sometimes the preferred solution by the insurance company isn’t the cheapest either. One couple was informed that Citizens was going to spend $150,000 to have the hole filled with grout. After they settled with the insurance company, they fixed the problem by installing steel piers, at a cost of about $45,000.
Read the full story…
Summary Judgment in Construction Defect Case Cannot Be Overturned While Facts Are Still in Contention in Related Cases
September 9, 2011 — CDJ Staff
The Alabama Court of Civil Appeals has dismissed an appeal of a summary judgment in the case Bella Investments, Inc. v. Multi Family Services, Inc. MFS was hired by Bella to be the general contractor for a hotel in Gardendale, Alabama. MFS hired various subcontractors, including the architect for the project. After completion of the hotel in April, 2006, Bella made requests for MFS to repair cracked floor tiles.
In August, 2008, Bella sued MFS, the architect, and various fictitiously named defendants. Subsequently, Bella amended its complaint, naming some of the fictitiously named defendants.
MFS in turn claimed that Bella’s claims were void under the statute of limitations and that Bella was in beach of contact by failing to pay MFS the full amount owed. MFS moved for summary judgment under the statute of limitations, which was granted by the court.
Bella requested that the court “alter, amend, or vacate its summary judgment order.” When this was denied, Bella appealed to the Alabama Supreme Court, which transferred the appeal to the Court of Civil Appeals. The Court of Appeals refused to vacate the summary judgment as claims that form part of the case against MFS are also part of Bella’s claims against the other defendants. For this reason, the court upheld the summary judgment.
Read the court’s decision…
Construction Employment Rises in Half of the States
December 9, 2011 — CDJ Staff
The Labor Department has noted that half the states and the District of Columbia saw increases in construction employment during the month of October. During the same month, twenty-three states lost construction jobs.
The biggest gains were in North Dakota, Oklahoma, DC, Texas, and California. The biggest losses were in Georgia, New Mexico, Wisconsin, and Florida. There was no change for Alabama.
The chief executive officer of the Association of General Contractors of America, Stephen E. Sandherr, called for more infrastructure development. “Allowing water, transportation and energy networks to deteriorate will hurt construction employment and force taxpayers to spend more later, to fix broken infrastructure.”
Read the full story…
There is No Non-Delegable Duty on the Part of Residential Builders in Colorado
August 2, 2012 — Brady Iandiorio, Higgins, Hopkins, McLain & Roswell, LLC
Recently, in the Arapahoe District Court, the Honorable Michael Spear, issued an order holding that builders do not owe a non-delegable duty to homeowners. In Marx and Corken v. Alpert Custom Homes, Inc., et al., Judge Spear’s order came in response to plaintiffs’ motion for determination of question of law seeking a finding that the defendants owed a non-delegable duty to the plaintiffs and thus, to strike defendants’ designation of nonparties at fault. After being fully briefed, Judge Spear, found that such a non-delegable duty does not exist.
The case arises from the construction of a single-family residence in Aurora, Colorado. Through the construction and interaction with Alpert Custom Homes, Inc. and Scott and Sally Alpert, the defendants, Paul Marx and Kay Corken, the plaintiffs claimed they suffered various damages and losses, and brought claims for breach of contract-warranty, breach of contract, violation of the Colorado Consumer Protection Act, breaches of the implied covenant of good faith, promissory estoppel, willful breach of contract, and quantum meruit. During litigation, the defendants filed a designation of nonparties at fault, which named several parties which were at fault for the alleged construction defects at issue in the case. The pertinent nonparties named were subcontractors of defendant Alpert Custom Homes, Inc. during the construction of the residence.
Read the full story…
Reprinted courtesy of Brady Iandiorio, Higgins, Hopkins, McLain & Roswell, LLC. Mr. Iandiorio can be contacted at iandiorio@hhmrlaw.com
Tampa Condo Owners Allege Defects
October 23, 2012 — CDJ Staff
Owners in the Bel Mare towers have filed a lawsuit alleging that the building have construction defects that could lead to problems during periods with high winds. The Tampa Bay Business Journal reports that the condo association has sued the developer, the general contractor, the architects, the structural engineers, and subcontractors.
Read the full story…
Wine without Cheese? (Why a construction contract needs an order of precedence clause)(Law Note)
August 11, 2011 — Melissa Brumback
For today’s law note, I’m addressing a comment that came to me last week from Dave O’Hern of Miller O’Hern Construction. Dave writes:
I am a general contractor doing a fuel tank replacement project for our county. In the specifications there is a spec for a UL 142 tank, on the plans the spec references UL 2085 ? a much more expensive tank. My subcontractor bid the UL 142 tank. The specifications state that the specs and plans are on the same level of precedence.
The county wants me to furnish the more expensive tank without compensation citing the clause that states the plans and specs are complementary and what is called for by one is binding as if called by all and the most stringent requirement will apply.
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Reprinted courtesy of Melissa Brumback of Ragsdale Liggett PLLC. Ms. Brumback can be contacted at mbrumback@rl-law.com.
Application of Efficient Proximate Cause Doctrine Supports Coverage
January 6, 2012 — Tred Eyerly, Insurance Law Hawaii
Relying on the efficient proximate cause doctrine, the court determined coverage potentially existed for damage caused by water. Union Sav. Bank v. Allstate Indem. Co., 2011 U.S. Dist. LEXIS 134398 (S.D. Ind. Nov. 21, 2011).
The Tods purchased property that was mortgaged by Union Savings. The Tods obtained a Landlords Policy for the property from Allstate. When the Tods were in default on their loan, Union Savings notified them that foreclosure proceedings would commence. Union Savings sent an appraiser to the property who discovered water in the basement. Water and electricity to the building were off. Union Savings notified Allstate and later filed a formal claim under the mortgagee clause in the Landlords Policy. This clause stated, "A covered loss will be payable to the mortgagees named on the policy declaration. . . ."
Allstate denied coverage, citing exclusions for water damage.
Read the full story…
Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii. Mr. Eyerly can be contacted at te@hawaiilawyer.com
Supreme Court of New York Denies Motion in all but One Cause of Action in Kikirov v. 355 Realty Assoc., et al.
April 28, 2011 — April 28, 2011 Beverley BevenFlorez - Construction Defect Journal
In the construction defect suit Kikirov v. 355 Realty Associates, LLC, et al., the Supreme Court of the State of New York granted a dismissal of the plaintiff’s fourth cause of action, but denied the defendants’ motion in all other respects. The plaintiff alleged breach of contract, among other claims. “355 Realty was the sponsor of 355 Kings Highway Condominium, a condominium project located at 355 Kings Highway, in Brooklyn, New York. The condominium units were allegedly marketed as ‘ultra luxury condos,’ and a ‘Manhattan style condominium building,’ which would be the ‘epitome of luxury and quality.’ The construction of the six-story 28 unit residential condominium building began in approximately November 2003. […] Plaintiff entered into a purchase agreement, dated December 21, 2005, with 355 Realty (which was executed on behalf of 355 Realty by Michael Marino, as its member) for the purchase of Unit 2G in the building.”
The plaintiff alleged that construction defects emerged soon after moving into the unit: “After taking occupancy of his condominium unit, plaintiff allegedly experienced serious leakage and moisture problems in his unit, which caused a dangerous mold condition to develop, in addition to causing actual damage to the structural elements of his unit. According to plaintiff, the walls, moldings, and wood floors of his unit are constantly wet and moist, and there is severe buckling of the wood floors. Plaintiff claims that these problems have caused his unit to be uninhabitable. Plaintiff alleges that he has been forced to remove all of his personal belongings from his unit and has been unable to occupy his unit.”
According to the plaintiff, Foremost attempted to repair the defects, but only made the situation worse: “Specifically, plaintiff asserts that Foremost’s contractors opened his walls to remove the stained drywall, but never corrected the cause of the leaks, destroyed the walls, and never properly taped and painted the sheet rock. Plaintiff alleges that Foremost repaired the openings in a defective manner. Plaintiff also claims that his floor was repaired at that time by a subcontractor hired by Foremost, but the basic structural problem was never resolved and the leaks continued, compromising the beams and causing the mold conditions, in addition to all of the physical damage present in the unit. On or about July 16, 2009, plaintiff allegedly sent a notice of the defects to 355 Realty and to the managing agent designated by the condominium board, by certified mail, return receipt requested. Plaintiff asserts that defendants have failed and refused to repair and remedy the defective condition, and that the damage is extensive and requires major structural repairs.”
The plaintiff filed suit on May 4, 2010, and the original complaint asserted eight causes of action. “By decision and order dated September 13, 2010, the court granted a motion by defendants to dismiss plaintiff’s second cause of action for breach of implied covenants of good faith and fair dealing, his third cause of action for breach of implied warranties, his fifth cause of action for negligence as against 355 Realty, Michael Marino, Anthony Piscione, Ahron Hersh, and Toby Hersh, his seventh cause of action for negligence as against Vision, Foremost, and MMJ, and his eighth cause of action for violations of General Business Law § 349 and § 350, and granted plaintiff leave to replead his first cause of action for breach of contract as against 355 Realty, Michael Marino, Anthony Piscione, Ahron Hersh, and Toby Hersh, his fourth cause of action for breach of statutory warranties, and his sixth cause of action for breach of contract as against Vision, Foremost, and MMJ.”
The plaintiff amended their complaint on October 18, 2010, and “has repleaded these three causes of action by asserting a first cause of action for breach of contract as against 355 Realty, Michael Marino, Anthony Piscione, Ahron Hersh, and Toby Hersh, a second cause of action for breach of statutory warranties, and a third cause of action for breach of contract as against Vision, Foremost, and MMJ. In addition, plaintiff, in his amended complaint, has added a fourth cause of action for fraud.”
The defendants, on the other hand, “argue that each of the four causes of action alleged by plaintiff in his amended complaint fail to state a claim upon which relief may be granted, and that plaintiff’s amended complaint must be dismissed pursuant to CPLR 3211 (a) (7). Defendants also cite to CPLR 3211 (a) (1), and (5), asserting that dismissal is also required based upon documentary evidence and the Statute of Limitations contained in the limited warranty.” The defendants’ motion to dismiss the first cause of action, breach of contract against 355 Realty, was denied: “While defendants dispute that the alleged defects are actually structural in nature, plaintiff’s allegations as to their structural nature are sufficient, at this juncture, to withstand defendants’ motion to dismiss. Thus, dismissal of plaintiff’s first cause of action must be denied.”
Next, the court reviewed the second cause of action, which was breach of statutory warranties: “Defendants’ motion also seeks dismissal of plaintiff’s second cause of action for breach of statutory warranties, which alleges that, under applicable law, including General Business Law § 777-a, et seq., the sponsor warranted to purchasers of units that the units would be constructed in a skillful, careful, and workmanlike manner, consistent with proper design, engineering, and construction standards and practices, and free of material latent, design, and structural defects. Defendants argue that General Business Law § 777-a, known as the housing merchant implied warranty, is inapplicable to this case because it is limited to the construction of a ‘new home,’ defined in General Business Law § 777 (5) as ‘any single family house or for-sale unit in a multi-unit residential structure of five stories or less.’ As noted above, the building in which plaintiff’s condominium unit is located is a six-story building.”
The motion to dismiss the second cause of action is denied. The court provided this reasoning: “the full text of the offering plan has not been provided, the court is unable to examine the entire written agreement so as to determine the purpose of the inclusion of the text of General Business Law § 777.”
In the third cause of action, the plaintiff alleges “a breach of contract claim as against Vision, Foremost, and MMJ based upon their contract with 355 Realty, pursuant to which they agreed to be the general contractors/construction managers for the condominium, to undertake oversight responsibility for the design and construction of the condominium, to prepare and/or review drawings, plans, and specifications for the condominium, and to otherwise manage and oversee the project. Plaintiff alleges that Vision, Foremost, and MMJ breached their contractual obligations in that the condominium units were improperly and inadequately designed and constructed, and completed in an incompetent and unworkmanlike manner, with material design and construction defects.”
The motion to dismiss the third cause of action was denied as well: “Plaintiff alleges, in his amended complaint, that Vision, Foremost, and MMJ have acknowledged notice of the defects and have not denied that they are responsible for providing a warranty to plaintiff. Plaintiff also refers to this warranty, in his amended complaint, by noting that paragraph 16 of the purchase agreement stated that the ‘[s]eller shall not be liable to . . . the [p]urchaser for any matter as to which an assignable warranty . . . has been assigned . . . to [p]urchaser and in such case the sole recourse of such . . . [p]urchaser . . . shall be against the warrantor . . . except that in the event a contractor or subcontractor is financially unable or refuses to perform its warranty . . . [s]eller shall not be excused from its obligations enumerated in the [offering p]lan under Rights and Obligations of Sponsor.’ Consequently, the court finds that dismissal of plaintiff’s third cause of action as against Foremost and MMJ must also be denied.”
In the fourth cause of action, the plaintiff alleges “that defendants made false statements and representations orally, in advertisements, and in the purchase agreement, that the condominium was properly and adequately designed and constructed and completed in a competent and workmanlike manner, in accordance with the condominium plans and specifications and proper design, engineering, and construction standards and practices consistent with applicable standards for a first class, luxury condominium in Brooklyn.”
The court dismissed the fourth cause of action stating, “it must be dismissed because it is duplicative of his first cause of action for breach of contract.” Therefore, “defendants’ motion to dismiss plaintiff’s amended complaint is granted to the extent that it seeks dismissal of plaintiff’s fourth cause of action, and it is denied in all other respects.”
Read the court’s decision…
After Katrina Came Homes that Could Withstand Isaac
October 23, 2012 — CDJ Staff
In the aftermath of Hurricane Katrina, Louisiana adopted its first uniform building code. Under the new standards, homes are better able to withstand the winds generated by hurricanes. The owner of one home said that during Hurricane Isaac, “there’s no shaking of the building itself, there’s no sign of a storm except for the rain.”
WWWLTV reports that the new standards require home to be able to withstand 130 mile per hour winds. They also must follow FEMA guidelines for elevation. Build Now, a non-profit organization, is seeking to build green homes that meet the new standards. Their executive director said “we’re building higher. We’re building stronger. We’re building greener.”
Read the full story…
Ohio Court of Appeals Affirms Judgment in Landis v. Fannin Builders
April 20, 2011 — April 20, 2011 Beverley BevenFlorez - Construction Defect Journal
The Ohio Court of Appeals affirmed the judgment in Landis v. William Fannin Builders. Landis contracted Fannin Builders to build their home. The case involved staining problems on the T1-11 siding chosen by the plaintiffs.
After a year and a half of discussion on how to resolve the problem of uneven staining on the siding, Landis filed suit “against Fannin Builders, alleging claims for breach of contract, breach of the express limited warranty, and violation of the Ohio Consumer Sales Practices Act (“OCSPA”). Fannin Builders, in turn, filed a third-party complaint against 84 Lumber, alleging claims for breach of contract and indemnification. With the trial court’s leave, Fannin Builders also later amended its answer to add a counterclaim against appellees for breach of contract and unjust enrichment. In the counterclaim, Fannin Builders alleged that appellees still owed it $3,908.98 for the construction of appellees’ home.”
“In its decision, the trial court found in appellees’ favor on their breach of contract claim and against appellees on their claims for breach of the express limited warranty and violation of the OCSPA. Additionally, the trial court found in Fannin Builders’ favor on its counterclaim for breach of contract and against Fannin Builders on its third-party claims for breach of contract and indemnity. The trial court determined that appellees’ damages amounted to $66,906.24, and after setting off the $3,908.98 that appellees owed Fannin Builders under the construction contract, the trial court awarded appellees $62,997.26. The trial court reduced its decision to judgment on May 18, 2010.”
Fannin Builders appealed this judgment and assigned the following errors:
[1.] The Trial Court Erred as a Matter of Law by Concluding that Appellant Breached its Contract with Appellees when it provided a Semi-Transparent Oil-Based Stain that Simply did not Meet their Approval.
[a.] The Contract does not Contain a Satisfaction Clause.
[b.] Even if the Court Implies a Satisfaction Clause, the Court Should Apply an Objective Standard.
[2.] The Trial Court Erred as a Matter of Law by Failing to Consider Appellant’s Right to Cure.
[3.] The Trial Court committed Reversible Error by not Assessing Damages Using “Diminished Value Standard,” and by Creating a Remedy that Constitutes Economic Waste.
[4.] The Trial Court Erred as a Matter of Law by Concluding that Appellant is Barred from Seeking Indemnification When 84 [Lumber] Never Fulfilled its Obligations Pursuant to the Settlement Agreement Entered on August 2, 2005.
In response to the first assigned error, the Court of Appeals stated: “Because the failure to provide siding of a uniform color, not appellees’ displeasure, breached the contract, we reject Fannin Builders’ contention that the trial court implied a satisfaction clause into the contract and found a breach of that clause. Accordingly, we overrule Fannin Builders’ first assignment of error.”
The Court of Appeals overruled the second assignment of error and provided the following reasoning: “Although Fannin Builders depends upon a term of the limited warranty for its right to cure, the trial court concluded that no breach of the limited warranty occurred. Fannin Builders breached the duty of workmanlike conduct implicit in the construction contract, not the limited warranty requiring it to satisfy the BIA’s Quality Standards. Consequently, the limited warranty does not apply to this case, and thus, it does not prevent appellees’ recovery of damages.”
The Appeals Court found “the trial court’s award of damages” was “both reasonable and supported by competent, credible evidence,” and therefore concluded “that the trial court did not err in setting appellees’ damages at $62,997.26.” The Fannin Builders third assignment of error was overruled.
The fourth and final assignment of error was also overruled by the Court of Appeals. “While Fannin Builders correctly asserts that 84 Lumber never installed the replacement siding, it ignores the fact that it ordered 84 Lumber to remove the replacement siding from appellees’ property. Thus, Fannin Builders precluded 84 Lumber from completely performing under the August 2, 2005 letter agreement. […] Consequently, Fannin Builders cannot now claim that the letter agreement is unenforceable or that it is entitled to indemnification from 84 Lumber. Because Fannin Builders assumed all liability for the defective siding in the letter agreement, it is responsible for appellees’ damages.”
James A. Zitesman, Columbus, Ohio Business Attorney, compared the case to Jones v. Centex (Ohio App. 2010), which had a different verdict:
“The common thread is the implied warranty of good workmanship. In the Jones case, the Court found that the buyers had in fact waived all implied warranties, including the implied warranty of good workmanship. In the contract between Jones and Centex, the builder stated that it “…would not sell the property to Purchasers without this waiver.” Probably should have been a sign to the buyers.
In the Landis case, the Court stated, “Contracts for the future construction of a residence include a duty, implied by law, that the builder must perform its work in a workmanlike manner.” The Court gave significant weight to the concept of the implied warranty of good workmanship. The builder relied upon the BIA Warranty which limits builders’ liability and exposure to legal issues. The trial court concluded there was no breach of the limited warranty, rather the builder “breached the duty of workmanlike conduct implicit in the construction contract, not the limited warranty requiring it to satisfy the BIAs Quality Standards.”
The Supreme Court of Ohio has accepted the Jones v. Centex Homes case for review.
Read the full story...
Alaska Supreme Court Dismisses Claims of Uncooperative Pro Se Litigant in Defect Case
August 11, 2011 — CDJ Staff
The Alaska Supreme Court found that in the case of Khalsa v. Chose, Ms. Khalsa? failure to cooperate with the courts has obligated them to dismiss her claims against Mr. Chose. Ms. Khalsa bought a home kit from Mandala Custom Homes of Nelson, British Columbia, Canada. Mr. Chose, one of the owners of Mandala was paid by Ms. Khalsa to supervise assembly in Fairbanks. After construction, the roof developed leaks. Ms. Khalsa stated that when climbing a ladder to inspect a skylight leak, she fell and injured herself.
During the subsequent suit, Khalsa proved uncooperative. She skipped a pretrial conference. She attended a hearing that set discovery deadlines but then did not comply with discovery, including her failure to provide medical records documenting her injuries. She eventually said that she would only be able to travel from Arizona to Alaska if the defendants paid for her and her caretaker?s expenses.
When finally deposed, Khalsa terminated the deposition after five minutes, alleging the deposition was “intentionally designed to cause [her] to endure further emotional distress, due to the psychological trauma . . . that was caused or contributed to by the defendants.”
Eventually, the lower court sanctioned her twice. In July, 2008, the court concluded that her failure to provide medical records required dismissal of her injury lawsuit. In October of that year, the court dismissed all remaining claims due to her “pattern of excuses and long delays in providing information for discovery culminating in her refusal to participate in her deposition by the defendants.” Further, Khalsa has argued that the trial court displayed “prejudice and bias toward the pro se plaintiff.”
The Alaska Supreme Court rejected all of Ms. Khalsa?s claims, dismissing her case. They did, however, note that she has thirty days to file an appeal.
Read the court’s decision…
A Call to Washington: Online Permitting Saves Money and the Environment
October 28, 2011 — Douglas Reiser, Builders Counsel
Here’s some good news for Oregon contractors: Electronic Permitting is here. That’s right, no more standing in line with folders full of printed submittals and waiting all day for your permit. The click of a few buttons and you are in business. Great news, right? Unfortunately, Oregon isn’t sharing that celebration with Washington. So I say - why not?
Last week, the State of Oregon released its new ePermitting online interface. The website allows contractors, owners and even local building departments to create an account, submit building plans and procure permits. With your account, you can track the progress of submissions, print documents and get posting information.
The state ran a limited test version in the City of Florence since 2009, working out the kinks. Perhaps the most impressive result of the new system is that Oregon tackled the task of coagulating a local process into one central location.
Read the full story...
Reprinted courtesy of Douglas Reiser of Reiser Legal LLC. Mr. Reiser can be contacted at info@reiserlegal.com
Geometrically Defined Drainage Cavities in EIFS as a Guard Against Defects
July 10, 2012 — CDJ Staff
The blog Stucco & Insulation Contractor writes up some details on a “relatively new modification to modern Exterior Insulation Finish Systems,” known as “geometrically defined insulation boards.” They note that the insulation has grooves cut in the back to provide a route for water to drain, instead of getting trapped. They note that when EIFS is installed by a skilled applicator, this is unnecessary. However, with less experienced (and cheaper) installers, problems are more likely.
By cutting these channels, the application of EIFS is rendered “idiot proof,” as they note. Their preference would be that EIFS installers take the time to do the job right, but call this “a step in the right direction.”
Read the full story…
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…
Faulty Workmanship may be an Occurrence in Indiana CGL Policies
April 7, 2011 — April 7, 2011 Beverley BevenFlorez - Construction Defect Journal
The question of whether construction defects can be an occurrence in Commercial General Liabilities (CGL) policies continues to find mixed answers. The United States District Court in Indiana denied the Plaintiff’s Motion for Summary Judgment in the case of General Casualty Insurance v. Compton Construction Co., Inc. and Mary Ann Zubak stating that faulty workmanship can be an occurrence in CGL policies.
Judge Theresa L. Springmann cited Sheehan Construction Co., et al. v. Continental Casualty Co., et al. for her decision, ”The Indiana Supreme Court reversed summary judgment, which had been granted in favor of the insurer in Sheehan, holding that faulty workmanship can constitute an ‘accident’ under a CGL policy, which means any damage would have been caused by an ‘occurrence’ triggering the insurance policy’s coverage provisions. The Indiana Supreme Court also held that, under identically-worded policy exclusion terms that are at issue in this case, defective subcontractor work could provide the basis for a claim under a CGL policy.”
As we reported on April 1st, South Carolina’s legislature is currently working on bill S-431 that would change the wording of CGL policies in their state to include construction defects. Ray Farmer, Southwest region vice president of the American Insurance Association spoke out against the bill. “CGL policies were never meant to cover faulty workmanship by the contractor,” he said. “The bill’s supplementary and erroneous liability provisions will only serve to unnecessarily impact construction costs in South Carolina.”
Read the Opinion and order...
Read the court’s ruling...
Read the American Insurance Association statement...
Ensuing Loss Found Ambiguous, Allowing Coverage
August 16, 2012 — Tred Eyerly, Insurance Law Hawaii
The court determined the ensuing loss provision was ambiguous and found coverage for the home owners in Platek v. Town of Hamburg, 2012 N.Y. App. Div. LEXIS 5371 (N.Y. App. Div. July 6, 2012).
The burst of a water main caused water damage to the insureds' basement. Allstate disclaimed coverage under exclusion 4 for losses caused by "[w]ater . . . on or below the surface of the ground, regardless of its source . . . [,] includ[ing] water . . . which exerts pressure on or flows, seeps or leaks through any part of the residence premises."
Another policy provision covered "sudden and accidental direct physical loss caused by fire, explosion or theft resulting from item []. . . 4 . . . ." Plaintiffs argued that this exception applied because their claimed loss was caused by an "explosion" of the water main.
Read the full story…
Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii. Mr. Eyerly can be contacted at te@hawaiilawyer.com
