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DIRECTORY AND CAPABILITIES

Are Untimely Repairs an “Occurrence” Triggering CGL Coverage?

January 17, 2023 — Christopher G. Hill - Construction Law Musings
All Class A commercial contractors in Virginia are required to have a minimum level of Commercial General Liability (CGL) coverage. As a general rule, this insurance is there for damage to property or persons arising from an “occurrence” that is covered by the policy. Many cases that are litigated relating to coverage for certain events under a CGL policy turn on the definition of “occurrence” and whether the event leading to a request for coverage constitutes an “occurrence.” A recent case in Fairfax County, Virginia, Erie Insurance Exchange v. Spalding Enterprises, et al., is just such a case. In the Spalding Enterprises case, the Court considered the following scenario. A homeowner, Mr. Yen contracted with Spalding Enterprises to fix some fire damage at his home. Spalding promised the repairs would be complete in October of 2019. However, after Mr. Yen paid a $300,000.00 deposit, Spalding Enterprises stated that the work would not be completed until November of 2019. Yen then fired Spalding Enterprises and sued for breach of contract, constructive fraud, and violation of the Virginia Consumer Protection Act. Spalding Enterprises sought coverage from Erie Insurance for the claim and Erie denied coverage and sought a declaratory judgment that the events alleged in the Complaint by Mr. Yen did not fall under the definition of “occurrence” in the CGL policy held by Spalding Enterprises. Read the full story...
Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

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Can I Be Required to Mediate, Arbitrate or Litigate a California Construction Dispute in Some Other State?

September 19, 2022 — William L. Porter - Porter Law Group
It is not uncommon in the construction industry for an out-of-state general contractor to include a provision in a subcontract requiring a California subcontractor to resolve disputes outside the state of California, even though the work is to be performed within California. Fortunately, most California subcontractors are immune from this tactic. California law generally prohibits clauses requiring subcontractors to travel outside California to resolve construction disputes. California Code of Civil Procedure Section 410.42, [CCP 410.42 Link] renders “void and unenforceable,” any provision in a contract that “purports to require any dispute to be litigated, arbitrated, or otherwise determined outside this state,” so long as the contract is “between the contractor and a subcontractor with principal offices in the state, for the construction of a public or private work of improvement in this state.” Similarly, this law voids any similar contractual term that might prevent the California subcontractor from commencing an action, obtaining a judgment, or resolving its dispute in the courts of California. Read the full story...
Reprinted courtesy of William L. Porter, Porter Law Group
Mr. Porter may be contacted at bporter@porterlaw.com

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End of an Era: Los Angeles County Superior Court Closes the Personal Injury Hub

October 24, 2022 — Elizabeth A. Evans & Angela S. Haskins - Haight Brown & Bonesteel LLP
On September 21, 2022, the Los Angeles County Superior Court announced that it would start a gradual shutdown of the Personal Injury Hub, currently located at the Spring Street Courthouse. This closure will see the return of personal injury cases being venued in the district where they occurred. The Personal Injury Hub was established in 2012 as a means of consolidating personal injury cases after several civil courtrooms around the County were closed due to significant budget cuts. It first began as two courtrooms in Stanley Mosk Superior Court, then moved to the Spring Street Courthouse and ballooned to six courtrooms, each handling a case load of reportedly over 9,000 cases at times. Case Management Conferences were abolished and the parties were largely left to their own devices to move cases along. At times, slow chaos ensued. With a new and increased budget, Los Angeles Superior Court has now decided that enough is enough. Effective October 10, 2022, new personal injury cases will be filed and handled from start to finish in independent calendar courtrooms in the districts where the events giving rise to the claims occurred. Any cases properly filed in the Central District will continue to be heard in the Personal Injury Hub for now. A new Civil Case Cover Sheet Addendum that reflects this change will be available on the Los Angeles County Superior Court website for use as of October 10th. Reprinted courtesy of Elizabeth A. Evans, Haight Brown & Bonesteel LLP and Angela S. Haskins, Haight Brown & Bonesteel LLP Ms. Evans may be contacted at eevans@hbblaw.com Ms. Haskins may be contacted at ahaskins@hbblaw.com Read the full story...

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New York Establishes a Registration Requirement for Contractors and Subcontractors Performing Public Works and Covered Private Projects

January 17, 2023 — Christopher B. Kinzel, K. Greer Kuras, Aaron C. Schlesinger - Peckar & Abramson, P.C.
By December 30, 2023, contractors and subcontractors bidding on public contracts and performing work on covered private projects in New York must register with the NYS Department of Labor, Bureau of Public Works, pursuant to the newly enacted Labor Law Section 220-i. The DOL has until June 28, 2023 to establish regulations to carry out the new law. There will be an online system where registrations and disclosures are publicly available. The stated purpose of the law is to help enforce New York’s prevailing wage and other worker protection laws. The DOL will create an online system through which contractors and subcontractors will have to answer questions and submit documents about:

• the business entity and its owners and officers
• unemployment and workers’ compensation insurance
• any outstanding wage assessments
• debarment under New York or federal law, or any other state’s laws
• final determinations of a violation of any labor laws, employment tax laws, or workplace safety standards (including OSHA)
• association or signatory to an apprenticeship program

If the DOL approves the submission, the contractor will receive a registration certificate that remains valid for two years. Reprinted courtesy of Christopher B. Kinzel, Peckar & Abramson, P.C., K. Greer Kuras, Peckar & Abramson, P.C. and Aaron C. Schlesinger, Peckar & Abramson, P.C. Mr. Kinzel may be contacted at ckinzel@pecklaw.com Ms. Kuras may be contacted at gkuras@pecklaw.com Mr. Schlesinger may be contacted at aschlesinger@pecklaw.com Read the full story...

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Professional Services Exclusion in CGL Policies

December 05, 2022 — David Adelstein - Florida Construction Legal Updates
A professional services exclusion in a commercial general liability policy means something. It’s an exclusion an insurer will rely on to avoid insurance coverage based on “professional services” performed or rendered by the insured. Don’t take it from me. Take it from the recent opinion in Colony Insurance Company v. Coastal Construction Management, LLC, 2022 WL 16636697 (M.D.Fla. 2022) where the trial court granted a commercial general liability insurer’s motion for judgment on the pleadings based on the professional services exclusion. Here, an owner sued, among other parties, an entity performing only construction management services based on construction defects at its project. The construction manager did not perform any design or physical construction. It was hired to make site inspections of the construction, review construction quality and finish standards, ensure workmanship quality, coordinate the punchlist process, and supervise management and administration of the project. The construction manager’s commercial general liability insurer sued for declaratory relief claiming it owed no duty to defend or indemnify based on the professional services exclusion. Read the full story...
Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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Netflix Plans $900M Facility At Former New Jersey Army Base

January 23, 2023 — The Associated Press (Wayne Parry) - Bloomberg
(AP) -- Netflix said Wednesday it plans to build a state-of-the-art production facility at a former Army base at the Jersey Shore that will cost more than $900 million, and create thousands of jobs. The subscription video streaming company will pay $55 million for a 292-acre site on the former Fort Monmouth military base in Eatontown and Oceanport. The California-based company plans an additional $848 million worth of investments in 12 sound stages and for other uses related to the film industry. “We’re thrilled to continue and expand our significant investment in New Jersey and North America,” said Ted Sarandos, the company's co-CEO and chief content officer. “We believe a Netflix studio can boost the local and state economy with thousands of new jobs and billions in economic output, while sparking a vibrant production ecosystem in New Jersey.” Read the full story...
Reprinted courtesy of Bloomberg

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Insurance Companies Score Win at Supreme Court

December 26, 2022 — Mason Fletcher & Ryan Sternoff - Ahlers Cressman & Sleight PLLC
In 2011, the Washington State Department of Transportation (“WSDOT”) contracted with Seattle Tunnel Partners, a joint venture of Dragados USA and Tutor Perini (“STP”) to construct a tunnel (“SR 99 Tunnel”) to replace the dilapidated Alaska Way Viaduct. STP obtained a builder’s “all-risk” insurance policy (“Policy”) from Great Lakes Reinsurance (UK) PLC and several other insurers (collectively, the “Insurers”) which insured against damage to both the project and the tunnel boring machine popularly known as Big Bertha (“Bertha”). Bertha began excavating in July 2013 but broke down a few months later when the machine stopped working. Work did not resume on the project until December 2015. WSDOT and STP tendered insurance claims for the losses associated with the delays and breakdown of Bertha but the Insurers denied coverage. Thereafter, WSDOT and STP sued.  The Insurers moved the trial court for partial summary judgment to resolve some, but not all, of the coverage disputes. In a unanimous decision, the Washington State Supreme Court affirmed the trial court and Court of Appeals, and held that insurance companies do not have to reimburse WSDOT and STP for costs accrued during a two-year Project delay, under certain provisions of the insurance policies. Reprinted courtesy of Mason Fletcher, Ahlers Cressman & Sleight PLLC and Ryan Sternoff, Ahlers Cressman & Sleight PLLC Mr. Sternoff may be contacted at ryan.sternoff@acslawyers.com Read the full story...

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Coverage for Collapse Ordered on Summary Judgment

November 21, 2022 — Tred R. Eyerly - Insurance Law Hawaii
A collapsed floor in a restaurant was found to be covered. J&J Fish on Center Street, Inc. v. Crum & Forster Spec. Ins. Co., 2022 U.S. Dist. LEXIS 163661 (D. Wis. Sept. 12, 2022). J&J Fish rented property from Vision. Vision was obligated to keep the premises insured under an all-risk policy. Vision was also responsible for maintaining and repairing the property "including the slab flooring exterior walls of the premises." Vision never obtained insurance on the building, but J&J Fish secured a commercial property policy from Crum & Forster. On May 29, 2020, approximately 25% of the building's slab floor, the section beneath the walk-in cooler, collapsed into the crawl space below. Dr. Daniel Wojnowski inspected the crawl space and observed overall dampness as well as a pool of water in the space. He concluded that the collapse occurred because the steel support beams and steel elements of the floor corroded after prolonged exposure to moisture. Based on this report, Crum & Forster denied coverage. J&J Fish sued and the parties moved for summary judgment. Read the full story...
Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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