In the push to get a construction project started, important management tasks may be overlooked or subordinated by “higher priority” tasks, and the importance of completing many of those tasks may not become apparent unless there is a legal dispute. In my latest article for the Daily Journal of Commerce, I provide a brief checklist … Continue Reading
Parties spend significant time negotiating insurance provisions for protection in the event they face claims related to defective construction, but those protections can be rendered worthless if the wrong insurance forms are used. In my recent Daily Journal of Commerce article, I look at one particularly troublesome provision – the “professional services” endorsement – and … Continue Reading
An anti-assignment provision in an insurance policy may prohibit the insured from assigning its rights under the policy. In my latest DJC article, I discuss a recent decision by the Oregon Court of Appeals, in which a claimant learned the hard way that Oregon courts will not hesitate to enforce an anti-assignment provision in an … Continue Reading
Owners frequently require their contractors to name them as additional insureds. Owners and contractors often include requirements seeking to have the obligation to name them as additional insureds “flow down” to parties with whom they lack a direct contractual relationship (e.g., subconsultants, subcontractors, and suppliers). Despite the simplicity and appeal of this arrangement, contractual additional … Continue Reading
Following a presentation I made at a Seminar Group conference in Oregon on crane easements, one of my colleagues brought to my attention the recent NY case of Lend Lease (US) Construction LMB Inc. v. Zurich American Insurance Co. The NY Court of Appeals found that damage caused to a tower crane when Superstorm Sandy … Continue Reading
So, what’s the big deal if you’re a little “late” in giving your insurer notice of the claim or lawsuit against your company? That’s the question, albeit in essence, that the Ninth Circuit has posed to the California Supreme Court recently in an Order Certifying Questions, Pitzer College v. Indian Harbor Insurance Co. Specifically, the … Continue Reading
Carrying adequate insurance on construction projects is a critical aspect of risk management for developers, builders and designers. But it’s a complicated and time-consuming subject, and if you haven’t slogged through the complexity of the details in policies, you may be vulnerable to unintended consequences. In my recent article for the Daily Journal of Commerce, … Continue Reading
Many times I hear from people who want to “save money” and serve as their own “owner-builder” under the exemption to the California Contractor’s Licensing law, which generally requires that any “construction” work over $500 to be performed by a licensed California contractor in the absence of an exemption. (Bus. & Prof. Code section 7048). … Continue Reading
A common insurance question asked by our owner/developer clients when they discover that their completed project has defects is whether their own insurance will cover the cost to fix the defect or any damage from the defect. While trying hard not to sound like the proverbial lawyer, we often have to say “it depends.” What … Continue Reading
Whether you call it SDI or SubGuard, subcontractor default insurance is yet another consideration for public and private project owners as they look at protection from subcontractor default. But what exactly is this relatively new option and when is it most appropriate? In my recent article for the Daily Journal of Commerce, I discuss SDI, … Continue Reading
Earlier this year, my colleague Eric Grasberger authored a blog post about a crane collapse in Lower Manhattan. In that post, he mentioned that neighboring landowners may seek to prevent cranes from intruding into the airspace above their property. Contractors and owners alike are often surprised to learn that a crane swinging over adjacent property … Continue Reading
On Friday, February 5, one man died and three were injured when a 565-foot crane toppled in gusty winds in lower Manhattan, not far from the World Trade Center. The investigation will likely take weeks to months as experts try to reconstruct whether the engineering, erection, operation or manufacture of the crane, or some combination … Continue Reading
Complex construction projects carry complex problems as they approach completion. In my recent article for the Daily Journal of Commerce, I address 10 potential pitfalls that owners, contractors and design professionals may encounter, and I offer tips to help you prepare for them. Read the full article here. “Finishing Strong vs. Finishing Wrong: Tips & … Continue Reading
My partner, Scott Kaplan, discusses the recent Oregon Court of Appeals in FountainCourt Homeowners’ Ass’n v. FountainCourt Development, LLC case in the Daily Journal of Commerce. On August 6, the Oregon Court of Appearls, handed down a decision making clear that standard form liability insurance policies cover construction defect claims so long any “property damage” for … Continue Reading
California has held for at least a decade that in order for there to be insurance coverage under a standard Comprehensive General Liability for a claim arising out of a construction project, including a duty to defend by the insurer, there must be damage to other property, not solely to the property on which the … Continue Reading
In my latest Daily Journal of Commerce Construction column, I discuss insurance jargon in contracts and use Commercial General Liability or “CGL” policies as an example. The terms “bodily injury,” “personal or advertising injury,” and “property damage” all have specific meanings in CGL policies. Since this language is not always intuitive, it is best to … Continue Reading
The apartment business is booming right now. Unfortunately, construction defects persist as well, particularly in garden-style and wood-framed construction. Most developers are savvy enough to maintain a good insurance program, but many do not understand (until too late) that the policies they bought may not cover the risk of construction defects. As an owner-developer, neither your property … Continue Reading
The new year brings a reminder that owners need to be careful about changes to their contractors’ and designers’ insurance policies. Many of the most important terms of an insurance policy are in “endorsements” added to the policy. For example, a policy may include an endorsement excluding claims between insured parties (say, a claim by … Continue Reading
You may have recently heard that on December 11, 2013, the California Supreme Court denied the builder’s Petition for Review of the published decision in Liberty Mutual Insurance Co. v. Brookfield Crystal Cove LLC, 163 Cal. Rptr. 3d 600, Cal. App. 4th 98 (2013). For builders and contractors, this is very frustrating news and undermines the … Continue Reading
The recent case of Ewing Constr. Co. v. Amerisure Ins. Co., 2012 U.S. App. Lexis 12154 (5th Cir. June 15, 2012) reminds us that, without an endorsement adding back to the policy specific coverage for contractual liabilities, defect claims arising from work under a construction contract may not be covered. In Ewing, the contractor signed … Continue Reading
A recent Utah Supreme Court decision could result in significant benefits to some policyholders in Utah’s construction industry. The case, Ohio Casualty Insurance Co. v. Unigard Insurance Co., 2012 UT 1, concerned a fight between two insurers about how to split the costs of defending a lawsuit brought against their policyholder, Cloud Nine. For policyholders, the most … Continue Reading
There are now 25 states in the U.S. that hold that construction defects are not an “occurrence” and are therefore not covered under commercial general liability policies insuring contractors. Couple this troubling statistic with the ever increasing number of policy exclusions and limitations, and we begin to realize that in many situations the contractor’s insurance … Continue Reading
Performance bonds—insurance-like arrangements in which a surety (the bonding company) contractually agrees to pay for the performance of a principal (the contractor) to an obligee (the owner) in case the principal fails to perform the obligations of its contract—should be used more often in construction agreements to provide owners with a source of funds to … Continue Reading
Do you think you have adequate insurance protection for your project under an “additional insured endorsement” to another entity’s policy? Or through a “wrap” policy, known as either an Owner’s Controlled Insurance Policy (OCIP) or Contractor’s Controlled Insurance Policy (CCIP), because you are listed as “an insured”? Perhaps not under more recent policies. Check the … Continue Reading
