Subcontractor default insurance (“SDI”) — insurance that covers certain losses related to a subcontractor’s material breach of a subcontract — has been gaining in popularity over bonds among general contractors. However, for a number of reasons, sureties assert that bonds are better than SDI, despite the common complaint about bonds that sureties are slow to pay … Continue Reading
California’s 2018 wildfire season — the most damaging and deadly on record — and a pair of earthquakes in Alaska can serve as case studies for Northwest property owners as to steps they can take to mitigate their risks in the event such disasters strike closer to home. In my latest article for the Seattle … Continue Reading
Ultimately, improving our companies, like improving ourselves, is up to us and our own diligence and persistence in identifying and implementing improvements on an ongoing basis. A strong market as we start 2019 means a great opportunity to review for and ensure solid implementation of legal compliance and financial goals for your construction projects – … Continue Reading
Although it may seem strange at first, the recent ruling by the California Fourth Appellate District Court in Thee Sombrero, Inc. v. Scottsdale Co., (2018 EL 5292072), holding that an insurer must pay for a claim where there was no actual physical property damage, is not as odd as it may seem to non-insurance coverage … Continue Reading
Engineers working in the commercial construction industry face a myriad of challenges that can keep them up at night. Of those many challenges, consulting on pollution issues can be one of the trickiest. As lawsuits involving pollution can be expensive to defend and bring the potential for significant judgements, engineers need to maintain a professional … Continue Reading
On May 9, 2018, in an unpublished opinion, the Ninth Circuit held that the proverbial London Bridge should be near collapse for an insured owner to successfully obtain insurance coverage for same. In American Economy Insurance Co. v. CHL LLC, No. 16-35606, an owner appealed the district court’s decision in a declaratory coverage action regarding … Continue Reading
In a recent Oregon Court of Appeals decision, the court likely eased the burden for contractors seeking a defense under insurance policies in which they have been named as an additional insured. In my latest article for the Daily Journal of Commerce, I examine the decision, which expands upon a 2016 Oregon Supreme Court ruling … Continue Reading
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
