If a contractor cannot meet deadlines on a construction project or a subcontractor pulls out of a new project bid in order to pursue a more attractive opportunity, the project owner and/or prime contractor face potentially significant damages, which can include corrective work, costs of completion or substitute performance, and delay. In my latest column … Continue Reading
On June 11, I will be co-chairing and my colleague Colm Nelson will be a panelist for “Navigating a Financially Troubled Project During Uncertain Times,” a full-day webinar presented by the WSBA Construction Law Section in partnership with Stoel Rives. Colm will be on a panel that will cover claims and claim defenses related to … Continue Reading
In the event of a near-term slowdown in the U.S. economy, analysts forecast that any resulting decline in construction starts will nevertheless leave the level of activity in that industry sector “close to recent highs.” As a result, project owners and general contractors already facing a strong demand for workers will continue to do so, … Continue Reading
Seattle and Bellevue’s strong real estate markets present a plethora of lucrative business opportunities for Canadian product manufacturers and suppliers. Because Washington-based developers and contractors are perhaps more litigious than their Canadian counterparts, Canadian-based product manufacturers and suppliers should consider a full spectrum of risk management and mitigation strategies before engaging in cross-border business activities. … 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
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
Cross-laminated timber (“CLT”) is a leading building technology that has been employed by European developers for decades, but the product’s use in the United States only recently took hold after its adoption by the 2015 International Building Code. A type of structural timber product composed of dimensional timber layers bonded together with structural adhesives, CLT … 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
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
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
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
