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LexisNexis® Mealey's™ Construction Defects Insurance Legal News
Headline Construction Defects Insurance Legal News from LexisNexis®

• Canada High Court: Clause Does Not Bar Coverage For Insureds' Construction Delay
  OTTAWA - In a 4-3 decision reversing an appeals court, the Canada Supreme Court ruled Nov. 21 that a "faulty or improper design" exclusion does not preclude coverage for losses incurred from the delay in the construction of a tunnel (Canadian National Railway Co. v. Royal and Sun Alliance Insurance Co. of Canada, No. 2008 SCC 66, Canada Sup.). Full story on lexis.com
• Ensuing Loss Provision Covers Loss Caused By Collapse, Judge Rules
  NEWARK, N.J. - An ensuing loss provision found in a faulty materials exclusion covers a loss incurred by an insured for the collapse, removal and replacement of a pipe liner, a New Jersey federal judge found Nov. 21 (Spiniello Cos. v. Hartford Fire Insurance Co., No. 07-02689, D. N.J.; 2008 U.S. Dist. LEXIS 95009). Full story on lexis.com
• Progressive Damage From Work Predating Policy Not Covered, Panel Holds
  SAN DIEGO - A California appeals panel on Oct. 29 ruled that a subcontractor cannot recover costs associated with mold and water damage under a policy purchased after work was completed (Valley Casework Inc. v. Lexington Insurance Co., No. D050683, Calif. App., 4th Dist.; 2008 Cal. App. Unpub. LEXIS 9389). Full story on lexis.com
• Judge Rules Insurer Owes Coverage For Repair, Removal Costs
  SEATTLE - Following the conclusion of a bench trial regarding coverage for construction defects, a Washington federal judge on Nov. 21 ruled that water intrusion began and caused damage to building structures during a liability insurer's time on the risk and that the scope of coverage includes the cost of removing siding to access repairs (MacLean Townhomes LLC v. Charter Oak Fire Insurance Co., et al., No. 06-01093, W.D. Wash.; 2008 U.S. Dist. LEXIS 95192; See November 2008, Page 17). Full story on lexis.com
• Powerine Cited In Moldy Drywall Coverage Ruling
  SACRAMENTO, Calif. - A federal judge on Nov. 10 ruled that a contractor's insurer is liable for the entire amount of an arbitration award relating to damage from moldy drywall and that unlike seminal California case law, the policy at issue includes arbitrations in the definition of a lawsuit (Michael D. McGranahan, Chapter 7 Trustee v. The Insurance Corporation of New York, No. 07-65, E.D. Calif.; 2008 U.S. Dist. LEXIS 91124). Full story on lexis.com
• Subrogation Claim Fails, Judge Says, Cites Lack Of Alleged Liquidated Damages
  SAN FRANCISCO - An excess carrier's equitable subrogation claim regarding coverage for an insured's defective work fails because it has not alleged damages in a liquidated amount against primary insurers, a California federal judge held Nov. 17, granting in part summary judgment to two of the primary insurers (AIU Insurance Co. v. Acceptance Insurance Co., et al., No. 07-05491, N.D. Calif.; 2008 U.S. Dist. LEXIS 95694). Full story on lexis.com
• Federal Judge Remands Contribution Suit Based On Service Of Suit Clause
  SEATTLE - Relying on a service of suit clause, a Washington federal judge on Oct. 30 remanded a contribution lawsuit brought by a commercial general liability insurer against a commercial excess liability insurer regarding an underlying settlement (American States Insurance Co. v. Century Surety Co., No. 08-01163, W.D. Wash.; 2008 U.S. Dist. LEXIS 91996). Full story on lexis.com
• Contribution Claim Allowed To Stand, Appeals Panel Rules
  LOS ANGELES - The Second District California Court of Appeal on Nov. 3 reinstated contribution claims by a commercial liability insurer against several subcontractor insurers seeking a ruling that the insurers had a duty to defend its mutual insured in two underlying construction defect lawsuits (Gerling America Insurance Co. v. American International Specialty Lines Insurance Co., et al.; Pacific Insurance Co. Ltd., et al. v. American International Specialty Lines Insurance Co., et al.; Nationwide Indemnity Co. v. American International Specialty Lines Insurance Co., No. B201955, Calif. App., 2nd Dist.; 2008 Cal. App. LEXIS 1914). Full story on lexis.com
• No Duty To Defend, Indemnify Allegations Of Defective Painting
  TAMPA, Fla. - A commercial general liability insurer has no duty to defend or indemnify an additional insured because the insured has not proven that defective painting claims relate to property damage that occurred during the policy period, a Florida federal judge held Oct. 27 (Nautilus Insurance Co. v. Batson-Cook Co., et al., No. 07-01361, M.D. Fla.; 2008 U.S. Dist. LEXIS 90909). Full story on lexis.com