Expert's Opinions On Causation Leads Way To Summary Judgment For Insurer
August 10, 2017 —
Tred R. Eyerly - Insurance Law HawaiiAlthough the insured claimed damages to her home was caused by vibrations from nearby construction, the court held she failed to overcome the insurer's expert's opinion that the damage resulted from excluded causes such as wear and tear, cracking and settling. King v. Am Family Ins., 2017 Ohio App. LEXIS 2565 (Ohio Ct. App. June 26, 2017).
The insured had a homeowners policy with American Family. The insured sued American Family, alleging that damage to her home was caused by vibrations caused by construction equipment at a nearby high school. The damage included cracks, leaks and mold.
American Family moved for summary judgment, attaching an affidavit from a structural engineering consulting firm. The report outlined alleged damages, including cracks throughout the house, and opined that the areas of concern had been present and progressing for years. Some damaged areas were discolored and patched. Accordingly, the report concluded that the damages were not caused by vibrations from construction.
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Tred R. Eyerly - Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
New York Court Temporarily Enjoins UCC Foreclosure Sale
September 21, 2020 —
Steven E. Ostrow, Timothy E. Davis, Steven E. Coury & Kristen E. Andreoli - White and WilliamsNew York courts have become a battleground for challenges to foreclosure sales under the Uniform Commercial Code (UCC) amidst the COVID-19 pandemic. Another trial court of the New York State Supreme Court (New York County) issued a preliminary injunction in Shelbourne BRF LLC v. SR 677 Bway LLC, halting a mezzanine lender’s August 19, 2020 UCC foreclosure sale. The decision confirms that the impact of the pandemic on the value of commercial real estate, and upon traditional steps taken to conduct a foreclosure auction, are both key factors that courts will continue to consider in determining whether a UCC foreclosure sale scheduled during the pandemic can be conducted in a commercially reasonable manner as required by the UCC.
THE CASE
In Shelbourne, the mezzanine borrowers owned the membership or equity interests in the companies (collectively, the “Property Owner”) that held title to a 12-story office building in Albany, New York. As security for the $3.35 million mezzanine loan, the mezzanine borrowers pledged their equity interests to the mezzanine lender. In May 2020, the mezzanine lender declared a default under the mezzanine loan as a result of the Property Owner’s default under the $28.5 million senior loan secured by a mortgage against the office building. The mezzanine lender then scheduled a public UCC foreclosure sale of the equity interests in the Property Owner for August 19, 2020. If the sale had been held, the equity interests in the Property Owner (and right to control the Property Owner and office building) would have been transferred to the successful bidder, either the mezzanine lender or a third party purchaser.
Reprinted courtesy of White and Williams attorneys
Steven E. Ostrow,
Timothy E. Davis,
Steven E. Coury and
Kristen E. Andreoli
Mr. Ostrow may be contacted at ostrows@whiteandwilliams.com
Mr. Davis may be contacted at davist@whiteandwilliams.com
Mr. Coury may be contacted at courys@whiteandwilliams.com
Ms. Andreoli may be contacted at andreolik@whiteandwilliams.com
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Mediation Clause Can Stay a Miller Act Claim, Just Not Forever
July 11, 2021 —
Christopher G. Hill - Construction Law MusingsIt seems to be Miller Act time here at Construction Law Musings, not to mention in the Federal District Courts here in Virginia. Last week I discussed what sort of work can form the basis for a Miller Act claim. This week I am discussing the effect of a mandatory mediation contract clause on the same type of claim. I have discussed both the benefits and the possible negative consequences of the inclusion of such a clause in your construction contract.
The recent case out of the Norfolk, Virginia Federal District Court recently explored the related question of whether such a clause can be enforced in the context of a Miller Act claim. In United States of America, for the use of Precision Air Conditioning of Brevard Inc. v. Cincinnati Insurance Company, the Court was confronted with a possible conflict between the legal requirement that any waiver of the right to pursue a Miller Act claim must be explicitly waived in writing and the clear contractual language between the general contractor and the plaintiff stating that mediation was a condition precedent to suit.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Benefits to Insureds Under Property Insurance Policy – Concurrent Cause Doctrine
December 08, 2016 —
David Adelstein – Florida Construction Legal UpdatesThe Florida Supreme Court in Sebo v. American Home Assurance Co., Inc., 41 Fla. L. Weekly S582a (Fla. 2016) gave really good news to claimants seeking recovery under a first-party all-risk property insurance policy. The Court held that the concurrent cause doctrine and not the efficient proximate cause doctrine was the proper theory of recovery to apply when multiple perils—an excluded peril and a covered peril-combined to create a property loss.
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David Adelstein, Katz, Barron, Squitero, Faust, Friedberg, English & Allen, P.A.Mr. Adelstein may be contacted at
dma@katzbarron.com
Hawaii Court of Appeals Affirms Broker's Liability for Failure to Renew Coverage
July 16, 2014 —
Tred R. Eyerly – Insurance Law HawaiiThe Hawaii Intermediate Court of Appeals affirmed the jury's finding that the broker was liable for failing to secure coverage for the insureds' home. Certain Underwriters at Lloyd's London v. Vreeken, 2014 Haw. App. LEXIS 322 (Haw. Ct. App. June 30, 2014).
Based upon their dealings with the broker, the insureds thought they had coverage for their home from March 3, 2004 to March 3, 2005 and from May 9, 2005 to May 8, 2006. The house was elevated nine feet above the ground for structural renovation, but collapsed on May 23, 2005. The original policy had lapsed on March 3, 2005. The second policy was voided because the application prepared by the broker stated there was no renovation work underway on the property.
The insureds sued. The jury found the broker and its agent liable for general, special and punitive damages. An appeal was filed. The ICA largely affirmed after addressing the many points raised on appeal.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Court of Appeals Invalidates Lien under Dormancy Clause
January 05, 2017 —
Chadd Reynolds – Autry, Hanrahan, Hall & Cook, LLPOn October 27, 2016, the Georgia Court of Appeals determined whether the Dormancy Statute, which bars the enforcement of judgments after seven years, applied to a lienholder’s action to foreclose its lien.
A property owner (“Owner”), contracted with a contractor Contractor (“Contractor”) to build a home in January 2006. Contractor purchased building materials from a supplier (“Supplier”). In September 2006, Contractor failed to pay for the materials, and Supplier filed a lien on Owner’s property in November 2006. Supplier filed a claim of lien and instituted a lien action against Contractor. In March 2007, a default judgment was entered in favor of Supplier for the lien amount.
It was not until November 2014 that Supplier sued Owner, seeking a declaration of a special lien in the amount of $14,655.65. The trial court granted Supplier’s motion for summary judgment and awarded Supplier a special lien in the amount of $14,655.65 plus $8,305 in accrued interest. Owner appealed, arguing that the lien was rendered unenforceable by the Dormancy Statute.
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Chadd Reynolds, Autry, Hanrahan, Hall & Cook, LLPMr. Reynolds may be contacted at
reynolds@ahclaw.com
Connecticut Gets Medieval All Over Construction Defects
February 10, 2012 —
CDJ STAFFThe Hartford Courant reports that Connecticut is trying a very old tactic in a construction defect suit. The law library building at the University of Connecticut suffered from leaks which have now been repaired. The state waited twelve years after was complete to file lawsuit, despite that Connecticut has a six-year statute of limitations on construction defect claims. Connecticut claims that the statute of limitations does apply to the state.
The state is arguing that a legal principle from the thirteenth century allows it to go along with its suit. As befits a medieval part of common law, the principle is called “nullum tempus occurrit regi,” or “time does not run against the king.” In 1874, the American Law Register said that nullum tempus occurrit reipublicae “has been adopted in every one of the United States” and “is now firmly established law.”
In the case of Connecticut, Connecticut Solicitor General Gregory D’Auria said that “the statute of limitations does not apply to the state.” He also noted that “the state did not ‘wait’ to file the lawsuit. The lawsuit was filed only after all other options and remedies were exhausted.”
Connecticut also argued that “nullus tempus occurrit regi” applied in another construction defect case at the York Correctional Institution. The judge in that case ruled in December 2008 to let the case proceed. But in the library case, Judge William T. Cremins ruled in February 2009 that the statute of limitations should apply to the state as well. Both cases have been appealed, with the library case moving more quickly toward the Connecticut Supreme Court.
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No Signature? Potentially No Problem for Sureties Enforcing a Bond’s Forum Selection Clause
March 21, 2022 —
Brian C. Padove - ConsensusDocsOne of the foundational tenets of contract law is that a party may only be bound by terms they agree to, or in other words, if the party did not sign a contract, that party cannot be bound by the terms thereof. While this principle is generally unwavering, there are certain situations in which a non-signatory to a contract may still be bound by the terms of a contract.
In particular, this non-signatory issue may arise when a payment bond claimant makes a bond claim, subsequently files a lawsuit, but the bond contains a forum selection clause different than the venue of the lawsuit and the surety seeks to enforce the bond’s forum selection clause. For example, the claimant may have filed its lawsuit against the surety in federal court, even though the bond provides language specifically mandating that no lawsuit shall be commenced by any claimant other than in a state court where the project is located. Thus, the question then becomes, can the surety enforce the forum selection clause against the claimant when the claimant did not sign the bond and/or never agreed to the terms thereof? The short answer, it depends (yes, that is a very lawyer-like answer). Given recent case law over the past decade, however, the surety has a strong argument in favor of enforcement of the forum selection clause.
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Brian C. Padove, Watt, Tieder, Hoffar & Fitzgerald, LLP (ConsensusDocs)Mr. Padove may be contacted at
bpadove@watttieder.com