Mealey's Construction Defects Insurance : Mealey's : Legal News & Analysis

Mealey's Construction Defects Insurance

May 28, 2025
Subrogated Insurer’s Case Against Contractor Dismissed Per Parties’ Stipulation

JACKSONVILLE, Fla. — Construing the parties’ stipulation of dismissal as a motion to dismiss, a federal judge in Florida on May 27 granted the motion and closed the case filed by a condominium insurer, as subrogee, against a subcontractor hired to install decking at the condominium pool.
May 28, 2025
10th Circuit Finds Date Of Plumbing Plan Unclear, Reverses Judgment For Engineer

DENVER — In the wake of the Wyoming Supreme Court’s ruling that the two-year statute of limitations for professional negligence claims attaches to the design that was the legal cause of the purported injury, the 10th Circuit U.S. Court of Appeals on May 27 ruled that a trial court erred in finding a subrogated homeowners insurer’s claim against a mechanical engineering firm that designed a home’s plumbing time-barred, noting that the record does not include the date of the plans the plumber used to install the faulty plumbing.
May 28, 2025
Judge Finds Insurer Not Required To Defend, Indemnify Defective Work Claims

ATLANTA — A federal judge in Georgia granted default judgment to an insurer that sought a declaration that it was not required to defend or indemnify a subcontractor or the contractor it worked with in a lawsuit claiming that their work was defective, finding that the underlying claims were not for property damage as defined in the insurance policy.
May 27, 2025
Excess Insurer Has No Duty To Indemnify Property Owners Who Qualify As Insureds

BROOLYN, N.Y. — A federal judge in New York declared an excess insurer has no duty to indemnify property owners who qualified as insureds under a building contractor’s insurance policy for losses caused by subsidence, granting the insurer’s motion for summary judgment in its declaratory judgment lawsuit.
May 23, 2025
Judge Finds Subcontractor Exclusion Precludes Defense In Underlying Roof-Leak Suit

TEXARKANA, Texas — A federal judge in Arkansas granted a commercial general liability insurer’s motion for partial summary judgment against a contractor it insured, finding that the subcontractor exclusion in the policy precluded coverage for an underlying case brought by the owner of an apartment complex that was remodeling 12 buildings alleging that defective roofing work by the insured’s subcontractor caused the roofs on the buildings to leak.
May 20, 2025
Contractor Urges 6th Circuit To Deny Rehearing On Duty-To-Defend Rulings

CINCINNATI —A contractor urged a Sixth Circuit U.S. Court of Appeals panel not to grant its insurers’ petition for rehearing of the panel’s decision that alleged damages to a preexisting building caused by the contractor’s work could potentially be covered by the contractor’s commercial general liability and umbrella excess insurance policies, arguing that the insurers’ reasoning for seeking a rehearing is without merit.
May 15, 2025
N.J. Judge Denies Insurers’ Motion To Reconsider Rulings In Defects Coverage Suit

NEWARK, N.J. — A New Jersey judge denied insurers’ motion for reconsideration of two earlier rulings that denied their motion for summary judgment and granted in part insureds’ motion to compel discovery in the insurers’ lawsuit disputing coverage for an underlying construction defects lawsuit.
May 15, 2025
Magistrate Recommends Granting Contractor, Homebuilder Motions For Attorney Fees

ORLANDO, Fla. — A federal magistrate judge in Florida recommended granting a general contractor and homebuilder’s motions for entitlement to attorney fees following a summary judgment ruling in their favor in a commercial general liability insurer’s lawsuit seeking a declaration as to coverage for construction-related damages at a condominium development.
May 14, 2025
Shingle Manufacturer Granted Partial Dismissal In Roof Damage Coverage Dispute

NEWARK, N.J. — A federal judge in New Jersey dismissed some claims against a shingle manufacturer in a suit brought by a homeowner against his homeowners insurer and the shingle manufacturer after the homeowner and insurer attributed damage to the homeowner’s roof to defective shingles, finding that some of the homeowner’s claims were barred by the applicable statute of limitations and the economic loss doctrine.
May 13, 2025
Minnesota Panel: Insurer Must Pay $174K Of $2M Construction Defects Settlement

ST. PAUL, Minn. — Applying for the first time a framework set forth by the Minnesota Supreme Court for assessing the reasonableness and allocation of unallocated Miller-Shugart agreements, the Minnesota Court of Appeals on May 12 affirmed a trial court’s ruling that an unallocated $2 million settlement between a marina and a contractor over construction defect claims was reasonable and the court’s finding that the contractor’s insurer must pay $174,350 of that amount.
May 12, 2025
Insureds’ Waiver Against Subcontractor Precludes Insurer’s Claims As Subrogee

BISMARCK, N.D. — A federal judge in North Dakota granted summary judgment to a subcontractor that was sued for negligence by a building owner’s insurer after the building it constructed suffered damage during a windstorm, allegedly due to the use of wrong materials, finding that because the building owner had waived its right to bring claims against the contractor and all subcontractors, the insurer had no right to bring claims against any of those parties.
May 12, 2025
Judge Denies Motion To Amend Judgment In Suit Arising From Hard Rock Hotel Damages

SANTA ANA, Calif. — A California federal judge denied without prejudice a commercial general liability insurer’s motion to amend a $2,186,359.76 judgment in its favor to include $780,360.12 in prejudgment interest in its equitable contribution and equitable indemnification lawsuit arising from damages to a Hard Rock Hotel location, finding that the motion fails to comply with the meet-and-confer requirements under a civil standing order that was issued to the parties.
May 09, 2025
Insurer Gets Partial Summary Judgment; Builder Must Repay $5.57M

ROCHESTER, N.Y. — A New York state court justice partially granted a subcontractor default insurer’s motion for summary judgment and determined that a construction manager/prime contractor for a retirement community project must repay the insurer $5.57 million from construction defect claim payments it received because the policy contemplates a later action against a defaulting subcontractor to recover sums paid to an insured and an arbitration panel found that some of the losses did not result from the subcontractor’s default.
May 09, 2025
Pool Defect Insurance Case Stayed Pending Further Factual Development

AUSTIN, Texas — A Texas federal judge has denied dismissal of a pool construction defect insurance lawsuit but granted an alternative motion to stay the case pending further factual development and possible related litigation.
May 06, 2025
5th Circuit: Policy Excludes Coverage For Concrete Damage Caused By Sugar In Sand

NEW ORLEANS — A Fifth Circuit U.S. Court of Appeals panel affirmed a district court’s ruling granting summary judgment to an insurer in a case brought by a concrete company after a trucking company delivered sand mixed with sugar causing the concrete to not cure properly, finding that exclusions applied under the trucking company’s policy.
May 05, 2025
Homeowners Appeal Order That They Weren’t Beneficiaries Of Contractor’s Insurance

GREENSBORO, N.C. — Homeowners in North Carolina have appealed to the Fourth Circuit U.S. Court of Appeals an order by a federal judge in North Carolina who found they had no standing to bring a suit against their waterproofing company’s insurer after the company’s work allegedly caused damage to their property.
May 05, 2025
Judge: Insurer’s Motion To Amend Judgment Can Be Resolved Without Hearing

SANTA ANA, Calif. — A California federal judge said that a commercial general liability insurer’s motion to amend a $2,186,359.76 judgment in its favor to include $780,360.12 in prejudgment interest is appropriate for resolution without a hearing, vacating a May 2 hearing in the insurer’s equitable contribution and equitable indemnification lawsuit arising from damages to a Hard Rock Hotel location.
May 02, 2025
Wyoming High Court Answers Certified Question In Insurer’s Suit Against Engineer

CHEYENNE, Wyo. — The Wyoming Supreme Court on May 1 answered a certified question from the 10th Circuit U.S. Court of Appeals in a subrogated homeowners insurer’s appeal of a Wyoming federal court’s ruling that its claim against an engineering firm that designed a home’s plumbing is time-barred by the two-year statute of limitations for professional negligence claims, finding that under Wyoming Statutes Annotated Section 1-3-107, the absence of contractual privity is not relevant in deciding when the statute of limitation attaches in a tort action and the statute of limitation attaches to the design that was the legal cause of the purported injuries.
May 02, 2025
Roofing Contractor’s Insurer Wins Judgment; Policy’s Prior Works Exclusion Applies

CHICAGO — An Illinois federal court issued a final judgment in favor of an insurer in its suit seeking a declaration that it has no duty to defend or indemnify its roofing contractor insured in an underlying lawsuit alleging that the insured’s negligent repair work contributed to the collapse of a building façade, killing two people; the judgment was issued two weeks after a judge ruled that the policy’s Prior Works Exclusion applies because the repair work at issue was completed before the policy’s coverage became effective.
April 30, 2025
Fact Issues Remain On Insured’s Extracontractual Claims In Water Damage Dispute

SEATTLE — An insurer is not entitled to summary judgment on an insured condominium association’s extracontractual claims because questions of fact exist regarding the reasonableness of the insurer’s interpretation of the policy language, the adequacy of the insurer’s claim investigation and the manner in which the insurer maintained the claim file, a Washington federal judge said in denying the insurer’s motion for summary judgment in a water damage coverage dispute.
April 29, 2025
Water Damage Loss Dispute Dismissed After Insureds, Insurer Settle

LOS ANGELES — A federal judge in California on April 28 dismissed with prejudice an insured couple’s suit against their homeowners insurer related to their water damage loss in accordance with a stipulation of voluntary dismissal the parties filed after reaching a settlement.
April 28, 2025
Judge Dismisses Bad Faith Suit Over ‘Hidden Damage’ To Condos Following Settlement

SEATTLE — A federal judge in Washington dismissed with prejudice a condominium owners association insured’s breach of contract and bad faith lawsuit seeking coverage for the cost of repairing “hidden damage” to its condominiums after the insured and its property insurer announced that they reached a settlement.
April 28, 2025
Judge Grants Summary Judgment To Excess Insurer In Coverage Dispute With Contractor

BROOKLYN, N.Y. — A federal judge in New York granted an excess insurer’s motion for summary judgment in its lawsuit seeking a declaratory judgment that it owed no indemnification to a building contractor because a policy exclusion bars coverage for losses caused by a subsidence.
April 25, 2025
Defect Suit Against Roofer, Roof Coating Maker Dismissed After Parties Settle

SPRINGFIELD, Mass. — A Massachusetts federal court has dismissed without prejudice a construction defect suit filed against a roofer and roof coating maker after receiving notification that the parties had settled their dispute.
April 25, 2025
Insurer Has No Duty To Defend Subcontractor, Florida Federal Judge Rules

MIAMI — A Florida federal judge has granted an unopposed summary judgment motion in a construction defect insurance coverage action, finding that a subcontractor’s insurer has no duty to defend because there is no property damage alleged in the underlying state court case.