FAIRFIELD CONNECTICUT CONSTRUCTION EXPERT WITNESS
DIRECTORY AND CAPABILITIES

Illinois Supreme Court Holds that Constructions Defects May Constitute “Property Damage” Caused By An “Occurrence” Under Standard CGL Policy, Overruling Prior Appellate Court Precedent

January 08, 2024 — Jason Taylor - Traub Lieberman Insurance Law Blog
On November 30, 2023, the Illinois Supreme Court issued an opinion that overturned precedent in Illinois regarding whether faulty workmanship that only caused damage to the insured’s own work constituted “property damage” caused by an “occurrence” under Illinois law. In Acuity v. M/I Homes of Chicago, LLC, 2023 IL 129087, the Illinois Supreme Court considered whether Acuity, a mutual insurance company, had a duty to defend its additional insured, M/I Homes of Chicago, LLC (M/I Homes), under a subcontractor’s commercial general liability (CGL) policy in connection with an underlying lawsuit brought by a townhome owners’ association for breach of contract and breach of an implied warranty of habitability. The Cook County Circuit Court granted summary judgment in favor of Acuity finding no duty to defend because the underlying complaint did not allege “property damage” caused by an “occurrence” under the initial grant of coverage of the insurance policy. The appellate court reversed and remanded, finding that Acuity owed M/I Homes a duty to defend. The Illinois Supreme Court affirmed, in part, holding construction defects to the general contractor’s own work may constitute “property damage” caused by an “occurrence” under the standard CGL Policy. This is significant as it overrules prior Illinois precedent finding that repair or replacement of the insured’s defective work does not satisfy the initial grant of coverage of a CGL Policy. By way of background, the underlying litigation stems from alleged construction defects in a residential townhome development in the village of Hanover Park, Illinois. The townhome owners’ association, through its board of directors (the Association) subsequently filed an action on behalf of the townhome owners for breach of contract and breach of the implied warranty of habitability against M/I Homes as the general contractor and successor developer/seller of the townhomes. The Association alleged that M/I Homes’ subcontractors caused construction defects by using defective materials, conducting faulty workmanship, and failing to comply with applicable building codes. As a result, “[t]he [d]efects caused physical injury to the [t]ownhomes (i.e. altered the exterior’s appearance, shape, color or other material dimension) after construction of the [t]ownhome[ ] was completed from repeated exposure to substantially the same general conditions.” The defects included “leakage and/or uncontrolled water and/or moisture in locations in the buildings where it was not intended or expected.” The Association alleged that the “[d]efects have caused substantial damage to the [t]ownhomes and damage to other property.” Read the full story...
Reprinted courtesy of Jason Taylor, Traub Lieberman
Mr. Taylor may be contacted at jtaylor@tlsslaw.com

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Clean Energy and Conservation Collide in California Coastal Waters

March 19, 2024 — Nadia Lopez & Josh Saul - Bloomberg
Two of President Joe Biden’s biggest priorities — conservation and the switch to clean energy — are colliding in the ocean off California’s quiet Central Coast. Located halfway between San Francisco and Los Angeles, Morro Bay boasts a rich ecosystem of fish, otters and migrating whales that the Indigenous Chumash people want to protect with a new marine sanctuary. But 20 miles (32 kilometers) out, developers plan some of the West Coast’s first offshore wind farms, where 1,100-foot-tall turbines (335 meters) tethered to the seabed will help California cut its carbon emissions. One US government agency appears poised to approve the sanctuary. Another already leased 376 square miles of ocean for wind development, just outside the sanctuary’s boundaries. Now, a fight is brewing over whether the scenic bay itself should be left out of the sanctuary, to give undersea power cables from the wind farms a place to come onshore. Reprinted courtesy of Nadia Lopez, Bloomberg and Josh Saul, Bloomberg Read the full story...

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Bill Proposes First-Ever Federal Workforce Housing Tax Credit for Middle-Class Housing

March 04, 2024 — Emily K. Bias & Brittany Griffith - Gravel2Gavel Construction & Real Estate Law Blog
Legislation was recently introduced to the U.S. Senate and House of Representatives proposing the creation of the first-ever Workforce Housing Tax Credit (WHTC) for middle-income housing developments. Similar to the existing Low-Income Housing Tax Credit (LIHTC), the WHTC would provide additional federal income tax credits to housing development projects for tenants making between 60% and 100% of Area Median Income (AMI). The allocation of WHTC would be based on a competitive bid process and awarded to developments over a 15-year credit period (as opposed to a 10-year credit period for LIHTC). Developments receiving allocations of WHTC will be subject to affordability requirements during the 15-year credit period and subsequent extended use period of at least 15 years. Reprinted courtesy of Emily K. Bias, Pillsbury and Brittany Griffith, Pillsbury Ms. Bias may be contacted at emily.bias@pillsburylaw.com Ms. Griffith may be contacted at brittany.griffith@pillsburylaw.com Read the full story...

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New Jersey Strengthens the Structural Integrity of Its Residential Builds

March 11, 2024 — Matthew D. Stockwell - Gravel2Gavel Construction & Real Estate Law Blog
In response to the June 2021 Champlain Towers collapse in Florida, New Jersey supplemented its State Uniform Construction Code Act by enacting legislation (effective January 8, 2024) to strengthen laws related to the structural integrity of certain residential structures in the State. The legislation applies to condominiums and cooperatives (but not single-family dwellings or primarily rental buildings) with structural components made of steel, reinforced concrete, heavy timber or a combination of such materials. The legislation also supplements the Planned Real Estate Development Full Disclosure Act to ensure that associations created under the Act maintain adequate reserve funds for certain repairs. The legislation requires structural engineering inspections of any primary load-bearing system (structural components applying force to the building which deliver force to the ground including any connected balconies). Buildings that are constructed after the date the legislation was signed must have their first inspection within 15 years after receiving a Certificate of Occupancy. Buildings that are 15 years or older must be inspected within two years of the legislation. Thereafter, the structural inspector will determine when the next inspection should take place, which will be no more than 10 years after the preceding inspection, except for buildings more than 20 years old which must be inspected every five years. Also, if damage to the primary load-bearing system is otherwise observable, an inspection must be performed within 60 days. Read the full story...
Reprinted courtesy of Matthew D. Stockwell, Pillsbury
Mr. Stockwell may be contacted at matthew.stockwell@pillsburylaw.com

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Risky Business: Contractual Versus Equitable Rights of Subrogation

December 16, 2023 — Kyle Rice - The Subrogation Strategist
In Zurich Am. Ins. Co. v. Infrastructure Eng’g. Inc., 2023 Ill. App. LEXIS 383, the insurer, Zurich American Insurance Company (Insurer) proceeded as subrogee of Community College District No. 508 d/b/a City Colleges of Chicago and CMO, a Joint Venture. The Appellate Court of Illinois, First District (Appellate Court) addressed whether Insurer – who issued a builder’s risk policy to insure a building during construction – could subrogate on behalf of the building owner, City Colleges of Chicago (City Colleges), who was part of the joint venture and an additional named insured, but who had not been directly paid for the underlying loss. The Appellate Court determined that the policy language established that the carrier was contractually permitted to subrogate on behalf of all additional named insureds on the policy, including the building owner. Read the full story...
Reprinted courtesy of Kyle Rice, White and Williams
Mr. Rice may be contacted at ricek@whiteandwilliams.com

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Compliance Doesn’t Pay: Compliance Evidence Inadmissible in Strict Liability Actions

February 05, 2024 — Kyle Rice - The Subrogation Strategist
In Sullivan v. Werner Co., No. 18 EAP 2022, 2023 Pa. LEXIS 1715 (Dec. 22, 2023), the Supreme Court of Pennsylvania (Supreme Court) clarified that in light of its decision in Tincher v. Omega Flex, Inc., 628 Pa. 296 (2014), evidence that a product complied with industry standards is inadmissible in an action involving strict product liability. In Tincher, the Supreme Court overruled prior case law and reaffirmed that Pennsylvania is a Second Restatement Jurisdiction. As stated in Sullivan, discussing Tincher, under the Restatement (Second) of Torts § 402A, a “seller of a product has a duty to provide a product that is free from ‘a defective condition unreasonably dangerous to the consumer or [the consumer’s] property.’ To prove breach of this duty, a ‘plaintiff must prove that a seller (manufacturer or distributor) placed on the market a product in a “defective condition.”” Read the full story...
Reprinted courtesy of Kyle Rice, White and Williams
Mr. Rice may be contacted at ricek@whiteandwilliams.com

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No Duty to Defend Construction Defect Claims under Kentucky Law

March 25, 2024 — Tred R. Eyerly - Insurance Law Hawaii
The federal district court determined that the insurer was not obligated to defend construction defect claims under Kentucky law. Westfield Ins. Co. v. Kentuckiana Commercial Concrete, LLC, 2023 U.S. Dist. LEXIS 222674 (W.D. Ky. Dec. 14, 2023). HRB, the owner of an apartment complex, filed an arbitration demand against the general contractor, Doster Commercial Construction, for allegedly doing faulty concrete work in the construction of the apartments. Doster added its concrete subcontrator Kentuckiana Commercial Concrete - and 16 other subcontractors - to the arbitration. Kentuckiana tendered the claim to its insurer, Westfield. Wesfield defended. Doster claimed it was an additional insured under the Westfield policy and also sought coverage. Westfield refused the defend Doster. Westfield argued there was no "occurrence." Westfield then sued both Doster and Kentuckiana in federal court, seeking a declaration that it had no duty to defend either. Westfield moved for a judgment on the pleadings. Read the full story...
Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Vietnam Expands Arrests in Coffee Region Property Probe

February 19, 2024 — Mai Ngoc Chau - Bloomberg
Vietnam authorities detained the Communist Party chief of coffee-producing province Lam Dong as they expand an investigation into alleged bribery tied to a tourist and residential project, the public security ministry said in a website statement. Party chief Tran Duc Quan was arrested for allegedly abusing his power and position, according to the statement. Quan allegedly violated the law while giving instructions to the Dai Ninh property project in the province, causing severe consequences, it said. A Lam Dong Provincial Party Committee representative declined to provide a comment about the arrest. A representative for Quan was not available. Read the full story...
Reprinted courtesy of Mai Ngoc Chau, Bloomberg

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