I often speak with prime contractors and owners who assure me that they require subcontractors to name them as additional insureds. This is the correct line of thinking as additional insured treatment is one of the key principals to adequately transfer the risk of construction defects or non property injury. The devil, as they say, … Continue reading Ongoing Operations and Completed Operations Coverage
No Damage for Delay
Although a slim majority of insurance companies providing architects and engineers professional liability insurance saw their rates stabilize in 2016, nearly one in three experienced modest rate decreases, according to a new survey by Ames & Gough. Despite intense competition, insurers are maintaining underwriting discipline and placing greater emphasis on claims experience. This year, 95 … Continue reading Insurance Market Leader Ames and Gough report Premium Price Decreases
The Miller Act, 40 U.S.C. §§ 3131–3134, provides that, before any contract for the construction, alteration, or repair of any public building or public work of the United States of more than $150,000 (increased fris awarded to any person, that person (usually the general contractor) must furnish: (1) A performance bond in an amount the … Continue reading The Miller Act and Performance Bonds
The Miller Act is codified at 40 U.S.C. §§ 3131-3134. The Act requires a general contractor contracting with the federal government or a federal governmental entity for a construction project with a contract in excess of $150,000 to obtain both a performance bond and a payment bond. The Miller Act's primary function is to foster construction and … Continue reading The Miller Act: An Introduction
A recent decision in New York has held that a construction manager was entitled to additional insured treatment under a general contractor's CGL policy. Turner Constr. Co. v. Navigators Ins. Co., 2015 N.Y. Misc. LEXIS 2704 (N.Y. Sup. Ct. July 23, 2015). The Construction Manager ("Turner") was hired to "provide pre-construction services and construction … Continue reading Construction Manager entitled to Additional Insured Status
A Florida court has determined that a project owner's (Cypress) general partner was not an additional insured under an insurance policy issued to the Genral Contractor (WPC) who constructed the project. The ruling was made in conjunction with a lawsuit brought by a homeowners association for construction defects, maintenance issues and failure to disclose material … Continue reading Florida Rules Developer Not Entitled to Additional Insured Coverage for Negligent Misrepresentation
A recent unpublished opinion by the Sixth Circuit Court of Appealshas held that a contractor’s allegedly poor workmanship did not constitute an “occurrence” under the contractor’s policy of insurance. The facts in this matter can be summarized, as follows: Wal-Mart contracted with MW Builders ("Contractor") to construct a new store in Kentucky. Contractor subcontracted the … Continue reading Kentucky Commercial Subcontractor’s Work Deemed to be Faulty and Insurance Not Triggered
Great article by Matthew Brouchard, Esq. on the rights of a subcontractor to sue design professionals for inadequate plans
Talk about being stuck between a rock and a hard place.
You’re an electrical sub who notices during your performance that installing certain light fixtures per plans would run afoul of the manufacturer’s instructions and violate the building code. You bring the issue to the attention of your general contractor, who submits an RFI. The architect’s response directs you to proceed per plans. The system later malfunctions, and you incur significant cost researching the problem, ultimately concluding that the installation method directed by the architect is the culprit. The architect refuses to pay your costs for researching the issue.
Might you have a claim for negligence against the architect?
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In this case of first impression arising from a general contractor’s liability for construction defects, the Court held that a member of a limited liability company (LLC) can be held personally liable for negligent acts committed while working for the LLC of which he was a member. The Court stated that, based upon the General … Continue reading An LLC does not shield active members from liability in South Carolina Construction Defect ruling