Love Me Tender: Tenders of Defense and Indemnification for Construction Cases – Risk Management Guidance and the “Duty to Defend” Case Law Update

Author: Pamela Palpallatoc

Guest Editor: Brittany Torrence

May 14, 2019 8:58am

Tyson & Mendes Associate, Margarite Sullivan, provides a great overview of how to manage risk by transferring it using the vehicles of tendering defense and indemnification in insurance defense cases.  The American Bar Association seemed to have gotten wind of Tyson & Mendes’s love for tenders and provided additional guidance here, just a few months after Tyson & Mendes published an article in the Insurance Defense Newsletter.

Proposition 65 Warning Requirements: Compliance Considerations for Landlords, Building Owners, And Counsel

Author: Michaela Jester

Guest Editor: Brittany Torrence

May 13, 2019 3:00pm

Beginning July 1, 2019, California residential rental properties will be subject to Proposition 65 Warning requirements. The warning requirements will be incorporated into lease agreements, letters, and e-mails, thereby replacing the warning signs plastered across the state. Pursuant to the new California law, landlords and building owners will be required to warn tenants and all known adult occupants of chemicals detected at the premises…

Recent Developments in the Privette-Toland Doctrine

Author: David Kahn

Guest Editor: Brittany Torrence

May 13, 2019 3:00pm

The Privette-Toland doctrine was created from a series of California Supreme Court cases protecting landowners and other hirers of independent contractors from lawsuits by employees of the independent contractor who sustain on the job injuries. The Privette-Toland doctrine is an important defense in premises liability/construction cases because, under the right circumstances, the doctrine may provide grounds…

A Challenge to the Privette Doctrine Defense – the Retained Control Doctrine Carves out an Exception

Author: David Ramirez

Guest Editor: Catie R. Johnson

February 11, 2019 4:00pm

The Privette Doctrine arises from a 1993 California Supreme Court case entitled Privette v. Superior Court (1993)5 Cal.4th 689, which provides that a higher-tiered party such as an owner or general contractor is not liable for injuries sustained by employees of a lower-tiered party such as a subcontractor on a construction project. There are, however, a number of exceptions to the Privette Doctrine. One of these exceptions is known as the “retained control doctrine.”

Court Rules Insurer May Not Pursue Subrogation Rights of Suspended Corporation

Author: David Ramirez

Guest Editor: Catie R. Johnson

February 11, 2019 4:00pm

In the recent case of Travelers Property Casualty Co. v. Engel Insulation Inc. (2018 WL 6259032; November 30, 2018), The Third District Court of Appeal ruled a Complainant in Intervention could not maintain an affirmative action against subcontractors to recover attorneys’ fees and costs incurred in defending its suspended insured in an underlying action.

A Powerful Tool to Deal with a Mechanic’s Lien Foreclosure Lawsuit in California

Author: Candice N. Hamant

Guest Editor: Catie R. Johnson

February 11, 2019 4:00pm

Contractors and material suppliers are entitled to foreclose on a mechanic’s lien if they comply with the preliminary notice (“prelien”) requirements. California Civil Code sections 8200 and 8204 require notice to the owner, direct contractor and construction lender, if any, not later than 20 days after the contractor or material supplier has first furnished work on the work of improvement. If the contractor or material supplier fails to do this, they…

New California Law Requires Contractors-Insurers to Disclose Settlements

Author: Robert Bernstein

Guest Editor: Catie R. Johnson

February 11, 2019 4:00pm

As part of the long-term response to the June 2015 collapse of an apartment building balcony in Berkeley, California which killed six young people, California Governor Jerry Brown signed into a law Senate Bill 1465, which requires contractors, subcontractors and insurers to report most settlements reached in construction defect cases. This new law took effect on January 1, 2019 and should be on the radar of California general…

“Loss of Use” May Constitute “Property Damage” in California

Author: Michaela Jester

Guest Editor: Catie R. Johnson

February 11, 2019 4:00pm

In October 2018, the Court of Appeals for the Fourth District of California Court unanimously held the “loss of use” of tangible property need not be a loss of all possible uses of the property to constitute property damage; loss of a particular use can be sufficient to trigger coverage. Further, the court held the use of economic loss calculations as an appropriate measure of property damage. Thee…

The Construction Defect Is Not Always the Contractor’s Fault, Right? Why Not Look at the Building Products Too?

Author: Bryan D. Scholnick

Guest Editor: Catie R. Johnson

February 11, 2019 4:00pm

How often during construction defect litigation does it appear the contractor is certain they did the work in a workmanlike manner?  How often do we hear from the contractor or subcontractor there is no way they caused the defect to arise?  Recently, a building envelope professional was adamant his envelope design was so redundant, there is no way the envelope would allow water to intrude into the building.  After multiple…

Fully Vette Your Public Adjuster Before Letting Them Work Your Property Claims

Author: Bryan D. Scholnick

Guest Editor: Brittany Torrence

November 13, 2018 9:00am

When considering hiring a public, or independent, adjuster for work in Washington, the claims person must begin the process of vetting possible candidates and documenting their reason behind their choice.  Based on two recent Washington court rulings, one state court case and one federal district court case, the actions of the public adjuster may be imputed to the claims person under certain circumstances. The number of proponents…

Good Faith Settlement Determination: Not a Free Pass

Author: Candice N. Hamant

Guest Editor: Brittany Torrence

November 13, 2018 9:00am

Often times, after a settlement in a construction defect litigation or case involving real property, such as a fall at a public park, defendants would run out to get their good faith settlement (“GFS”) determination as a matter of course. While a GFS determination protects a litigant from equitable comparative contribution, or partial or comparative indemnity, based on comparative negligence or comparative fault, it has no impact on…

A Win for Design Professionals – A Late Certificate of Merit Could Result in a Time-Barred Claim

Author: Brian Johnson

Guest Editor: Brittany Torrence

November 13, 2018 9:00am

On May 5, 2014, George Sutherland sustained injuries when, while working as a crane operator, his crane became unstable and fell over. Sutherland brought an action almost exactly two years later, on May 3, 2016. His complaint alleged a cause of action for negligence against defendant Curtis Engineering Corporation. Curtis Engineering Co. provided engineering services to Sutherland’s project and at the worksite where Sutherland’s…

Product Defects and The Risk-Benefit Test

Author: David Ramirez

Guest Editor: Brittany Torrence

November 13, 2018 9:00am

In the recent case of William Jae Kim, et al. v. Toyota Motor Corporation, et al. (2018 WL 4057248), the California Supreme Court affirmed the Second Appellate District Court of Appeal decision which previously affirmed the trial court judgment after a jury found for defendant in a product liability case. Plaintiffs claimed the pickup truck was defective because its standard configuration did not…

Rodriguez v. Department of Transportation: California Public Entities Shielded From Guesswork Games When Approving Public Property Designs

Author: Allison Lawrence

August 13, 2018 9:00am

In March, 2018, the California Court of Appeal decided an interesting issue with regarding defective designs on public property in Rodriguez v. Department of Transportation, Case No. F074027 (March 27, 2018). The Court had to decide whether a public entity could avoid liability through the affirmative defense of design immunity. In a nutshell, the Court rejected plaintiff’s assertion that a public official’s approval ­of a design does…

Tips for California HOAs When Enforcing Rights Against Delinquent Homeowners

Author: Po Waghalter

August 13, 2018 9:00am

Can an owner lose their home simply because they do not pay their homeowner’s association (“HOA”) dues?  The answer is: yes.  It is only fair, after all.  However, it is not as simple as it sounds.  There are legal and technical hoops in place, and HOAs are mandated to comply with these hoops or be subject to attorney-driven lawsuits where attorneys’ fees can exceed the cost of the technical violation(s).

United Riggers & Erectors v. Coast Iron & Steel: Can Contractors Withhold Retention Payments from Subcontractors?

Author: Allison Lawrence

August 13, 2018 9:00am

When a general contractor subcontracts work in California, it is standard practice that payment is made by the general contractor to the subcontractor on a monthly basis. The contractor is allowed to withhold a certain amount of the payment due as a retention in order to ensure that the subcontractor continues to uphold their end of the bargain at the expected level of quality. The payment of these retention funds is dictated by Civil Code…

California: Know Thy Tenants

Author: Candice N. Hamant

August 13, 2018 9:00am

Given the lack of affordable housing, especially in major cities like San Francisco, landlords should not be surprised to find changes in occupancy in their rental units without their consent. Landlords might inadvertently change the status of those occupants to “tenants” and unwittingly confer tenant rights on those occupants.

California: Do Not Waive Goodbye to Arbitration

Author: Mia Kelly

August 13, 2018 9:00am

A June 6, 2018 California Appeals Court decision in Von Becelaere Ventures, LLC v. James Zenovic (24 Cal.App.5th 243) held a contractor waives the right to arbitrate a “construction dispute under the terms of the contract by failing to request a stay of a mechanic’s lien pending the outcome of arbitration.”  In that case, Von Beccelaere Ventures, LLC (“VBV”) entered into a contract with James Zenovic Construction…

Contractor Licenses

Author: David Ramirez

August 13, 2018 9:00am

In a recent decision entitled MP Nexlevel of California, Inc. v. CVIN LLC (2018 WL 3358395), the Ninth Circuit Court of Appeals took a pro-contractor stance on the issue of the scope of contractor licensing.  The matter arose from a dispute over the scope of a California specialty contractor’s license. The issue was whether the subcontractor’s performance of certain work was outside the scope of its license constituting a breach…

Future Apartment-to-Condominium Conversion May Not Be a Way to Escape From Construction Defect Suits in Washington

Author: Bryan D. Scholnick

August 13, 2018 9:00am

If you have traveled to Seattle in the last few years, you may have noticed the number of cranes.  Other than the large number of buildings under construction for Amazon and other technology companies, many of the buildings seen under construction are multi-unit, high-rise apartments.  A decade or more ago, one would have expected many of these to be condominium buildings.  However, between then and now, Washington…

McMillan Albany LLC v. The Superior Court of Kern County: A Landmark Decision for California Builders and the Understanding of the Right to Repair Act

Author: Allison Lawrence

May 14, 2018 8:00am

Builders have long awaited a decision on the hot button topic of whether or not homeowners may assert common law causes of action such as negligence and strict liability against builders in relation to construction defects. This past January, the California Supreme Court held the “Right to Repair Act” is the exclusive remedy for construction defect claims. The Court also held that all claims seeking recovery for defect damages are subject to…

The Privette Doctrine Applied to Passive Conduct of the Property Owner

Author: David Ramirez

May 14, 2018 8:00am

In the recent case of Delgadillo v. Television Center, Inc., (2018) 20 Cal.App.5th 1078, the California Court of Appeal, Second District recently examined and refined the Privette doctrine.   Starting with Privette v. Superior Court (1993) 5 Cal.4th 689, the Courts have explained the limitations of a homeowner’s liability for work performed on the premises by the employee of a contractor.  The Privette Doctrine

No Coverage Where Negligence is Inseparable with Professional Service

Author: David Ramirez

November 26, 2017 11:52am

In the recent matter of Energy Ins. Mutual Ltd. v. Ace American Ins. Co. (2017 WL 3476705), the First District Court of Appeals found that a professional services exclusion barred coverage for wrongful death and other claims blamed on pipeline inspectors’ failure to identify and properly mark a gas pipeline that was ruptured during construction of another pipeline, resulting in injuries and damages.

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