Construction Law: Supreme Court Cases
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- Auto-Owners Ins. Co. v. Pozzi Window Co. (Supreme Court of Florida) A post-1986 standard form commercial general liability policy with "products-completed operations hazard" coverage, issued to a general contractor, does not provide coverage for the costs of repair or replacement of a subcontractor's defective work because the defective work itself does not constitute "property damage."
- Belz v. Clarendon Am. Ins. Co. (Cal. App.Districts) In case where homeowner in construction defect case obtained a default judgment against the contractor then brought action against the contractor's insurer for payment on the default judgment, summary judgment for insurer is reversed as: 1) where a default judgment results from a lack of notice by the insured, the insurer is liable on the judgment unless it suffered actual, substantial prejudice; and 2) the mere inability to investigate the claim thoroughly or to present a defense in the underlying suit does not satisfy the prejudice requirement.
- Clark v. Boscher (U.S. 1st Circuit Court of Appeals) In a 42 U.S.C. section 1983 suit against a former mayor and various former city council members and commissioners for obstructing the development of a residential subdivision on plaintiffs' land, dismissal of plaintiffs' claims is affirmed where their well-pleaded facts failed to demonstrate violations of their constitutional due process or equal protection rights under the Fourteenth Amendment.
- Crown Point Dev., Inc. v. City of Sun Valley (U.S. 9th Circuit Court of Appeals) A decision finding that plaintiff-developer could not state a claim for relief based on the allegedly arbitrary and irrational denial of a permit application is reversed and remanded for further proceedings where, contrary to the ruling below and in light of other Supreme Court rulings, Armendariz v. Penman, 75 F.3d 1311 (9th Cir. 1996) (en banc), does not entirely foreclose the developer's substantive due process theory.
- Grimes Constr., Inc. v. Great Am. Lloyds Ins. Co. (Supreme Court of Texas) In a case involving the duty to defend and indemnify under a commercial general liability policy (CGL), a court of appeals' decision affirming summary judgment for insurer is reversed where, pursuant to recent precedent of the court: 1) allegations of unintended construction defects may constitute an "accident" or "occurrence" as defined under the CGL policy; and 2) allegations of damage to or loss of use of the home itself may constitute "property damage" sufficient to trigger the insurer's duty to defend under the policy.
- In the Matter of 9th & 10th Street L.L.C. v. Bd of Standards & Appeals of the City of New York (N.Y. Court of Appeals) A decision reversing the New York City Department of Buildings' denial of a building permit to construct a dormitory is reversed as: 1) the Department's denial was not arbitrary and capricious; and 2) where there is reason to doubt that a proposed structure can be used for a lawful purpose, municipal authorities are not required to let the property owner build the building and see what happens.
- Jones v. DHR Cambridge Homes (Illinois Supreme Court) In a suit arising from personal injuries sustained while working on a construction site resulting in a third-party complaint against the plaintiff's employer for contribution, directed verdict in favor of defendant and third-party plaintiff on the contribution claims is reversed where the responsibility for providing the fall protection was disputed at trial.
- Otay River Constructors v. San Diego Expressway (Cal. App. Districts) Where an action is brought solely to compel arbitration of contractual disputes between the parties, a party who succeeds in obtaining an order denying the petition to compel arbitration is a prevailing party in the action on the contract even though the merits of the parties' underlying contractual disputes have not yet been resolved, and an order denying a request for costs and attorney's fees under such circumstances is appealable as a "special order after final judgment" under Code of Civil Procedure section 1294(e).
- Plumbers & Steamfitters, Local 290 v. Duncan (Cal. App. Districts) Ruling that renovation of a building was a public works project under California's prevailing wage law and award of attorney's fees to plaintiff is affirmed over defendant's claim that the trial court erred in concluding that the plumbing work performed under a shell construction contract was a pubic work within the meaning of Labor Code section 1720.2.
- SMI Owen Steel Co. Inc. v. Marsh USA Inc. (U.S. 5th Circuit Court of Appeals) In a suit brought by a subcontractor against an insurance broker under Nevada law asserting a tort claim for negligent failure to procure insurance, and two quasi-contractual claims for third-party beneficiary and promissory estoppel, a judgment for plaintiff is affirmed where: 1) plaintiff's negligence claim was not barred by Nevada's economic loss doctrine; and 2) there was a legally sufficient evidentiary basis for a reasonable jury to find that plaintiff proved the causation element of the negligence claim.
- St. John's United Church of Christ v. Fed. Aviation Admin. (U.S. D.C. Court of Appeals) Petition for review challenging an FAA grant to the City of Chicago reimbursing costs of certain work performed as part of the City's expansion of O'Hare International Airport is dismissed for lack of standing where: 1) the grant reimbursed the City for work that did not injure petitioners; 2) vacating the grant would not redress petitioners' injuries since the City is committed to finishing the project and could do so with other sources of funding; and 3) plaintiffs were subject to the normal standard for redressability.
- Watral & Sons, Inc. v. OC Riverhead 58, LLC (N.Y. Court of Appeals) In an action to foreclose upon a mechanic's lien against defendant-landowner's property, the Court of Appeals finds counterclaiming landowner is not entitled to contractual indemnification for damages which exceed the scope of indemnification provisions contained in the parties' construction contract as interpreted by the court.
- Wilkerson v. Paul H. Schwendener, Inc. (Illinois Courts of Appeal) In a complaint to recover from a construction site injury, summary judgement in favor of defendant is reversed and the matter remanded for further proceedings where an issue of fact exists as to what, if any, fall protection could have been provided and whether a retirement home is "residential" for purposes of the federal regulation requiring fall protection.
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