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No Damages for Delay May Not Be Enforceable in Virginia

January 08, 2024 — Christopher G. Hill - Construction Law Musings
Anyone who reads Construction Law Musings with any regularity (thank you by the way) knows that the contract is king in most instances here in Virginia. Any commercial construction subcontractor in Virginia is likely also very familiar with so-called “no damages for delay” clauses in construction contracts. These clauses essentially state that a subcontractor’s only remedy for a delay caused by any factor beyond its control (including the fault of the general contractor), after proper notice to the general contractor, is an extension of time to complete the work. However, in 2015 the Virginia General Assembly passed a change in the law that precluded the diminishment of any right to claims for demonstrated additional costs prior to payment. This left open the question as to which types of “diminishment” would be barred by the statute. The recent case out of the Eastern District of Virginia federal court, Strata Solar LLC v. Fall Line Construction LLC, added a bit of clarity. Read the full story...
Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

Former NYC Condo Empire Executive Arrested for Larceny, Tax Fraud

March 11, 2024 — Ava Benny-Morrison - Bloomberg
A former New York executive facing lawsuits over the collapse of real estate empire HFZ Capital Group has been arrested in Miami, charged with grand larceny and tax fraud. Nir Meir, 48, was arrested Monday, a spokesperson for the Miami-Dade Police Department confirmed. Meir was detained on an out-of-state warrant, suggesting his arrest may be the result of an investigation by law enforcement in New York. A spokesperson for the Manhattan District Attorney’s Office didn’t immediately respond to a request for comment. Meir’s attorney also didn’t immediately respond to an email. Meir, the former managing principal of HFZ Capital Group, has been battling multiple lawsuits in New York over his involvement in the once-prominent real estate firm. He’s denied wrongdoing. Read the full story...
Reprinted courtesy of Ava Benny-Morrison, Bloomberg

Hawaii Court of Appeals Finds Insured AOAO Not Liable for Securing Inadequate Insurance

March 04, 2024 — Tred R. Eyerly - Insurance Law Hawaii
The Hawaii Intermediate Court of Appeals (ICA) affirmed the trial court's finding that the insured Association of Apartment Owners (AOAO) was not liable for securing a policy with inadequate coverage. AOAO Queen Emma Gardens, et al v. Wa, 2023 Haw. App. LEXIS 400 (Haw. Ct. App. Dec. 19, 2023). In October 2002, the Was purchased a condominium located in the Queen Emma Gardens Condominium. The AOAO's bylaws provided that it would procure and maintain insurance "to insure the Board, the Association, and each apartment owner against claims for personal injury, death, and property damage arising out of the condition of the property or activities thereon . . ." The AOAO secured a CGL policy from Insurance Association, Inc., with coverage limits for bodily injury at $1,000,000 and an umbrella policy providing an additional $5,000,000 of coverage. Each of the policies "insured each individual insurance owner of the insured condominium, but only with respect to liability arising out of the ownership, maintenance or repair of that portion of the premises which is not reserved for that unit owner's exclusive use or occupancy." Read the full story...
Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

Perez Broke Records … But Should He Have Settled Earlier?

February 19, 2024 — Sofya Uvaydov & John F. Watkins - Kahana Feld
In 2021, Mark Perez’ Labor Law 240(1) lawsuit made legal news by breaking the record of the highest appellate-sustained pain and suffering award in New York history. While that record was short-lived, it still maintains its place as New York’s highest-ever pain and suffering award for a brain injury. This January 17th, the Appellate Division, First Department revisited the litigation but, this time, in a dispute between Perez and his then-lawyer, Ben Morelli and the Morelli Law Firm. Mr. Perez claims breach of contract over a 10% additional contingency fee charge related to the Perez v. Live Nation appeal and breach of fiduciary duty by his counsel in failing to convey settlement offers during the lifetime of the case. The Morelli firm counters, among other things, that the prior settlement offers – a $30 million offer during the 2019 trial and intermediate sums during the appellate stage – were still lower than the ultimate $55 million settlement. No harm, Mr. Morelli argues, and thus no foul in failing to convey the offers. But is that so? Did Mark Perez ultimately receive more money in his $55 million settlement than from the $30 million settlement offer mid-trial? Despite the glaring $25 million difference, the surprising calculations show that Perez would have been financially better off taking the $30 million mid-trial settlement. Reprinted courtesy of Sofya Uvaydov, Kahana Feld and John F. Watkins, Kahana Feld Ms. Uvaydov may be contacted at suvaydov@kahanafeld.com Mr. Watkins may be contacted at jwatkins@kahanafeld.com Read the full story...

Motion for Reconsideration Challenging Appraisal Determining Cause of Loss Denied

November 16, 2023 — Tred R. Eyerly - Insurance Law Hawaii
The court rejected the insurer's motion for reconsideration attempting to set aside the appraisal award that determined the cause of loss. Mesco Mfg., LLC v. Motorists Mut. Ins. Co., 2023 WL 5334659 (S.D. Ind. Aug. 18, 2023). Mesco suffered a loss to the roofs of its facilities due to hail damage. Mesco sued Motorists alleging it breached the policy by failing to pay the full amount of the claim. The claim went to appraisal. The policy's appraisal provision reserved Motorists' right to deny the claim despite an appraisal going forward. The appraisal award noted that the loss was caused by hail. Cross-motions for summary judgment were filed. The court found that Motorists had breached the policy by failing to pay the arbitration award and granted summary judgment to the insured. The "right to deny" clause did not give Motorists the unfetterd right to disregard the umpire's award if it disgreed about the amount of loss caused by hail. The only dispute was whether the damage was caused by hail, and the umpire found that it was. Read the full story...
Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

Allegations Versus “True Facts”: Which Govern the Duty to Defend? Bonus! A Georgia Court Clears Up What the Meaning of “Is” Is

December 11, 2023 — Rachel E. Hudgins & Syed S. Ahmad - Hunton Insurance Recovery Blog
Courts scrutinize a complaint’s factual allegations to decide whether the allegations trigger a duty to defend. [1] If the facts unambiguously exclude coverage, there is no duty to defend. [2] But what if the factual allegations fall within a policy exclusion, but the allegations are untrue or questionable? What if the true facts would mean the exclusion doesn’t apply? In that case, many courts have found that the insurer should base its decision on the policyholder’s version of the “true facts.” [3] An insurer can’t rely on the complaint’s allegations to deny coverage when the facts that the insurer knows or can ascertain show that the claim is covered. [4] A recent case, United Minerals & Properties Inc. v. Phoenix Insurance Co., No. 4:23-cv-00050 (N.D. Ga.), illustrates these policy interpretation principles. Reprinted courtesy of Rachel E. Hudgins, Hunton Andrews Kurth and Syed S. Ahmad, Hunton Andrews Kurth Ms. Hudgins may be contacted at rhudgins@HuntonAK.com Mr. Ahmad may be contacted at sahmad@HuntonAK.com Read the full story...

CGL Policy May Not Cover Cybersecurity and Data-Related Losses

March 25, 2024 — Susana Arce - Saxe Doernberger & Vita, P.C.
The construction industry, like many other industries, has experienced an increased reliance on, and implementation of, technology in the past few years. Smart phones and tablets are used on most project sites, computers are an integral part of the planning process, and various software programs are used throughout the construction process. Likewise, much of the machinery and equipment used during construction (e.g., total stations, trucks, tower cranes) is interconnected, and in some cases, operated or monitored remotely.1 With an increase in technology comes a risk of cybersecurity and data-related losses. Many large businesses purchase Commercial General Liability (“CGL”) insurance and assume cybersecurity and data-related losses are covered. Unfortunately, this is generally not the case. CGL policies typically cover three general types of damage: bodily injury, property damage, and advertising injury. Read the full story...
Reprinted courtesy of Susana Arce, Saxe Doernberger & Vita, P.C.
Ms. Arce may be contacted at SArce@sdvlaw.com

John Paulson’s $1 Billion Caribbean Empire Faces Betrayal

November 27, 2023 — Jim Wyss & Tom Maloney - Bloomberg
In the decade since hedge fund billionaire John Paulson took a grand gamble on Puerto Rico, he’s faced the wrath of the markets and mother nature. He’s navigated hurricanes, earthquakes, the pandemic and the largest municipal bankruptcy in US history to amass a portfolio of luxury hotels and resorts, high-end office blocks, and auto dealerships catering to the island’s rich. Now, just a few months after breaking ground on one of San Juan’s tallest and most exclusive residential towers, Paulson is facing a new wave of threats: lawsuits that strike at the heart of his Caribbean empire. Reprinted courtesy of Jim Wyss, Bloomberg and Tom Maloney, Bloomberg Read the full story...

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