News & Analysis as of

Construction Contracts Subrogation

White and Williams LLP

Not a Waiver for All: Maryland Declines to Apply Subrogation Waiver to Subcontractors

In Lithko Contr., LLC v. XL Ins. Am. Inc., No. 31, Sept. Term, 2023, 2024 Md. LEXIS 256, the Supreme Court of Maryland considered whether a tenant who contracted for the construction of a large warehouse facility waived its...more

Saul Ewing LLP

Subcontractors Were Not Third-Party Beneficiaries of Waiver of Subrogation Language in a General Contract, Requiring Reversal of...

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A recent Maryland appellate decision arising from an insurance company’s exercise of subrogation rights against negligent subcontractors in connection with tornado damage to a warehouse illustrates the pitfalls of waiver of...more

White and Williams LLP

No Signature, No Problem: Texas Court Holds Contractual Subrogation Waiver Still Enforceable

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In Chubb Lloyds Inc. Co. of Tex. v. Buster & Cogdell Builders, LLC, No. 01-21-00503-CV, 2023 Tex. App. LEXIS 676, the Court of Appeals of Texas, First District (Court of Appeals) considered whether the lower court properly...more

White and Williams LLP

In All Fairness: Illinois Appellate Court Finds That Arbitration Clause in a Residential Construction Contract Was Unconscionable...

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In Bain v. Airoom, LLC, No. 1-21-001, 2022 Ill. App. LEXIS 241, the Appellate Court of Illinois (Appellate Court) considered whether the lower court erred in enforcing an arbitration clause in a construction contract between...more

White and Williams LLP

Waive Your Claim Goodbye: Louisiana Court Holds That AIA Subrogation Waiver Did Not Violate Anti-Indemnification Statute and...

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In 2700 Bohn Motor, LLC v. F.H. Myers Constr. Corp., No. 2021-CA-0671, 2022 La. App. LEXIS 651 (Bohn Motor), the Court of Appeals of Louisiana for the Fourth Circuit (Court of Appeals) considered whether a subrogation waiver...more

White and Williams LLP

Tenants Underwater: Indiana Court of Appeals Upholds Privity Requirement for Property Damage Claims Against Contractors

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In United States Automatic Sprinkler Corp. v. Erie Ins. Exch., et al., No. 21A-CT-580, 2022 Ind. App. LEXIS 87 (Automatic Sprinkler), the Court of Appeals of Indiana (Court of Appeals) considered whether there is a privity...more

Ward and Smith, P.A.

The Notice of Contract Mechanism: How Contractors Can Avoid Double Payment

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As the economic crisis stemming from the coronavirus pandemic unfolds, it is ever more important that contractors and subcontractors protect their payment rights and avoid the risk of double payment; i.e., the risk of having...more

White and Williams LLP

Wisconsin Court Applies the Economic Loss Doctrine to Bar Negligence Claims for Purely Economic Losses

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In Mech. Inc. v. Venture Elec. Contrs., Inc., No. 2018AP2380, 2020 Wisc. App. LEXIS 170, the Court of Appeals of Wisconsin, District Two, considered whether a party may bring a negligence claim for purely economic damages. In...more

Troutman Pepper

Maryland Court Holds No Right of Contribution Where A Waiver of Subrogation Precludes Common Legal Responsibility

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Gables Construction, Inc. v. Red Coats, Inc., No. 23, 2020 BL 193791, 2020 MD LEXIS 264 (Md. May 26, 2020) - Upper Rock II, LLC (“Upper Rock”) contracted Gables Construction, Inc. (“GCI”) to construct a multi-building...more

Gray Reed

Obscure But Important Surety and Guarantee Rules

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Texas surety law contains obscure procedural rules that can have outsized consequences. Chapter 43 of the Civil Practice and Remedies Code is an important example....more

White and Williams LLP

Virginia Molds Tort Versus Contract Law in New Home Construction Case

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Often times, both contract and tort claims co-exist in a subrogation matter and the line between the two can be blurred. This is especially true in the context of damages resulting from new home construction defect claims....more

White and Williams LLP

Wisconsin Supreme Court Holds that Subrogation Waiver Does Not Violate Statute Prohibiting Limitation on Tort Liability in...

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In Rural Mut. Ins. Co. v. Lester Bldgs., LLC 2019 WI 70, 2019 Wisc. LEXIS 272, the Supreme Court of Wisconsin considered whether a subrogation waiver clause in a construction contract between the defendant and the plaintiff’s...more

White and Williams LLP

California Court of Appeals Holds Subrogating Carrier Cannot Assert Claims of Its Suspended Insured

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In Travelers Prop. Cas. Co. of Am. v. Engel Insulation, Inc., 29 Cal. App. 5th 830 (2018), the Third District Court of Appeals of California addressed whether a subrogating carrier can assert the rights of its corporate...more

Fox Rothschild LLP

Guideline And Checklists For Subrogation Recovery

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About the E-book This resource serves as a guideline for understanding subrogation recovery and the insurance claims processes in specific subrogation cases. From case intake and investigation to filing a suit and...more

White and Williams LLP

Wisconsin Court of Appeals Holds Economic Loss Doctrine Applies to Damage to Other Property If It Was a Foreseeable Result of...

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In Kmart Corp. v. Herzog Roofing, Inc., 2018 Wisc. App. Lexis 842, the Court of Appeals of Wisconsin considered whether the economic loss doctrine barred the plaintiff’s negligence claims against the defendant roofer for...more

White and Williams LLP

Florida’s Fourth District Appeals Court Clarifies What Actions Satisfy Florida’s Construction Defect Statute of Repose

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In Gindel v. Centex Homes, 2018 Fla.App. LEXIS 13019, Florida’s Fourth District Court of Appeal recently concluded that the date on which the plaintiffs provided a pre-suit notice in compliance with §558.004 of Florida’s...more

Ward and Smith, P.A.

North Carolina Updates its Construction Lien Laws

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Gary is a commercial office space builder. Olivia owns a vacant parcel of real property in North Carolina and hires Gary to build an office building on the parcel. Olivia and Gary sign a contract by which he agrees to do the...more

White and Williams LLP

Northern District of Mississippi Finds That Non-Work Property Damages Are Not Subject to AIA’s Waiver of Subrogation Clause

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In recent months, the Northern District of Mississippi has grappled with how to interpret waivers of subrogation in American Institute of Architects (AIA) construction industry contracts and, specifically, how they apply to...more

Bradley Arant Boult Cummings LLP

Broad “Assumption of Liability” Clause in Subcontract Likely Trumps “Waiver of Subrogation” Clause in Prime Contract

In a recent case handled by Bradley, a federal court in Maryland issued a decision attempting to reconcile inconsistent contract provisions. The general contractor said that its fire sprinkler subcontractor was...more

Faegre Drinker Biddle & Reath LLP

When Contract Forms Cause Unintended Consequences

Inclusion of unrevised Standard AIA contract forms in your construction agreements can cause serious unintended consequences. A case decided by the Indiana Supreme Court, Bd. of Comm’rs. Cty of Jefferson v. Teton Corp., 30...more

Pillsbury Winthrop Shaw Pittman LLP

Perspectives on Insurance Recovery

Welcome to the latest edition of Pillsbury’s Perspectives on Insurance Recovery. As this 2015 edition of Perspectives demonstrates, our team is working on the most challenging issues—from cyber-insurance and complex claims...more

Haight Brown & Bonesteel LLP

Equities Favor Subrogating Insurer Over Subcontractor That Performed Defective Work

In Valley Crest Landscape v. Mission Pools (No. G049060, filed 6/26/15, ord. pub. 7/2/15), a California appeals court held that equities favor an insurer seeking equitable subrogation over a subcontractor that agreed to...more

Troutman Pepper

Ninth Circuit Enforces Waiver of Subrogation Clause in Design/Build Agreement Against Post-Construction Property Insurer

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Travelers Indem. Co. v. Crown Corr, Inc., 2014 U.S. App. LEXIS 21101 (9th Cir. 2014) - This action arose out of the construction of the University of Phoenix Stadium (the “Stadium”), home of the Arizona Cardinals. ...more

Snell & Wilmer

Arizona Supreme Court to Contractor: Sorry But Equitable Subrogation of a Bank’s Later Deed of Trust Trumps Earlier Mechanics’...

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The smoke has finally cleared in a hard and long-fought battle between a bank and contractor both claiming priority to foreclose millions of dollars on a Phoenix condominium project. The project, well-known as Summit at...more

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