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CONSTRUCTION DEFECTS

Montrose Chemical vs. Admiral Insurance (1995) 10 Cal.4th 645
In the context of continuous or progressively deteriorating property or bodily injury losses insurable under a third party CGL policy, as long as there remains uncertainty about damage or injury that may occur during the policy period and the imposition of liability upon the insured, and no legal obligation to pay third party claims has been established, there is an insurable risk within the meaning of sections 22 and 250 for which coverage may be sought under such a policy.

Time On Risk Analysis
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Montrose Chemical vs. Superior Court (1993) 6 Cal.4th 287
Supreme Court has concluded that "[t]he insured's desire to secure the right to call on the insurer's superior resources for the defense of third party claims is, in all likelihood, typically as significant a motive for the purchase of insurance as is the wish to obtain indemnity for possible liability.

CNA Casualty vs. Seaboard Surety (1986) 176 Cal.App 3d 598

Dillon vs. Hartford Accident Indemnity (1974) 38 Cal.App. 3d 335

State Farm Mutual vs. Flynt (1971) 17 Cal.App. 3d 538

Gray vs. Zurich Insurance Co. (1966) 65 Cal.2d 263

Duty to Defend - Additional Insured - Allocation
Maryland Casualty Company v. Nationwide Mutual Insurance Company

Duty to Defend - Additional Insureds
Pardee Construction Co. v. Insurance Company of the West

Coverage - Contribution - Tender
Truck Insurance Exchange v. Unigard Insurance Company

Insurance Coverage - Bad Advice - Roofing Consultant
Richard T. Ray v. Valley Forge Insurance Company

Damages - Emotional Distress - Construction Defect Claim
Erlich v. Menezes 

Insurance Coverage - Insured - Successor Company
Westoil Terminals Co. v. Harbor Insurance Co. 

Coverage - Additional Insured Endorsement
National Union Fire Ins. Co. of Pittsburgh v. Nationwide Ins. Co. 

Duty to Defend - Additional Insured Endorsement
Acceptance Insurance Co. v. Syufy Enterprises 

Bad Faith - Settlement - Deductibles
New Hampshire Insurance Co. v. Ridout Roofing Co., Inc. 

Bad Faith - Pre-Suit Obligations
San Diego Housing Commission v. Industrial Indemnity Co. 

Insurance - Additional Insured Endorsements - Construction Defect Litigation
Maryland Casualty Company v. Nationwide Insurance Company 

Insurance Coverage - Contractor Claim - Exclusions
William D. Collett v. Insurance Company of the West 

Duty to Defend - Continuous Trigger - Construction Defect
Maryland Casualty Co. v. National American Insurance Co. of California 

Calderon Act
Amended Civil Code Section 1375 applies to Actions after July 1, 2002.

Additional Insured Endorsement Covering Liability "Arising Out Of" Named Insured's Work Is Ambiguous
Acceptance Insurance Company v. Syufy Enterprises 99 C.D.O.S. 534 (January 19, 1999) 

General Liability Policy Does Not Cover Contractor's Liability For Failure To Meet Project Deadline 
Truck Insurance Exchange v. Superior Court, 98 Daily Journal D.A.R. 3067 (March 26, 1998)

Presley Homes vs. American States Insurance Company
Plaintiff Presley Homes, Inc. sued defendant American States Insurance Company seeking damages, plus declaratory and injunctive relief.  Defendant cross-complained against plaintiff for declaratory relief.  The action involves a dispute over the extent of defendant’s obligation under the additional insured endorsements of two insurance policies to provide plaintiff with a defense in a third party’s construction defects lawsuit. Plaintiff was entitled to have defendant provide a defense to the entire action as a matter of public policy. To defend meaningfully, the insurer must defend immediately. To defend immediately, it must defend entirely.  It cannot parse the claims, dividing those that are at least potentially covered from those that are not.  To do so would be time consuming.

Garriott Crop Dusting Co. v. Superior Court
There is a duty to defend, because the test of an "occurrence" of property damage under the CGL policy is not when the plaintiff was injured, but rather when the land was damaged. 

Aas vs. Superior Court (The William Lyon Company)
The court held that other "economic damages" would not be recoverable under a negligence theory. This means that homeowners and associations can no longer recover the cost of repairing structural problems in homes until physical damage occurs.

Coverage - Attorneys' Fees - Damages
Golden Eagle Insurance Company v. Insurance Company of the West (Court of Appeal, Fourth District - June 26, 2002)
This case states it is the first to hold that attorneys' fees and costs awarded pursuant to an indemnity agreement and insured under a contractual liability provision are "damages" under a general liability policy. (Caselaw)

STEARMAN, JEFFREY N. et al., vs. CENTEX HOMES
A defendant builder of mass produced housing may be held strictly liable for construction defects.  This question is firmly established in California cases beginning 30 years ago. The court held that the damage plaintiffs sustained to their home is physical injury falling outside the parameters of economic loss and is thus compensable under strict liability in tort. The order denying plaintiffs’ motion to recover expert fees as damages is reversed.  The judgment in favor of plaintiffs is modified to include an additional $37,500 representing those damages.  As so modified, the judgment is affirmed.  Plaintiffs shall recover their costs on appeal. 

Garmendi vs. Golden Eagle
Judgment after insurer's withdrawal in not a Default Jugdment, and plaintiffs were not limited to amount alleged.

Gray Cary vs. Vigilant Insurance
Civil Code 2860 does not require arbitration of dispute between insurer and insured regarding cost of defending insured's investigator.

Low vs. Golden Eagle
No voluntary payment clause is enforceable post-tender unless insurer has wrongfully rejected tender.

Baroco West vs. Scottsdale Insurance
There is no duty to defend under a completed operations policy when the project was completed after the expiration of the policy.

Rosen vs. State Farm
Clear and unambiguous policy language takes precedence over public policy.

Employers Insurance of Wausau vs. Granite State
Successive primary policies are liable for more than one year's policy limit where a single occurrence causes damage during multiple years.

Century Surety vs. United Pacific
Primary policy that purports to be excess to other valid and collectible insurance must participate on a pro rata basis with other primary policies.

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