Burlington

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   Judge Mollway, U.S. District Court Judge for the District of Hawaii, found the insurer was not in bad faith for allegedly leading its insured to believe that construction defects would be covered under the policy. The court, however, allowed the insured's negligent misrepresentation claim to survive summary judgment. Ill Nat'l Ins. Co v. Nordic …

   Judge Kobayashi of the U.S. District Court, District of Hawaii, largely followed earlier precedent established by Judge Mollway in finding no coverage for construction defect claims. See Evanston v. Nagano, 2012 WL 3800320 (D. Hawaii Aug. 31, 2012).

   Evanston issued several liability policies to the insured contractor from 2002 and 2011. The insured…

   Coverage for construction defects continues to be hotly contested in Hawaii state and federal courts. In a recent decision, Judge Mollway felt bound to follow the Ninth Circuit's decision in Burlington Ins. Co. v. Oceanic Design & Constr., Inc., 383 F.3d 940, 944 (9th Cir. 2004), where the court found construction defect claims…

   Ever since the Ninth Circuit made an Erie guess in Burlington Ins. Co. v. Oceanic Design & Constr. Inc., 383 F.3d 940 (9th Cir. 2004), that the Hawai’i appellate courts would find that construction defects do not constitute an occurrence under a CGL policy, coverage practitioners have waited for an answer.  Today, the Hawai`i Intermediate Court of Appeals…

Burlington Insurance Company wins again.  The Ninth Circuit of Appeals issued an unpublished decision a few months ago entitled Burlington Insurance v. Steve’s Ag Services, which appears to perpetuate some of the logic flaws in the original Burlington decision.  Although the court refused to explain the underlying facts (instead simply stating "the parties are…

An article recently came out in the "Construct" journal, put out the Construction Litigation Committee of the ABA, entitled "State Courts Trend: Coverage for Faulty Workmanship."  This article is similar to an earlier blog post analyzing the Ninth Circuit decision entitled Burlington Ins. Co. v. Oceanic Design & Constr., Inc. (9th Cir. 2004) and…

        No case has stirred the construction and insurance coverage community in Hawaii quite like Burlington Ins. Co. v. Oceanic Design & Constr., Inc.   Together with the economic loss doctrine, this case, if followed in state courts, could signal the death knell for insurer participation in many construction defect cases and have…