Archive for October, 2009
Two separate actions were heard together in this case. The Builder ("Aspen") sued for the balance due on a construction contract and the homeowner counterclaimed for defective workmanship and materials. Kingsway General Insurance Company, the homeowner warranty provider ("the Insurer"), sought indemnification from the builder for any sums it was ordered to pay the homeowner under the warranty. The Builder gave notice it would not appear at trial and its claim against the homeowner was dismissed for want of prosecution.
The homeowners were awarded judgment against the Builder and costs in the first action, and recovered damages against the Insurer in the second action. The Insurer was entitled to recover those costs against the Builder.
Aspen Enterprises Ltd. (c.o.b. Aspen Homes) v. Quiding, [2008] B.C.J. No. 2755, October 21, 2008, British Columbia Supreme Court, L. Fenlon J.
The homeowner, Quiding, hired Aspen to build a home on his lot. The home was replete with defects and problems, including leaking windows and walls, fans venting into the attic, entranceways that gathered water, and stucco placed so close to concrete that it wicked water into the walls.
Quiding refused to pay Aspen for the work, and Aspen sued for the balance due on the contract. Quiding’s counterclaim against Aspen was framed in both contract and tort. The breach of contract claim was based on the implied warranty that the work would be suitable and fit for purpose, and the tort claim was that Aspen owed a duty to exercise all reasonable care, skill, and competence as a general contractor in constructing the new home. The judge found that Aspen breached both the implied contractual warranty and the duty of care owed to Quiding, and awarded $44,000 for items left unfinished.
Under the Home Warranty Program, the limit of liability under the warranty was the lesser of (a) the total provincial contract price for the dwelling unit or (b) $200,000. This number included cost of repairs, investigation, engineering and design, and the supervision of the repair.
An additional term of the warranty stipulated that Aspen was to perform the repair, but Quiding rejected that. Three years after an adjuster was assigned to the claim, the Insurer wrote a letter to Quiding declining coverage on the basis that Quiding refused to let Aspen do the repairs. The Insurer also said that it would cover the defects and apply the warranty coverage if Quiding would let Aspen do the repair work.
The repair work was by December 2007 but Aspen did not correct the defects. In January of 2008, the Insurer commenced legal proceedings to sort out its obligations to Quiding. Part of the counterclaim by Quiding included punitive damages for bad faith.
While the judge felt that starting an action to resolve the issue was not the ideal way to address the matter, it did not amount to reprenhensible conduct in all of the circumstances. The judge rejected the punitive damages claim, but awarded damages of $180,000 against the Insurer. The judge further ordered that the Insurer was able to recover that $180,000 from Aspen.
This case was originally summarized by Neil J. MacDonald and originally edited by David W. Pilley.
Pennsylvania-based Donegal Mutual Insurance Co. and Georgia-based Southern Mutual Insurance Co. have finalize an affiliation they announced in early September.
The deal brings Southern Mutual …
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Aon Corp. reported results for the third quarter ended September 30, 2009, which show net income attributable to Aon stockholders was up slightly at $120 million or $0.41 per share, compared to …
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First the good news. In case you hadn’t noticed, the recession is officially over.
“Better than expected GDP is confirming that the Great Recession has ended,” said Kevin Flanagan, fixed-income strategist for Global Wealth Management at Morgan Stanley in Purchase, New York.
That’s fantastic. But the 3rd quarter numbers remind me of the scene in Pulp Fiction where Mia Wallace is dying from a heroin overdose and Vincent Vega stabs her in the heart with an adrenaline shot and she comes screaming back to life.
Congress has again temporarily extended the federal flood insurance program, this time until Dec. 18, 2009.
The latest extension was approved by the House and Senate as part of an …
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Trinity E&S Services, Inc., with offices in Bermuda Dunes and Petaluma, Calif., is announcing the introduction of an E&S Business Owners Policy for retail agents in California that do not …
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CNA Financial Corp. has named David Rutkowski as senior vice president of Commercial Segments. Rutkowski will be responsible for CNA's Middle Market customer segments including Construction, …
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LPL Financial Corporation (LPL) will pay nearly $1.3 million in restitution to Montana investors and a fine of $150,000 to the State of Montana under a settlement announced today by Monica …
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On average, the number of Texans hit by cars spikes 23.3 percent during Halloween week, according to Allstate Insurance Company.
The insurer recently looked at its Texas auto insurance claims …
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The Republican-led Michigan Senate has killed legislation that would have banned auto insurers from considering where a driver lives when setting rates.
Democrats say the practice is unfair to …
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