Construction defect litigation is the bane of commercial general liability policy insurers. Given that the duty to defend is far broader than the duty to indemnify, insurers often find themselves defending very expensive cases where “negligence” is alleged, even though the actual damage in the case is defective work product. To date, New York, with its old housing stock, has been immune to this phenomenon. However, as a result of a construction boom over the past few years, some are predicting that defective workmanship claims are set to hit New York. Claims against insurers and expensive litigation will follow. As if New York’s Labor Law wasn’t enough to worry about!
On an unrelated construction defect matter (on which we previously reported), Chinese drywall is a major source of claims. The search for a causal linkage between the drywall and the claimed injuries/damages continues.
If you would like more information regarding this post, please email firstname.lastname@example.org.