Defective Construction

The attorneys at the Adler Law Group have over three decades of experience representing clients in construction defect claims involving insurance carriers, contractors, and subcontractors in Los Angeles and throughout Southern California.

Defective Construction Claims

Claims of defective construction - whether viewed in the context of a cathedral or a cottage - have created major issues. One aspect of difficulty is the size of the claims: the claimants' contentions may involve a subdivision of hundreds of homes or alternatively, multi-unit high-rise construction. While some claims professionals may see such claims as being a subcategory of ordinary coverage claims or a subset of typical litigation, such claims present unique problems.

Coverage Issues

While claims regarding defective construction may present insurance coverage issues, they present such claims in a more complex format than the more typical commercial general liability (CGL) claim.

That is so for a variety of reasons, including the presence of multiple buildings or units, significant amounts of money at stake, and the presence of numerous other carriers who advocate their separate, conflicting viewpoints.

While coverage issues are often seen as presenting knotty analytical problems, the level of complexity in defective construction claims may result in especially complicated issues for a variety of reasons:

• Carriers have been developing special policy formats for this market, including wholly new concepts such as "wrap-up coverage."
• Some carriers have new contractual provisions - such as policy limitations, which, in effect, provide CGL coverage on a "claims made" basis or preclude application of a "continuous trigger" - in effect which may be difficult to coordinate with traditional formats used by other carriers.
• Other policy provisions which apply generally-- such as deductibles, SIRs, and the definition of a "claim"— require special analysis in the context of demands being made by a large group of homeowners and insurance carriers with competing interests and policy formats.

Over the last three decades, the lawyers of the Adler Law Group have issued numerous opinions interpreting and applying insurance policies to claims of defective construction. These opinions involve the complete range of such issues, from issues as narrow as the scope of coverage provided by additional insured endorsements and as general as the consequence of an applicant for insurance failing to disclose preexisting conditions.  Further, in writing these opinions, they have had to deal with the evolving and changed policy provisions involving this market.

Besides handling issues regarding coverage advice, the lawyers of the Adler Law Group have been considered to be sufficiently knowledgeable about coverage issues to draft their own form of policy (as well as various endorsements) currently being used to cover specialty contractors in a major home construction program.

Special Assignments in Mediation and Settlement Conferences

The Adler Law Group, because of its experience in handling the coverage aspects as well as litigating issues involving this market, has been regularly requested to act as representative and advisor to insurance carriers at settlement discussions and mediations.  For over three decades, the lawyers of the Adler Law Group have been assigned the task to settle or resolve such litigation, even when other lawyers were the original litigating counsel.  Furthermore, the Adler Law Group has generally been able to resolve the underlying claim even when the original defense attorney was unable to negotiate a settlement.

Litigating Coverage and Bad Faith Lawsuits

Paralleling the broad experience of our lawyers in interpreting policy provisions as well as drafting policy provisions for insurance carriers in this market, we have also been involved in litigating resulting coverage issues.  Thus, as trial lawyers, we have been involved in litigating new policy formats with other carriers as well as with policyholders in declaratory relief actions. Consistent with the lawsuits involving the industry, we have defended numerous bad faith claims.

Defending Claims Against the Policyholder

Because of our experience in dealing with such claims, the lawyers of the Adler Law Group have been assigned by insurance carriers to defend policyholders, such as general contractors or subcontractors, in actions brought against them.  Whether the complaining parties are individuals, a group of individuals, or a Homeowners Association, the Adler Law Group has provided exceptional professional assistance.