The dispute in Security National Insurance Company v. Sunset Presbyterian Church, __ Or. App.__ arose out of construction claims involving a church, its general contractor, a subcontractor, and the subcontractor’s liability insurer. In an underlying lawsuit, the church brought claims against the general contractor (Andersen), who brought third-party claims against its subcontractors, including its masonry subcontractor (B&B). In settlement of the claims, Andersen assigned its rights against subcontractors to the church (Sunset).
In subsequent litigation between Sunset and B&B’s insurer (Security National), Security National sought a judgment declaring that it had had no duty to defend Andersen, thus defeating Sunset’s assigned claims. The Oregon Court of Appeals reversed the trial court, and held that Security National did have an obligation to defend. Continue Reading
An endorsement that has become common in general contractors’ insurance policies can function as a trap for both the policyholder and defense counsel. The “Contractors Special Conditions” endorsement requires that the policyholder must have written contracts with each subcontractor that it uses on a project, and that those agreements must meet certain requirements. If there is a loss involving those subcontractors, and if contract conditions were not met, the insurer may deny coverage. The problem, of course, is that if the policyholder does not read the policy before the loss, and didn’t get the right contracts in place, there may be no way to “cure” the problem. And defense counsel may be put in a bind as well when they are asked to report to the insurer.
We are honored to represent United Policyholders (a non-profit advocacy organization for policyholders) on an issue of great concern to many of our commercial clients, and in particular those in the construction industry: the scope of the so-called “absolute pollution exclusion.” Our amicus brief to the Ninth Circuit for UP on the issue was filed on November 2 and is available 
Many Northwest businesses are being impacted by the wildfires close to home, and also by the hurricanes that have or will hit Texas, Florida and other Gulf states. Can commercial insurance help to mitigate losses from these natural disasters? In many cases, yes.
Many businesses that previously resisted the urging of their insurance broker or (ahem) legal counsel to buy cyber-insurance are now re-thinking that strategy in the wake of the “WannaCry” ransom-ware attack that has been in the news. The damage in the U.S. was apparently minimized by quick-thinking security specialists in the UK, but the attack reportedly caused considerable disruption in Europe – although the total amount of the ransom payments has (so far) been small. The publicity, however, has all businesses asking good questions about where they stand. When you talk to your broker to buy cyber coverage, or review your current insurance, keep a few things in mind. 
On May 10, 2017, the Oregon Court of Appeals made several significant holdings in the appeal of an insurance policy garnishment proceeding. The court of appeals held that a liability insurer’s exclusion for multi-unit new residential construction was ambiguous and, when construed against the insurer, did not apply to defeat coverage for construction-defect claims in a mixed-use development. The result was especially gratifying because the insurer had refused to defend its subcontractor insured, against which a default judgment had been entered. The court of appeals also held that attorney fees awarded to an indemnitee for defending a construction-defect claim were covered by a liability insurance policy, either as damages or as costs taxed against the insured. Finally, the court of appeals held that a party is entitled to a jury trial on factual issues in an insurance policy garnishment proceeding and that an Oregon statute allowing a bench trial is unconstitutional. 
Note: In the following guest post, Rob Fleming of the Clark Nuber consulting firm provides some guidance on how to manage one of the many “uninsurable” risks: reputational harm. We appreciate Rob’s willingness to contribute a guest post to our blog! – Seth
On April 27, the Washington Supreme Court created a significant new wrinkle in how courts will approach liability insurance disputes involving policy exclusions. In 
Contractors, builders, real estate managers, and others should be aware of a March 9, 2017, decision by an Oregon federal judge who found that carbon monoxide is included in the plain meaning of “pollutant” as defined in a liability insurance policy. As a result, an insured contractor had no coverage for its faulty work.