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May 2011 Construction Law Newsletter

May 2011, vol. 1, no. 1

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In This Issue…

Related Court Cases

Insurance
Harwell v. Fireman's Fund Insurance Company of Ohio

Jury found general contractor negligent in supervising construction site where Plaintiff was injured. General contractor's insurer refused to pay damages to Plaintiff, who was employee of subcontractor, claiming that general contractor had not complied with policy endorsement. Equitable principles estop insurer from asserting that endorsement against Plaintiff.  Thus, court erred in granting summary judgment for insurer and should have been granted to Plaintiff. Insurer had told general contractor, years prior to trial, that it was limiting its liability to $50,000, but never disclosed this to Plaintiff  in discovery. (PIERCE and SIMON, concurring.)

Construction Contracts
Pepper Construction Company v. Palmolive Tower Condominiums, LLC

(Court opinion corrected 7/11/16.) Dispute between general contractor and one of its subcontractors. In 2004, the two worked on an interior build-out of 96 condo units in a building on North Michigan Avenue in Chicago. In 2007, general contractor filed demand for arbitration against condo building owner. Because general contractor and its subcontractor were not true adversaries at arbitration and there are questions about extent of subcontractor's control over its claim, subcontractor is not precluded from pursuing its claims against general contractor in circuit court, and circuit court properly found that collateral estoppel did not apply.General contractor does not have an absolute right to payment from subcontracotr without proof of actual loss. Court erred in granting partial summary judgment to general contractor based on judicial estoppel.(CUNNINGHAM and HARRIS, concurring.)

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