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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

Subrogation
Empress Casino Joliet Corporation v. W.E. O'Neil Construction Co.

(Court opinion corrected 12/6/16.) Fire occurred during extensive renovation project at casino, resulting in extensive damage to casino. Casino received $81.15 million in insurance payments from 3 separate insurers under 3 separate insurance policies. Waiver of subrogation provision is not limited to negligence actions, but can apply with equal force to contract claims. As parties agreed that loss and damage from fire would be borne solely by casino's property insurance, casino thus waived all claims against contractors arising from such loss. Plaintiffs failed to present facts showing that "time is of the essence" provision was material to contract such that Defendants' failure to complete project within contemplated time frame would negate waiver of subrogation provision. Contract provisions requiring contractor to obtain liability insurance and to indemnify casino for claims arising out of performance of work did not conflict with waiver of subrogation clause, so as to render those provisions an exception to the waiver. (LAVIN and COBBS, concurring.)

Construction Contracts
Beal Bank Nevada v. NorthShore Center THC, LLC

(Court opinion corrected 10/25/16.) Parties' subcontract requires Contractor to pay Subcontractor, and does not impose any condition precedent on such a fundamental obligation. Thus, Contractor is liable for amounts due to a subcontractor even if property owner fails to make payment to Contractor for Subcontractor's work.(GORDON and LAMPKIN, concurring.)

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