August 16, 2017

Professional Services Exclusion Bars Coverage Where Ordinary Negligence is Inseparably Intertwined With Professional Service

Source:, August 14,2 017

In Energy Ins. Mutual Ltd. v. Ace American Ins. Co. (No. A140656, filed 7/11/17, ord. Pub. 8/10/17), a California appeals court found that a professional services exclusion barred coverage for wrongful death and other claims blamed on pipeline inspectors’ failure to identify and properly mark a gas pipeline that was ruptured during construction of another pipeline, resulting in an explosion and fire.

In Energy Ins. Mutual, a pipeline owner hired two temporary construction inspectors through a staffing company. The inspectors had to ensure compliance with engineering and safety standards, practices and procedures for pipeline construction, and understand construction drawings and blueprints. They worked together with one of the owner’s employees to perform daily surveillance to ensure the integrity of the pipeline and avoid third party damage.

An excavator operated by a subcontractor punctured a high-pressure petroleum line releasing gasoline into the pipe trench that was ignited by another contractor’s welding. The resulting explosion and fire killed five employees, seriously injured four others and caused extensive property damage. A Cal/OSHA investigation concluded that failure to properly mark the petroleum pipeline was the primary cause. Wrongful death and other lawsuits followed.…

August 14, 2017

Avoiding Unintended Liability for Design

Source:, August 8, 2017
By: Daniel McLennon, Smith Currie & Hancock

A recent trend in design-build contracting, especially on large projects, is for the owner to incorporate a heightened standard of care for the design aspects of the building. Creeping into contracts is language requiring the project to perform according to unspecified expectations, such as “fit for owner’s use” or “suitable for the use intended”. This heightened, ambiguous standard of care conflicts with the traditional designer’s standard of care—the ordinary care expected of reasonably competent designers—leaving a gap between the performance that may be required from the design team and the performance expected by the owner. This gap may result in uninsurable exposure to the design builder. This article explores that gap and how to prevent or handle it.

Traditional Design-Bid-Build Projects

In a traditional design-bid-build project, the owner hires the design team, and the contractor builds the design provided to it by the owner. The design team is typically liable to the owner for any failure to meet the standard of care resulting in design deficiencies. The owner would absorb any loss related to failure of the building to perform according to the owner’s expectations that did not result from a breach of the standard of care. Anecdotally, studies have shown that these losses have ranged between 3-4% of a project’s hard costs.…

August 14, 2017

Non-toxic black mold found in Chico condos, 6 condos affected

Source:, August 9, 2017
By: Jerry Olenyn

Heavy rains expose design flaw in gutter system

Six condominiums in the Doe Mill subdivision at East 20th and Hutchinson Streets are being cleaned, repaired and redesigned because of a design flaw in the gutters, after non-toxic black mold was discovered inside.

Tom DiGiovanni, the president of New Urban Builders, acknowledged that his company is responsible and is paying for the temporary living costs of the three homeowners and three landlords.

The flaw was in the metallic gutters, which weren’t large enough to handle the torrential downpour of rain and wind that came crashing into the condos during the severe winter storms, as the water seeped into the walls.

“Especially when it was driving rain…that was wind-driven,” said DiGiovanni.

Chico code enforcement officer Leo DePaola said it appeared to him that this was a design issue that was exposed by the severe weather.

“Typically if you have a failure in one particular facet, it’s repeated multiple times,” said DePaola.

The three homeowners and three landlords will to have remain patient, as work may not be completed for at least three months.

DiGiovanni said his company recently received permission from their insurance company to complete the work, which includes re-stuccoing the outside of the buildings.…

August 10, 2017

The trains are too long. The platform is too short. Bad news for the new station

Source:, January 29, 2017
By: Alfonso Chardy

The train is late out of the station. That’s because the station and the train have a size problem.

Plans to open the new Amtrak station near Miami International Airport are behind schedule, Florida transportation officials say. Source of the problem: an engineering error in the construction of the train platform , according to the state Department of Transportation.

The station won’t be ready to open until the end of the year at the Miami Intermodal Center, said Ivette Ruiz-Paz, an FDOT spokeswoman in Miami.

“FDOT is in the process of finalizing an operations and maintenance agreement with Amtrak to provide their passenger service at the MIC Central Station,” Ruiz-Paz said in an email. “The department anticipates to open Amtrak service by the winter of 2017.”

Though FDOT had not previously given a date for the opening, officials hinted it would happen soon after transportation officials acknowledged in 2013 that a mistake had been made in the construction of the platform.

The error?

August 9, 2017

Town files civil suit against Burchfield building’s architects, engineers

Source:, August 7, 2017
By: Ali Ingersoll

The Town of West Seneca is moving forward, filing a civil lawsuit against the Burchfield designers — Louis Design Group and Nussbaumer & Clarke, inc. The town taking legal action after a consultant came in, looking at the Burchfield Nature and Art Center, determining a man made error and design flaw is the cause behind the site being structurally unsound.

“It is a design and engineering problem,” said Eugene Hart, one of the town council members.

Taxpayer dollars covered most of the construction costs for the center and that’s why the town is moving forward with the lawsuit seeking between $800,000 and $1.7 million in financial compensation.

The Burchfield building is only 16 years old; already, though, areas in the structure are giving way, deteriorating, and starting to bend and buckle.

“It shouldn’t be happpening to something that new,” said Ken Pearl, an architect the town is consulting with to analyze the state of the site.

Pearl points out issues in the design, showing the original blueprints where the engineers and architects expected the ground to be about 2 feet below where it actually is. Pearl says those who constructed the building probably faced some difficulties looking but feels they just brought things to code, never actually altering the design details.…

July 17, 2017

Settlement reached between Yeager, engineering firm in connection with hillside collapse

Source:, July 13, 2017
By: Carrie Hodousek

Charleston’s Yeager Airport has entered into a partial settlement with an engineering firm it sued following the 2015 hillside collapse at the end of the airport’s main runway.

Yeager’s Resolution Committee announced Thursday it has settled with Triad Engineering, Inc. for $900,000.

“It releases the officers and their company assets from any claims that we would have against them,” explained Airport Director Terry Sayre.

Yeager has been tied up in litigation against a number of defendants, including Triad, in connection with the construction of the airport’s EMASS system on the runway extension. The system collapsed on March 12, 2015.

“There’s never a perfect decision when you have lawsuits and things of that nature, so it’s the best deal for today,” Sayre said.

Several other lawsuits in connection with the collapse remain unsettled.

The airport has struggled to come up with enough money to pay for a temporary slope repair. Sayre said they’re in constant communication with the Federal Aviation Administration in hopes of receiving funds for a short term fix.

“Hopefully get a grant in hand for that, which would be a substantial grant — probably somewhere between $10-20 million to where we can start work,” he said.

The long term goal, Sayre said, is to extend the other end of the airport’s runway into Charleston’s Coonskin Park.

It took close to two years and cost nearly $5 million to remove the more than 550,000 cubic yard of debris off Keystone Drive, located at the base of the slope. The road reopened after debris was completely removed in February.

Sayre said they’re hoping work to rebuild the slope can begin this fall.

“All the mess is cleaned up,” he said. “It’s time to go to work.”…

July 5, 2017

District Court Rules “Professional Services” Exclusion means Professional Services

Source:, June 29, 2017
By: R. Bruce Wallace, Nexsen Pruet

Recently, the United States District Court for the District of South Carolina granted judgment in favor of an insurance carrier, finding the carrier did not owe a duty of defense or a duty to indemnify the insured in an underlying professional malpractice claim. In State Farm Fire and Casualty Company v. Morningside Consultants, Inc., State Farm initiated a declaratory judgment action against Morningside Consultants, Inc. (MCI). MCI was the defendant in eight separate tort suits alleging, in effect, that MCI had negligently inspected several construction projects, which were rife with construction defects. State Farm had issued two policies to MCI seriatim, which were the subject of the declaratory action. Each policy contained an exclusion for damage resulting from “the rendering or failure to render any professional services.” During the policies’ effective periods, MCI provided professional building inspection services.

MCI advanced two theories in support of coverage: (1) MCI holds no professional licenses, such that it could not render “professional” services within the meaning of policies; and (2) application of the exclusion would render the two policies meaningless.…

June 30, 2017

County, architectural firm reach settlement following errors at Talon, judicial center

Source:, June 29, 2017
By: Keith Gushard

Crawford County has reached a financial settlement with its architectural firm for errors involving additional site work costs at the former Talon Inc. property and the county having to buy a high density file storage system for the new judicial center.

County commissioners Wednesday unanimously approved an agreement totaling $75,000 in cash and credits with Weber Murphy Fox, its architectural firm for both issues. Tribune attempts to reach Dick Fox of Weber Murphy Fox for comment Wednesday were unsuccessful.

The two sides have been in negotiations for the past several months.

Under the agreement, the county gets $35,000 in cash from Weber Murphy Fox within 30 days to settle the site work issue at the former Talon Inc. The county also receives $15,000 in cash from Weber Murphy Fox within 30 days to settle the storage system issue plus receive a $25,000 credit toward future invoices sent by Weber Murphy Fox to Crawford County for architectural/engineering services done by the company.

Under the agreement, neither the county nor Weber Murphy Fox are admitting liability for the errors that took place.

“I think it was a fair adjustment,” Francis Weiderspahn Jr., chairman of the board of commissioners, said following the vote.…

June 8, 2017

The New York disaster that never happened: How one phone call from an architecture STUDENT saved the 915ft Citigroup skyscraper from crashing onto Manhattan during a hurricane

Source:, April 21, 2014
By: James Nye

  • New York City authorities and 2,500 Red Cross members prepared for the Citigroup Center to come crashing down on Manhattan in the summer of 1978
  • A catastrophic design flaw was uncovered when an architecture student phoned the building’s chief engineer
  • He discovered that the building could not withstand high winds
  • Hurricane Ella began to form off the East Coast in August 1978 – launching authorities into action
  • Disaster planners believed that 18 blocks of Midtown would be destroyed if the building came down
  • Contingency plans were made in secret and the story was not made public for nearly 20-years

With its distinctive 45-degree diagonal crown the Citigroup Center is one of Manhattan’s most prominent skyscrapers.

But nearly 40 years ago, as a hurricane threatened the Eastern Seaboard, New York’s Office of Emergency Management was hurriedly planning a mass evacuation of Midtown in case the tower collapsed – decimating 18 blocks of Midtown like dominoes all the way to Central Park.

Thankfully, that plan was never put into action, and the story of how just one phone call from an architecture undergraduate set off the chain of events that saved New York City from certain disaster went untold for almost 20-years.

When it was topped-out in 1977, the 59-story, $195 million skyscraper on Lexington Avenue was the seventh-tallest building in the world.

In fact, the most distinctive part of its construction are its four massive, 114-foot-tall stilts that are located in the center of the building, rather than its corners.…

May 18, 2017

Appeals court finds C.B. Engineering responsible in dispute over condemned Lake St. Louis home

Source:, May 17, 2017
By: Sam Knef

A dispute between a homebuilder and engineering firm over who was to blame for a newly constructed home being condemned shortly after the owners moved in has been decided by the Missouri Court of Appeals Eastern District.

In a decision handed down May 9, the appeals panel upheld a St. Charles County Circuit jury verdict holding C.B. Engineering Inc. of Union responsible for the condition of the Lake St. Louis home at 115 Place de Yeager because it failed to test the compaction rate of at least one layer of fill below grade upon which the home’s foundation was laid. The $615,000 home slid down the rear slope of the property, according to court documents.

The engineering firm faced cross-claims brought by Beris Construction LLC of Wentzville, which discovered in litigation brought by homeowners Carl and Jessica Eisenmann that, even though C.B. Engineering provided a certification letter to the city’s building department indicating testing was completed and ensuring the bearing capacity of the subgrade, it actually did not test or observe a layer of soil between 6 feet and 7 feet below grade.

According to the ruling, the certification letter stated that “the materials placed under observation met or exceeded the minimum compaction requirements and are suitable for support of the residential construction.”

Three months before the Eisenmanns were to close on the house, they had noticed cracking and leaking in the basement. As a result, the builder had a retaining wall installed, the ruling states.

The ruling also says that the engineer who was consulted for the retaining wall had not been aware of any problems related to slope failure when he was asked to design and install it, and he therefore did not perform any additional soil stability or global stability analysis of the area.…