Faulty Groundwater Management Plan

Acknowledgement to XL Environmental

A construction manager (CM) retained an XL insured environmental consultant to perform hydro-geological services for the construction of two high rise residential towers. The insured prepared a groundwater management plan which included the design of a dewatering system and monitoring of the dewatering activities during excavation. After construction completion, a sinkhole and additional depressions appeared. The project owner sued the insured and other parties involved with the project, claiming damages over $6,000,000. The project owner alleged that the insured had prepared a faulty groundwater management plan and failed to properly oversee dewatering activities.

XL’s environmental claims counsel retained local defense counsel to defend the insureds and assess the allegations against them. The claims counsel and the insured maintained good communication throughout a lengthy claims process.

All parties attended mediation, which yielded an overall favorable settlement contribution from the insured of $900,000. XL paid the settlement funds and defense costs on the insured’s behalf under the insured’s Professional and Pollution Legal Liability Policy.

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