Law Offices of John C. Lane
Call us at: 201-848-6000
Construction Litigation, Architects' and Engineers' Defense
Insurance Coverage for Construction Manager
The client, a construction manager, faced significant exposure for respiratory injury claims by workers employed by a subcontractor and allegedly exposed to carbon monoxide fumes from a gasoline generator operated in a closed basement area. The client’s insurers had disclaimed coverage in timely fashion. Mr. Lane persuaded the CNA, the insurer for the responsible subcontractor, to undertake the client’s defense and indemnity. CNA took over and controlled the defense for nearly two years, when it sought to disclaim by way of a declaratory judgment action, raising the pollution exclusion for the very first time. On motion for summary judgment, the Superior Court agreed that CNA had waited entirely too long to raise the exclusion. The court confirmed coverage and dismissed CNA’s action. Shortly afterward, CNA settled the underlying claims for more than $1.5 Million, an exposure which otherwise would have been faced by the client. CNA did not appeal.
CNA v. LMB, Superior Court of New Jersey, Middlesex County
Successful Defense of Engineering Firm Preparing Property Condition Assessment
A national real estate investment and property management firm purchased a 326,000 square-foot warehouse in northern New Jersey. Our client, a prominent engineering firm, prepared a property condition assessment prior to the purchase. One and a half years later, a portion of the roof of the warehouse collapsed as the result of a torrential storm. The purchaser spent over $15,000,000 to repair and rebuild the warehouse, and to remediate a problem with a natural cliff adjacent to the building. With the aid of our engineering expert, we established that the cause of the roof collapse, latent defects in the original construction, could not possibly have been ascertained during our client’s inspection of the building. The owner sued the original architects and engineers, and the general contractor and subcontractors, who constructed the building and who devised an allegedly inadequate protective scheme for the adjacent cliff. On the day of trial, the case settled for more than $10,000,000, with our client reluctantly contributing a very miniscule percentage of that figure to avoid trial.
AMB Property, LP v. North Arlington Associates, Superior Court of New Jersey, 2004
Sometimes a Good Settlement is the Best Strategy
Our structural engineering client was engaged to design the renovation of a warehouse to a retirement home. The owner required that the design include as much open space as possible, which necessitated removal of some existing concrete columns. Most could not be inspected until demolition proceeded, and structural problems were noted when the columns were removed. The problems, according to the owner, required that the project be redesigned after some significant demolition of the work already been performed, all at a claimed cost of $3.5 Million. The Architect which had retained our client had already paid its policy limit of $1,000,000 to the owner. We had an extremely cooperative and helpful client, and we were aided by a structural engineering expert who performed a powerful computer analysis. Armed as were, we negotiated a settlement for less than ten percent of the redesign and remediation costs being claimed.
Jewish Home at Rockleigh, Superior Court of New Jersey, 2002
Dismissal of Claim Against Inspection Engineers
Our client performed soils testing for an addition to a school. The client later determined that certain soils problems existed despite a careful inspection, and brought the problems to the school board’s attention before any construction began. Nevertheless, the school board asserted a claim against the engineers for purported negligence and breach of contract. When the claim reached the Superior Court, we moved to dismiss because the school board had failed to serve an affidavit of merit in the time required by New Jersey statute, attesting to the validity of the claim. The school board countered, arguing that the Affidavit of Merit Statute applied to personal injury claims, but not to claims of commercial damage. The Superior Court ruled that the Statute applies to professional claims regardless of the type of damages claimed, and dismissed the complaint. By virtue of the Statute, a dismissal for failure to provide an affidavit of merit is with prejudice.
Montville Board of Education, Superior Court of New Jersey, Morris County, 2002
Exoneration of Consultant in Chemical Plant Explosion
An explosion at a New Jersey chemical tank farm propelled a worker 200 feet into the air, and to his death. Our client, a consultant, had just taken on management duties with respect to a renovation project on which the worker had been engaged. He was in the process of identifying the project, and meeting with the contractors, when the terrible mishap occurred. Aggressive plaintiffs’ attorneys disclosed a history which they asserted showed prior deficiencies and carelessness of very serious and long-standing proportions, supporting punitive damage claims against the owners and contractors. After years of pre-trial discovery by the plaintiffs’ attorneys, and coverage litigation in three states, they achieved a multi-million settlement, with details largely undisclosed. We held our ground, because our client had done nothing wrong. Our client was voluntarily dismissed, with no contribution to the settlement, as part of the conclusion of the case.
Matuza v. Safety-Kleen Corp., Superior Court of New Jersey
Arbitration Victory for Civil Engineer in $5 Million Planned Unit Development Controversy
A major New York-New Jersey contractor/developer brought a $5,000,000 arbitration demand against our client, the site and environmental design engineer, with regard to a large planned-unit development in upstate New York. The developer claimed that the engineer had delayed in procuring environmental and other regulatory approvals, and had made numerous design errors, all causing the multi-million dollar project to be delayed beyond a peak selling period and into an economic downturn. The Developer, represented by Peckar & Abramson, was able to establish a loss of more than $5,000,000, but we were able to thwart his attempts to place blame for the loss on the Engineer. Through a 35-session arbitration lasting over 13 months, we were able to establish that the Developer’s financing had been cut off by his surety company because they viewed the project as ill-conceived, that the marketing plan was flawed, and that that the real cause of the financial collapse of the project was the severe real estate downturn of the late 1980s. A three-arbitrator panel ruled unanimously in favor of our client. Client was sued, because they were convinced that an error had been made.
Tennanah Lake Associates v. Erickson & Schmidt Engineers, American Arbitration Association
Exoneration of Testing Engineer at Mediation
Plaintiff, a construction worker, suffered very serious and debilitating injuries in a fall from structural steel which collapsed when a temporary steel weld gave way. Our client, one of several defendants, had been engaged to perform inspections of concrete, reinforcing steel, soils compaction, and, commencing on a date after the accident, structural steel, including welds. Through pre-trial discovery, we were able to demonstrate that the custom and practice was for the inspections to be made when requested by the owner’s representative, that no such request had been made for inspection of the temporary weld in question, and that the owner’s representative did not even know the weld had been performed and thus could not have made a request for an inspection. Moreover, we demonstrated that it is unusual for temporary welds to be inspected, because the inspectors necessarily get in the way of work-in-progress, and it is unsafe to do so. A mediation led to a settlement in excess of $1,000,000. Our client was dismissed from the lawsuit and made no contribution to the settlement.
McGregor v. Can-Do Construction, Inc., Superior Court of New Jersey, Essex County, 2000
