Cracks in the Plaster: Construction Defect Litigation
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“You put up these buildings. Even though no one has noticed anything wrong, no one has been injured, nothing has been damaged; by virtue of the fact that you put them up, there must be defects in them. Therefore we will sue.” Not a pretty scenario, but unfortunately construction defect in the building industry can take on this hopeless appearance for insurers. The trend of litigation, particularly in multi-family construction, is no longer just a Southern California phenomenon. “It’s like so many other litigation trends we run into, they tend to start out based on the classic horrendous story and branch out from there,” said David Golden, director of commercial lines for the National Association of Independent Insurers (NAII). “That’s how the whole thing has progressed, from starting out with situations that had real merit, to now situations that may not ever have merit to them.” According to the California Department of Finance, California needs 250,000 new housing starts per year in order to accommodate the population; yet only 139,000 units were built last year. Law firms specializing in construction defect have popped up across California and are now opening branch offices in Nevada and Arizona. More : insurancejournal.com |