Waivers of Subrogation: Are you Really Protected?

It’s common for a construction contract to contain a “waiver of subrogation” provision under “insurance requirements.” Unfortunately, these provisions are widely misunderstood. Although they’re designed to shield owners, contractors and subcontractors against lawsuits by insurers covering project-related claims, the protection offered may not be as extensive as you might think.

Understanding the Concept

Subrogation is a legal concept under which an insurance company that covers a loss gains the right to “step into the shoes” of the insured. The insurer becomes “subrogated to” the rights of the insured, allowing it to sue any third party or parties allegedly responsible for the loss.

Suppose, for example, that an owner hires a contractor to build an office building. During construction, an electrical subcontractor causes a fire that does $3 million in damage to the building. If the owner’s property insurance or builder’s risk policy pays for the loss, the insurance company becomes subrogated to the owner’s rights and may sue the subcontractor for the damage it caused to the building.

Waiving the Provision

The rationale behind waiver of subrogation is that the parties to a construction contract pay substantial premiums to buy insurance to protect themselves against certain risks. If an insurer pays a claim, the argument goes, it should bear the loss and not be permitted to pass it on to another party. Otherwise, insurance companies would rarely pay for anything. Another benefit of waiver of subrogation is that it avoids costly litigation that can result if an insurer goes after one or more parties to the contract.

For these reasons, most standard construction contracts, including the American Institute of Architects form documents, contain waiver of subrogation provisions. Typically, under these provisions, parties waive all rights against each other for damages caused by fire or other perils to the extent such damages are covered by builder’s risk or other property insurance.

Assessing your Protection

Just because your contract contains a waiver of subrogation clause doesn’t necessarily mean that you’re fully protected. The breadth of protection depends on the terms of the parties’ insurance policies and the applicable law in the relevant jurisdiction or jurisdictions.

First, for an insured party’s waiver of subrogation to be effective, its policy must permit the insured to waive the insurer’s subrogation rights.

Many standard property insurance policies authorize waiver of subrogation, but some require an endorsement.

Second, the treatment of subrogation waivers varies from court to court. Some courts, albeit a minority, make a distinction between work and nonwork damages. In other words, the waiver extends only to property that’s part of a contractor’s “work,” as defined in the contract. It doesn’t prohibit subrogated claims related to nonwork property.

So, in our previous example, the waiver of subrogation would apply only to the subcontractor’s electrical work; it wouldn’t prevent the insurance company from bringing a claim for damages to other parts of the building. (The “majority rule,” however, holds that a subrogation waiver bars claims by the insurer for both work and nonwork property.)

Getting the Full Picture

Before signing a construction contract that contains a waiver of subrogation, consult a subrogation lawyer like Stephen Barker today to get a full picture of its level of protection and potential impact on profitability. Call Stephen Barker Law today at 561-910-4340 +15619104340.

Construction Disputes: Construction Defect Litigation in Florida

If you have ever been involved with a construction project, you have an intimate understanding of how easily problems between groups of individuals can become complex, messy, and even potentially hazardous in financial terms. A Subrogation lawyer with experience in the construction industry like Stephen Barker will be your best defense in while pursuing construction defect litigation in Florida.

First, many different parties have many different interests in the construction industry. You have the workers themselves, the companies who oversee the workers, and the people who contract these companies to do the building. With so many parties having their own interests to look out for, it makes sense that disputes may eventually happen. These disagreements and disputes can be triggered by a number of things, including:

  • Changes to contracts that aren’t properly warned for
  • Changes to contracts that were disallowed or unwanted
  • Work claim disputes
  • Unfair or unsafe working conditions
  • Budget changes

Communication is key in any construction project. As soon as that begins to deteriorate, it’s not uncommon to see problems related to the above areas or more begin to pop up. Unfortunately, as tensions begin to rise, it becomes increasingly difficult to reach an agreement without some form of mediation.

Proving Construction Defects in Florida

With many miles of coastline and a large number of vacation homes built near its shores, Florida is the site of frequent construction disputes. That state’s Construction Defect Statute (Chapter 558 of the Florida Statutes) requires homeowners to follow a pre-suit procedure before suing a contractor for construction defects. This includes providing the contractor with notice and the opportunity to “cure” the defects. In some cases, the parties have agreed in writing that Chapter 588 doesn’t apply, but unless they opt out, they must comply with the statute before filing suit. Investigating construction defects may start with site inspections and destructive testing that takes place during the pre-suit procedure, while the contractors or other responsible parties are getting their insurers to pick up defense of the lawsuit.

To fix the harms caused by construction defects in your new building, you and your attorney will need to prove the defects, identifying which contractor is at fault for them. The culpable parties may include the general contractor, architect, subcontractors, and possibly suppliers. You may be able to assert negligence, breach of contract, and breach of express and implied and warranties against these parties. Depending on what your causes of action are, you will need to prove different facts.

Alleging Negligence in Florida

If you allege negligence in Florida, you will need to prove that the defendant had a duty of care, the defendant breached that duty, the breach caused an injury, and the injury resulted in actual damages. Negligence is the breach of a legal duty that is not contractual. Therefore, you would need to prove that a particular contractor or subcontractor breached a non-contractual legal duty, such as one prescribed by ordinance or statute. For example, a contractor has a duty to comply with a building code even if the code is not part of a contract. When a contractor renders services, he assumes a duty to exercise a reasonable degree of care in offering those services even if he has no contract with the owner of the house.

For example, a plumbing subcontractor owes a duty to install plumbing in compliance with a duty of care that is sometimes defined by the industry’s standards. Your attorney will retain a plumbing expert to offer opinions on the construction and design standard of care. Once the standard is established by the expert, the expert will also testify on the issue of whether the defect constitutes a failure to meet the standard of care.

A breach of contract claim can only be brought against a party with whom you have a contract. It may be appropriate, for example, against the developer from whom you bought a condominium.

If you need to handle a construction dispute, you may need a helping hand. You’ll need all of the information and backup possible in order to defend your own position and protect your own interests. To read more about how you can accomplish those things during a construction dispute case, call Stephen Barker Law at , +15619104340 or (561) 910-4340 and we can help prepare you for the court case ahead.

Property Damage Litigation Against Utilities – Negligence

Negligence by a utility company may cause extensive damage to your property. If so, the utility company may be held liable. Each state has laws regarding whether or not a utility company can be sued for damages, but most states require the utility to take responsibility and pay for damage caused.

In this article, we will help you understand what legal rights you have if your property is damaged by a utility company.

Types of Damage Caused by Utility Companies

The types of damage caused by utility companies are extensive. For example, a broken water main may cause erosion under your driveway that leads to its collapse. If a car is parked over the eroding spot, it can be heavily damaged.

If a tree-trimming crew isn’t careful, a large branch may fall on a vehicle or building and cause damage. All utility companies have a utility easement on private property. If you park a vehicle on the easement or build on it, then the utility will not be held liable in most cases.

A downed wire can cause a fire. If the wire damage was the result of a storm or other “act of god,” then the utility company will probably not be considered liable. However, if the downed wire was the result of poor maintenance or if it was allowed to remain on the ground too long, the utility might be found liable.

Your Rights When a Utility Company Causes Damage

Most utility companies quickly compensate their customers for damage caused by negligence or accidents. However, if you’re having trouble collecting, you’ve got two options.

The first option should be to contact the state agency that has oversight of public utilities. Contact the office and find out how to file a complaint. Follow through with your complaint and see how it is resolved. In most cases, the utility will agree to pay for damage it caused. Search your state’s .gov website for the agency responsible for public utilities.

If the problem is not resolved, you may have the right to take the utility to court. In most states that allow this, you will have to have a complaint with the state rejected before you can file suit.

Talking with a Litigation Attorney

If a utility company has damaged your property and you have not been compensated, even after going through the proper channels, you might want to speak with a litigation attorney. Find one with experience in utility company issues. Discuss your case with the a subrogation lawyer to determine whether or not a lawsuit is possible and if it is likely to be successful.

If you would like more information or have a utility company that you would like to pursue legal action on, please contact a subrogation lawyer like Stephen Barker Law today at (561) 910-4340 or +15619104340.

Homeowners Association Foreclosure in Florida

Florida is a judicial foreclosure state. Therefore, a party seeking to foreclose a home must go to court and receive approval from a judge. This includes not just banks, homeowner association foreclosure cases must also go through the court process as well. Unfortunately, many HOA’s are very aggressive and will seek foreclosure if a homeowner fails to pay the HOA dues. If you are being threatened with a homeowners association foreclosure contact a subrogation lawyer like Stephen Barker Law right away, there may be foreclosure defenses available to  prevent the foreclosure.

Defense of Insufficient Notice

Under Florida Statute 720.3085, before a homeowners association foreclosure case can be filed the HOA must provide the homeowner with proper notice. Florida law requires the HOA to send notice to the homeowner of their intent to record a lien. Their notice must be sent at least 45 days prior to recording the lien. The notice must include details of the amount owed and an opportunity to pay the amount prior to filing foreclosure. The notice must meet all the requirements outlined in the Statute. For information regarding a specific notice contact an HOA foreclosure defense attorney for legal advice.

Notice of Intent to File Homeowners Association Foreclosure

Additionally, Florida foreclosure law requires the HOA to send the homeowner notice of their intent to foreclose on the lien. This notice must be sent at least 45 days prior to filing for a homeowners association foreclosure. The notice of intent to foreclosure the lien should be sent after the HOA files their lien for fees. If the HOA does not send the homeowner both the notice of their intent to record a claim of lien and notice of intent to foreclosure on the lien they should not be entitled to foreclosure. Additionally, the HOA may be responsible for paying your legal fees if you win the case.

Both notices are required to be sent by registered or certified mail with a return receipt. See Florida Statute 720.3085(4)(b). The notices must be sent to the address of the property they are intending to foreclose. If the property owners do not live in the home the HOA must send the notices to both the homeowner’s mailing address and the property address.

Homeowners Association Foreclosure for Late Fees

It may not be just past due fees and assessments, a homeowners association foreclosure case can also seek interest and attorney’s fees. In most homeowners association foreclosure cases, the amount of attorney’s fees they charge will be far in excess of the amount of HOA dues owed. In some cases, the attorney’s fees are more than 3 times the amount of the past due HOA fees. On the other hand, if your foreclosure defense lawyer is successful in getting the homeowners association foreclosure case dismissed the HOA may be held responsible for reimbursing you for your attorney’s fees. See Florida Statute 57.105.

Homeowners Association Foreclosure Defense Law Firm

If you are being threatened with a homeowners association foreclosure contact Florida Law Advisers to speak with a subrogation lawyer. Stephen Barker has years of experience in these types of cases and will aggressively fight the HOA and stand firm for what is fair.

For more information about your rights in an HOA case or to schedule a consultation with a Stephen Barker Law, call
(561) 910-4340 or +15619104340.

Plumbing Damage to Property – Get Help With Subrogation Today!

Damages resulting from water are one of the most common homeowner claims and are often very costly.  High paid claim dollars can result if the leak is not detected early.  Because plumbing is often hidden (running behind walls, in attics and in many instances encased in cement below the floor) water can be running for some time before a loss is discovered.  Most homeowners and business owners do not conduct an inspection of piping, fittings, and hoses and rarely even give much thought to them all until they are ankle deep in water!  Subrogation may exist if faulty plumbing work is the culprit or defective materials can be established but in most instances, the failure and ultimate loss is simply age.

The use of plastic (CPVC) materials has become universal in the plumbing industry mostly due to its low cost.  In addition, plastic is lightweight, easy to work with and does not rust.  However, plastic plumbing parts are frequently made of poor plastic material, are improperly shipped, are poorly manufactured or the part design may be substandard for its intended use.  Imperfect product installation is also a contributing factor to water damage claims.  There have been many instances where pipes are laid in slab work by one worker who is followed by another gluing the line together who unfortunately misses a few joints.  The pipes are then covered by cement and usually maintain their connectivity for a few years, then eventually start moving apart which results in a very costly slab leak.

For a Subrogation Specialist to be successful in pursuing a subrogation claim against the proper party in water damage losses the investigation must include onsite exploration of the plumbing system to determine the failure as to whether there is a  design or manufacturers defect or possibly an installation or maintenance problem.  A plumbing system less than 10 years old should not fail. Hiring the proper expert to conduct an inspection may be somewhat costly but the dollar amount of the paid claim often justifies the expenditure on water damage claims.  That is where we at Stephen Barker Law come in and save you time, energy, and money with a highly experienced professional like Stephen Barker. Contact us today so we can work together and solve your subrogation case at (561) 910-4340 +15619104340.

Subrogation Law in Florida

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Sometimes this leaves people wondering how is this possible, and rightfully so! The insurance company is exercising its right to subrogation, which means the insurance company is substituting itself for the actual party involved in the auto accident and collecting the money for the damage done to that individual’s property (for which they have already paid pursuant to their insurance contract with that person).

What is Subrogation?

Subrogation is an equitable doctrine in Florida and throughout the country.  The purpose of subrogation is to provide relief against loss and damage to a creditor who has paid the debt of another and preventing people needlessly paying for other people’s mistakes.  What does that mean?  It means if someone else pays your bill and you are compensated by the wrongdoer for that bill, the person who paid that bill for you — usually an insurance company  — has to be paid back.

The most common example we see is health insurance.  When you get in a car accident, your health insurer often pays your bills.  The at-fault driver’s insurance company also pays your bills. Florida law typically requires you to compensate the insurance company for the money that they spent.  Luckily, we at Stephen Barker Law are often able to negotiate substantial reductions in that amount.

Let’s get into how this is fair.   The insurance companies are stealing money from accident victims who have more of a right to that money than the insurance companies.  Why does it matter that there was an accident involved?  That is what you are paying premiums for in the first place, right?  Unfortunately, Florida law does not see it that way.  The law sees it from a freedom of contract perspective.  These insurance companies all have contractual language obligating you to pay back the money they pay you if you collect that money from another source.

What Is the Solution to This Problem?

Our lawyers deal with this issue all of the time.  We have developed a lot of tactics to reduce and even eliminate health insurance liens.  What if your case is too small for a lawyer?  You should contact the insurance company’s lawyer and try to negotiate a settlement on your own without a lawyer.  The insurance company’s lawyer is sometimes authorized to accept pennies on the dollar to settle these cases in an effort to save the insurance company the time and effort of trying to collect a judgment it obtains.

If you want answers, please reach out to us at Stephen Barker Law and we can help you get your case in order today!