Surfside Condo Families and Survivors Reach $1B Settlement with Insurers, Others

Insurance Journal

Families of the 98 victims of the 2021 condominium collapse near Miami Beach, along with injured survivors, could split hundreds of millions of dollars in payouts under a preliminary settlement agreement announced Wednesday.

The settlement will top $997 million, the plaintiffs’ lawyer said in Miami-Dade Circuit Court, according to reports in the Miami Herald and Sun Sentinel newspapers. How the money will be distributed among the families and injured victims, along with attorneys’ fees, has yet to be decided.

The judge in the case, who last year had charged the lawyers with reaching a speedy resolution, marveled at the results so far.

“The result achieved and the speed is beyond extraordinary,” Hanzman said, the Herald reported. “When this case first came in this court I told everyone this wouldn’t be business as usual. This was a tragedy of unspeakable proportions. If we didn’t have the right people handling this case, it would be a 10-year slog with tens of millions in attorneys’ fees.”

The judge must approve the settlement before it is finalized and he said he hopes to get it done before the one-year anniversary of the collapse on June 24.

Hanzman (AP photo)

The money will come from more than 10 sources, including insurers of the security company for the Champlain Towers South building in Surfside, on the northern edge of Miami Beach. The security firm was responsible for safety systems at the condo building and will pay the largest share, more than $450 million, according to news reports.

Other defendants include parties associated with the condominium association, engineers, architects, the town of Surfside, where the building was situated, and the developers and contractors at 87 Park, the condo next door to the collapsed tower.

Plaintiffs had argued that the construction of the adjacent condo in 2016 had contributed to the collapse by destabilizing the Champlain foundation and forcing runoff into the building’s underpinnings, according to news reports and lawsuit filings. The 87 Park owners and associated firms have not admitted fault in the case, and settled for an undisclosed amount. An engineering firm for 87 Park will pay about $8.5 million as part of the settlement.

Two other defendants have settled in recent weeks, including the powerhouse Florida condo law firm of Becker, which advised the Champlain Towers board. The firm’s professional liability insurer will pay an estimated $31 million in its part of a settlement.

The engineering firm hired to inspect the towers shortly before the collapse also has agreed to a $16 million settlement, paid by the engineering firm’s insurance company.

Repairs to the tower, which had been postponed by the Champlain condo association, were estimated to cost $15 million, and had just begun when part of the high-rise building crumbled, according to news reports. Investigations are continuing, but have raised questions about Champlain Towers’ construction techniques, modifications, water infiltration, unrepaired cracks in concrete and other deterioration since it was built more than 40 years ago.

The Champlain South condo association’s insurer also has paid out $50 million, according to reports.

Part of the proceeds from the sale of the property, where the remaining part of the condo has been demolished and removed, will eventually be added to the total settlement. That will increase the total for the settlement to more than $1 billion, the Herald reported.

Separately, Judge Hanzman in March approved a $83 million settlement for lawsuits brought by individual owners of units in the Champlain Towers condo building who lost property and belongings. The settlement money would come from the condo association’s property and liability insurers and from the sale of the property.

When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email

Lead Paint Coverage Claim Bites The Dust

Gina M. Foran, William Baron and Philip Matthews | Duane Morris

Duane Morris lawyers helped secure a victory at the California Court of Appeal when the court held Tuesday that ConAgra’s insurers have no duty to indemnify ConAgra against a public nuisance action in which ConAgra was ordered to contribute to an abatement fund due to its predecessor’s promotion of the use of lead paint in pre-1950 homes.  (See Certain Underwriters at Lloyd’s London, et al. v. ConAgra Grocery Products Companyet al., Case No. A160548, April 19, 2022, certified for publication (“ConAgra“).)

The underlying case (the “Santa Clara  Action”) began in 2000 when Santa Clara County, later joined by other California government agencies filed a class action complaint against certain lead paint manufacturers, including ConAgra, NL Industries, Inc., and Sherwin-Williams Company. The focus of the underlying case was narrowed, and that case ultimately went to trial on one cause of action for representative public nuisance.  In pursuing that causes of action, the underlying plaintiffs alleged that the presence of lead in paint and coatings in and around homes and buildings in California created a public health crisis created and/or assisted by the defendants.  In a pre-trial appeal in the Santa Clara  County action, the court held that the representative public nuisance cause of action required as an essential element that the paint manufacturers had acted intentionally with actual knowledge that their marketing of lead paint for interior residential use would cause harm.  (See County of Santa Clara v. Atlantic Richfield Co.  (2006) 137 Cal.App.4th 292, 299 (“Santa Clara I“).)  The underlying case went to trial under that standard, and the court found the manufacturers jointly and severally liable for representative public nuisance.

In 2017, the Court of Appeal in the Santa Clara  Action affirmed the finding that the paint manufacturer were liable, although the Court ruled that the amount of the judgment must be re-tried.  (People v. ConAgra Grocery Products Co.  (2017) 17 Cal.App.5th 51 (“Santa Clara II“).).  In upholding the finding of liability, Santa Clara II  held that when ConAgra’s corporate predecessor, W.P. Fuller & Co. (“Fuller”) marketed paint for use inside homes, Fuller had “actual knowledge of the hazards of lead paint—including childhood lead poisoning,” and specifically that “(1) ‘lower level lead exposure harmed children,’ (2) ‘lead paint used on the interiors of homes would deteriorate,’ and (3) ‘lead dust resulting from this deterioration would poison children and cause serious injury.'”  (Santa Clara II, supra,  17 Cal.App.4th at 85.)

The plaintiffs’ public nuisance cause of action in the Santa Clara  Action did not seek damages, but instead sought abatement, which allows a plaintiff to obtain relief before a hazard causes physical injury or damage to property.  The trial court in the Santa Clara  initially ordered the defendants to pay $1.15 billion into an abatement fund.  On remand after the 2017 appellate opinion, the Santa Clara  trial court recalculated the amount of the abatement fund to be $409 million.  The parties in that case eventually reached a settlement, which required ConAgra to pay $101,666,666 to resolve the plaintiffs’ claims.

While the underlying Santa Clara  action was pending, in January 2014 certain London Market insurers filed a declaratory relief action seeking a determination that they had no coverage obligations to ConAgra under policies issued to ConAgra and its predecessors, and bringing numerous other insurers into the case.  The coverage case was stayed while the underlying case went forward.  The insurers ultimately filed a motion seeking summary judgment on the grounds that: (1) Cal. Ins. Code Section 533 prohibits coverage for ConAgra’s intentional promotion of lead paint with actual knowledge of the health hazards that would result; (2) there was no “occurrence” under the policies because the harm was expected or intended from the standpoint of the insured; (3) the abatement remedy was not liability for “damages” or an “expense” under the policies; and (4) ConAgra’s liability was not “because of” or “on account of” “bodily injury,” “property damage” and/or “personal injury” under the policies.

The trial court granted summary judgment in favor of the insurers, ruling that Insurance Code Section 533 barred coverage as a matter of law where liability arises from deliberate conduct that the insured expected or intended to cause damage. The court reasoned that Fuller, ConAgra’s predecessor, intentionally promoted lead paint for use inside homes with actual knowledge that damage to children was at least highly probable.

ConAgra appealed the judgment to the California Court of Appeal. It advanced several arguments in its appeal, including contentions that: (1) Because it was ConAgra’s predecessor, Fuller, that committed the wrongful acts, Section 533 did not apply to bar coverage for ConAgra; (2) Section 533 is inapplicable because the loss for which ConAgra seeks indemnity was too attenuated from Fuller’s past promotion of lead paint for Section 533 to apply; and (3) the underlying findings did not establish as a matter of law that Fuller acted with the requisite knowledge under Section 533. The Court of Appeal rejected each of these arguments.

With respect to its first argument, ConAgra reasoned that its predecessor’s knowledge should not be imputed to ConAgra under Section 533, citing cases that allowed coverage where an insured was vicariously liable for willful conduct of another person. The court rejected this argument, holding that cases regarding vicarious liability do not apply in situations involving successor liability.  The Court reasoned that, in the event of a merger, as occurred when Fuller was merged into ConAgra through several corporate acquisitions over time, the successor is on notice that it is succeeding to the liabilities of its predecessor and is therefore responsible as the wrongdoer for purposes of Section 533.

In its second argument, ConAgra contended that even if the focus is on its predecessor’s conduct, Section 533 should not apply because the loss ConAgra was being held liable for was too attenuated from Fuller’s promotions.  ConAgra argued that Section 533 required both a direct causal relationship and a close temporal connection between the act and the loss. Because only a few of Fuller’s promotions were held to be actionable, and the harm resulted decades after the wrongful conducts, ConAgra argued that Section 533’s requirements were not satisfied. The court disagreed, noting examples of environmental contamination cases where Section 533 applied to bar coverage where the wrongful act causing damage occurred many years before the damage eventually resulted. The Court also quoted the lower court for its statement that the connection between the promotion and current presence of lead was not too attenuated, as those who were influenced by the promotions to use lead paint were the “single conduit” between defendants’ actions and the current hazard. The Court of Appeal stated that the underlying litigation conclusively established ConAgra’s liability for public nuisance, and that the proper inquiry under Section 533 is whether the loss for which an insured seeks indemnity was caused by a willful act of the insured.

ConAgra last argued that the underlying findings did not establish that Fuller acted with the requisite knowledge under Section 533. ConAgra argued that the “actual knowledge” found was not the same as the subjective “substantial certainty” required under Section 533, and that coverage could be precluded only if evidence showed that Fuller believed the widespread prevalence of deteriorated lead paint was substantially certain to result from its few actionable promotions. The Court rejected this argument, noting that the proper test was whether there was a willful act of the insured performed with the expectation that harm would result.  Because the courts in the Santa Clara  action had found that it conclusively established that Fuller had actual knowledge that harm would result from its promotion of lead paint, Fuller necessarily acted with knowledge that lead paint was “substantially certain” or “highly likely” to result in a hazard. This evidence satisfied Section 533’s willful act requirement.

As part of its last argument, ConAgra asserted that Section 533 could bar coverage only if it was proven that Fuller’s management had the requisite knowledge to preclude coverage. The Court of Appeal rejected that argument, citing prior case law holding that the knowledge of all employees is imputed to the corporation for purposes of applying Section 533.

Accordingly, the Court of Appeal affirmed the lower court rulings and upheld summary judgment in favor of the insurers.

See full opinion here.

When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email

Weed Property Owner Gets Smoked Under Insurance Policy

Garret Murai | California Construction Law Blog

When’s the last time you read your homeowner’s insurance policy? Didn’t think so.

But you might consider doing so, particularly in light of all of the discussions surrounding climate change – a nearly 2 degree Fahrenheit increase in summer temperatures over the past 20 years –  and studies finding that wildfires in California could increase by 20% or more by the 2040s, and that the total burned area could increase by 25% or more.

In the next case, Vulk v. State Farm (2021) 69 Cal.App.5th 243, one homeowner found out too late (after his house burned to the ground) that his homeowner’s insurance policy didn’t provide the coverage that he thought it did.

The Vulk Case

In September 2014, Gary Andrighetto’s house in Weed, California burned to the ground during the Boles fire in Siskiyou County. Andrighetto’s house had been insured by State Farm General Insurance Company. State Farm had insured the house, a three bedroom, two bath house, with two-car garage comprising approximately 1,500 square feet, since 1993.

At the time that Andrighetto renewed his homeowner’s insurance policy in 2013, the coverage limit on the dwelling $184,900, plus $18,490 for dwelling extension coverage. The dwelling-related coverage limits also included three optional coverages,: (1) Option ID, which provided an additional sum equal to 20% of the policy maximum for increased dwelling and dwelling extension costs; (2) Option OL, which provided an additional sum equal to 10% of the policy maximum for statutory building code compliance costs; and (3) an additional sum equal to 5% of the policy maximum for dwelling debris removal costs.

In addition to the annual renewal certificate, State Farm would send a California Residential Insurance disclosure form required under Insurance Code section 10102. The form defined various types of insurance coverage including: (1) “replacement cost coverage” which “only pays for replacement costs up to the limits specified in [the] policy”; (2) “extended replacement cost coverage” which “provides additional coverage above the dwelling limits up to a stated percentage or specific dollar amount” and (3) “guaranteed replacement cost coverage” which “covers the full cot to repair or replace the damaged or destroyed dwelling . . . regardless of the dwelling limits shown on the policy declarations page.”  The form sent to Andrighetto in 2012 advised that he had purchased extended replacement coverage.

Further, every five years, State Farm would send a letter to Andrighetto providing him “information about an important aspect of . . . homeowners coverage – estimating the cost to replace [his] home at today’s reconstruction prices.” The letter identified several ways to obtain such an estimate including using a recent replacement cost appraisal, a recent building contractor’s estimate, or working with his insurance agent using Xactware software.

Following the fire, State Farm paid Andrighetto the coverage limits for the dwelling-related damage ($285,725.37), the coverage limits for personal property loss ($143,949.00) and additional living expense reimbursements ($37,221.30) in the total amount of $466,896.27. Thereafter, Andrighetto hired a contractor to build a near duplicate copy of his old home at a cost of $236,173.26. However, a contractor hired by Andrighetto’s public adjuster estimated that the actual cost to replace his home would have been $365,450.26.

I’m scratching my head a bit here, but based on this information from the public adjuster, Andrighetto filed suit against State Farm claiming that his insurance policy did not provide full coverage since he was “forced to build a substantially cheaper replacement house.” His complaint asserted claims for breach of contract, breach of the implied covenant of good faith and fair dealing, negligence and unfair trade practices.

During his deposition, Andrighetto acknowledged that he never read his policy documents and was unaware of his coverage limits except the “base amount” of $188,00, but claimed that he told his State Farm insurance agent that he wanted the “best policy” for his home and that his insurance agent had told him that his policy provided “full coverage.” Andrighetto also testified that he trusted his insurance agent to procure “the right amount” of insurance, to “give [him] the right policy for [his] house” and that his insurance agent would automatically increase his coverage limits as necessary to ensure the sufficiency of his coverage.

State Farm later filed a motion for summary judgment. As to Andrighetto’s breach of contract and breach  of implied covenant of good faith and fair dealing claims, State Farm argued that these claims failed as a matter of law because State Farm paid Andrighetto all benefits due under his policy and did not act unreasonably with respect to the handling of his claim. As to Andrighetto’s negligence claim, State Farm argued that it did not breach any duty of care owed to Andrighetto and that he did not suffer any damages from any alleged breach. Finally, as to Andrighetto’s unfair competition claim, State Farm argued that Andrighetto had not demonstrated the existence of any unlawful, unfair, or fraudulent conduct by State Farm.

The trial court granted State Farm’s motion for summary judgment. Andrighetto appealed.

The Appeal

On appeal, the 3rd District Court of Appeal explained that on appeal from the grant of a motion for summary judgment the Court of Appeals reviews the trial court’s decision “de novo,” that it “liberally construe[s] the evidence in support of the party opposing summary judgment and resolve[s] doubts concerning the evidence of that party,” but that the losing party has “the burden of affirmatively establishing reversible error.”

As to Andrighetto’s negligence claim, the Court of Appeals set forth the elements most attorneys are aware of: (1) a legal duty on the part of the defendant, in this case, State Farm; (2) a breach of that duty by the defendant; (3) proximate harm caused by a breach of that duty toward the plaintiff, in this case, Andrighetto; and (4) damages suffered by the plaintiff.

As to insurance agents, the Court of Appeal explained that “[a]s a general proposition, an insurance agent does not have a duty to volunteer to an insured that the latter should procure additional or different insurance coverage” unless: (1) the agent misrepresents the nature, extent or scope of the coverage being offered or provided; (2) there is a request or inquiry by the insured for particular type or extent of coverage; or (3) the agent assumes an additional duty by either express agreement or by holding themselves out as having expertise in a given field insurance sought by the insured.

Here, however, explained the Court of Appeal:

Andrighetto did not direct the trial court to any evidence showing that he specifically requested Winkelman procure full replacement cost coverage for his home prior to the Boles Fire. Nor did he cite any evidence showing that he ever asked her whether his insurance coverage was adequate to replace his home in the event of a total loss. Indeed, Andrighetto stated in his deposition that he never made a specific inquiry as to the type or extent of coverage provided by his homeowners policy. He explained that, prior to the Boles Fire, he never read his policy, never had any concerns or questions about it, never contacted or met with his insurance agent to discuss coverage limits, and never requested a specific type of coverage or that his coverage limits be changed Further, he did not claim that he ever asked Winkelman or arranged for a current estimate of the cost to rebuild his home under current construction prices (even though this was also one of the recommendations in the biannual disclosure form designed to protect against insureds being underinsured).

As to Andrighetto’s unfair competition claim, the Court of Appeal explained that “unfair competition” includes “any unlawful, unfair or fraudulent business act or practice.” However, explained the Court of Appeal, the California Insurance Commissioner adopted regulations, the Unfair Insurance Practices Act (UIPA) (Ins. Code § 790. et seq.), to determine “whether insurance companies are or have been engaged ‘in any . . . deceptive act or practices prohibited by Section 790.03,” and “[o]ur Supreme Court has held that ‘[p]rivate UIPA actions are absolutely barred; a litigant may not rely on the prescriptions of section 790.03 as the basis for a UCL [unfair competition law] claim.”

Finally, as to Andrighetto’s breach of contract and breach of implied covenant of fair dealing claim, the Court of Appeal explained:

Andrighetto has not pointed to any express term of his homeowners policy that State Farm breached. Instead, as he did in the trial court, he insists that he has a viable implied contract claim based on the same facts supporting his negligence claim. He argues that State Farm and its agent, “having undertaken to provide a `full coverage’ homeowner policy, … owed [him] a contractual duty to perform reasonably and adequately.” He adds that “when [he] requested the `best policy’ and State Farm’s agent told [him] his replacement cost policy provided `full coverage,’ that created a duty to provide coverage that was within a reasonable margin of error of the actual replacement cost of [his] house. That duty can be enforced by a lawsuit either in contract or in tort.” As for his claim for breach of the implied covenant of good faith and fair dealing, Andrighetto argues, as he did below, that State Farm failed to advise him that its agents do not provide a reasonably accurate estimate of the cost to replace his home.

However, explained the Court of Appeal:

The operative complaint alleges breach of an express contract, not an implied contract. Therefore, Andrighetto cannot obtain reversal of the trial court’s summary judgment ruling on such a theory. Moreover, Andrighetto has failed to show the existence of a valid implied contract for full replacement cost coverage or that the trial court otherwise erred in granting summary judgment on his claims for breach of contract and breach of the implied covenant of good faith and fair dealing. Indeed, as we have noted, the parties stipulated that Andrighetto was paid all benefits due under the terms of the insurance policy, and that his insurance claim was handled in a manner consistent with State Farm’s obligations under the covenant of good faith and fair dealing.


Whether you’re a residential homeowner or a commercial property owner, and whether the insurance you are obtaining or maintaining is a property insurance policy, commercial general liability policy, professional liability policy or other type of policy, it can pay, literally, to become familiar with what those policies cover and don’t cover because when necessity requires that you become familiar with them, it can be too late.

When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email

Accepting Coverage for Part of a Claim May Subject an Insurer to the Appraisal Process Under Tennessee Law

Elliot Kerzner and Alycen A. Moss | Property Insurance Law Observer

Accepting coverage for part of a claim may subject an insurer to a policy’s appraisal process when the extent of covered damage is in dispute, according to a recent ruling issued by the Eastern District of Tennessee. In Morrow v. State Farm Fire & Cas. Co., Case No. 1:21-CV-00133-DCLC-CHS, 2022 WL 885863 (E.D. Tenn. Mar. 22, 2022), a severe storm with strong winds and tornadic activity damaged the insured’s home in Manchester, Tennessee. After the storm, the insured promptly reported the damage to her home to her insurer. The insured’s policy covered direct physical loss to her home, other structures on her property, and her personal property. The insurer acknowledged that the damage to the insured’s home was covered under the policy and made a payment, following its own estimate of the damage, for her loss. The insured, however, alleged that the insurer failed to determine the actual cost of the damage to her home. She informed the insurer that its payment was insufficient to cover all of the damage and restore her home to its condition before the storm.

As a result of this dispute, the insured invoked the policy’s appraisal clause, which provided for mandatory appraisal if the insured and the insurer failed to agree “on the amount of loss” and one of the parties demanded that “the amount of the loss be set by appraisal.” The insured selected an appraiser, but the insurer denied her demand for appraisal. The insurer told the insured that her estimate of the damage to her home represented a dispute in coverage rather than a dispute in the amount of loss, which could not be settled under the appraisal clause in the policy. The insured then filed suit against the insurer, asserting claims for breach of contract and bad faith.

After filing her lawsuit, the insured moved to compel the insurer to engage in the appraisal process contemplated by the policy. In response, the insurer contended that there was a coverage dispute between it and the insured, not a disagreement about the amount of loss. The insurer admitted that it acknowledged coverage over the insured’s claim and paid her for its estimate of the damage to her home. However, the insurer explained that its own contractor concluded that there was no other storm damage to her home beyond what it initially acknowledged. Moreover, the insurer maintained that the policy did not provide coverage for the damages identified by the insured’s contractor. The insurer contended that its initial estimate and payment were the only amounts due to the insured under the policy.

The court held that the appraisal provision was valid in Tennessee and applied to the claim at issue. The court noted that the parties did not dispute that the insured’s damage was covered as a general matter; they instead argued over the extent and the amount of the loss: the insured contended that there was additional loss unaccounted for in the insurer’s estimate, while the insurer contended that its initial payment represented the full value of the damage caused by the storm. Because the insurer had conceded that at least some storm damage was covered, the court held that the dispute was about the total amount of loss, rather than coverage. To decide otherwise, the court reasoned, would allow insurers to avoid appraisal by claiming there is a coverage issue, even when the dispute concerned additional amounts of loss. Consequently, the court determined that the dispute fell within the policy’s appraisal clause. Accordingly, the court granted the insured’s motion to compel appraisal and ordered the parties to engage in the appraisal process.

Therefore, under Tennessee law, when an insurer acknowledges coverage and makes a payment on a portion of the claim, it may be compelled to participate in the appraisal process if it takes the position that no further damages are covered. An insurer who has accepted a portion of a claim will only be able to avoid the appraisal process if it is clear that its dispute with the insured revolves around a coverage issue, and not merely the extent of covered damages.

When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email

Florida Appellate Court Finds Water Damage Sub-limit Ambiguous And Includes Tear-Out Costs

Brennah S. Toomey | Phelps Dunbar

A Florida appellate court affirmed summary judgment entered in favor of insureds after determining that the policy wording applicable to the loss was ambiguous. Security First Ins. Co. v. Vazquez,  No. 5D20-2528, 2022 Fla. App. LEXIS 1205, 47 Fla. L. Weekly D487b (Fla. 5th DCA, Feb. 18, 2022).

The insureds reported water damage to their insurer following the failure of a cast iron plumbing system. The insurer accepted coverage for the claim and issued payment pursuant to the policy’s limited water damage endorsement sub-limit. The insureds, however, filed suit alleging that they were owed the costs to tear out the concrete in order to access and repair the damaged plumbing. The parties filed cross-motions for summary judgment on whether the limited water damage endorsement sub-limit included the access costs. The trial court entered judgment in favor of the insureds.

On appeal, the insureds argued that the endorsement was ambiguous as to coverage for the tear-out costs and the sub-limit did not apply to those costs. The insurer countered that the tear-out costs were necessarily a part of the water damage claim and were, therefore, included within the endorsement’s sub-limit. The court concluded that the policy should have expressly stated that the tear-out costs were subject to the water damage endorsement sub-limit and that because the endorsement could reasonably be interpreted in each party’s favor, affirmed summary judgment in favor of the insureds.

When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email