{"id":2647,"date":"2014-03-04T06:21:02","date_gmt":"2014-03-04T13:21:02","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=2647"},"modified":"2014-02-24T15:21:21","modified_gmt":"2014-02-24T22:21:21","slug":"waiver-subrogation-two-reminders","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/waiver-subrogation-two-reminders\/","title":{"rendered":"Waiver of Subrogation \u2013 Two Reminders"},"content":{"rendered":"

Stanley A. Martin – February 5, 2014<\/span><\/p>\n

Diesel fuel is spilled during renovation of a library, damaging both the work in progress and the surrounding building or land.\u00a0\u00a0Damages may exceed $500,000, but the owner\u2019s pollution coverage is apparently limited to $5,000.\u00a0\u00a0Is the owner barred from pursuing the contractor and others based on the waiver of subrogation language in the contract?\u00a0\u00a0The Indiana Court of Appeals focused on one issue in its analysis:<\/span>[1]<\/span><\/span><\/span><\/span><\/a>\u00a0that the waiver of subrogation applies only to claims paid relative to the \u201cWork\u201d, and not to other surrounding elements that were damaged.\u00a0\u00a0A second issue seems to an outsider to be equally if not more important: the waiver does not apply if the insurance policy has not covered the damage.\u00a0<\/span><\/span><\/p>\n

The focus of the recent decision is whether the contractor had preserved in prior filings its position that the damage was limited to the \u201cWork\u201d and thus within the waiver of subrogation.\u00a0\u00a0The Indiana court followed what it characterizes as the majority position, that AIA A201 \u00a7\u00a011.3.7 does not bar claims against the contractor for damage to \u201cnon-Work\u201d areas.\u00a0\u00a0Thus, any damage to \u201cnon-Work\u201d areas would be outside the waiver of subrogation, and not barred by that waiver, in any event.\u00a0\u00a0That is the first reminder \u2013 to be mindful of the scope of the waiver.\u00a0<\/span><\/span><\/p>\n

The Indiana court discusses the second point only when it cites a New York appellate decision<\/span>[2]<\/span><\/span><\/span><\/span><\/a>\u00a0supporting its position.\u00a0\u00a0In the NY case, the court held that the owner had\u00a0not\u00a0<\/strong><\/em>waived claims against the contractor if such claims were\u00a0not<\/em><\/strong>\u00a0covered by the owner\u2019s property insurance.\u00a0\u00a0That would appear to be the more important factor here.\u00a0\u00a0If the owner\u2019s insurance covers only a small portion of the damage, then a waiver\u00a0that applies\u00a0only \u201cto the extent covered by property insurance\u201d (per A201 \u00a7\u00a011.3.7) would not extend beyond what has been covered; subrogation has been waived by the library only as to the $5,000 in damages covered by insurance.\u00a0\u00a0The second reminder is that the waiver of subrogation does not come into play if the damage is not covered by insurance, when following the standard AIA waiver language.<\/span><\/span><\/p>\n


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[1]<\/span><\/span><\/span><\/span><\/a>\u00a0\u00a0Allen County Public Library v. Shambaugh & Son, L.P., et al<\/i>., No. 02A04-1302-PL-78 (Jan. 28, 2014), available\u00a0<\/span>here<\/span><\/a>.\u00a0\u00a0\u00a0<\/span><\/span><\/p>\n<\/div>\n

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[2]<\/span><\/span><\/span><\/span><\/a>\u00a0\u00a0Mu Chapter of Sigma Pi Fraternity v. Northeast Construction Services<\/i>, 273 A.D.2d 579, 582 n.2 (N.Y. A.D. 2000).\u00a0<\/span><\/span><\/p>\n<\/div>\n<\/div>\n

via Waiver of subrogation \u2013 two reminders – Lexology<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Stanley A. Martin – February 5, 2014 Diesel fuel is spilled during renovation of a library, damaging both the work in progress and the surrounding building or land.\u00a0\u00a0Damages may exceed $500,000, but the owner\u2019s pollution coverage is apparently limited to $5,000.\u00a0\u00a0Is the owner barred from pursuing the contractor and others based on the waiver of… Continue reading Waiver of Subrogation \u2013 Two Reminders<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[3],"tags":[3,233],"class_list":["post-2647","post","type-post","status-publish","format-standard","hentry","category-insurance-claims","tag-insurance-claims","tag-subrogation","entry"],"jetpack_publicize_connections":[],"yoast_head":"\nWaiver of Subrogation \u2013 Two Reminders - Advise & Consult, Inc.<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/waiver-subrogation-two-reminders\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Waiver of Subrogation \u2013 Two Reminders - Advise & Consult, Inc.\" \/>\n<meta property=\"og:description\" content=\"Stanley A. Martin – February 5, 2014 Diesel fuel is spilled during renovation of a library, damaging both the work in progress and the surrounding building or land.\u00a0\u00a0Damages may exceed $500,000, but the owner\u2019s pollution coverage is apparently limited to $5,000.\u00a0\u00a0Is the owner barred from pursuing the contractor and others based on the waiver of… Continue reading Waiver of Subrogation \u2013 Two Reminders\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.myconstructionexpert.com\/blog\/waiver-subrogation-two-reminders\/\" \/>\n<meta property=\"og:site_name\" content=\"Advise & Consult, Inc.\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Advise-Consult-Inc-126949043996790\/\" \/>\n<meta property=\"article:published_time\" content=\"2014-03-04T13:21:02+00:00\" \/>\n<meta name=\"author\" content=\"admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@adviseconsult\" \/>\n<meta name=\"twitter:site\" content=\"@adviseconsult\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/waiver-subrogation-two-reminders\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/waiver-subrogation-two-reminders\/\"},\"author\":{\"name\":\"admin\",\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/#\/schema\/person\/0a11abe008083d5fb19c2b0feefe7bd7\"},\"headline\":\"Waiver of Subrogation \u2013 Two Reminders\",\"datePublished\":\"2014-03-04T13:21:02+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/waiver-subrogation-two-reminders\/\"},\"wordCount\":405,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/#organization\"},\"keywords\":[\"Insurance Claims\",\"Subrogation\"],\"articleSection\":[\"Insurance Claims\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.myconstructionexpert.com\/blog\/waiver-subrogation-two-reminders\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.myconstructionexpert.com\/blog\/waiver-subrogation-two-reminders\/\",\"url\":\"https:\/\/www.myconstructionexpert.com\/blog\/waiver-subrogation-two-reminders\/\",\"name\":\"Waiver of Subrogation \u2013 Two Reminders - 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