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CONSTRUCTION CLAIMS BUILDING BETTER OUTCOMES WINTER 2024 ISSUE 4 • VOLUME 9 A LIGHT SHINES ON FRAUD SOLVING THE CONSTRUCTION WORKFORCE PUZZLE DEFEATING DESIGN PROFESSIONAL LIABILITY CLAIMS A New Alternative in Residential and Commercial Construction Is Construction 3D Revolution? Set for aOne Company For All Your Consulting Needs EXPANDED SERVICES Expert Disciplines A-W Architects Biomechanical Engineers Building Envelope Certified Industrial Hygienists (CIH) Civil Engineers Cost of Repair Consultants Delay Claims Consultants NEW Dram Shop & Public Safety NEW Electrical Engineers Environmental Consultants Fire and Explosion Investigators General Contractors Geotechnical Engineers Heavy Equipment Operations NEW Materials Science Engineers Mechanical Engineers Metallurgists NY Labor Law NEW Premises Liability Consultants Premises Security – Police Practices NEW Property Loss Consultants Safety Consultants NEW Safety – OSHA Structural Engineers Transportation/Traffic Engineers Trial Exhibit Animators UAV (Drone) Pilots Waterproofing Consultants CD & GL Forensic Consulting Property Loss Consulting Construction Consulting mcconsultants.com 800.729.0355 35WINTER 2024 | 3 THE BONES WINTER 2024 10 ON THE COVER IS CONSTRUCTION SET FOR A 3D REVOLUTION? A New Alternative in Residential and Commercial Construction 20 A LIGHT SHINES ON FRAUD The Impact of Tradesman’s RICO Actions on Labor Law Claims 28 SOLVING THE CONSTRUCTION WORKFORCE PUZZLE Practical Solutions as the Labor Crisis Continues 24 CAUSE AND EFFECT E.O. 14063, the Elimination of Chevron Deference, and the Impact on Federal Construction Projects 32 DEFEATING DESIGN PROFESSIONAL LIABILITY CLAIMS Leveraging Workers’ Compensation to Challenge Injury Cases 14 California Construction Professionals Could Face More Liability Exposure Following Appellate Ruling 16 Louisiana Defining the Limits 18 Georgia Who’s a Nuisance? 4 Inside Counsel Building the Future of the Construction Industry, and Construction Claims 6 Ask the Expert Risk Transfer in New York 8 Survey This Printing Houses FEATURES STATE-BY-STATE DEPARTMENTS4 | CONSTRUCTION CLAIMS TheCLM.org/Magazine INSIDE COUNSEL BUILDING THE FUTURE OF THE CONSTRUCTION INDUSTRY, AND CONSTRUCTION CLAIMS Our fourth and final issue of 2024 is a good time to look forward to next year and beyond. For construction, there are key topics now—many of them covered here in Construction Claims over the past few years—that will shape the future of the industry, such as new construction materials, new methods such as 3D printing, and the evolving construction workforce— where will the next generation of workers come from and what will the ideal skillset look like? You can read about some of those topics in this issue. Our cover feature, “Is Construction Set for a 3D Revolution?” (pg. 10) dives into 3D printing and offers a comprehensive look at how it is being used today, particularly in residential construction; the advantages of 3D printed houses and 3D printing techniques; and special considerations. Meanwhile, “Solving the Construction Workforce Puzzle” (pg. 28) examines the ongoing labor crisis in construction, discussing the impacts on the industry and on claims. It also proposes several solutions for creating new talent pipelines so the industry can bring in a new generation of professionals. Of course, the future of the construction industry will not only be shaped by the next generation of construction workers, but also by the next generation of claims and litigation professionals who will handle complex and evolving construction cases. Within the ranks of CLM, the future in that regard appears bright indeed. Since 2022, CLM has featured its “Phenoms Under 40” in our flagship publication, CLM Magazine. This year, six of our 10 winners are connected to the construction industry, either practicing in construction or specializing in it. These phenoms are: Alexandra Santo, Golden Bear Insurance Company; Chelsea Novelli, Callahan & Fusco LLP; Brittney Aquino, Kahana Feld LLP; Catherine Deter, Wood Smith Henning & Berman LLP; Caitlin McPhillips, Berkley Construction Solutions; and Brian Wilsher, Amerisure Mutual Insurance Company. McPhillips and Wilsher also both serve as Young Professional liaisons to the Construction Community Board. Head to theclm.org/magazine and, under “Topics,” click “Phenoms Under 40” to view our profiles of these extraordinary professionals. The successful future of construction claims depends on insurance companies and legal firms recruiting this kind of talent, so it is worth your time to read what these professionals have to say about their personal journeys and how the industry can more effectively recruit top talent. K PHIL GUSMAN Editor Phil.Gusman@theCLM.org WINTER 2024 ISSUE 4 • VOLUME 9 Construction Claims is published four times a year and covers all aspects of construction-related claims, including construction defect, site accidents/injuries, insurance coverage, subcontractor issues, and new technologies that address both national and regional/ statewide audiences. Copyright© 2024 by the Claims and Litigation Management (CLM) Alliance. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior written permission of the Claims and Litigation Management (CLM) Alliance. The views expressed in the articles are solely those of the authors and do not necessarily reflect the views or opinions of the Claims and Litigation Management (CLM) Alliance or the companies in which the authors are employed. ART DIRECTOR/ PUBLISHING OPERATIONS MANAGER Jason T. Williams ADVERTISING Jeremy Campbell jeremy.campbell@TheCLM.org 513-377-7228 EDITORIAL SUBMISSIONS & QUESTIONS Phil Gusman at phil.gusman@TheCLM.org REPRINTS For reprints and licensing please contact Jeremy Campbell at jeremy.campbell@TheCLM.org or 513-377-7228. PRESIDENT Susan Wisbey-Smith VP PARTNERSHIPS Jeremy Campbell SENIOR ACCOUNT EXECUTIVE Laurel Metz ACCOUNT EXECUTIVE Megan Josd DIRECTOR OF CONTENT Phil Gusman ASSOCIATE EDITOR Angela Sabarese ASSISTANT EDITOR Fran ClarkNumerous factors can lead to serious construction-site accidents, from inadequate worker training and safety procedures to faulty products and heavy equipment. Rimkus has decades of forensic experience investigating and evaluating injury accidents across the U.S. and in many foreign countries. Our construction experts and engineers conduct in-depth investigations to determine what happened and can help provide solutions for recovery. If you’re facing a complex forensic challenge of any kind, count on us to uncover the facts. YOU HAVE QUESTIONS. WE PROVIDE ANSWERS. +1 800 580 3228Consultants. Experts. Innovators.™rimkus.comrimkus.com WHAT HAPPENED? WITH SO MUCH AT STAKE, YOU NEED TO KNOW6 | CONSTRUCTION CLAIMS TheCLM.org/Magazine ASK THE EXPERT QUESTION: What should claims departments know about risk transfer in New York Labor Law/construction matters? A: Additional insured coverage and contrac- tual indemnity are two separate avenues of risk transfer available to insurers and their insureds. There are two requirements to trigger additional insured coverage specified in most additional insured endorsements: 1. It must be agreed upon in the written contract; 2. “Trigger- ing language” (wherein the policy will require that the alleged claim/incident “arose out of the work of” or was “caused in whole or in part by” the named insured’s work). Contractual indemnification is a risk transfer mechanism guided by the contract between two parties. In New York, a party can be indemnified for their own negligence absent a statutory provi- sion. New York General Obligations Law § 5-322.1 impacts construction contracts and renders “void and unenforceable” indemnity agreements where the prospective indemnitee is negligent to any degree. In practice, this requires a party to obtain a decision on summary judgment or at trial elimi- nating all New York Labor Law § 200 and com- mon law negligence claims to obtain contractual indemnity from a downstream party. Q: What are some top trends we are seeing in construction legal defense as it pertains to risk transfer? A: Since Burlington Insurance v. NYC Transit Authority, 29 N.Y.3d 313, 79 N.E.3d 477 (N.Y. 2017), we have seen insurers issuing more reservation of rights with regard to indemnity to prospective additional insureds rather than acceptances. While the New York Court of Ap- peals indicated that 04 13 additional insured endorsement language (“caused in whole or in part by”) is a narrower trigger than the “arising out of the work” language of prior additional insured endorsements, neither the Burlington court nor the progeny require a showing of negligence to trigger additional insured cover- age. The Burlington court found that the 04 13 endorsement requires a prospective additional insured to prove that the named insured was at least a “partial proximate cause” to trigger coverage. The ramifications of this trend are that insurers for named insureds are forced to incur legal fees for both counsel for named in- sureds and conflict counsel for the additional insureds who are offered a defense. In situa- tions where it is clear that a named insured was a proximate cause, insurers may be best suited accepting and controlling the defense of the claims against the additional insured(s). K RISK TRANSFER IN NEW YORK Tom Maroney Partner, Clyde & Co.2025 CONFERENCES & EVENTS LOCAL CHAPTER EVENTS HAPPEN YEAR-ROUND. LEARN MORE: theclm.org/events DATE CONFERENCE/EVENT LOCATION Sponsorship: sponsorship@theclm.org Speaking: programming@theclm.org DATES, LOCATIONS, TOPICS, AND EVENT NAMES SUBJECT TO CHANGE. FEBRUARY 11-12 Focus Conference ORLANDO • Work Comp • Casualty & Risk Management APRIL 8 CCO and CLM Advisory Board DALLAS Networking (invite only) APRIL 9 - 11 Annual Conference DALLAS JUNE 12-13 Focus Conference NASHVILLE • Cyber • Diversity, Equity & Inclusion • Property • Transportation • Claims & Litigation Management SEPTEMBER 3 CCO Summit (invite only) BALTIMORE SEPTEMBER 3-5 Claims College BALTIMORE SEPTEMBER 17-19 Construction Conference SAN DIEGO OCTOBER 14-15 Litigation Management Symposium CHICAGO OCTOBER 15-18 Litigation Management Institute CHICAGO DECEMBER 4 Women’s Summit CHICAGO DECEMBER 4-5 Focus Conference & Holiday Party CHICAGO • Alternative Dispute Resolution • Extra-Contractual • Insurance Coverage • Insurance Fraud • Claims & Litigation Management REV.11272024 LITIGATION MANAGEMENT WEEK8 | CONSTRUCTION CLAIMS TheCLM.org/Magazine SURVEY THIS PRINTING HOUSES The image on the left shows the process of 3D printing a residential home. This process is described in our cover feature on pg. 10 as, “3D construction ‘prints’ a structure’s walls from a computerized three-dimensional model by successively stacking thin layers of a single proprietary cement-based material, which is heated during a thermal extraction process, squeezed through a nozzle, and then solidified by a concrete dryer before the process repeats to render its digital design.” The image on the right shows the exterior wall of a 3D printed home on Long Island, New York. PHOTO CREDIT: GETTY IMAGES/FRED FROESE; GETTY IMAGES/FUTUREWALKNext >