Joint Names Insurance And Risk Allocation In Construction Projects

Two recent cases highlight how provision for joint names insurance in construction projects can determine risk allocation.

The employer entered into a JCT With Contractor’s Design (1998 ed) contract with the main contractor. Part of the work under the contract involved retaining a building's facades. The main contractor contracted with the claimant (Hunt) as demolition sub-contractor who, in turn, contracted with the defendant (ASME) as a sub-subcontractor (to provide temporary supports to the facades during demolition). The facades were damaged in a fire caused by ASME's negligence.

Hunt settled a claim brought jointly by the employer and main contractor and then sought to recover the amount paid in settlement from ASME.