By A. Vince Colella
A surveillance camera pans across two luxury pools surrounded by plush cabanas in the warm Miami Beach still of the night. In the background, a 12-story residential condominium building can be seen in infrared as if it were broad daylight. A man walking his dog and another sleeping nearby hear a loud "bang" that they immediately attribute to a lightning strike. However, the lone surveillance camera captures the pristine condominium building begin to disintegrate before its lens. Massive amounts of concrete simultaneously begin to collapse inward, pulling the building walls, floors, ceilings, and balconies to the ground in a uniquely organized demolition-like fashion. Twelve stories of the Champlain Towers ("Towers"), concrete and steel crash to the ground creating a plume of smoke that billows outward toward the city street. In the wake of the dust, mounds of rubble, rock, and smoldering flames, 18 unsuspecting individuals are found dead with 147 others unaccounted for. A surreal scene that feels reminiscent of a natural disaster. But was it? Planes don't fall from the sky. Likewise, high rise buildings don't crumble to the ground. Or do they?
What caused the collapse? As of now, we are left with the speculation of expert structural engineers. While there may be no singular cause, the prevailing thought is that the Towers experienced a "punching shear failure." Slabs of concrete that make up the floors detach from the vertical columns at or near ground level, resulting in extreme gravitational forces that pull the concrete flooring slabs downward, collapsing the adjacent walls. Municipal structural engineering inspections revealed that the Towers had been sinking 1 millimeter per year in the 1990s and a 2018 report revealed "major structural damage" from the rusting of reinforced steel a/k/a "decay." From a legal standpoint, the condition of the building, maintenance, and inspection records together with the design, materials and workmanship all raise significant questions as to whom should be held accountable for the loss, and whether insurance coverage exists.
The parties who most likely will share in the allocation of accountability are the building owners (or in this case the condominium association) and municipal building inspectors. In the context of Michigan law, a building owner may be held liable under traditional common law principles of premises liability, i.e., duty, breach, proximate cause, and damages. However, unlike what appears to be the case with the Towers, building owners are commonly unaware of suspected structural defects thereby placing an onerous task of establishing notice on the injured parties.
It is well established under Michigan law that a municipal building inspector owes a common law duty to reasonably inspect for plan and building code violations. Imposing a duty requires the balancing of the relationship of the parties, the nature of the risk, and the public interest. However, as a governmental employee, a municipal inspector acting within the scope of his authority in the discharge of a governmental function, he/she is entitled to immunity under MCL 691.1407(2). Accordingly, to establish liability against the inspector, a plaintiff must demonstrate "gross negligence." Tangentially, the gross negligence must be "the" proximate cause of the injury caused by the collapse. However, it should be noted that Michigan has recognized that there is no duty of a municipal inspector to protect the third-party invitees of a homeowner from a grossly negligent "approval" of a structurally defective building. Should Florida law follow similar principles of jurisprudence, it may prove fatal to claims against the City of Miami.
Equally complicated are the issues of insurance coverage for such a loss. The seminal case under Michigan law is Joy Tabernacle-The New Testament Church v State Farm, 616 Fed. Appx. 802 (6th Cir. 2015). The Joy case arose out of the collapse of a ceiling in a Flint church built in 1927. The specific policy exclusions included corrosion, decay, deterioration, and hidden or latent defects. The policy further contained general policy exclusions for faulty design, repair, and workmanship. However, the policy carried a coverage extension for "collapse," seemingly in direct conflict with the exclusions expressed in the policy. The court reconciled the conundrum between the policy extension and the exclusions by adopting a broad dictionary definition of the term "decay" to include a "general decline or degeneration over time." The court also rejected the insurance carrier's "defective design" argument by reiterating that where conflicts in specific contract provisions exist, the conflicts must be found in favor of the insured. Thus, the policy extension for losses caused by "collapse" were held to be covered under the policy. The takeaway from the Joy opinion is obvious. Absent a specific contract rider, amendment or extension specifically providing coverage for a loss caused by collapse, the general exclusions will void coverage. This is especially important where the losses go beyond physical property damage to include personal injury or death.
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A. Vince Colella is a co-founder of personal injury and civil rights law firm Moss & Colella.
