LJN Newsletters

Recent rulings you need to know.

A complete list of everything contained in this issue.

Recent rulings of importance to you and your practice.

The latest cases.

Not long ago there was a movement afoot to turn co-ops into condominiums due to the supposed benefits they offered, including the lessened economic interdependence resulting from absence of any blanket mortgage or real estate tax lien. Although such transformations never gained traction, in recent years condominiums have become market darlings (accounting for nearly all new construction and conversions), most notably because of their perceived let-freedom-reign philosophy, particularly the ability of owners to buy, sell, and lease without board intervention. Yet such relative independence may soon be more illusory than real as condo boards seek to assume powers traditionally reserved for their co-op brethren, and unit owners find themselves lacking legal protections available to shareholders.

A roundup of recent cases.

Highlights of the latest insurance cases from around the country.

In the few short years since Fuller-Austin was decided, the use of "prepack" bankruptcies has become a favored approach to resolving asbestos liabilities, often with the threat of a "Fuller-Austin result" as a hammer over the insurers asked to pick up the tab. Here's the drill: A policyholder uses section 524(g) of the Bankruptcy Code to channel its present and future asbestos liabilities to a trust; under policyholder's reorganization plan, the trust is funded in significant part with insurance rights; the insurers cannot object to the plan because it is said not to affect their interests; yet plan confirmation triggers coverage for the entire liability in an amount (often a nine or 10 digit amount) to be determined at a later date. See Fuller-Austin Insulation Co., 2002 WL 31005090 (Cal. Sup. Ct. Aug. 6, 2002) (appeal pending). The pressure this Fuller-Austin play puts on insurers leads many to settle their coverage obligations ' often a rational response to a high-stakes game in which insurers have few sources of leverage.