Fireplaces, Heating Stoves, Flues and Chimneys - Insulating exterior walls around fireplace?

I am currently moving my fireplace about 2 inches or so and will be reconstructing the entire framing, etc. I have however run into an issue at least in my mind and need input to qualify my findings. Currently the fireplace is in the corner of a room. When I began removing the drywall, I was quite surprised in what I found. There was no insulation on the exterior wall directly behind and below the fireplace. So, there is an area that is approximately 12 ft long, x 5ft high that has no insulation whatsoever. I can also see outside along the bottom of the wall. The gap in some places is about a ¼ of an inch wide, but spans the entire length of the bottom of the wall. The gap is all the way on the bottom, so there is no chance of rain getting into the wall.

I am a bit perplexed at these findings. My home is under a year old and is a custom home, rather than your average tract. I guess I expected the quality to match the price. Anyway, I have been known to be a perfectionist and rather anal in some areas. My concerns are if I see these issues here, where else do I have problems? If these are in fact problems…

My question to you is, are these items typical of construction practices? I just cannot believe it is code to have an exterior wall without any form of insulation whatsoever. Not to mention the fact that I live in the Arizona desert and I am wasting electricity… If there is an issue with insulation being next to a fireplace, I would assume they would find another way around it such as enclosing the insulation within sheeting material.

I am also concerned about scorpions or spiders getting into the wall and nesting. My plans are to go to Home depot and get some canned insulation foam to disperse within the cracks in the wall behind the fireplace. Of course, now I wonder if this occurs around the entire house… Do you also deem this practice with the foam acceptable? The construction company could not possibly have allowed a little space to vent the air surrounding the fireplace could they? Seems ludicrous to me, however I am not in construction, nor thoroughly understand what may be necessary for installation of a fireplace. The reasonable person in me wants to believe if venting was necessary, they would still insulate the wall, and put a traditional venting system on it.

Any help would be great.

Thank you.

I think I would go down to city hall and go to CODE and see who passed this and what code is there for your home. Not a year old . Get the builder back on this for sure;) ED