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    California Builders Right To Repair Current Law Summary:

    Current Law Summary: SB800 (codified as Civil Code §§895, et seq) is the most far-reaching, complex law regulating construction defect litigation, right to repair, warranty obligations and maintenance requirements transference in the country. In essence, to afford protection against frivolous lawsuits, builders shall do all the following:A homeowner is obligated to follow all reasonable maintenance obligations and schedules communicated in writing to the homeowner by the builder and product manufacturers, as well as commonly accepted maintenance practices. A failure by a homeowner to follow these obligations, schedules, and practices may subject the homeowner to the affirmative defenses.A builder, under the principles of comparative fault pertaining to affirmative defenses, may be excused, in whole or in part, from any obligation, damage, loss, or liability if the builder can demonstrate any of the following affirmative defenses in response to a claimed violation:


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    Treasure Island Sues Beach Trail Designer over Concrete Defects

    September 10, 2014 —
    The city of Treasure Island, Florida “has filed a lawsuit against Graham Landscape Design of St. Petersburg and Coastal Technology Corp. of Vero Beach for failing to properly design the 1-mile trail along the city's beachfront, which has hundreds of cracks in its concrete surface,” reported the Tampa Bay Times. "The city has been unable to resolve the construction defects of the Central Beach Trail outside of the litigation process," City Attorney Maura Kiefer said to the Tampa Bay Times. Cracks allegedly began appearing on the $1.2 million dollar trail soon after the project was concluded (March 2013). Treasure Island “submitted a performance bond claim and notified insurance companies representing Graham Landscape of the problem.” Consultants hired by Phil Graham IV, the owner of the design company, determined that the cracking was caused by “a combination of problems in the design, construction and composition of materials.” Read the court decision
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    Land a Cause of Home Building Shortage?

    June 17, 2015 —
    Diana Olick of CNBC reported that builders are not keeping up with the housing demand due to a lack of supply of developed lots as well as the increasing price of available land. "You have to find the land, you've got to be able to buy it and you've got to persuade someone to let you develop it. The one you hear the most about is the last one," Paul Emrath, vice president of survey and housing policy research at the National Association of Home Builders (NAHB), told CNBC. Olick wrote that “[l]and prices have actually surpassed their peak values in many markets where builders are particularly active, especially in Texas.” Read the court decision
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    Wendel Rosen’s Construction Practice Group Receives First Tier Ranking by U.S. News and World Reports

    December 02, 2015 —
    Ok, it may not be an Oscar, or even an Emmy, but we’re humbled and honoured just the same. Wendel Rosen’s Construction Practice Group has received a first-tier ranking by the U.S. News and World Reports in its 2016 Best Law Firms rankings. This is the third year in a row that the firm’s Construction Practice Group has received this honor. Joining it on stage is the firm’s Real Estate, Bankruptcy, and Real Estate Litigation practices which also received first-tier rankings and the firm’s Land Use practice which received a second-tier ranking. Read the court decision
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    Reprinted courtesy of Garret Murai, Wendel Rosen Black & Dean LLP
    Mr. Murai may be contacted at gmurai@wendel.com

    Federal Court Predicts Coverage In Utah for Damage Caused By Faulty Workmanship

    April 03, 2013 —
    The federal district court predicted that the Utah Supreme Court would find that damage to property other than the insured's work product is unexpected and arises from an occurrence. Cincinnati Ins. Co. v. AMSCO Windows, 2013 U.S. Dist. LEXIS 15999 (D. Utah Feb. 5, 2013). The insured, AMSCO Windows, installed windows in new homes constructed in Nevada. A number of homeowners asserted claims against the contractors who built their homes, alleging numerous construction defects, including the windows, and that the defects caused property damage to their homes. The contractors, in turn, asserted claims against AMSCO. The insurer, Cincinnati Insurance Company, filed for a declaratory judgment that it had no duty to defend or indemnify AMSCO. Read the court decision
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    Reprinted courtesy of Tred Eyerly
    Tred Eyerly can be contacted at te@hawaiilawyer.com

    Limiting Plaintiffs’ Claims to a Cause of Action for Violation of SB-800

    November 18, 2011 —

    There has been a fair share of publicity about the SB-800 amendments to the Civil Code (Civil Code section 896, et seq.) that codified construction defect litigation in 2002. Most of the publicity is geared toward the pre-litigation standards allowing a builder the right to repair before litigation is commenced by a homeowner. Less focus and attention has been given to the fact that violation of the SB-800 performance standards is being used by plaintiff’s counsel as an additional tool in the plaintiff’s pleading tool box against builders. Closer scrutiny to SB-800 reveals that those provisions should in fact act as a limitation to the pleading tools available to plaintiffs and an additional tool for builders in the defense of cases governed by SB-800.

    The typical construction defect complaint contains the boiler plate versions of numerous causes of action. These causes of action include Strict Liability, Negligence, Negligence Per Se, Breach of Contract, Breach of Contract – Third-Party Beneficiary, Breach of Express Warranties, Breach of Implied Warranties, among others. The wide array of causes of action leave a defendant “pinned to the wall” because they require a complex defense on a multitude of contract and tort related causes of action. Furthermore, the statutes of limitations as to these claims widely differ depending upon if the particular defect is considered latent or patent. The truth of the matter remains, no matter what the circumstances, if a construction defect matter ultimately goes to trial, it is inevitable that plaintiffs will obtain a judgment on at least one of these causes of action.

    On its own, the Strict Liability cause of action can be a thorn in a defendant’s side. A builder is obviously placing a product into the stream of commerce and strict liability is a tough standard to defend against, particularly when it concerns intricate homes comprised of multiple components that originally sold for hundreds of thousands of dollars. A Negligence cause of action can also be difficult to defend because the duty of care for a builder is what a “reasonable” builder would have done under the circumstances. An interpretation of this duty of care can easily sway a jury that will almost always consist of sympathetic homeowners. A Negligence Per Se cause of action can also leave a defendant vulnerable to accusations that a builder violated the Uniform Building Code or a multitude of other obscure municipal construction-related code provisions during the construction of the home. Lastly, the Breach of Contract cause of action leaves a builder relying on dense and intricate purchase and sale agreements with dozens of addenda which leave the skeptical jurors turned off by what they view as one-side, boilerplate provisions. Ultimately, when a matter is about to go to trial, the complexity of these complaints can benefit a plaintiff and increase a plaintiff’s bargaining power against a defendant who is attempting to avoid a potentially large judgment.

    Enter the SB-800 statutes. The SB-800 statutes apply to all homes sold after January 1, 2003. Civil Code section 938 specifically states that “[t]his title applies only to new residential units where the purchase agreements with the buyer was signed by the seller on or after January 1, 2003.” (Civil Code §, 938.) As time progresses, more residential construction defect cases will exclusively fall under the purview of SB-800. Slowly but surely more SB-800 governed litigation is being filed, and its exclusive application is looming on the horizon.

    On its surface, this “right to repair” regime has left builders with a lot to be desired despite the fact that it is supposed to allow the builder the opportunity to cure any deficiencies in their product before litigation can be filed by potential plaintiffs. However, the application of the time line for repair has shown to be impractical for anything but the most minor problems involving only small numbers of residential units. Moreover, the fact that the fruits of the builder’s investigation into the claimed defects in the pre-litigation context can freely be used as evidence against it in litigation makes builders proceed with trepidation in responding with a repair. For these reasons, more SB-800 litigation can be expected to result due to the shortcomings of the pre-litigation procedures, and savvy defense counsel should anticipate the issues to be dealt with in presenting the defense of such cases at trial.

    This fact should not necessarily be met with fear or disdain. Within the SB-800 statutes, the legislature made it clear that they were creating a new cause of action for construction defect claims, but it further made it clear that this cause of action is a plaintiff’s exclusive remedy. The legislature giveth, but at the same time, the legislature taketh away. Throughout numerous provisions within the SB-800 statutes, the Civil Code states that claims for construction defects as to residential construction are exclusively governed by the Civil Code, and that the Civil Code governs any and all litigation arising under breaches of these provisions. Civil Code section 896 specifically states:

    In any action seeking recovery of damages arising out of, or related to deficiencies in, the residential construction … the claimant’s claims or causes of action shall be limited to violation of, the following standards, except as specifically set forth in this title. (Civil Code §, 896.)

    Civil Code section 896 then provides approximately fifty-plus standards by which a construction defect claim is assessed under that provision. Civil Code section 896 covers everything from plumbing to windows, and from foundations to decks, and in several instances expressly dictates statutes of limitations as to specific areas of construction that severely truncate the 10-year latent damage limitations period. As for any construction deficiencies that are not enumerated within Civil Code section 896, Civil Code section 897 explicitly defines the intent of the standards and provides a method to assess deficiencies that are not addressed in Civil Code section 896. Civil Code section 897 states:

    Intent of Standards

    The standards set forth in this chapter are intended to address every function or component of a structure. To the extent that a function or component of a structure is not addressed by these standards, it shall be actionable if it causes damage. (Civil Code §, 897.)

    Therefore, Civil Code section 897 acts as a catch-all by which defects that are not covered within Civil Code section 896 can be evaluated on a damage standard mirroring the Aas case (damages must be present and actual). The result of sections 896 and 897 being read in combination is a comprehensive, all-inclusive set of performance standards by which any defect raised by Plaintiffs can be evaluated and resolved under a single SB-800 based cause of action.

    Civil Code section 943 makes clear that a cause of action for violation of SB-800 performance standards is a plaintiff’s sole remedy for a residential construction defect action. Specifically, Civil Code section 943 states:

    Except as provided in this title, no other cause of action for a claim covered by this title or for damages recoverable under 944 is allowed. In addition to the rights under this title, this title does not apply to any action by a claimant to enforce a contract or express contractual provision, or any action for fraud, personal injury, or violation of a statute. (Civil Code §, 943.)

    Civil Code section 944 provides the method for computing damages within a construction defect action, as follows:

    If a claim for damages is made under this title, the homeowner is only entitled to damages for the reasonable value of repairing any violation of the standards set forth in this title, [and] the reasonable cost of repairing any damages caused by the repair efforts… . (Civil Code §, 944.)

    A cursory review of these statutes yields the conclusion that the legislature was attempting to create an exclusive cause of action that trumps all other causes of action where SB-800 applies. The remedy available to plaintiffs is limited to that allowed by the Civil Code. As noted above, “[n]o other cause of action for a claim covered by this title…is allowed.” (Civil Code §, 943.) Therefore, Civil Code sections 896, 897, 943, and 944 specifically prohibit the contract-based and tort-based causes of action typically pled by plaintiffs.

    Plaintiff’s counsel has seized upon the language of section 943 to advance the argument that SB-800 still allows a plaintiff to advance typical contract and tort based causes of action. On the surface, this argument may seem compelling, but a minimum of scrutiny of the express language of section 943 dispels this notion. Section 943 says that it provides rights “[i]n addition” to those under the SB-800 Civil Code provisions. Clearly, the language in section 943 is intended to expressly underscore the fact that a plaintiff is not precluded from seeking relief in addition to that allowed under SB-800 for damages not arising from a breach of the SB-800 standards or for damages in addition to those recoverable under Section 944. This language does not provide an unfettered license to bring a Strict Liability, Negligence or other cause of action against a builder where SB-800 applies.

    In fact, this language only keeps the door open for plaintiffs to pursue such causes of action not arising from a breach of the SB-800 standards should there be such supporting allegations. For example, if a plaintiff alleges that a builder breached an “express contractual provision” related to the timing of the completion of the home and close of escrow, and the contract specifies damages in this regard, a plaintiff may have a viable separate cause of action for Breach of Contract for recovery of those damages precisely because that is not an issue expressly dealt with in SB-800 in the performance standards under sections 896 and 897, or in the damage recovery terms under 944. As it stands, the vast majority of complaints are seeking redress for violation of the same primary right; that is, defects specifically outlined in Section 896 and 897 or which result in damages as stated in Section 944.

    So, how does a builder defend against a complaint that contains multiple causes of action regarding construction defects for a home sold after January 1, 2003? There are numerous ways to approach this. First and foremost, these superfluous and improper causes of action can be attacked by demurrer seeking dismissal of all causes of action other than the cause of action alleging violation of SB-800. If the the time period within which to file a demurrer has passed already, a motion for judgment on the pleadings can be utilized to attack the improper causes of action in the same way as a demurrer can be used for this purpose.

    The limitation to a demurrer or motion for judgment on the pleadings is that the judge is restricted to viewing only the four corners of the pleading when making a ruling. It is typical for plaintiffs’ counsel to cleverly (or one might even say, disingenuously) leave the complaint purposely vague to avoid a successful defense attack on the pleadings by not including the original date the residence was sold. In that instance, a motion for summary adjudication can be used to attack a plaintiff’s complaint. By simply providing evidence that the homes were originally sold after January 1, 2003, the improper causes of action should be subject to dismissal by summary adjudication. If the plaintiff is a subsequent purchaser, the builder still has recourse to enforce the pleading limitations under SB-800. Civil Code section 945 states that “[t]he provisions, standards, rights, and obligations set forth in this title are binding upon all original purchasers and their successors-in-interest.” (Civil Code §, 945.)

    Attacking a plaintiff’s complaint to eliminate multiple causes of action can have numerous benefits. The practical result is that a plaintiff will only have one viable cause of action. The advantage is that the SB-800 performance standards include the defined performance standards and shortened statutes of limitations periods with regard to specific issues. Furthermore, as to defects which are not specifically provided for in Civil Code section 896, Civil Code section 897 requires a proof of actual damages. Therefore, a plaintiff must provide evidence of current damages and not simply conditions that may potentially cause damage in the future.

    The Appellate Courts have yet to directly address and interpret these SB-800 provisions. The time for that is undoubtedly drawing near. For now, however, plaintiffs will have to find ways to accurately plead construction defect claims within the confines of one cause of action for breach of the performance standards enumerated within the Civil Code.

    Printed courtesy of Lorber, Greenfield & Polito, LLP. Mr. Patel can be contacted at spatel@lorberlaw.com and Mr. Verbick at tverbick@lorberlaw.com.

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    California Supreme Court Raises the Bar on Dangerous Conditions on Public Property Claims

    February 16, 2016 —
    Earlier we wrote about the affirmative defense of “design immunity” which can be used by public entities to shield themselves from personal injury claims dangerous conditions on public property. Under the design immunity doctrine a public entity can avoid liability for dangerous conditions on public property if it can show: 1.A causal relationship between the plan or design and the accident; 2.Discretionary approval of the plan or design prior to construction; and 3.Substantial evidence supporting the reasonableness of the plan or design. Read the court decision
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    Reprinted courtesy of Roger Hughes, Wendel Rosen Black & Dean LLP
    Mr. Hughes may be contacted at rhughes@wendel.com

    Updated: Happenings in and around the West Coast Casualty Seminar

    May 13, 2014 —
    For those who are attending the West Coast Casualty Construction Defect Seminar this week, the Construction Defect Journal has updated its list of concerts, sporting events, and museum exhibitions taking place in and around Anaheim. Whether you like to spend your personal time checking out a new band, or watching your favorite Angel slide into home, or perusing the local art museum, there is something to spark your interest. ***CONCERT VENUES*** THE HOUSE OF BLUES IN ANAHEIM Live Band Karaoke Wednesday, May 14th, 2014 Doors Open at 10pm / Show Begins at 11pm Every Wednesday experience the excitement of singing your favorite song with a live band. Over 200 songs to choose from our massive collection of classics and current hits. Get down here and let your vocals roar. No Cover! Rockin’ The Blues Thursday, May 15th, 2014 Doors Open at 10pm / Show Begins at 11pm Every Thursday night head down to The Voodoo Lounge and listen to the best local live blues band. This is the music that shaped American music and influences every genre we listen to today. No cover! Alice in Cooperland with Sons of Cream and Iron Plaid Friday, May 16th, 2014 Doors Open at 7pm / Show Begins at 8pm Friday Night Live Friday, May 16th, 2014 Doors Open at 10pm / Show Begins at 11pm Every Friday night features live music in The Voodoo Lounge. One stage, weekly mind blowing performances. No cover! Stephen "Ragga" Marley Saturday, May 17th, 2014 Doors Open at 8pm / Show Begins at 9pm Dance, Pop and Hip-Hop Saturday, May 17th, 2014 Doors Open at 10pm / Show Begins at 11pm Every Saturday night The Voodoo Lounge heats up with the sounds of DJ Matt Hill spinning across genres and getting the party started. No Cover! For More Information on Events at THE HOUSE OF BLUES OF ANAHEIM... THE GROVE OF ANAHEIM Lindsey Stirling plus special guest Dia Frampton Wednesday, May 14, 2014 Doors Open at 7pm / Show Begins at 8pm Primal Fear Thursday, May 15, 2014 Doors Open at 6:30pm / Show Begins at 7pm Jillian Michaels 'Maximize Your Life' Tour Friday, May 16, 2014 Doors Open at 6pm / Show begins at 8pm For More Information on Events at THE GROVE OF ANAHEIM... THE HONDA CENTER 2014 Powerhouse Saturday, May 17, 2014 – Parking lot Festival 3pm – Show Begins 7pm Power 106 presents Powerhouse with Performances by Nicki Minaj, TDE’s Schoolboy Q, Wiz Khalifa, Trey Songz, YG, Jennifer Lopez, Childish Gambino, Juicy J, Sage The Gemini, Isaiah Rashad, plus Special Surprise Guests and More! For More Information and to Purchase Tickets for THE HONDA CENTER... ***SPORTING EVENTS*** ANGEL’S STADIUM - BASEBALL The Los Angeles Angels of Anaheim v. Tampa Bay Rays Thursday, May 15th at 7:05pm Friday, May 16th at 7:05pm Saturday, May 17th at 6:05pm Sunday, May 18th at 12:35pm For More Information and to Purchase Tickets for ANGEL'S BASEBALL... THE HONDA CENTER – HOCKEY Ducks v. Kings – Game 7 (If Necessary) Friday, May 16th at TBA For More Information and to Purchase Tickets for DUCKS' HOCKEY... ***MUSEUM EXHIBITIONS*** MUZEO Transcending Trash: The Art of Upcycling Apr 26 –Aug 31, 2014 Transcending Trash: The Art of Upcycling celebrates the transformation of throwaway objects into complex and colorful works of art. African Exhibit On The Move (free) May 7 –May 1, 2014 Photographer Dawn Harman has captured the spirit and energy of Africa through a series of limited edition images- each and every photo tells an extraordinary story. Museum Days/Hours: Tuesday – Sunday (Closed Mondays) / 10 am to 5 pm For More Information on Events at MUZEO... BOWERS MUSEUM (Santa Ana) Beethoven: The Late Great Feb 8 - May 18, 2014 In recognition of the 60th anniversary of the Philharmonic Society of Orange County and its 21st and final season of Dean Corey’s leadership, the Philharmonic Society will present a multi-season celebration of the major late works of Ludwig van Beethoven, including a celebratory exhibition at the Bowers Museum. Soulful Creatures: Animal Mummies In Ancient Egypt Mar 22 – June 15, 2014 Soulful Creatures: Animal Mummies in Ancient Egypt is the first major exhibition to focus on one of the most fascinating aspects of ancient Egyptian culture and religion—the mummification of animals. Chuck Jones: Doodles of a Genius Apr 26 - August 3, 2014 This exhibition contains original drawings, most never publicly displayed, including a section of 50 so‐called "Doodles," perhaps best described as coming from one artist's very far side. The Lure Of Chinatown: Painting California's Chinese Communities Apr 12 - August 31, 2014 The unique cultural customs, fascinating architecture, and rich aesthetic of the Chinese communities in San Francisco and Los Angeles inspired many 19th and 20th century artists. Museum Days/Hours: Tuesday – Sunday (Closed Mondays) / 10 am to 4 pm For More Information on Events at BOWERS MUSEUM... Read the court decision
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    Nevada Senate Rejects Construction Defect Bill

    June 07, 2011 —

    The Las Vegas Sun reports that Assembly Bill 401, the construction defect bill, lost in a vote of 9 to 12. The measure extended the time for construction defect suits to be filed, awarded legal costs only to successful plaintiffs, and set a definition of construction defects. Two Democrats joined the Republicans in the Senate in defeating the bill.

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