SEATTLE WASHINGTON BUILDING EXPERT
DIRECTORY AND CAPABILITIES

Account for the Imposition of Material Tariffs in your Construction Contract

March 28, 2018 — David Adelstein – Florida Construction Legal Updates
After Hurricane Irma, I wrote an article that contractors should revisit the force majeure provisions in their construction contracts. Not later. But Now. The force majeure provision is an important provision in a construction contract to account for certain uncertainties that you have NO control over. Recently, another reason has given rise to contractors needing to revisit their force majeure provisions, as well as any provisions dealing with material escalations. Not later. But now. The imposition of raw steel and aluminum tariffs (tax on imported goods) and the back-and-forth regarding a potential trade war leads to the kind of uncertainty that should be assessed as a risk. A risk in both time and cost from material escalations. Read the court decision
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Reprinted courtesy of David Adelstein, Florida Construction Legal Updates
Mr. Adelstein may be contacted at dadelstein@gmail.com

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How Will Artificial Intelligence Impact Construction Litigation?

September 12, 2023 — Patrick McKnight - The Dispute Resolver
In the first half of 2023, artificial intelligence (“AI”) caught the public’s imagination. Attorneys have not been immune from the fever-pitch of commentary regarding the possible applications. While early adopters have had varying degrees of success, commentators have proposed various potential impacts on construction projects and disputes. This article discusses potential areas where AI can assist in preventing and resolving disputes from the pre-bid stage through project completion and close-out. What is AI? Artificial intelligence entered the popular zeitgeist accompanied by both optimistic and pessimistic predictions about the future. Internet searches on AI exploded in December 2022, reflecting a rapid and widespread public interest in the topic. The term “AI” itself is often loosely used to refer to a machine or computer software with the ability to conduct machine learning.[1] Whereas “automation” is the simple process of computing inputs, artificial intelligence refers to the ability to learn without additional programming from a human being. Now, increased computing power is finally helping some of the potential applications of this technology come into focus. Nonetheless, artificial intelligence is still maturing and is subject to “hallucinations” where the technology essentially generates erroneous nonsense. Read the court decision
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Reprinted courtesy of Patrick McKnight, Fox Rothschild LLP
Mr. McKnight may be contacted at pmcknight@foxrothschild.com

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Town Sues over Defective Work on Sewer Lines

January 13, 2014 — CDJ STAFF
The Handy Sanitary District in North Carolina has filed a lawsuit against one of the subcontractors on the Badin Lake Sewer Project, which the Lexington Dispatch describes as “delay riddled.” The town claims that the materials used by Hobbs, Upchurch and Associates “were not adequate for the project.” Additionally, the town claims that valves were improperly installed or damaged, and that pipes were of the incorrect type and improperly connected. The Sanitary District Board of Commissioners has additionally settled a lawsuit over non-payment for work on the sewer project. The Handy Sanitary District has settled claims brought by Monroe Roadways Contractors and Young Construction with a payment of $250,000. Read the court decision
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Suppliers Must Also Heed “Right to Repair” Claims

October 16, 2013 — CDJ STAFF
“Right to repair” statutes don’t only affect general contractors, but everyone involved in the building of a home, down to those who supply materials, warns Paul Gary in a post on Window & Door. He notes that “if you sell your window or door products in one of the growing number of states with a ‘Notice and Opportunity to Cure’ or ‘Right to Repair’ statute, you need a plan in the event you receive a defect notice relating to your product.” A supplier that receives a statement that a defect exists should, according to Mr. Gary, carefully document not only when the notice was received, but when it was sent, according to postmark, and whether the sender complied with all the regulations. From there, the supplier should determine if there were previous, informal complaints. Finally, determine sales information. At this point, the supplier has the information its insurer will require. His next caution is that in what follows, other may “seek defense and indemnity from you.” And while you may point out problems with the notice,” he counsels that “if you confirm there is an issue with your product, don’t be afraid to make a fair proposal for repair.” Read the court decision
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Colorado’s Need for Condos May Spark Construction Defect Law Reform

January 29, 2014 — Beverley BevenFlorez-CDJ STAFF
On January 6th, Ed Sealover of the Denver Business Journal reported that Denver Mayor Michael Hancock has asked Colorado legislators “to pass a reform law that will make it easier to build condos without fear of getting sued.” Hancock is one of several mayors “to advocate for a construction defects reform proposal that was killed by Democrats in a committee last year.” The problem, Sealover notes, is that only “2 percent of new housing in the state is multifamily units made for ownership—far lower than the 20 to 25 percent of such housing stock in other states represented by condos.” There is some dissent as to whether reforming construction defect laws is the solution to the housing problem: “Taking away rights of homeowners to get shoddy construction fixed in what is likely the most expensive purchase in their life is not the way to fix the lack of affordable housing,” Lynea Hansen, spokeswoman for a group of construction defect homeowners told Sealover. Furthermore, on January 7th, Sealover reported that Democrats “expressed skepticism” about a need to reform the laws, saying “they need more data on what is causing owner-occupied multifamily housing to be such a small part of the new housing market.” Moreover, Senate President-elect Morgan Carroll stated that she “wants to look into issues like why it is so hard to get insurance for building condominiums or examine why some areas of Colorado are seeing condo development and others aren’t.” Read the full story, January 6th article... Read the full story, January 7th article... Read the court decision
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Harsh New Time Limits on Construction Defect Claims

April 26, 2011 — Scott F. Sullan, Esq., Mari K. Perczak, Esq., and Leslie A. Tuft, Esq.

A recent Colorado Supreme Court decision, Smith v. Executive Custom Homes, Inc., 230 P.3d 1186 (Colo. 2010), considerably shortens the time limit for bringing many construction defect lawsuits. Homeowners and homeowner associations risk losing the right to seek reimbursement from builders, developers and other construction professionals unless they carefully and quickly act upon discovery of evidence of any potential construction defect.



The Statute of Limitations for Construction Defect Claims
Colorado’s construction defect statute of limitations limits the time for homeowners and homeowners associations to bring lawsuits for construction defects against “construction professionals,” including developers, general contractors, builders, engineers, architects, other design professionals, inspectors and subcontractors. The statute requires homeowners and associations to file suit within two years “after the claim for relief arises.” A claim for relief “arises” when a homeowner or association discovers or reasonably should have discovered the physical manifestation of a construction defect.



The two-year time limitation applies to each construction defect separately, and will begin to run upon the appearance of a “manifestation” of a construction defect (which may include, for example, a condition as simple as a roof leak or drywall cracks), even if the homeowner or association does not know the cause of the apparent problem.



The Smith Opinion and its Effect on the Statute of Limitations
In Smith v. Executive Custom Homes, Inc., the plaintiff homeowner, Mrs. Smith, slipped on ice that had accumulated on her sidewalk because of a leaking gutter and suffered injury. When she first noticed the leak, she reported it to her property manager, who reported it to the builder. The builder attempted to repair the gutter, unbeknownst to Mrs. Smith, and she did not notice further problems until approximately one year after she first observed the leak, when she fell and suffered serious injury. She sued the builder within two years of her injury, but nearly three years after she first learned of the leak.



The Colorado Supreme Court dismissed Mrs. Smith’s claims as untimely and held that under the construction defect statute of limitations, the two-year period for suing for injuries due to construction defects begins when the homeowner first observes the physical manifestation of the defect, even if the resulting injury has not yet occurred. The court acknowledged that this ruling could result in “unfair results,” especially if a serious and unforeseeable injury occurs more than two years after the first time the homeowner noticed the problem, and as a result the victim is unable to seek redress from those responsible for the defect.



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Reprinted courtesy of Scott F. Sullan, Esq., Mari K. Perczak, Esq., and Leslie A. Tuft, Esq. of Sullan², Sandgrund, Smith & Perczak, P.C., and they can be contacted through their web site.

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Supreme Judicial Court of Maine Addresses Earth Movement Exclusion

March 01, 2021 — James M. Eastham - Traub Lieberman
In Bibeau v. Concord Gen. Mut. Ins. Co., 2021 WL 243867, 2021 ME 4, the Supreme Judicial Court of Maine addressed an earth movement exclusion contained in a residential homeowners policy. In 2017, the insured submitted a claim to Concord for damage to the insured’s home which included foundation cracks and settlement resulting in interior damage to the home. The insured contended that the damage was the result of a 2006 water line leak. Concord denied the claim based on the Earth Movement exclusion contained in it’s policy which precluded coverage for losses caused by earthquakes, landslides, mudslides, mudflow, subsidence, sinkholes or “[a]ny other earth movement including earth sinking, rising or shifting; caused by or resulting from human or animal forces or any act of nature”. The insured filed suit asserting a breach of the policy and unfair claims settlement practices. According to the insured’s expert, the damage was caused by a 2006 water line leak -- which in turn caused the foundation to settle. Concord's expert, however, concluded that the settling was caused by the house being built on “unprepared or uncontrolled fill” which allowed the house to settle at different rates. Despite the disagreement regarding the cause of the settling, the parties ultimately agreed that the damage was the result of earth moving under the house's foundation. Concord moved for summary judgment and the trial court entered summary judgment for Concord, reasoning that because there was no genuine dispute that the losses were caused by “subsurface soils being undermined and earth movement,” the Earth Movement exclusion precluded coverage. The trial court further concluded that the disagreement over the cause of the settlement was not material because regardless of the cause of the earth movement, the losses were clearly excluded by the policy's Earth Movement exclusion. Read the court decision
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Reprinted courtesy of James M. Eastham, Traub Lieberman
Mr. Eastham may be contacted at jeastham@tlsslaw.com

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Corporate Formalities: A Necessary Part of Business

February 18, 2020 — Hannah Kreuser - Porter Law Group
Many benefits exist in choosing to create a corporation or limited liability company (“LLC”) as your business entity. However, what attracts most people to these entities is the protection they afford the business owner(s) against personal liability for the business’ obligations, debts, and other liabilities. Whatever reason prompts your decision to form a corporation or LLC, if you are like many smaller businesses, once the formation process is over its back to business as usual. However, in order to keep the protection against personal liability associated with a corporation or LLC, the business must engage in, what are known as corporate formalities. Corporate formalities are formal actions that must be taken by a corporation or LLC in order to maintain the benefits associated with that business entity. These corporate formalities may be required under California law, by the bylaws, and/or by the operating agreement of your business. When your business is formed as a corporation, many of the corporate formalities exist as part of California’s Corporations Code (“CCC”). These formalities include: (1) holding annual meetings (CCC § 600); (2) regularly electing directors (CCC § 301); (3) keeping meeting minutes (CCC § 1500); and (4) maintaining accurate corporate records (CCC § 1500). While these are only a few of the corporate formalities existing for corporations in the State of California, these formalities are often overlooked or put off by smaller businesses because they are either unknown to the business or are intended to be complied with later, as the actual running of the business takes priority. Read the court decision
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Reprinted courtesy of Hannah Kreuser, Porter Law Group
Ms. Kreuser may be contacted at hkreuser@porterlaw.com

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