Ways of Evaluating Property Damage Claims in Various Contexts
February 18, 2020 —
Bremer Whyte Brown & O'Meara LLPPotential damages in a lawsuit may come in many forms depending on the facts of the case. Common damages include medical expenses, loss of earnings, property loss, physical pain, and mental suffering. Of the many damages Plaintiffs may claim, one of the most prevalent and recognizable is property damage. This article briefly discusses these types of damages which fall under two major categories – Real Property and Personal Property.
Broadly speaking, “real property” means land, and “personal property” refers to all other objects or rights that may be owned. Ballentine’s Law Dictionary defines “real property” as: “Such things as are permanent, fixed, and immovable; lands, tenements, and hereditaments of all kinds, which are not annexed to the person or cannot be moved from the place in which they subsist. . . .” (Ballentine’s Law Dict. (3d ed. 2010).) “Personal property” is defined as: “Money, goods, and movable chattels . . . . All objects and rights which are capable of ownership
except freehold estates in land, and incorporeal hereditaments issuing thereout, or exercisable within the same.” (Id. (emphasis added).)
Real Property
Real property may be damaged or “harmed” through trespass, permanent nuisance, or other tortious conduct. The general rule is that Plaintiffs may recover the lesser of the two following losses: (1) the decrease in the real property’s fair market value; or (2) the cost to repair the damage and restore the real property to its pre-trespass condition plus the value of any lost use. (Kelly v. CB&I Constructors, Inc.) However, an exception to this general rule may be made if a Plaintiff has a personal reason to restore the real property to its former condition, sometimes called the “personal reason” exception. In such cases, a Plaintiff may recover the restoration costs even if the costs are greater than the decrease in the real property’s value, though the restoration cost must still be “reasonable” in light of the value of the real property before the injury and the actual damage sustained.
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Gru Was Wrong About the Money: Court Concludes that Lender Owes Contractor “Contractually, Factually and Practically”
November 07, 2022 —
Matthew DeVries - Best Practices Construction LawThis weekend was all about
The Rise of Gru. I love Gru so much that when my children ask for money, my best Gru-like voice belts back: “Now, I know there have been some rumors going around that the bank is no longer funding us….In terms of money, we have no money.” And that’s precisely what many lenders say on distressed projects when the owner fails to make final payment and the contractor looks to the bank for funding: “We have no money for you contractor!”
In
BCD Associates., LLC v. Crown Bank, CA No. N15c-11-062 (Super. Ct. Del, May 2, 2022), the trial court found that when a bank pays a contractor directly, it can create a legally binding relationship subject to the terms of the construction loan agreements with the owner.
The project involved a $13m construction loan between the lender and the owner to renovate a hotel. The owner and contractor entered into an AIA Contract for the construction management services. During construction the contractor would submit payment applications to the lender, who would review and approve the invoices for payment. The lender then would pay 90% of the approved payment application and hold back the remaining 10% as retainage. The contractor was supposed to be paid the final retainage upon completion, which it did not receive in accordance with the terms of the AIA Contract.
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Matthew DeVries, Burr & Forman LLPMr. DeVries may be contacted at
mdevries@burr.com
Expansion of Statutes of Limitations and Repose in K-12 and Municipal Construction Contracts
March 27, 2019 —
Henry Bangert - Colorado Construction LitigationThe purpose of this whitepaper is to bring attention to a trend in K-12 and municipal construction contracts, which expands the time periods for law suits against construction professionals.
Introduction and Background
Under Colorado statute, the period of time within which a legal action for construction defects may be brought against a construction professional in Colorado is two years from when the claimant (or its predecessor in interest) discovers or in the exercise of reasonable diligence should have discovered the physical manifestations of a defect (the “Statute of Limitations”), but in no case may an action be brought more than six years after substantial completion of the improvement, unless the claim arises in the fifth or sixth year after substantial completion, in which event the action may be brought within two years of such date, i.e., up to eight years after substantial completion (the “Statute of Repose”). See C.R.S. § 13-80-104. While the triggering events differ for the Statute of Limitations and Statue of Repose, the periods are intended to run concurrently to limit the period of time an action may be brought against construction professionals for construction defects to, at most, eight years after substantial completion. Importantly, these limitations periods may be expanded by agreement.
Prior to 1986, Colorado law provided for a 10-year Statute of Repose. However, in 1986, Colorado’s legislature shortened the Statute of Repose time limit to the current six (or up to eight) year period. In 1986, Colorado also redefined the date the claim arises from the date the defect was discovered or should have been discovered to the date the physical manifestation of a defect was discovered or should have been discovered. Therefore, after 1986, the two-year limitations period could begin to run when a claimant should have discovered the manifestation of a defect, even if the claimant did not recognize that a defect existed.
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David McLain, Higgins, Hopkins, McLain & Roswell, LLCMr. McLain may be contacted at
mclain@hhmrlaw.com
Newmeyer & Dillion Selected to 2017 OCBJ’s Best Places to Work List
July 26, 2017 —
Newmeyer & Dillion LLPProminent business and real estate law firm Newmeyer & Dillion LLP is proud to be one of the selected companies in the
Best Places to Work in Orange County – 2017 Survey in the category of medium sized companies. This marks the sixth consecutive year Newmeyer & Dillion LLP has made the list, affirming that its profound commitment to professionalism and client service is shared among its workforce. The firm was honored in the July 24 issue of the Orange County Business Journal.
Jeff Dennis, Newmeyer & Dillion's Managing Partner, commends the effort and commitment of each employee in achieving this result. "We strive to make Newmeyer & Dillion a great place to be, but we only set the goal. It is our employees and their ongoing loyalty and commitment to our mission that makes it happen. Together, we create a culture here that cannot be matched anywhere else."
Created in 2009, the awards program evaluates entries based on workplace policies, practices, demographics, and also collects employee surveys to measure overall satisfaction and experience. The Best Companies Group worked alongside the Orange County Business Journal in collecting and analyzing the data and is a partner in the project.
About Newmeyer & Dillion
For more than 30 years, Newmeyer & Dillion has delivered creative and outstanding legal solutions and trial results for a wide array of clients. With over 70 attorneys practicing in all aspects of business, employment, real estate, construction and insurance law, Newmeyer & Dillion delivers legal services tailored to meet each client’s needs. Headquartered in Newport Beach, California, with offices in Walnut Creek, California and Las Vegas, Nevada, Newmeyer & Dillion attorneys are recognized by The Best Lawyers in America©, and Super Lawyers as top tier and some of the best lawyers in California, and have been given Martindale-Hubbell Peer Review's AV Preeminent® highest rating. For additional information, call 949-854-7000 or visit www.ndlf.com.
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BE PROACTIVE: Steps to Preserve and Enhance Your Insurance Rights In Light of the Recent Natural Disasters
October 19, 2017 —
Jacquelyn M. Mohr – Newmeyer & Dillion LLPOur hearts go out to those families and businesses who have suffered losses due to the recent fires, hurricanes, and other natural disasters. We hope that everyone in Sonoma, Napa, Orange County, and nationwide affected by these tragic events is somewhere safe. As someone who lost a house in a fire growing up and now is an attorney who helps both residential and business policyholders, there are a few pieces of wisdom I’d like to pass along to help prepare for the worst:
1) MAINTAIN DUPLICATES OF CRITICAL DOCUMENTS OFFSITE OR ONLINE
After the fire, you’re going to need your insurance policies and other critical documents. While it’s usually possible to request copies, this can take weeks, which will hold up your claims process. We are fortunate enough to have the technology for cloud-based storage of key documents – like your insurance policy, insurance broker contact information, tax returns, life insurance policies, will, business plan, inventories, etc. – oftentimes for free. Maintaining these records onsite during your daily life and business operations is important, but so is taking the time and trouble to make sure you have a back-up offsite. It’s easy to do, and so much easier than trying to recreate it after the fact.
2) MAKE A RECORD OF YOUR PROPERTY AND POSSESSIONS
If you are lucky enough to still be in your home or business property, I strongly recommend that you take a video of your property and possessions to keep for your records. A digital inventory with receipts would be great – but a video log will also be very helpful later.
- For your home: This includes the furniture, artwork, appliances, jewelry, electronics, collectibles, landscaping and custom features of the inside and outside of your house.
- For your business: This includes your furniture and artwork, your inventory and your electronics.
Look into offsite back-ups of your important electronic data – whether documents, e-mails, insurance policies, inventory logs, accounting data, client correspondence, or pictures of your kids or grandkids.
Why A Record Is Important in the Insurance Claims Process
Though I hope no one has to deal with this, a video record will make it much easier in the event of a tragedy to deal with insurance claims for two reasons:
- It is evidence to submit to the insurance company to show exactly what your property was like before disaster struck.
- For your home, you likely have a homeowner's insurance policy that covers your “3 bedroom, 2 bath, 2000 square foot home built in 1962,” but your insurer won’t know the quality of what is actually inside. It will be up to you to prove you had a brand new Viking stovetop, rather than a 20-year old Kitchenaid; custom built-in cabinets rather than Ikea furniture. (On this note, if you ever do any remodeling, be sure to tell your broker to make sure it's covered by your policy!)
- For your business, your policy will similarly be generic, and the insurer will similarly insist on evidence of your business inventory, sales orders, equipment, artwork, etc. in the event of a loss.
- A video record will also help to jog your memory to create itemized inventories to submit to the insurance company. Creating an inventory of everything lost after a casualty can be the most difficult and emotional part of the rebuilding process. I encourage you to do anything you can do now to lessen the stress later. After a traumatic loss, it’s impossible to remember everything, so most people never collect their full insurance benefits. United Policyholders, an amazing non-profit resource for policyholders, has a great app and other online tools to help create your inventory. You can find the app and other helpful information at http://www.uphelp.org/
3) CHECK YOUR POLICY
Even if you have not been personally affected by the recent disasters, these tragedies are an excellent reminder to check to make sure you are fully covered.
- Make sure you understand what is covered under your policy, and get confirmation that you are covered for a total loss. Talk with your broker to make sure your policy limits make sense, including those for separate structures, personal property, and additional living expenses, which are usually a percentage of your dwelling coverage limit.
- Check to make sure your personal property limits would cover your possessions– if you have a lot of artwork, jewelry, antiques, and other valuables, the standard limits might not be enough for you.
- Consider this question: Does your additional living expense/business interruption coverage (aka the amount your insurance company will pay while your home or business property is being rebuilt) provide enough for your needs? Even if your limits/coverage made sense when you purchased the policy, things may have changed.
You can usually increase your other coverage limits with a quick email to your insurance broker, often with very little impact on your annual premium.
4) DON’T BE AFRAID TO ASK FOR HELP
As simple as it sounds, don’t be afraid to ask for help. No one expects you to be an expert on this, and pretending you don’t need assistance can cost you thousands of dollars in insurance benefits in the future. So be sure to take advantage of the resources out there so that you are fully prepared to handle whatever disaster nature sends your way.
For any additional questions, and for help navigating the insurance claims process after a disaster, please do not hesitate to reach out.
Jacquelyn Mohr is an associate in the Walnut Creek office of Newmeyer & Dillion, focusing in business litigation, insurance coverage, securities fraud and construction disputes. Jacquelyn can be reached at Jacquelyn.Mohr@ndlf.com or 925.988.3200.
About Newmeyer & Dillion
For more than 30 years, Newmeyer & Dillion has delivered creative and outstanding legal solutions and trial results for a wide array of clients. With over 70 attorneys practicing in all aspects of business, employment, real estate, construction and insurance law, Newmeyer & Dillion delivers legal services tailored to meet each client’s needs. Headquartered in Newport Beach, California, with offices in Walnut Creek, California and Las Vegas, Nevada, Newmeyer & Dillion attorneys are recognized by The Best Lawyers in America©, and Super Lawyers as top tier and some of the best lawyers in California, and have been given Martindale-Hubbell Peer Review's AV Preeminent® highest rating. For additional information, call 949-854-7000 or visit www.ndlf.com.
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Reprinted courtesy of Jacquelyn M. Mohr, Newmeyer & Dillion LLP
Ms. Mohr may be contacted at Jacquelyn.mohr@ndlf.com
Lien Actions Versus Lien Foreclosure Actions
June 02, 2016 — David R. Cook Jr. – AHHC Construction Law Blog
The lawsuits required to perfect and foreclose upon a lien have confused lien claimants and their attorneys for years. This confusion was recently demonstrated in a recent case entitled Founders Kitchen and Bath, Inc. v. Alexander, No. A15A1262, 2015 WL 6875026 (Ga. App. 2015).
In the case, the trial court granted an owner’s motion for summary judgment against a subcontractor that sought to foreclose on its materialman’s lien. In deciding to reverse the trial court’s decision, the Court held that issues of material fact still existed as to whether the owner and subcontractor were in privity of contract.
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Reprinted courtesy of David R. Cook Jr., Autry, Hanrahan, Hall & Cook, LLP
Mr. Cook may be contacted at cook@ahclaw.com
Construction Calamity: Risk Transfer Tips for Contractors After a Catastrophic Loss
August 17, 2020 — William S. Bennett - Saxe Doernberger & Vita, P.C.
From structural collapses to fires, the construction industry has experienced a number of high-profile catastrophes over the past decade. These disasters test the mettle of even the most experienced risk professionals and the strongest insurance programs. Issues can arise in all facets of the company’s contracts and insurance policies, and dealing with the aftermath is an extensive and demanding process that can involve many players.
As overwhelming as the task may seem, however, it is possible for general contractors to get through the disaster with minimal uncovered exposure if proper steps are taken. By understanding some of the exposures a general contractor faces after a catastrophic loss and implementing key risk transfer strategies from the outset of a project, risk professionals can minimize the impact of a loss on the company in the short and long term.
Understanding Possible Risk Exposures
When a catastrophic loss occurs, contractors face a wide array of potential exposures. Unfortunately, many large catastrophic losses involve serious bodily injuries and even loss of life. If such a tragedy occurs, the general contractor can reasonably expect to be named in a flurry of personal injury and wrongful death lawsuits. Depending on the scope of the project and the area associated with the loss, the catastrophe may also prompt a wide range of bystander claims, from dust inhalation to emotional distress. Read the court decision
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Reprinted courtesy of William S. Bennett, Saxe Doernberger & Vita, P.C.
Mr. Bennett may be contacted at wsb@sdvlaw.com
WSHB Expands into the Southeast
March 18, 2019 — William Silverman – Wood Smith Henning & Berman LLP
National law firm Wood, Smith Henning & Berman LLP (WSHB) announced the opening of its North Carolina office, bringing the total number of offices nationwide to 24. Leading this office is prominent trial attorney William Silverman.
Mr. Silverman enjoys a well deserved reputation for consistent results throughout the Carolinas in complex commercial litigation. His practice areas include construction and corporate disputes, insurance coverage, first and third party insurance bad faith litigation, environmental, and catastrophic injury matters. He is an “AV Preeminent” rated attorney by Martindale-Hubbell, and has been listed in Business North Carolina’s Legal Elite in the Young Guns and Construction categories. Mr. Silverman comes to the Firm from a seven year tenure at Wall Templeton, where he served as a Shareholder.
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Reprinted courtesy of William Silverman, Wood Smith Henning & Berman LLP
Mr. Silverman may be contacted at wsilverman@wshblaw.com