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    Subsequent Owners of Homes Again Have Right to Sue Builders for Construction Defects

    October 07, 2016 —
    Owners of homes with damage from construction defects have long had the standing to sue the builders of their homes using the legal theories of 1) breach of contract, 2) breach of implied warranty, and 3) breach of Pennsylvania’s consumer fraud statute, the Unfair Trade Practices and Consumer Protection Law (UTPCPL). Before the 2014 decision of the Pennsylvania Supreme Court in Conway v. Cutler, even owners who were not the original purchasers of their homes, so-called subsequent owners, had a right to sue the builder of their homes using implied warranty as the legal theory. But the Supreme Court in Conway said in 2014 that even though an implied warranty theory is not based on a written contract, it is a quasi contract theory and because subsequent owners never had a contractual relationship with the builder of their home, the implied warranty cause of action was not available. Subsequent purchasers were thus left without a remedy for damage from defective construction in their homes and builders had a second safe harbor from claims regarding homes they built. The first safe harbor is Pennsylvania’s Statute of Repose. If the home was completed more than 12 years before a lawsuit was filed, the Statute of Repose bars the claim. But after Conway, if the home was sold, this also cut off a builder’s potential liability for construction defects in the home. ENTER THE UTPCPL On July 26, 2016 the Pennsylvania Superior Court in the case of Adams v. Hellings Builders issued a non-published (and therefore non-precedential) decision in a stucco construction defect case that held that subsequent purchasers could sue their home’s builder under the UTPCPL because the Act had no requirement that the purchaser of a product, or home, be the original purchaser. The decision cites several other appellate cases not involving construction defect claims that held that the UTPCPL was a valid legal theory for claims regarding products purchased second hand by the plaintiffs in those other cases. The court in Adams held that there was no reason that a suit regarding construction defects in a home should be treated any differently. Read the court decision
    Read the full story...
    Reprinted courtesy of Mark L. Parisi, White and Williams LLP
    Mr. Parisi may be contacted at parisim@whiteandwilliams.com

    The Anatomy of a Construction Dispute Stage 3- The Last Straw

    January 28, 2015 —
    Over the past two weeks here at Construction Law Musings, I’ve discussed the first two stages of a typical construction dispute (if such a thing exists): the claim, and how to bring heat short of litigation/arbitration. As promised, this week I’ll be discussing the next step or “last straw” in a construction dispute, namely, arbitration or litigation to enforce all of those rights that you preserved in the first two stages. Construction litigation is expensive, time consuming, and, quite frankly, a pain in the neck. Because of this fact, I almost always recommend that my construction clients exhaust all of the non-litigation methods (including mediation of course) of resolving their disputes prior to “going nuclear” and filing suit. Unfortunately, even the most diligent attempts at less formal resolution means can be unfruitful and more formal means become necessary. Read the court decision
    Read the full story...
    Reprinted courtesy of Christopher G. Hill, Law Office of Christopher G. Hill, PC
    Mr. Hill may be contacted at chrisghill@constructionlawva.com

    Mediation Clause Can Stay a Miller Act Claim, Just Not Forever

    July 11, 2021 —
    It seems to be Miller Act time here at Construction Law Musings, not to mention in the Federal District Courts here in Virginia. Last week I discussed what sort of work can form the basis for a Miller Act claim. This week I am discussing the effect of a mandatory mediation contract clause on the same type of claim. I have discussed both the benefits and the possible negative consequences of the inclusion of such a clause in your construction contract. The recent case out of the Norfolk, Virginia Federal District Court recently explored the related question of whether such a clause can be enforced in the context of a Miller Act claim. In United States of America, for the use of Precision Air Conditioning of Brevard Inc. v. Cincinnati Insurance Company, the Court was confronted with a possible conflict between the legal requirement that any waiver of the right to pursue a Miller Act claim must be explicitly waived in writing and the clear contractual language between the general contractor and the plaintiff stating that mediation was a condition precedent to suit. Read the court decision
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    Reprinted courtesy of The Law Office of Christopher G. Hill
    Mr. Hill may be contacted at chrisghill@constructionlawva.com

    Maine Case Demonstrates High Risk for Buying Home “As Is”

    August 27, 2014 —
    According to Meredith Eilers of Bernstein Shur, writing in JDSupra Business Advisor, a Boston Appeals court “enforced an 'as is' provision in a purchase and sale agreement and concluded that the sale of a multimillion dollar oceanfront property in Bar Harbor was not accompanied by Maine’s implied warranty of habitability.” Eilers explained that “the first circuit concluded that the bargained-for ‘as is’ provision that was incorporated into the purchase and sale agreement—in exchange for a reduction in the purchase price—essentially waived any claims from the buyer regarding misrepresentations by the sellers.” This left “the buyer to incur the repair costs without the ability to recover those costs from the seller” and it demonstrated “that agreeing to such a clause when closing a real estate deal has real risks.” Read the court decision
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    Reprinted courtesy of

    The Importance of Providing Notice to a Surety

    October 21, 2015 —
    A recent case out of Missouri emphasizes the importance of providing notice to a surety when a bonded subcontractor is in default. When the question of whether a surety will be obligated under the bond is in the balance, notice is crucial. In CMS v. Safeco Insurance Company, Safeco provided a performance bond to a subcontractor for the benefit of CMS. The bond specifically provided:
    “PRINCIPAL DEFAULT. Whenever the Principal [Subcontractor] shall be, and is declared by the Obligee [CMS] to be in default under the Subcontract, with the Obligee having performed its obligations in the Subcontract, the Surety [Safeco] may promptly remedy the default, or shall promptly: 4.1 COMPLETE SUBCONTRACT. . . . 4.2 OBTAIN NEW CONTRACTORS. . . . 4.3 PAY OBLIGEE. . . . 4.4 DENY LIABILITY. . .”
    Read the court decision
    Read the full story...
    Reprinted courtesy of Craig Martin, Lamson, Dugan and Murray, LLP
    Mr. Martin may be contacted at cmartin@ldmlaw.com

    Construction Litigation Roundup: “The Jury Is Still Out”

    October 30, 2023 —
    “The Seventh Amendment guarantees the right to a trial by jury for a legal claim in a civil action.” So, isn’t the law, well, the law? Well, perhaps. Some axioms to remember in contracting are that parties are typically able to agree in a contract to anything that is lawful, and that all such lawful agreements essentially become the “law” between the parties. It is on these principles that courts issue jurisprudence which becomes binding on future litigants – for example, concerning waiver of any right to trial by jury. Hence, when a second-tier subcontractor on a federal project sought a jury for a lawsuit it had against a general contractor’s sureties, the sub was successfully rebuffed by the sureties based upon a waiver to trial by jury contained in the relevant subcontract. The court noted various matters to be considered in connection with the generally enforceable jury waiver – including the conspicuousness of the waiver (and, therefore, whether the subcontractor “knowingly” agreed to the waiver), as well as the relative bargaining power of the parties to the agreement (here, the sub was self-proclaimed to be a “leader in the construction contracting field”) – and affirmed the legality of the waiver. Read the court decision
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    Reprinted courtesy of Daniel Lund III, Phelps
    Mr. Lund may be contacted at daniel.lund@phelps.com

    Duty to Defend Affirmed in Connecticut Construction Defect Case

    August 13, 2014 —
    According to an article by Matthew Vocci of Ober | Kaler in JD Supra, the Supreme Court of Conneticut affirmed in Travelers Cas. & Sur. Co. v. Netherlands Ins. “that allegations of years-long, continuing and progressive water intrusion caused by alleged construction defects triggered a duty to defend under CGL coverage language.” Vocci stated that the result demonstrated “the importance of the wording of the allegations relating to construction defects, resulting damage and when the parties were on notice of the issues. For property owners, contractors/builders/developers and their insurers, the allegations in the complaint guide what can be a difficult and contentious determination regarding whether the insured is provided with a defense from its CGL carrier.” Read the court decision
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    Reprinted courtesy of

    Presenting a “Total Time” Delay Claim Is Not Sufficient

    September 12, 2022 —
    When presenting a delay-type of claim on a construction project, a claimant MUST be in a position to properly PROVE the claim. Trying to present a delay claim loosey-goosey is not a recipe for success. In fact, it can be a recipe for an easy loss. This is not what you want. To combat this, make sure you engage a delay expert that understands delay methodologies and how to calculate delay and do NOT present a total time claim. Presenting a delay claim using a total time approach, discussed below, makes it too easy to attack the flaws and credibility of the approach. Per the discussion of the case below, a total time claim with a contractor that used its project manager, versus a delay expert, to support its claim turned the contractor’s claim into a loss. In French Construction, LLC v. Department of Veteran Affairs, 2022 WL 3134507, CBCA 6490 (CBCA 2022), a contractor submitted a delay claim to the government for almost $400,000. The contractor was hired to construct a two-story corridor to connect hospital buildings. The contractor was required to be complete within 365 days. It was not. The contractor was seeking 419 days of delay from the government. The contractor’s “delay expert” was its project manager who compared the contractor’s as-planned schedule to an as-built schedule he prepared for the claim. Read the court decision
    Read the full story...
    Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
    Mr. Adelstein may be contacted at dma@kirwinnorris.com