Georgia Court Clarifies Landlord Liability for Construction Defects
June 02, 2016 —
Chadd Reynolds - AHHC Construction Law BlogIn Cowart v. Schevitz, the Georgia Court of Appeals clarified the instances in which an out-of-possession landlord can be liable in a premises liability claim. No. A15A2036, 2016 WL 563114, at *4 (Ga. Ct. App. Feb. 15, 2016).
In this case, the plaintiff was leaving a restaurant and injured herself stepping down off of a sidewalk near the bottom of a ramp. The plaintiff filed a premises liability claim against the owner of commercial property (the “landlord”) and the operator of the restaurant (who later settled), seeking medical expenses and costs of litigation. An expert testifying on behalf of the plaintiff stated that the ramp was required to have railings pursuant to building codes and, had the railings been installed on the ramp, the plaintiff’s fall more than likely would not have occurred. The landlord moved for summary judgment, arguing that as an out-of-possession landlord, his liability to third persons for the use of the property by his tenant was precluded under O.C.G.A. § 44-7-14. The trial court denied the motion without comment, and the owner subsequently appealed.
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Chadd Reynolds, Autry, Hanrahan, Hall & Cook, LLPMr. Reynolds may be contacted at
reynolds@ahclaw.com
Insurance Coverage Litigation Section to Present at Hawaii State Bar Convention
October 15, 2014 —
Tred R. Eyerly – Insurance Law HawaiiThe Hawaii State Bar convention will be on October 24, 2014, at the Hawaiian Hilton. The Insurance Coverage Litigation Section will make a presentation from 8:30 a.m. to 11:45 a.m.
Three presentations will be made. First, Richard C. Mosher (Anderson Kill), Kathy Dang (Marsh), and Beau Monday (Hawaiian Telcom) will discuss cyber-liability claims and insurance options.
Next, David R. Harada-Stone (Tom Petrus & Miller) and I (Damon Key Leong Kupchak Hastert) will address "occurrences," i.e., deciding on and the impact of determining the number of occurrences in particular factual settings.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
New Home for the Aged Suffers Construction Defects
July 31, 2013 —
CDJ STAFFAlthough it’s only about a year old, there are already complaints about construction defects at Lubertha Johnson Estates, a property for low-income seniors in Southern Nevada. The 112-unit project is currently the subject of a construction defect lawsuit, with residents complaining about roof leaks, defective gates, and other problems.
Jane Ann Morrison, writing in the Las Vegas Review-Journal, also notes that when the director of public housing operations presented resident complaints to the board of the Southern Nevada Regional Housing Authority, a few defects seemed to have crept into their complaints, errors that weren’t in the one residents supplied to the reporter.
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Judge Halts Sale of Brazilian Plywood
June 06, 2022 —
Beverley BevenFlorez – CDJ StaffA permanent injunction was issued by Judge Roy Altman in a Ft. Lauderdale federal court on May 24th that requires the revocation of all PS 1 certificates that were issued by PFS-TECO to more than a dozen Brazilian mills that produced structural plywood for the U.S. market,
reported Business Wire.
“This case highlights how a few bad actors profited by essentially looking the other way while substandard, and potentially dangerous plywood was imported into the U.S. and used to build homes and businesses,”
Michael Haglund, counsel representing the U.S. Structural Plywood Integrity Coalition, of Haglund Kelley, LLP, told Business Wire.
Building codes throughout the U.S. require the use of PS 1 structural plywood in construction. "If product standards are not being met, there can be serious implications for all homes constructed using those substandard wood panel products," Tyler Freres, VP of Sales for
Freres Engineered Wood, told CDJ. "Contractors and homeowners should be able to trust that U.S. certification agencies are doing their due diligence to accurately inspect panels, ensuring consumers' health and safety."
The U.S. Structural Plywood Integrity Coalition, including nine family-owned U.S. plywood manufacturers, alleged that PFS-TECO falsely certified that plywood from Brazil met U.S. structural integrity requirements. This substandard plywood has been used throughout the U.S. In particular, it was used during the hurricane reconstruction efforts in Florida and Puerto Rico due to its cheaper price. In 2021, Brazilian plywood made up 11% of the U.S. supply with
nearly 1.2 billion square feet sold.
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Renters Who Bought Cannot Sue for Construction Defects
October 08, 2013 —
CDJ STAFFA Wisconsin couple that leased then bought a home cannot sue the couple that built the home for construction defects. The court rejected the claims made by Niksa and Kelly Ivancevic that the sellers, Ronald and Debra Reagan, had breached contract or that the contract represented a mutual mistake.
The Ivancevics initially leased the home, with an agreement that said the house would be “delivered in clean condition and good repair, free of mold and toxic substances, suitable for habitation in compliance with all laws.” Before the purchase, no defects were found. After the purchase, the Ivancevics had problems with the air conditioning, leading to water leaks on the second floor.
The court found that the actual sales contract did not guarantee a defect-free residence. Therefore the Ivancevic’s claim of a mutual mistake, in which “both parties of a contact are unaware of the existence of a past or present fact material to their agreement” did not apply, since the presence of construction defects was not “material to their agreement.”
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Construction Contract Terms Matter. Be Careful When You Draft Them.
February 01, 2022 —
Christopher G. Hill - Construction Law MusingsIn a prior post, I discussed the case of Fluor Fed. Sols., LLC v. Bae Sys. Ordinance Sys in the context of the interplay between fraud, contract, and statutes of limitation. Some cases just keep on giving. This time the case illustrates the need for careful drafting of those
pesky, and highly important, clauses in your construction documents.
In the
current iteration of this ongoing saga, the Court considered the contractual aspects of the matter. As a reminder, the facts are as follows: In May 2011, the United States Army (“Army) awarded BAE Systems Ordnance Systems, Inc. (“BAE”) a contract to design and construct a natural gas-fired combined heating and power plant for the Radford Army Ammunition Plant (“RAAP”). On October 7, 2015, BAE issued a request for a proposal from Fluor Federal Solutions, LLC (“Fluor”) to design and build a temporary boiler facility at a specific location on the RAAP property. On October 13, 2015, the Army modified the prime contract to change the location of the boiler facility. On December 10, 2015, the Army modified the prime contract to require BAE to design and construct a permanent boiler facility. On December 30, 2015, Fluor and BAE executed a fixed-price subcontract for Fluor to design and construct the temporary boiler. Throughout 2016, BAE issued several modifications to Fluor’s subcontract to reflect the modifications BAE received from the Army on the prime contract. On March 23, 2016, BAE directed Fluor to build a permanent – rather than temporary – boiler facility. On March 28, 2016, Fluor began construction of the permanent facility and began negotiations with BAE about the cost of the permanent facility. On September 1, 2016, the parties reached an agreement on the cost for the design of the permanent facility, but not on the cost to construct the permanent facility. On November 29, 2016, the parties executed a modification to the subcontract, officially replacing the requirement to construct a temporary facility with a requirement to construct a permanent facility and agreeing to “negotiate and definitize the price to construct by December 15, 2016.” The parties were unable to reach an agreement on the construction price.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Connecticut Court Clarifies Construction Coverage
June 28, 2013 —
CDJ STAFFThe Connecticut Supreme Court has recently ruled on a case in which breach of contract and bad-faith claims were made against an insurer in an construction defect case. Joseph K. Scully of Day Pitney LLP discussed the case in a piece on Mondaq.
Mr. Scully noted that the background of the case was that Capstone Building was the general contractor and project developer of a student housing complex for the University of Connecticut. Unfortunately, the building had a variety of problems, some of which were violations of the building code. Mr. Scully noted that the building had “elevated carbon monoxide levels resulting from inadequate venting, improperly sized flues.” Capstone entered into mediation with the University of Connecticut. Capstone’s insurer, the American Motorists Insurance Company (AMICO), declined involvement in the participation. Afterward, Capstone sued AMICO. The issues the court covered involved the insurance on this project.
The court addressed three questions. The first was “whether damage to a construction project caused by construction defects and faulty workmanship may constitute ‘property damage’ resulting from an ‘occurrence.’” The court concluded that it could “only if it involved physical injury or loss of use of ‘nondefective property.’”
The second question dealt with whether insurers were obligated to investigate insurance claims. The court, “agreeing with the majority of jurisdictions,” did not find “a cause of action based solely on an insurer’s failure to investigate a claim.” Under the terms of the contract, it was up to AMICO to decide if it was going to investigate the claim.
Thirdly, the court examined whether “an insured is entitled to recover the full amount of a pre-suit settlement involving both covered and noncovered claims after an insurer wrongfully disclaims coverage.” The court concluded that the limits are that the settlement be reasonable, the policy limit, and the covered claims.
Mr. Scully concludes that the decision will limit “the scope of coverage for construction defect claims” and “also imposes reasonable requirements on an insured to allocate a settlement between covered and noncovered claims.
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Endorsement to Insurance Policy Controls
March 28, 2022 —
David Adelstein - Florida Construction Legal UpdatesI’ve said this before, and I’ll say it again: an insurance policy is a complicated reading and this reading gets compounded with endorsements that modify aspects of the policy.
What you think may be covered may in fact not be covered by virtue of an endorsement to the insurance policy. This is why when you request an insurance policy you want to see the policy PLUS all endorsements to the policy. And when you analyze a policy, you need to do so with a full reading of the endorsements.
An endorsement to an insurance policy will control over conflicting language in the policy. Geovera Speciality Ins. Co. v. Glasser, 47 Fla.L.Weekly D436a (Fla. 4th DCA 2022) (citation omitted).
The homeowner’s insurance coverage dispute in Glasser illustrates this point. Here, the policy had a water loss exclusion. There was an exception to the exclusion for an accidental discharge or overflow of water from a plumbing system on the premises. But there was an endorsement. The endorsement modified the water loss exclusion to clarify that the policy excluded water damage “in any form, including but not limited to….” Examples were then given which did not include the accidental discharge or overflow of water from a plumbing system.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
