FAIRFIELD CONNECTICUT BUILDING EXPERT
DIRECTORY AND CAPABILITIES

Liquidated Damages: Too High and It’s a Penalty. Too Low and You’re Out of Luck.

November 21, 2022 — Christian Fernandez - Snell & Wilmer Real Estate Litigation Blog
Liquidated damages provisions in commercial and residential real estate contracts play a vital role when a transaction goes south, and should be given careful consideration when negotiating a real estate contract. Liquidated damages may be referred to in a variety of ways, such as “earnest money,” a “good-faith deposit,” or a “non-refundable deposit,” but each typically denote a negotiated amount of money that a seller is entitled to retain should a buyer breach a purchase and sale agreement. The purpose of liquidated damages is to provide the parties with certainty when actual damages arising from a breach of contract may be difficult to calculate. Accordingly, liquidated damages provisions alleviate the need for potentially expensive litigation associated with proving damages. While parties are free to negotiate the amount of liquidated damages, the amount must approximate the loss anticipated at the time of contracting, or the loss that actually occurs as a result of a breach. Arizona courts have held that where the amount of liquidated damages is unreasonably large when compared to the anticipated loss or actual loss, the liquidated damages provision is unenforceable as a penalty. A breaching party faced with high liquidated damages will often seek to invalidate the provision as a penalty. If a court agrees, the non-breaching party may still recover damages, but must go through the process of proving such damages. Therefore, when negotiating a real estate contract, consideration should be given as to whether a liquidated damages amount is arbitrarily high when compared to an anticipated loss in the event of a breach. Read the court decision
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Reprinted courtesy of Christian Fernandez, Snell & Wilmer
Mr. Fernandez may be contacted at cfernandez@swlaw.com

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Ruling Finds Builder and Owners at Fault in Construction Defect Case

December 30, 2013 — CDJ STAFF
A Minnesota home owners association has been found 30liable for some of the damage to their homes in a jury trial. The Interlachen Propertyowners Association made a claim of construction defects against Keupers Architects and Builders who had constructed the 24-unit town home complex. According to the association’s lawyer, the half-log siding was improperly installed, leading to water intrusion and rot. The jury did find for the homeowners on the construction defect claim, but found on a claim of negligent repairs that the association was 30% at fault, due to insufficient maintenance of the building. “We don’t think any amount of maintenance would have saved these buildings,” said Jason Tarasek, the lawyer for the association. The association is likely to appeal. Read the court decision
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Construction Defects and Second Buyers in Pennsylvania

February 07, 2013 — CDJ STAFF
The ability to sue over construction defects has typically been limited to the initial purchaser of a home. But as Kevin F. McKeegan writes in the Pittsburgh Post-Gazette, the Pennsylvania Superior Court recently expanded that to subsequent purchasers. As Mr. Keegan notes, "not only can the first buyer of a new home bring a lawsuit against a builder, but now any subsequent buyer within 12 years of the home's construction can file a claim." Mr. Keegan, a lawyer with Meyer, Unkovic & Scott, notes that in the underlying case, the second owners of a home in Jamison, Pennsylvania filed a claim that the water infiltration violated the "implied warranty of habitability." There are still limitations on construction defects in Pennsylvania. The suit must be filed within twelve years of completion of the construction, and a breach of implied warranty must be proven. Mr. Keegan notes that "the homeowner must show that a defect is hidden and non-obvious, that it is the result of the builder's design or construction, and that it affects the habitability of the residence." Read the court decision
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Fast-Moving Isaias Dishes Out Disruption in the Mid-Atlantic, Northeast

August 24, 2020 — Jim Parsons - Engineering News-Record
Far from the most powerful storm to strike the Eastern Seaboard, Hurricane Isaias nevertheless proved disruptive enough to rival some infrastructure impacts from Superstorm Sandy in 2012 while also raising concerns about the potential of additional doses of destruction arriving in the coming months. Jim Parsons, Engineering News-Record ENR may be contacted at ENR.com@bnpmedia.com Read the full story... Read the court decision
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Uniform Rules Governing New York’s Supreme and County Courts Get An Overhaul

February 08, 2021 — Andrew I. Hamelsky, Jenifer A. Scarcella & Monica Doss - White and Williams LLP
By Administrative Order effective February 1, 2021, New York’s Uniform Civil Rules for the Supreme Court will incorporate a number of changes to the general part that reflect many of New York’s Commercial Division Rules, in an effort to streamline court processes. The general part rule changes are a step forward for improving the efficiency, modernization and cost-effectiveness of the New York Courts, and will require practitioners to be more conscientious of court appearances and deadlines. Judges will likely be strict on adherence to the new Uniform Rules. Some notable changes to the rules are highlighted below. Court Appearances and Scheduling Orders Uniform Rule 202.1 has been revised to require that counsel who appear before the court must be familiar with the case they are appearing for, and be fully prepared and authorized to discuss and resolve the issues that are the subject of the appearance. Reprinted courtesy of Andrew I. Hamelsky, White and Williams LLP, Jenifer A. Scarcella, White and Williams LLP and Monica Doss, White and Williams LLP Mr. Hamelsky may be contacted at hamelskya@whiteandwilliams.com Ms. Scarcella may be contacted at scarcellaj@whiteandwilliams.com Ms. Doss may be contacted at dossm@whiteandwilliams.com Read the court decision
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CLB Recommends Extensive Hawaii Contractor License Changes

January 27, 2014 — Beverley BevenFlorez-CDJ STAFF
In 2013, the Hawaii senate passed a resolution, which asked the Contractors License Board to assess “each of the contractor licensing classifications under chapter 444, Hawaii Revised Statutes, and chapter 77, Hawaii Administrative Rules, and prepare a report that evaluates each classification,” according to Anna Oshiro’s blog, Hawaii Construction Law. The “board completed its task” and “recommends wholesale changes to the scope of work to be performed by licensed contractors in the State of Hawaii.” The report has been filed with the Legislative Reference Bureau. Read the court decision
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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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Washington School District Sues Construction Company Over Water Pipe Damage

August 27, 2014 — Beverley BevenFlorez-CDJ STAFF
The Yakima Herald reported that “[t]he Toppenish School District is suing a local construction company over a breach of contract that allegedly led to defective water pipes at one of its elementary schools, according to a complaint filed with the Yakima County Superior Court earlier this week.” According to the complaint (as reported by the Yakima Herald), Toppenish officials alleged that the Huylar Construction Co. failed to install calcium silicate seals during the pipe installation. Furthermore, the complaint stated that last November, the school district discovered “’[e]xtensive corrosion and deterioration’ of the pipes.” Toppenish argued that failure to install the seals is a breach of contract. Toppenish is suing for about $120,000. The Yakima Herald stated that a Huylar representative “could not be reached for comment.” Read the court decision
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