Iowa Apartment Complex Owners Awarded Millions for Building Defects
March 31, 2014 —
Beverley BevenFlorez-CDJ STAFFThe owners of a West Des Moines, Iowa apartment complex received an award of $12.4 million by a Polk County jury, according to The Des Moines Register, who declared that “[i]t’s believed to be one of the largest judgments of its kind in state history.” The owners had sued the builders “over leaks and mold the owners said took years to correct.”
The verdict “marked the culmination of a nearly decade-long saga involving the construction of the Westlake apartments and condos, a 300-unit complex built at 1770 92nd St. on the Dallas County side of West Des Moines during the pre-recession housing boom.”
Attorney Steve Eckley told The Des Moines Register that “the settlement covers about $3 million in previous repairs, about $6 million in expected repairs and maintenance and about $6 million in lost revenue.”
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Massachusetts SJC Clarifies “Strict Compliance” Standard in Construction Contracts
January 02, 2019 —
Jacob Goodelman - Gordon & Rees Construction Law BlogIn Massachusetts, it is well established that a contractor cannot recover damages from a construction contract without first showing that the contractor completely and strictly performed on all of the contract’s terms. Recently, the Massachusetts Supreme Judicial Court narrowed the rule by concluding that complete and strict performance is only required for contract terms relating to the design and construction itself. The high Court explained that non-design / non-construction contract terms are governing by “ordinary contract principles, including the traditional Massachusetts materiality rule.”
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Jacob Goodelman, Gordon Rees Scully MansukhaniMr. Goodelman may be contacted at
jgoodelman@grsm.com
The Complex Insurance Coverage Reporter – A Year in Review
February 27, 2019 —
White and Williams LLPWelcome to CICR’s annual review of insurance cases. Here, we spotlight five (actually, seven) decisions from the last year that you should know about, and five pending cases—all before state high courts—to keep an eye on. The choices were not always easy.
That is because 2018 saw a number of notable insurance coverage developments. Among them was the “Restatement of the Law – Liability Insurance,” a nearly five hundred-page document that the American Law Institute (ALI) adopted after eight years and twenty-nine drafts.
Already, much has been written about the ALI Restatement, including by us. There will be more to come. Going forward, we will continue to highlight significant examples where courts address its provisions.
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Will a Notice of Non-Responsibility Prevent Enforcement of a California Mechanics Lien?
March 05, 2015 —
William L. Porter – Porter Law Group, Inc.The “Notice of Non-Responsibility” is one of the most misunderstood and ineffectively used of all the legal tools available to property owners in California construction law. As a result, in most cases the answer to the above question is “No”, the posting and recording of a Notice of Completion will not prevent enforcement of a California Mechanics Lien.
The mechanics lien is a tool used by a claimant who has not been paid for performing work or supplying materials to a construction project. It provides the claimant the right to encumber the property where the work was performed and thereafter sell the property in order to obtain payment for the work or materials, even though the claimant had no contract directly with the property owner. When properly used, a Notice of Non-Responsibility will render a mechanics lien unenforceable against the property where the construction work was performed. By derailing the mechanics lien the owner protects his property from a mechanics lien foreclosure sale. Unfortunately, owners often misunderstand when they can and cannot effectively use a Notice of Non-Responsibility. As a result, the Notice of Non-Responsibility is usually ineffective in protecting the owner and his property.
The rules for the use of the Notice of Non-Responsibility are found in California Civil Code section 8444. Deceptively simple, the rules essentially state that an owner “that did not contract for the work of improvement”, within 10 days after the owner first “has knowledge of the work of improvement”, may fill out the necessary legal form for a Notice of Non-Responsibility and post that form at the worksite and record it with the local County Recorder in order to prevent enforcement of a later mechanics lien on the property.
What commonly occurs however is that early in the process the owner authorizes or even requires its tenant to perform beneficial tenant improvements on the property. This authorization is often set forth in a tenant lease or other written document. The dispositive factor for determining whether the Notice of Non-Responsibility will be enforceable though is that the owner knows that these improvements will be made to the property and intends that they be made, usually long before the work begins. Indeed, the owner has usually negotiated these very terms into the lease contract. The owner then mistakenly believes that once work on the property commences it has 10 days to post and record a Notice of Non-Responsibility and thereby protect itself from a mechanics lien.
The usual error is two-fold. First, the statute states that the Notice is available when the owner “did not contract for the work of improvement”. The fact though is that the owner did contract for the work of improvement. It did so through the lease contract. This is true even though the owner’s contract was not with the contractor or supplier directly. Secondly, the 10 day period to post and record the Notice begins when the owner first “has knowledge” of the work of improvement. This knowledge was of course gained when the lease was negotiated and signed, providing knowledge typically many days before the work has begun. Thus, the 10 day period can also seldom be met. The Notice of Non-Responsibility will therefore fail both rules because the owner has in fact contracted for the improvement and because he does not act within 10 days of gaining this knowledge.
The next event in the typical scenario occurs when the tenant does not pay its contractor. The contractor then has nothing to pay its subcontractors. Material suppliers also go unpaid. Mechanics liens are then recorded by the unpaid claimants, followed by foreclosure actions within ninety days thereafter. Owners will typically point to the Notice of Non-Responsibility they posted and recorded, claiming its protection. Claimants then in turn point to the lease or other evidence that the owner knew of the pending improvements and contracted in some way that the improvements be performed, often also more than 10 days before they posted the Notice. Judges generally agree with the unpaid mechanics lien claimants and the Notice of Non-Responsibility is deemed ineffective.
The fact that the Court does not enforce the Notice of Non-Responsibility under these circumstances is not an unfair result. Since the owner authorized the work to be performed and it received a substantial benefit in the form of those improvements, it is not unfair that the owner should pay for those benefits. It would be inequitable for the owner to obtain the benefit of the improvements which it authorized but for which it did not pay, while allowing those who provided the benefit to go unpaid. Moreover, without such a system in place the door would be open to owners setting up sham “tenants” who would enter into contracts to have work performed, only to disappear when the work is completed, leaving the contractor without a source of payment. The system in place as described above prevents such duplicity. Owners would do well to arm themselves with proper knowledge of when the Notice of Non-Responsibility will and will not protect them and then responsibly use the Notice of Non-Responsibility.
For the legal eagles among you, the following cases illustrate the view of the courts, consistent with the above: Baker v. Hubbard (1980) 101 Cal.App.3d 226; Ott Hardware v. Yost (1945) 69 Cal. App.2d 593 (lease terms); Los Banos Gravel Co. v. Freeman (1976) 58 Cal.App.3d 785 (common interest); Howard S. Wright Construction Co. v. Superior Court (2003); 106 Cal.App.4th 314 (participating owner).
William L. Porter of
Porter Law Group, Inc. located in Sacramento, California may be contacted at (916) 381-7868 or bporter@porterlaw.com
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US Civil Rights Tools Are Failing the Most Polluted Black Communities
February 05, 2024 —
Manann Donoghoe & Andre Perry - BloombergIn 2022, the United Nations declared that access to a safe and healthy environment, free of pollutants and toxic waste, is a universal
human right. The resolution provides a legal foundation for international challenges to environmental injustice; it should also provide an impetus for nations like the US to enforce their own environmental protections.
Without more clearly defined rights, some of the greatest environmental injustices may continue to be mired in politics.
Take the case of “Cancer Alley,” an 85-mile stretch along the Mississippi River in Louisiana where Black residents have long faced higher rates of death and morbidity due to polluted and toxic environments. For people of color living in the region,
fresh air is certainly not a right; it is a privilege for others to experience.
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Sanctions Award Against Pro Se Plaintiff Upheld
June 22, 2020 —
Tred R. Eyerly - Insurance Law HawaiiThe plaintiff's failure to timely name an expert witness in his bad faith action led to sanctions being awarded against him in favor of the insurer. Black v. Fireman's Fund Ins. Co., 2020 Cal. App. Unpub. LEXIS 2477 (Cal. Ct. App. April 23, 2020).
After Black's claim was denied by Fireman's Fund, he communicated with company through letters, emails and phone conversations. Black complained that Fireman's Fund handled his claim improperly, engaged in illegal activities and had ties to the Nazi regime in Germany. Fireman's Fund sued Black alleging that his communications amounted to civil extortion, interference with contractual relations, interference with prospective economic advantage, and unfair business practices. Fireman's Fund eventually dismissed its complaint without prejudice.
Black, however, had filed a cross-complaint in which he asserted a number of claims, including bad faith. Black designated attorney Randy Hess as an expert on insurance claims. Over the next year and a half, Fireman's Fund repeatedly attempted to take Hess's deposition. In March 2018, Fireman's Fund moved to compel the deposition or exclude the testimony. The court set a July 20, 2018 deadline for the disposition to take place or else the testimony would be excluded.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Roots of Las Vegas Construction Defect Scam Reach Back a Decade
August 05, 2013 —
CDJ STAFFRecent court documents in the Las Vegas HOA scandal reveal that the late Nancy Quon, thought to be a mastermind in the scam was involved with a similar case before 2001. The Las Vegas Review-Journal reports that the Nevada attorney general’s office launched an investigation of the Starfire condominium complex. Claims were made that an architect and a construction company attempted to fill the Starfire board with straw buyers. Quon represented a resident to filed a claim over defective windows.
Chris Rasmussen, the attorney for Edith Gillespie, Leon Benzer’s half sister, has noted that his client was not charged in the Starfire case, but the Review-Journal notes that no one was, as the insurance company settled quickly, which ended the chances for a criminal investigation. The Starfire case is described as “a $6 million lawsuit based on fraudulent construction defect claims.” Quon, Benzer, and their co-conspirators are alleged to have modeled their subsequent actions after Starfire.
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Traub Lieberman Attorneys Named 2019 Super Lawyers
November 04, 2019 —
Traub LiebermanRelated Attorneys:
Jonathan R. Harwood,
Michael K. Kiernan,
Michael S. Knippen,
Meryl R. Lieberman,
Christopher Russo,
Scot E. Samis,
Lisa L. Shrewsberry,
Stephen D. Straus,
Richard K. Traub,
Cheryl P. Vollweiler,
Brian C. Bassett,
Jessica N. Kull,
Jeremy S. Macklin,
Dana A. Rice,
Burks A. Smith, III,
Jason Taylor
Ten Traub Lieberman attorneys have been named 2019 Super Lawyers and seven named 2019 Rising Stars. The honored attorneys represent five of the firm's seven offices and nearly all of its service areas.
Super Lawyers, a Thomson Reuters business, is a rating service of outstanding lawyers from more than 70 practice areas, who have attained a high degree of peer recognition and professional achievement. The annual selections are made using a patented multiphase process that includes a statewide survey of lawyers, an independent research evaluation of candidates and peer reviews by practice area.
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