Embracing Generative Risk Mitigation in Construction
February 12, 2024 —
Georgia Stillwell - Construction ExecutiveProject delays have long plagued the construction industry, with risk often identified as the primary culprit. However, finding effective solutions to mitigate risk on complex projects has remained daunting. Traditional methods for simulating risk primarily focus on extending project timelines, overlooking the diverse range of opportunities available for risk mitigation. With the construction industry’s digital transformation, generative methodologies have emerged to handle complex decision-making in uncertain situations. This article aims to shed light on the limitations of existing risk modeling and introduce a novel approach known as generative risk mitigation to enhance decision-making under deep uncertainty.
According to McKinsey, 98% of megaprojects experience cost overruns exceeding 30%. Project delays have become so pervasive that the industry has grown accustomed to them. For example, in 2022, the UK government issued ‘
The Green Book,’ which requires contingency funds in projects, such as a 44% contingency budget for standard civil projects. This implies that for a $100 million project, you should allocate $144 million to manage expected risks. There is no denying significant academic literature on the root cause of these delays: it is ‘risk,’ and there is an entire industry based on it.
Conversations with project directors and risk experts reveal the same issue, different project. And that issue is that we cannot easily forecast risk, qualify the impacts or fully understand the opportunities that exist to mitigate risks and make timely decisions. A method that will finally help us overcome this has emerged within the industry.
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Georgia Stillwell, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Federal Court Sets High Bar for Pleading Products Liability Cases in New Jersey
November 11, 2024 —
Lian Skaf - The Subrogation StrategistProducts liability is an area of law that both sides of the aisle vigorously litigate. Like in most litigation, products liability claims provide subrogation attorneys with an important means of prosecuting cases against manufacturers, sellers, and other entities in the stream of commerce. Of course, these claims also come with numerous “buyer beware” requirements.
New Jersey allows products liability claims and the United States District Court for the District of New Jersey (District Court) clarified how such claims should be plead in Cambridge Mut. Fire Ins. Co. a/s/o David Krug vs. Stihl, Inc., No. 22-05893, 2024 U.S. Dist. LEXIS 178804 (D. N.J.). After becoming subrogated to the rights of its insured, Cambridge Mutual Fire Insurance Company (Cambridge) filed suit against Stihl, Inc. (Stihl) in the Superior Court of New Jersey, Morris County, Law Division. Stihl then removed the case to federal court. Once in federal court, Stihl filed a motion to dismiss the action. The District Court granted the motion, doing so in part with prejudice and in part without prejudice.
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Lian Skaf, White and Williams LLPMr. Skaf may be contacted at
skafl@whiteandwilliams.com
Real Estate & Construction News Round-Up (05/11/22)
May 30, 2022 —
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law BlogThe supply of homes for sale is on the uptick, the White House releases a plan to improve the permitting process for infrastructure projects, cryptocurrency opens the door to a new class of property owners, and more.
- Though the number of active listings is still down 67% from pre-pandemic levels, the supply of homes for sale is finally showing signs of improvement. (Diana Olick, CNBC)
- Large corporations and institutional investors are flocking to buy digital real estate, with parcels being bought faster than they can be created. (Dan Patterson, CBS News)
- London-based company, Admix, has been purchasing real estate in various Metaverse platforms and leasing them to companies interested in becoming involved in the online virtual space. (Nate Berg, Fast Company)
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Pillsbury's Construction & Real Estate Law Team
Judicial Panel Denies Nationwide Consolidation of COVID-19 Business Interruption Cases
October 05, 2020 —
Tred R. Eyerly - Insurance Law HawaiiThe Judicial Panel on Multidistrict Litigation denied motions to centralize pretrial proceedings in pending COVID-19 business interruption claims. In re COVID-19 Business interruption Protection Insurance Litigation, 2020 U.S. District. LEXIS 144446 (Aug. 12, 2020).
Plaintiff policy holders sought consolidation, contending their policies provided coverage for business interruption losses caused by the COVID-19 pandemic and the related government orders suspending, or severely curtailing, operations of non-essential businesses. The Panel considered 15 actions on the pending motions, but had notice of 263 related actions.
Some plaintiffs opposed centralization or sought to be excluded from any MDL. Some argued the Panel should centralize the coverage actions on a state-by-state, regional, or insurer-by-insurer basis.
The Panel did not accept consolidation of all cases. There was little potential for common discovery across the litigation because there was no common defendant as the actions involved either a single insurer or insurer-group. The various cases involved different insurance policies with different coverages, conditions, exclusions, and policy language, purchased by different businesses in different industries located in different states.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Sustainability Is an Ever-Increasing Issue in Development
November 21, 2022 —
Scott L. Baker - Los Angeles Litigation BlogBusinesses must be open to change. It is essential to survive in the business world, regardless of the industry. This goes hand-in-hand with the necessity to change along with consumer needs and values as well.
With the increasing emphasis on sustainability across industries, many businesses have had to make their processes and products more environmentally friendly. However, in terms of real estate construction, there are some challenges.
SUSTAINABILITY IN NEW CONSTRUCTION IS NOW A MATTER OF LAW – NOT JUST A PREFERENCE
The push to become greener comes from many fronts. Property owners, potential buyers and even lawmakers all expect the real estate industry to go greener. For example, homeowners and businesses often want their properties to meet their personal values of sustainability.
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Scott L. Baker, Baker & AssociatesMr. Baker may be contacted at
slb@bakerslaw.com
Hunton Insurance Practice, Attorneys Recognized in 2024 Edition of The Legal 500 United States
July 02, 2024 —
Hunton Andrews Kurth LLPHunton Andrews Kurth LLP’s insurance coverage practice was once again recognized among the top policyholder insurance practices nationally, receiving a Band 2 national ranking in the 2024 United States Edition of The Legal 500 for Insurance: Advice to Policyholders. The Legal 500 ranks the nation’s top law firms, practices, and lawyers, highlighting those that consistently provide “the most cutting edge and innovative advice to corporate counsel … based on feedback from 300,000 clients worldwide, submissions from law firms and interviews with leading private practice lawyers, and a team of researchers who have unrivalled experience in the legal market.”
Bolstering the team’s national recognition, several of the team’s lawyers received individual accolades: partner Lorelie (Lorie) Masters was named to The Legal 500’s Hall of Fame; team head Syed Ahmad was named a Leading Lawyer; partner Andrea DeField was named a Next Generation Partner; and counsel Latosha Ellis was named a Rising Star. In addition, partners Walter Andrews, Michael Levine, and Geoffrey Fehling were recognized as key lawyers on the team.
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Hunton Andrews Kurth LLP
Genuine Dispute Summary Judgment Reversed for Abuse of Discretion and Trial of Fact Questions About Expert Opinions
July 27, 2020 —
Christopher Kendrick & Valerie A. Moore – Haight Brown & Bonesteel LLPIn Fadeeff v. State Farm General Ins. Co. (No. A155691, filed 5/22/20 ord. pub. 6/8/20), a California appeals court held that triable issues of fact and the trial court’s failure to address a request for a continuance precluded summary judgment for an insurer under the genuine dispute doctrine.
In Fadeeff, the policyholders made a claim to State Farm for smoke damage to their home from the 2015 Valley Fire in Hidden Valley Lake, California. With State Farm’s approval, the insureds retained the restoration company, ServPro, to assist with smoke and soot mitigation. State Farm documented smoke and soot on the interior walls, ceilings and carpeting, and on all exterior elevations, including on the deck and handrail. State Farm made a series of payments on the claim totaling about $50,000.
The insureds then hired a public adjuster and submitted supplemental claims for further dwelling repairs and additional contents replacement, totaling approximately $75,000. State Farm responded by using its own independent adjuster to investigate, who was neither licensed as an adjuster, nor as a contractor. State Farm also retained forensic consultants for the structure and the HVAC system, but neither the independent adjuster nor the consultants were aware that State Farm had an internal operation guide for the use of third-party experts in handling first party claims, which guidelines were therefore not followed. In addition, the consultants made allegedly superficial inspections, with one attributing smoke and soot damage to other sources of combustion, including the insureds’ exterior propane barbecue, an internal wood fireplace and wood stove and candles that had been burned in the living room. None of the consultants asked the insureds when they had last used any of the sources of combustion.
Reprinted courtesy of
Christopher Kendrick, Haight Brown & Bonesteel LLP and
Valerie A. Moore, Haight Brown & Bonesteel LLP
Mr. Kendrick may be contacted at ckendrick@hbblaw.com
Ms. Moore may be contacted at vmoore@hbblaw.com
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Colorado Construction-Defects Reform Law Attempt Expected in 2015
January 14, 2015 —
Beverley BevenFlorez-CDJ STAFFAccording to the Denver Post, another attempt to change Colorado’s construction defect laws to spur condo development is likely this term. Reform supporters are encouraged by the city of Lakewood’s ordinance, Denver Post reported: “"A patchwork around the state on this issue is not the way to go," Rep. Brian DelGrosso, R-Loveland, said. "Hopefully, the Lakewood measure will spur the conversation this year."
Lakewood’s “measure gives builders a ‘right to repair’ faulty work before facing legal action and requires that a majority of home owners approve legal action before it is taken.”
However, “Nancy Stockton, president of the homeowners association at the Vallagio at Inverness in Arapahoe County, said following Lakewood's example statewide would only make it that much harder to hold builders accountable for the quality of their work.”
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