Real Estate & Construction News Roundup (7/31/24) – International Homebuying Shrinks Commercial Real Estate Focus on Sustainability, and U.S. Banks Boost Provisions for Credit Losses
September 09, 2024 —
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law BlogIn our latest roundup, mortgage rates drop to lowest levels since March, hotel construction activity highest since February 2023, Biden administration calls for legislation regarding property owners, and more!
- International buyers bought 54,300 existing homes from April 2023 to March 2024 – a 36% drop from the year before. (Diana Olick, CNBC)
- The Biden administration called on Congress to pass legislation penalizing property owners for rent increases above a certain level as part of its plan to lower housing costs through a series of administrative actions. (Mary Salmonsen, Multifamily Dive)
- U.S. banks have boosted their provisions for credit losses as deteriorating commercial real estate (CRE) loans and high interest rates fuel fears of defaults. (Manya Saini, Niket Nishant and Matt Tracy, Reuters)
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Pillsbury's Construction & Real Estate Law Team
Appellate Court reverses district court’s finding of alter ego in Sedgwick Properties Development Corporation v. Christopher Hinds (2019WL2865935)
August 13, 2019 —
Frank Ingham - Colorado Construction LitigationDivision V of the Colorado Court of Appeals addressed, for the first time, corporate veil-piercing in the context of a single-member, single-purpose LLC that is managed under a contract by another company. On July 3, 2019, the Court of Appeals reversed the order of the Honorable Ross B. Buchannan, Denver District Court Judge (17CA2102), who held that Plaintiff/Appellee Christopher Hinds satisfied the elements required to pierce the corporate veil of Sedgwick Properties Development Corporation (“Sedgwick”).
Background
Defendant 1950 Logan, LLC (“1950 Logan”) was the developer of a building located at 1950 Logan Street, in Denver, called The Tower on the Park (“Project”), which contained 141 individually owned condominium units. The Project was completed in 2006. 1950 Logan was a single-purpose entity created for the construction of the Project, which is a common practice in the construction industry. After the units were sold in 2006, the LLC wrapped up operations.
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Frank Ingham, Higgins, Hopkins, McLain & Roswell, LLCMr. Ingham may be contacted at
ingham@hhmrlaw.com
Newmeyer Dillion Partner Louis "Dutch" Schotemeyer Named One of Orange County's 500 Most Influential by Orange County Business Journal
January 25, 2021 —
Newmeyer DillionProminent business and real estate law firm Newmeyer Dillion is pleased to announce that partner
Louis "Dutch" Schotemeyer has been selected to the Orange County Business Journal's fifth annual "OC 500 Directory of Influence" list. The 2020 list recognizes the 500 most influential leaders who have made a positive mark on Orange County's business community over the last year.
Located in the Newport Beach office, Schotemeyer's practice areas include, Real Estate Litigation, Construction Operations and Litigation, Business Litigation and Labor & Employment. Additionally he provides risk management and legal advice to companies without dedicated in-house legal counsel. A seasoned litigator, he leverages his litigation experience to advise clients, including C-Level executives, regarding potentially litigious situations that touch their business operations and his practice areas.
"Dutch's deep knowledge and experience as in-house counsel has informed his business-first approach to complex legal disputes and made him an invaluable resource to the Orange County business community," said Firm Managing Partner Paul Tetzloff. "We are pleased that Dutch's contributions to the community have been recognized by Orange County Business Journal."
Schotemeyer
rejoined the firm in September after serving as Vice President and Associate General Counsel for William Lyon Homes, Inc., and Vice President and Deputy General Counsel for Taylor Morrison. While at William Lyon Homes, he was named 2019 "General Counsel Rising Star" by the Orange County Business Journal.
The full "OC 500 Directory of Influence" list was distributed in a special December supplement.
About Newmeyer Dillion
For over 35 years, Newmeyer Dillion has delivered creative and outstanding legal solutions and trial results that achieve client objectives in diverse industries. With over 60 attorneys working as a cohesive team to represent clients in all aspects of business, employment, real estate, environmental/land use, privacy & data security and insurance law, Newmeyer Dillion delivers holistic and integrated legal services tailored to propel each client's operations, growth, and profits. Headquartered in Newport Beach, California, with offices in Walnut Creek, California and Las Vegas, Nevada, Newmeyer Dillion attorneys are recognized by The Best Lawyers in America©, and Super Lawyers as top tier and some of the best lawyers in California and Nevada, and have been given Martindale-Hubbell Peer Review's AV Preeminent® highest rating. For additional information, call 949.854.7000 or visit www.newmeyerdillion.com.
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Best Lawyers Recognizes Hundreds of Lewis Brisbois Attorneys, Honors Four Partners as ‘Lawyers of the Year’
September 19, 2022 —
Lewis Brisbois(August 18, 2022) - Best Lawyers has selected 149 Lewis Brisbois attorneys across 46 offices for inclusion in its list of 2023 Best Lawyers in America. It has also recognized four Lewis Brisbois partners on its "Lawyers of the Year" list: Chairman & Founding Partner Robert F. Lewis (Insurance Law); Portland Managing Partner Eric J. Neiman (Litigation - Health Care); Akron Managing Partner David Kern (Tax Law); and Roanoke Partner Paul C. Kuhnel (Medical Malpractice Law - Defendants).
Please join us in congratulating these four partners and the following attorneys on their Best Lawyers recognition.
- Nashville Partner Tara Aaron-Stelluto:
Copyright Law
- Pittsburgh Partner Andrew F. Adomitis:
Mass Tort Litigation / Class Actions - Defendants
- Fort Lauderdale Partner Vincent F. Alexander:
Bankruptcy and Creditor Debtor Rights / Insolvency and Reorganization Law
- Miami Partner Seth Alhadeff:
Litigation - Insurance
- Seattle Partner Randy J. Aliment:
Commercial Litigation
- Phoenix Partner Dina Anagnopoulos:
Medical Malpractice Law - Defendants
- Madison County Partner Charles S. Anderson:
Mass Tort Litigation / Class Actions – Defendants
- Reno Managing Partner Jack G. Angaran:
Insurance Law, Litigation – Construction, Litigation - Real Estate
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Lewis Brisbois
Resolving Subcontractor Disputes with Pass-Through Claims and Liquidation Agreements
May 13, 2024 —
Stephanie Cooksey - Peckar & Abramson, P.C.Imagine a project where you are unable to reach final completion due to an unresolved subcontractor claim. If the project owner is responsible for the claim, and both the owner and subcontractor are entrenched in their positions, how would you resolve this dispute?
The default option is a three-party lawsuit where the subcontractor sues you in your capacity as general contractor. By denying the claim, you bring the owner into the lawsuit as a liable party to the subcontractor’s claim. This option is efficient from the judicial system’s perspective, as it means one lawsuit instead of two. The subcontractor cannot sue the owner since the two have no contract between them. Thus, the subcontractor’s recourse is limited to suing the contractor. In the three-party lawsuit, you argue that if the subcontractor prevails in its claim against you, the owner is liable. If the owner successfully defends against the claim, the subcontractor takes nothing.
Putting judicial economy aside, it may not make economic sense for contractors to have a lawyer involved in litigating a case where they have no skin in the game. Fortunately, there is a better option than the three-party lawsuit on multi-party construction projects.
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Stephanie Cooksey, Peckar & Abramson, P.C.Ms. Cooksey may be contacted at
scooksey@pecklaw.com
Subcontractor Allowed to Sue Designer for Negligence: California Courts Chip Away at the Economic Loss Doctrine (Independent Duty Rule)
August 30, 2017 —
John P. Ahlers - Ahlers & Cressman PLLCAn architect may have to pay over $1 million to a subcontractor who was contractually obligated to rely on the designer’s plans – even though the architect was not a party to the contract.[1] That was the ruling in U.S. f/u/b/o Penn Air Control, Inc. v. Bilbro Constr. Co., Inc.[2]
The dispute involved a $7.3 million design-build contract award to Bilbro Construction (“Bilbro”) to renovate a facility for the Naval Facilities Engineering Command in Monterey, California. Bilbro hired an architect (“FPBA”) to serve as the designer of record and provide all the architectural design services. FPBA’s design team included an acoustical sub-consultant (Sparling). The general contractor (design builder) also retained Alpha Mechanical (Alpha) as the mechanical electrical and plumbing (“MEP”) design/build subcontractor. Alpha, in turn, subcontracted the MEP design to Shadpour Consulting Engineers. During the design phase of this project, Alpha’s MEP design was reviewed by FPBA, Bilbro, and Sparling at the 35, 75, and 100 percent design completion levels. Alpha demonstrated that it regularly received direct communications during design development from Sparling and FPBA, including comments, changes, and revisions. One example Alpha cited was it raised some concerns about anticipated noise level in eight rooms. Sparling made several recommendations to Alpha and Shadpour that were implemented.
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John P. Ahlers, Ahlers & Cressman PLLCMr. Ahlers may be contacted at
jahlers@ac-lawyers.com
Texas Supreme Court Rules That Subsequent Purchaser of Home Is Bound by Original Homeowner’s Arbitration Agreement With Builder
May 29, 2023 —
Kim Altsuler - Peckar & Abramson, P.C.In a new opinion
Lennar Homes of Texas Land and Construction, Ltd., et al. v. Kara Whiteley, Cause No. 21-0783, 66 Tex. Sup. Ct. J. 8740, issued May 12, 2023, the Texas Supreme Court partially reversed two lower court decisions and held that an arbitration provision contained in the original homeowner’s contract with the builder was binding on a subsequent homeowner. In the decision, the court found that Kara Whiteley—the second owner of the home in Galveston, Texas—was bound to arbitrate her construction defect claims with Lennar by virtue of the doctrine of “direct-benefits estoppel.” The rationale was based on the fact that Whitely was seeking benefits emanating from Lennar’s contract with the original homeowner.
The residence in question was first purchased from Lennar in May 2014. Whiteley purchased the home in July 2015. The original contract documents included several arbitration provisions—one in the Purchase and Sale Agreement, one in the Limited Warranty issued by Lennar, and one in the general warranty deed. Whiteley sued Lennar in Galveston County District Court alleging mold growth and other defects at the property. Lennar moved for arbitration and its motion was granted. The parties arbitrated the case and Lennar received an award in its favor. Lennar then moved the District Court to confirm the arbitration award, and Whiteley filed a cross-motion to vacate the award, arguing that Lennar’s original motion to compel arbitration should not have been granted. The District Court agreed with Whiteley, vacating the arbitration award. Lennar appealed. The Court of Appeals affirmed the District Court’s vacatur, and Lennar appealed to the Texas Supreme Court.
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Kim Altsuler - Peckar & Abramson, P.C.Ms. Altsuler may be contacted at
kaltsuler@pecklaw.com
The Business of Engineering: An Interview with Matthew Loos
July 15, 2019 —
Aarni Heiskanen - AEC BusinessMatthew Loos is an experienced project manager in the civil engineering industry. He works as a project engineer at Jones|Carter in Fort Worth, Texas. In this interview, we discuss Matt’s new book, The Business of Engineering.
It is not very common that an engineer writes a non-technical book. What inspired you to do so?
Have you ever gotten an idea stuck in your head that you just couldn’t let go of? A time when you couldn’t go to sleep because the idea was consistently begging for your attention?
That’s what happened to me. The idea for this book hits me right before bed, as most good ideas do. I couldn’t go to sleep after the idea struck me. I spent half of the night writing the chapters of this book in my mind. I had been thinking about the idea of engineering and how it relates to other career fields, even the non-technical ones. I was disenchanted with the trifling number of classes I took that prepared me for the business world. These were the initial thoughts that eventually led me down the road into thinking about engineering as a profession going forward.
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Aarni Heiskanen, AEC BusinessMr. Heiskanen may be contacted at
aec-business@aepartners.fi
