Hawaii Federal District Rejects Another Construction Defect Claim
November 30, 2020 —
Tred R. Eyerly - Insurance Law HawaiiThe Federal District Court, District of Hawaii, continued it long line of cases finding no coverage for claims of faulty workmanship. Nautilus Ins. Co. v. Summary Judgment RMB Enters., 2020 U.S. Dist. LEXIS 200468 (D. Haw. Oct. 28, 2020).
Property owners entered a construction contract with RMB Enterprises to develop and construct residential structures and a pond. The pond walls enclosed residential spaces, providing structural foundations for the walls of the building. After completion of the project, the pond leaked into its pump room. RMB performed remedial work by injecting epoxy into cracks. Later, water from the pondleaked into the interior of a residence near a staircase. Water also leaked into the master bedroom area causing musty odor, mood growth, and increased humidity.
The owners sued RMB asserting breach of contract, breach of warranty, misrepresentation, and negligence claims. Nautilus denied coverage. The policy provided that faulty workmanship did not constitute an "occurrence." But when faulty workmanship caused property damage to property other than "your work," then such property damage would be considered caused by an occurrence.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Prefabrication Contract Considerations
March 08, 2021 —
David Adelstein - Florida Construction Legal UpdatesPrefabrication (also referred to as modular construction in instances), is a form of offsite construction where certain construction activities occur at an offsite manufacturing facility or location. Construction components or units are preassembled (prefabricated) at this offsite location prior to being delivered to the project site and then integrated into the project.
When preparing a prefabrication contract (including a prefabrication subcontract), there are a number of complex considerations that need to be weighed, and these considerations are bullet-pointed below. The purpose of these bullet-points is to give you considerations to discuss and vet when preparing, negotiating, and agreeing to a prefabrication contract or subcontract.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
My Employees Could Have COVID-19. What Now?
March 23, 2020 —
Amy R. Patton, Leila S. Narvid, Matthew C. Lewis, Robert Tadashi Matsuishi & Sarah J. Odia - Payne & FearsUpdated Guidance as of March 19, 2020.
You are concerned about potentially sick employees in the workplace. One employee is off work sick for a couple of days, and then wants to return to work. Another plans to return to work after a week of travel. Another appears to be sick at work. They are coughing, sneezing, and appear to be short of breath. You are concerned they may have COVID-19. What can you do? You're not the only one concerned -- your other employees are, too.
Your public-facing employees want to wear masks to protect themselves. One employee tells you he doesn’t want to touch anything that others in the office have touched. What are your obligations to these employees?
Below, we address questions relating to keeping employees safe from COVID-19 in the workplace without violating the Americans with Disabilities Act (ADA) or employee privacy laws.
Can I require an employee returning from days away from work due to illness to report the symptoms the employee was experiencing that kept him/her out of work?
Short answer: yes, so long as the questions are limited to whether the employee has had flu-like symptoms. Though the ADA prohibits asking employees questions related to an employee disability, COVID-19 (like the seasonal flu) likely does not rise to the level of a disability, so asking an employee about flu-like (or COVID-19-like) symptoms is unlikely to elicit information related to a disability. The Equal Employment Opportunity Commission (EEOC) has taken the position that an employer may ask if an employee is experiencing flu-like symptoms if the employee reports being ill during a pandemic.
Reprinted courtesy of Payne & Fears attorneys
Amy R. Patton,
Leila S. Narvid,
Matthew C. Lewis,
Robert Tadashi Matsuishi and
Sarah J. Odia
Ms. Patton may be contacted at arp@paynefears.com
Ms. Narvid may be contacted at ln@paynefears.com
Mr. Matthew may be contacted at mcl@paynefears.com
Mr. Robert may be contacted at rtm@paynefears.com
Ms. Odia may be contacted at sjo@paynefears.com
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Illinois Supreme Court Finds Construction Defect Claim Triggers Initial Grant of Coverage
February 26, 2024 —
Tred R. Eyerly - Insurance Law HawaiiThe Illinois Supreme Court found that the underlying allegations addressing construction defects were sufficient to establish "property damage" caused by an "occurrence."Acuity v. M/I Homes of Chicago, LLC, 2023 Ill. LEXIS 1019 (Ill. Nov. 30, 2023).
M/I Homes was the general contractor for a residential townhome development. The Owners' Association sued for breach of conract and breach of the implied warranty of habitability against M/I Homes. The complaint alleged that M/I Homes' subcontractors caused construction defects by using defective materials, conducting faulty workmanship and failing to comply with applicable building codes. The defects included leakage and uncontrolled water with moisture in locations in the buildings where it was not intended or expected. The Association further alleged that M/I Homes did not intend to cause the construction defects nor did it expect or intend the resulting property damage, such as damage to other building materials. The complaint further alleged that M/I Homes did not perform any of the construction work and that the subconractors performed all the work on its behalf.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Home Builders and Developers Beware: SC Supreme Court Beats Up Hybrid Arbitration Clauses Mercilessly
November 15, 2022 —
Matthew Devries - Best Practices Construction LawToday’s guest post is by one of my favorite construction lawyers and friends, Burr partner Ned Nicholson in our Columbia, SC office. Ned regularly represents clients in construction defect and compensation claims, manufacturer/dealer disputes, and insurance coverage lawsuits. He is also a South Carolina certified mediator. Ned can be reached at nnicholson@burr.com or (803) 799-9800.
If you are a homebuilder, residential housing developer, construction industry insurer, or any one of the many participants in the industry providing affordable and decent housing for the citizens of South Carolina, you are already aware that South Carolina courts have for decades prioritized the promotion of consumer (i.e., home buyer) rights, usually at the expense of the providers of housing. There is nothing inherently wrong with that; the goal is laudable. But as in so many things, the implementation has been extremely costly for the residential construction industry as a savvy plaintiff’s bar has taken advantage of grey areas that are inevitably created in our judicial system.
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Matthew Devries, Burr & Forman LLPMr. Devries may be contacted at
mdevries@burr.com
New Jersey Rules that Forensic Lab Analysts Can’t be Forced to Testify
August 06, 2014 —
Beverley BevenFlorez-CDJ STAFFThe New Jersey Law Journal reported that the New Jersey Supreme Court has rejected a rule that would have required “laboratory analysts who prepare forensic reports in criminal cases be available for cross-examination at trial.”
The court stated that “requiring every analyst who was involved in the testing to be available for questioning by the defense was not required by the U.S. Constitution's Sixth Amendment Confrontation Clause and that doing so would create ‘practical drawbacks that range from moderate to severe.’”
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Terminating Contracts for Convenience — “Just Because”
June 28, 2021 —
David Adelstein - Florida Construction Legal UpdatesTermination for convenience provisions are important provisions to include in construction contracts. These are provisions that allow a party to terminate the contract for ANY REASON. No cause is needed to exercise the termination for convenience provision. In other words, the terminating party does not have to demonstrate the other party breached the contract. A termination for convenience can be exercised “just because.”
Typically, the party providing the service should not get to terminate for convenience. However, the party receiving the service will want to be afforded this contractual right.
For example, an owner (receiving a service) will want to include a termination for convenience provision with its prime contractor (providing a service). And, a general contractor (receiving a service) will want to include a termination for convenience provision in its subcontract with its subcontractor (providing a service). However, a general contractor providing a service for an owner, or a subcontractor providing a service to a general contractor, should not be able to terminate the contract for their convenience “just because” a better opportunity comes along.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
Why Builders Should Reconsider Arbitration Clauses in Construction Contracts
October 21, 2019 —
David M. McLain – Colorado Construction LitigationMy advice to home builders has long been to arbitrate construction defect claims instead of litigating them in front of juries. Based on my experience and watching others litigate claims, I have learned that home builders usually fare better in arbitration than in jury trials, both in terms of what they have to pay the homeowners or HOAs and also in what they recover from subcontractors and design professionals. Because of these dynamics, conventional wisdom has been that builders should arbitrate construction defect claims. For several reasons, I am now questioning whether the time is right to consider a third option.
First, plaintiffs’ attorneys dislike arbitration and will continue their attempts to do away with arbitration for construction defect claims. In 2018, the Colorado Legislature considered HB 18-1261 and HB 18-1262. While both bills were ultimately killed, they showed the plaintiffs’ attorneys disdain for arbitration, and serve as a warning that attempts to prevent arbitration legislatively will continue. If the legislature does away with the ability to arbitrate construction defect claims, and that is the only means of dispute resolution contained in a builder’s contracts, that builder may find itself in front of a jury.
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David McLain, Higgins, Hopkins, McLain & RoswellMr. McLain may be contacted at
mclain@hhmrlaw.com