Use It or Lose It: California Court of Appeal Addresses Statutes of Limitations for Latent Construction Defects and Damage to Real Property
August 02, 2017 —
Omar Parra & Jesse M. Sullivan - Haight Brown & Bonesteel LLPThe First Appellate District of the California Court of Appeal recently confirmed California’s latent defect statute of limitations, codified in California Code of Civil Procedure section 337.15, bars only claims based on construction defects. Estuary Owners Association v. Shell Oil Company, No. A145516, (Cal. Ct. App. July 26, 2017). The Court also reemphasized that under California’s three-year statute of limitations for damage to real property, delineated in California Code of Civil Procedure section 338(b), the actual and constructive knowledge of the prior landowner is imputed to the current landowner.
Estuary Owners Association concerned the development and construction of a 100-unit condominium by Signature at the Estuary, LLC (“Signature”) on land Shell Oil Company (“Shell”) previously used as a fuel distribution terminal. Construction of the condominiums was completed in 2006. In 2008, it was discovered that residual concentrations of petroleum related chemicals remained in the soil, soil gas, and groundwater beneath the development. Later that year, Signature revealed that the condominiums had been constructed with moisture barriers beneath the building slabs instead of the vapor/gas barriers called for in the corrective action plan.
Reprinted courtesy of
Omar Parra, Haight Brown & Bonesteel LLP and
Jesse M. Sullivan, Haight Brown & Bonesteel LLP
Mr. Parra may be contacted at oparra@hbblaw.com
Mr. Sullivan may be contacted at jsullivan@hbblaw.com
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Failure to Comply with Sprinkler Endorsement Bars Coverage for Fire Damage
July 31, 2013 —
Tred Eyerly, Insurance Law HawaiiDespite its application stating otherwise, the insured's failure to install a sprinkler system in its building barred coverage for extensive damage caused by fire.American Way Cellular, Inc. v. Travelers Prop. Cas. Co. of Am., 2013 Cal. App. LEXIS 425 (Cal. Ct. App. May 30, 2013).
American Way contacted a broker, A&J, regarding liability and property coverage. A&J sent American Way an application for a policy with Travelers. The application indicated American Way had a sprinkler system and fire detectors in its building.
Travelers issued a policy with a Protective Safeguards Endorsement For Sprinkler Locations and Restaurants. The endorsement stated that as a condition of the insurance, the insured was required to maintain a sprinkler system. An exclusions section said the insurer would not pay for loss caused by fire if there was no sprinkler system.
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Tred EyerlyTred Eyerly can be contacted at
te@hawaiilawyer.com
How Retro-Commissioning Can Extend the Life of a Building—and the Planet
July 10, 2023 —
Matthew Zweibruck - Construction ExecutiveSustainability initiatives in the built environment need not be limited to new construction or other large expenditures. Aging facilities have the potential to extend their years of service while also combating greenhouse gas emissions. But what is the best course of action? From building design initiatives such as net zero and electrification to renewables and green building certifications, it can be a complicated and overwhelming field to navigate.
Building owners and property managers may question if they are pursuing the correct programs to minimize their organization’s negative impacts on the environment. With all the initiatives, buzzwords and fancy awards surrounding these initiatives, there are energy-efficiency strategies available to buildings that cut through this noise—strategies that are cost effective, quick to implement, widely abundant and result in an immediate reduction in a building’s impact on climate change.
Reprinted courtesy of
Matthew Zweibruck, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Incorrect Information Provided on Insurance Application Defeats Claim for Coverage
July 31, 2024 —
Tred R. Eyerly - Insurance Law HawaiiThe Eleventh Circuit affirmed the district court's finding of no duty to defend or indemnify because of an answer on the insured's application for insurance. Snell v. United Specialty Ins. Co., 2024 U.S. App. 12733 (11th Cir. May 28, 2024).
Snell was hired by a family, the Westons, to turn an above ground trampoline into a ground level trampoline. This involved various tasks like tree pruning and removal, installation of shrubs, trees, and sod, and setting up a sprinkler irrigation system. The trampoline aspect of the project involved site work to make a place for the trampoline and assembly and installation of the trampoline. The site work included excavation of a pit, installation of a drain and drainage sand, excavation of a trench to install a drainage pipe, installation of the drainage pipe and of a drain pump, construction of concrete block retainer walls and installation of a wood cap on the retainer walls. Then, Snell unboxed the trampoline, assembled it, and lowered it into the pit.
A few years later, a visitor to the Weston home sued the Westons for injuries to his daughter suffered on the trampoline. The complaint alleged the daughter was injured when she "fell off of the trampoline and struck her face on the wooden board" surrounding the tramline. The complaint was later amended to add Snell as a defendant.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Colorado Senate Revives Construction Defects Reform Bill
January 04, 2018 —
BEVERLEY BEVENFLOREZ - CDJ STAFFOriginally Published by CDJ on March 1, 2017
A re-booted construction defects reform bill recently passed its first Senate committee, according to the Denver Business Journal. Next, Senate Bill 156, sponsored by Sen. Owen Hill, R-Colorado Springs, heads to the Senate floor for debate.
SB 156 “would require that condominium owners alleging construction defects take their disputes to arbitration or mediation if requested by builders,” the Denver Business Journal reported. “It also would require that homeowners be informed of the consequences of filing legal actions over purported disputes and that a majority of all owners in a condominium complex vote to proceed with legal action, rather than just a majority of homeowners association board members.”
However, it is almost identical to the failed measures that were introduced in 2014 and 2015.
Homeowners association group members and owners of defective condominiums argued against the measure, stating “that the effort would not improve the quality of building in the state, but simply would block aggrieved Coloradans from taking their complaints before a jury of their peers.”
Proponent of the bill, Tom Clark, CEO of Metro Denver Economic Development Corp., said “that Denver’s housing costs have risen since the first bill was introduced in 2013 to the sixth-most-expensive in the country – and are tops for any metro area not on a coast.”
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Northern District of Mississippi Finds That Non-Work Property Damages Are Not Subject to AIA’s Waiver of Subrogation Clause
July 11, 2018 —
Shannon M. Warren - The Subrogation StrategistIn recent months, the Northern District of Mississippi has grappled with how to interpret waivers of subrogation in American Institute of Architects (AIA) construction industry contracts and, specifically, how they apply to work versus non-work property. The distinction between work and non-work property has been commonly litigated and remains a hotly debated topic when handling subrogation claims involving construction defects.
In Liberty Mutual Fire Ins. Co. v. Fowlkes Plumbing, 2018 U.S. Dist. LEXIS 23515 (February 12, 2018), a fire consumed the entire insured risk when one of the defendants was performing window restoration services. Subsequently, the insured’s subrogated insurer filed suit against several defendants involved in the construction project at issue. In response to the defendants’ motion for summary judgment, the District Court for the Northern District of Mississippi considered whether the waiver of subrogation clause in AIA contract form A201-2007 precluded the subrogated insurer from recovering damages from the defendants. The court held that the waiver of subrogation provision contained in AIA document A201-2007 barred the insurer from recovering for damages to the work itself, but did not apply to non-work property.
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Shannon M. Warren, White and Williams LLPMs. Warren may be contacted at
warrens@whiteandwilliams.com
Fraud Claims and Breach Of Warranty Claims Against Manufacturer
March 04, 2024 —
David Adelstein - Florida Construction Legal UpdatesA recent case touches upon two issues that are noteworthy when considering fraud claims and breach of warranty claims against a manufacturer. Below contains a discussion on these claims.
Independent Tort Doctrine
“Florida’s independent tort doctrine provides that a party may not recover in tort for a contract dispute unless the tort is independent of any breach of contract.” MidAmerica C2L Inc. v. Siemens Energy, Inc., 2024 WL 414620, *6 (M.D.Fla. 2024). This means tort allegations and claims MUST be separate and distinct from performance under the contract. Id. (citation omitted).
In MidAmerica C2L, a plaintiff sued a manufacturer relating to sophisticated equipment for a coal gasification plant. The parties entered into different agreements for the equipment and a license where the plaintiff could use the manufacturer’s patented technology for its coal gasification plants. A dispute arose and the plaintiff sued the manufacturer under various legal theories. The manufacturer moved for summary judgment.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
While Construction Permits Slowly Rise, Construction Starts and Completions in California Are Stagnant
December 05, 2022 —
John Kazanovicz & Jason Feld - Kahana FeldThere is an interesting phenomenon happening in the California construction market since the Summer of 2022. There is a steady but slow rise in the construction building permits being issued throughout California. According to the U.S. Census and the U.S. Department of Housing and Urban Development’s joint announcement (https://www.census.gov/construction/nrc/pdf/newresconst.pdf) of new residential construction statistics for September 2022, privately‐owned housing units authorized by building permits in September were at a seasonally adjusted annual rate of 1,564,000. This is 1.4 percent above the revised August rate of 1,542,000. While this is slightly lower than a year ago (3.2 percent below the September 2021 rate of 1,615,000), the trend for obtaining new home permits was reportedly ahead of the projected rates given the market conditions and inflation throughout the country. Interestingly, single‐family authorizations in September were at a rate of 872,000 which was also 3.1 percent below the revised August 2022 figure of 900,000. Authorizations of units in buildings with five units or more were at a rate of 644,000 in September. Overall, while slowly recovering from the record lows during the height of the pandemic, the economic forecast for new home construction in California is positive, but cautious.
The flip side of this coin is the construction starts in California, which continue to remain stagnant despite additional building permits being issued. Privately‐owned housing starts in September were at a seasonally adjusted annual rate of 1,439,000. This is 8.1 percent (±14.9 percent) below the revised August estimate of 1,566,000 and is 7.7 percent (±11.5 percent) below the September 2021 rate of 1,559,000. Single‐family housing starts in September were at a rate of 892,000; this is 4.7 percent (±10.7 percent) below the revised August figure of 936,000. The September rate for units in buildings with five units or more was 530,000.
Reprinted courtesy of
John Kazanovicz, Kahana Feld and
Jason Feld, Kahana Feld
Mr. Kazanovicz may be contacted at jkazanovicz@kahanafeld.com
Mr. Feld may be contacted at jfeld@kahanafeld.com
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