Cambridge Massachusetts Building Expert Directory

S&P Suspended and Fined $80 Million in SEC, State Mortgage Bond Cases

January 21, 2015 — Keri Geiger and Matt Robinson – Bloomberg
Standard & Poor’s (MHFI) agreed to be suspended from rating the biggest part of the commercial-mortgage bond market and pay almost $80 million to state and federal authorities over claims it bent criteria to win business. S&P misled investors about the methodology it used in 2011 to rate eight commercial-mortgage backed securities, the U.S. Securities and Exchange Commission said in a statement today. The company will pay about $58 million to the SEC and an additional $19 million to attorneys general for New York and Massachusetts to settle the matter. Ms. Geiger may be contacted at kgeiger4@bloomberg.net; Mr. Robinson may be contacted at mrobinson55@bloomberg.net Read the court decision
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Reprinted courtesy of Keri Geiger and Matt Robinson, Bloomberg

Connecticut Crumbling Concrete Cases Not Covered Under "Collapse" Provision in Homeowner's Policy

July 01, 2019 — Kerianne E. Kane - Saxe Doernberger & Vita, P.C.
What do you do when your house falls out from underneath you? Over the last few years, homeowners in northeastern Connecticut have been suing their insurers for denying coverage for claims based on deteriorating foundations in their homes. The lawsuits, which have come to be known as the “crumbling concrete cases,” stem from the use of faulty concrete to pour foundations of approximately 35,000 homes built during the 1980s and 1990s. In order to save their homes, thousands of homeowners have been left with no other choice but to lift their homes off the crumbling foundations, tear out the defective concrete and replace it. The process typically costs between $150,000 to $350,000 per home, and homeowner’s insurers are refusing to cover the costs. As a result, dozens of lawsuits have been filed by Connecticut homeowners in both state and federal court. Of those cases, three related lawsuits against Allstate Insurance Company were the first to make it to the federal appellate level.1 The Second Circuit Court of Appeals was tasked with deciding one common issue: whether the “collapse” provision in the Allstate homeowner’s policy affords coverage for gradually deteriorating basement walls that remain standing. The Allstate policies at issue were “all-risk” policies, meaning they covered “sudden and accidental direct physical losses” to residential properties. While “collapse” losses were generally excluded, the policies did provide coverage for a limited class of “sudden and accidental” collapses, including those caused by “hidden decay,” and/or “defective methods or materials used in construction, repair or renovations.” Covered collapses did not include instances of “settling, cracking, shrinking, bulging or expansion.” Read the court decision
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Reprinted courtesy of Kerianne E. Kane, Saxe Doernberger & Vita, P.C.
Ms. Kane may be contacted at kek@sdvlaw.com

Benefits and Pitfalls of Partnerships Between Companies

December 21, 2016 — Aarni Heiskanen – AEC Business
To bring innovations to the market, companies almost always need partnerships. Partnerships can offer scalability, productivity, and open up new markets. However, partnerships are not easy to establish and manage. The benefits of partnering Construction companies have always done joint ventures. The reason has been to simply be able to bid for and deliver a project that would be too big for one company at that specific moment. Partnering allows you to become larger than you are and to get work that would otherwise be out of your reach. It also lets you spread the risk in a demanding project among the members. Read the court decision
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Reprinted courtesy of Aarni Heiskanen, AEC Business
Mr. Heiskanen may be contacted at aarni@aepartners.fi

Specific Source of Water Not Relevant in Construction Defect Claim

June 28, 2013 — CDJ STAFF
The Nebraska Court of Appeals has concluded that a lower court came to the correct conclusion in a construction defect case involving water intrusion. The Hiatts built a home in North Platte, Nebraska, in in 2004 which they sold to the Oettingers in May, 2006. Shortly thereafter, the Oettingers started experiencing problems with water intrusion and contacted the Hiatts. The Hiatts responded by replacing the septic lift. Subsequently, the Oettingers landscaped their yard, which they allege was done with the assistance of the Hiatts. The water problems continued and “the parties took substantial remedial measures, including excavating the sidewalk and inspecting the downspouts.” The water problems continued, getting worse and requiring increasingly aggressive responses. The Oettingers then had a series of inspections, and they hired the last of these inspectors to actually fix the water intrusion problem. At that point, they filed a lawsuit against the Hiatts alleging that the Hiatts “breached their contact by constructing and selling a home that was not built according to reasonable construction standards,” and that they “were negligent in the repair of the home in 2009.” During the trial, Irving Hiatt testified that they “tarred the outside of the basement and put plastic into the tar and another layer of plastic over the top of that.” He claimed that the problem was with the Oettingers’ landscaping. This was further claimed in testimony of his son, Vernon Hiatt, who said the landscaping lacked drainage. The Oettingers had three experts testify, all of whom noted that the landscaping could not have been the problem. All three experts testified as to problems with the Hiatts’ construction. The court concluded that the Hiatts had breached an implied warranty, rejecting the claim that the water intrusion was due to the landscaping. The Hiatts appealed the decision of the county court to the district court. Here, the judgment of the lowest court was confirmed, with the district court again finding a breach of the implied warranty of workmanlike performance. The Hiatts appealed again. They alleged that the district court should not have held a breach of implied warranty existed without proving the source of the water intrusion, and that damages should have been apportioned based on the degree to which the Oettingers’ landscaping and basement alterations were responsible. The appeals court dispensed with the second claim first, noting that “they do not argue this error in their brief nor do they explain how or why the trial court should have apportioned damages.” The court also noted that although the Oettingers made a negligence claim in their suit, the case had been decided on the basis of a breach of implied warranty. The appeals court upheld the Oettingers’ claim of a breach of implied warranty. In order to do this, the court noted that the Oettingers had to show that an implied warranty existed, that the Haitts breached that warranty, damage was suffered as a result, and that no express warranty limited the implied warranty. That court noted that “the record is sufficient to prove that the Hiatts breached the implied warranty in the method in which they constructed the basement” and that “this breach was the cause of the Oettingers’ damages.” The court concluded that the Oettingers “provided sufficient evidence that the Hiatts’ faulty construction allowed water, whatever its source, to infiltrate the basement.” The court rejected the Hiatts’ claim that the Oettingers’ repairs voided the warranty, as it was clear that the Hiatts were involved in carrying out these repairs. The court’s final conclusion was that “the evidence in the record supports the trial court’s factual finding that the Hiatts’ flawed construction caused water damage to the Oettingers’ basement.” Read the court decision
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Reprinted courtesy of

Homebuilder Immunity Act Dies in Committee. What's Next?

May 07, 2015 — Jesse Howard Witt – Acerbic Witt
For the third straight year, the Colorado legislature has rejected efforts by the homebuilders’ lobby to provide virtual immunity for construction defects and property damage. Late Monday night, the House committee on State, Military, and Veterans Affairs voted down Senate Bill 15-177 on straight party lines. All six Democrats on the committee voted against the bill, while all five Republicans voted for it. Similar bills had died in the Senate in 2013 and 2014. In theory, SB177 would have boosted multifamily construction by shielding builders from liability for negligent work. Unlike the 2013 bill, this version never expressly stated that it was providing homebuilders with immunity, but it would have made it nearly impossible for community associations to take action against a builder who refused to honor a warranty. And even if the homeowners managed to overcome the procedural obstacles, the bill would have forced their claims into costly, private arbitration. Proponents hoped that, by eliminating responsibility for negligent work and property damage, they could entice homebuilders to construct more cheap condominiums. Read the court decision
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Reprinted courtesy of Jesse Howard Witt, Acerbic Witt
Mr. Witt welcomes comments at www.wittlawfirm.net

U.S., Canada, Mexico Set New Joint Clean-Energy Goal

June 30, 2016 — Tom Ichniowski – Engineering News-Record
The U.S., Canada and Mexico have agreed to boost their combined clean-energy generation to 50% of electricity production by 2025, from 37% last year. Read the court decision
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Reprinted courtesy of Tom Ichniowski, Engineering News-Record
Mr. Ichniowski may be contacted at ichniowskit@enr.com

Not All Work is Covered Under the Federal Miller Act

May 24, 2021 — David Adelstein - Florida Construction Legal Updates
The recent opinion out of the Eastern District Court of Virginia, Dickson v. Forney Enterprises, Inc., 2021 WL 1536574 (E.D.Virginia 2021), demonstrates that the federal Miller Act is not designed to protect ALL that perform work on a federal construction project. This is because NOT ALL work is covered under the Miller Act. In this case, a professional engineer was subcontracted by a prime contractor to serve on site in a project management / superintendent capacity. The prime contractor’s scope of work was completed by January 31, 2019. However, the prime contractor was still required to inventory certain materials on site, which was performed by the engineer. The engineer claimed it was owed in excess of $400,000 and filed a Miller Act payment bond lawsuit on February 5, 2020 (more than a year after the project was completed). Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

Wyoming Supreme Court Picks a Side After Reviewing the Sutton Rule

January 16, 2024 — Ryan Bennett - The Subrogation Strategist
In a matter of first impression, the Supreme Court of Wyoming (Supreme Court), in West American Insurance Company v. Black Dog Consulting Inc., No. S-23-0052, 2023 WY 109, 2023 Wyo. LEXIS 111, examined whether a landlord’s insurer could pursue a subrogation claim against a tenant who caused a fire loss. The Supreme Court, applying a case-by-case approach, found that the insurer could not subrogate against the tenant. West American Insurance Company (West) insured Profile Properties (Profile), which owned commercial property in Cheyenne, Wyoming. Black Dog Consulting Inc., d/b/a C.H. Yarber (Yarber) leased commercial space from Profile where it operated a metal fabrication business. The lease agreement between Profile and Yarber required Yarber to pay the full expense of Profile’s blanket insurance policy, which included general commercial liability insurance and fire and extended coverage insurance on the building. Read the court decision
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Reprinted courtesy of Ryan Bennett, White and Williams LLP
Mr. Bennett may be contacted at bennettr@whiteandwilliams.com

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