Construction Spending Drops in March
May 10, 2013 —
CDJ STAFFReuters reports that construction spending dropped by 1.7 percent in March, bringing it to the lowest level since August, more than wiping out February’s increase of 1.5 percent. Economists had predicted a mild gain of 0.7 percent. Spending fell due to a 4.1 percent drop in public construction projects, bringing it to its lowest in six and a half years.
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N.J. Appellate Court Applies Continuous Trigger Theory in Property Damage Case and Determines “Last Pull” for Coverage
November 15, 2017 —
K. Alexandra Byrd – Saxe Doernberger & Vita, P.C.The New Jersey Superior Court, Appellate Division, published an important decision addressing several fundamental issues regarding how a commercial general liability (CGL) policy applies to long-term property damage. The court held that: (1) a continuous trigger theory of coverage may be applied to third-party liability claims involving progressive property damage caused by an insured’s allegedly defective work; (2) the “last pull” (i.e., the cutoff point) of the continuous trigger is when the “essential nature and scope” of the property damage first becomes known or could reasonably be known; and (3) the “last pull” is not when the property damage is “attributed” to the insured’s faulty work.
The underlying action in Air Master & Cooling Inc. v. Selective Ins. Co., et al. 1 concerned property damage arising out of the construction of a seven-story, 101-unit condominium building in Montclair, New Jersey. The project’s construction manager hired Air Master & Cooling, Inc. (Air Master) to perform HVAC work on the project, including installing individual HVAC equipment in each resident’s unit from 2005 to 2008. In early 2008, unit owners began complaining about water infiltration and damage to their windows, ceilings, and other portions of their units. The general contractor and developer began assessing the damage and making repairs. Eventually, in April 2010, an expert consultant performed a moisture survey of the roof and discovered 111 areas that were damaged by water infiltration. The expert report indicated that “it [was] impossible to determine when [the] moisture infiltration occurred.”
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K. Alexandra Byrd, Saxe Doernberger & Vita, P.C.Ms. Byrd may be contacted at
kab@sdvlaw.com
General Indemnity Agreement Can Come Back to Bite You
October 21, 2019 —
Christopher G. Hill - Construction Law MusingsI talk about payment bonds often here at Construction Law Musings. I talk a bit less about performance bonds and even less about the General Indemnity Agreements (GIA) that are signed by companies and their principals as part of the agreement between a construction company and its bonding company for the provision of these bonds. However, this does not mean that these GIA’s are not important. In fact, these are the agreements that allow a bonding provider to recoup any money paid out pursuant to either a payment or performance bond.
A 2018 case illustrates their importance. In Allegheny Cas. Co. v. River City Roofing, LLC, the Court considered a claim by Allegheny seeking both specific performance of the collateral agreement and reimbursement of certain expenses and investigative costs expended by Allegheny pursuant to its performance bond. Allegheny sought to be reimbursed for certain payments for siding work, investigative costs, and costs spent enforcing the GIA. Allegheny further sought to force the defendants to post sufficient collateral. To do so, Allegheny sued in the Eastern District of Virginia and then moved for summary judgment stating that the GAI uneuivocally required such a result due to the good faith payment for the siding work and the plain language of the GIA.
In response, the Defendants, River City Roofing and its principals that had personally guaranteed the indemnity, argued that the GIA did not apply to the siding work because only the roofing contract was subject to the performance bond and that any bond claims for which collateral was demanded were inchoate and therefore not proper for specific performance.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Defend Trade Secret Act of 2016–-Federalizing Trade Secret Law
October 07, 2016 —
Erin M. Stines and Reed Cahill - Ahlers & Cressman PLLCThe Defend Trade Secret Act of 2016 (DTSA) was signed into law on May 11, 2016, and became effective immediately. The DTSA allows an owner of a trade secret to sue in federal court for trade secret misappropriation. Previously, only state law governed civil misappropriation of trade secrets. While the DTSA largely mirrors the current state of the law under the Uniform Trade Secrets Act (UTSA), adopted by 48 states, including Washington,[1] there are some additions found in the new law.
The DTSA imposes the same three-year statute of limitations and authorizes remedies similar to those provided under the UTSA. The DTSA also offers new forms of relief, including a provision permitting ex parte seizure orders (that is, without a hearing or response from the opposing party) to prevent further misappropriation of the trade secret. The DTSA further provides for a new definition of trade secret. The UTSA's definition of a trade secret is a “formula, pattern, compilation, program, device, method, technique, or process.” Under the DTSA, the definition of a “trade secret” is broadened to include “all forms and types of financial, business, scientific, technical, economic, or engineering information...whether tangible or intangible...” [2]
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Erin M. Stines & Reed Cahill, Ahlers & Cressman PLLCMs. Stines may be contacted at
erin.stines@ac-lawyers.com
Owners and Contractors are Liable for Injuries Caused by their Independent Contractors under the “Peculiar Risk Doctrine”
October 15, 2024 —
William L. Porter - Porter Law GroupMany contractors and owners believe that if they hire an independent contractor to perform work and that independent contractor causes injury to others during the performance of that work, then it is the independent contractor alone who will be liable for those injuries. In most circumstances, this is correct. The owner or the contractor will not be held liable for injuries caused by his or her independent contractor. However, this is not always the case.
Under the “Peculiar Risk Doctrine” and California cases interpreting the doctrine, a contractor or owner who hires an independent contractor to do work which is considered to be “inherently dangerous work” can be still be held directly liable for damages when that independent contractor causes injury to others by negligently performing the work.
Such liability can generally be imposed on the one hiring the independent contractor under either of two branches of the peculiar risk doctrine. First, where a person hires an independent contractor to do inherently dangerous work, but fails to provide in the contract or in some other manner that special precautions must be taken to avert the peculiar risk of injury related to that work, then the one hiring the independent contractor can be held liable for injuries to others caused by the independent contractor’s negligence. (Restatement Second of Torts Section 413). For example, in Mackey v. Campbell Construction Co. 101 Cal. App. 3d 774, 162 Cal. Rptr. 64 (1980), Western Electric Company, the owner of the project, was found liable for the personal injuries of a subcontractor’s employee because Western’s representatives were on the job at all times, had doubts about the safety of scaffolding being used on the project, yet failed to require use of precautions that could have been taken to avoid injury.
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William L. Porter, Porter Law GroupMr. Porter may be contacted at
bporter@porterlaw.com
Biden Administration Focus on Environmental Justice Raises Questions for Industry
March 22, 2021 —
Karen C. Bennett, Jane C. Luxton, Rose Quam-Wickham & William J. Walsh - Lewis BrisboisThe Biden Administration has left no doubt that it intends to prioritize environmental justice (EJ) in implementing energy and environmental policy. While EJ is not new – in fact, President Clinton signed the first EJ Executive Order (EO 12898) in 1994 – the new Administration’s plan to expand the concept to include “climate justice” and “health equity” is both novel and undefined. Similar to actions taken on climate change (see our previous alert from January 28), President Biden has announced plans for elevating EJ by designating new Cabinet level offices, intensifying enforcement, and advocating for Congressional action. Given the likelihood of serious impacts from these sweeping changes, industry will need to step up engagement as these concepts are integrated into regulatory decisions and U.S. positions globally.
Authority for addressing injustice caused by environmental pollution that disproportionately affects certain communities is found in Title VI of the Civil Rights Act of 1964. The Act imposed a responsibility on the Environmental Protection Agency (EPA or Agency) to ensure that its funds are not being used to subsidize discrimination, based on race, color, or national origin, making EPA’s Office of Civil Rights responsible for the investigation and enforcement of Title VI within the Agency. President Clinton relied on this authority in signing EO 12898, which directed federal agencies to identify and address disproportionately high adverse human health and environmental effects of their programs, policies, and activities on minority and, going beyond the protections covered by Title VI, low-income populations.
Reprinted courtesy of
Karen C. Bennett, Lewis Brisbois,
Jane C. Luxton, Lewis Brisbois,
Rose Quam-Wickham, Lewis Brisbois and
William J. Walsh, Lewis Brisbois
Ms. Bennett may be contacted at Karen.Bennett@lewisbrisbois.com
Ms. Luxton may be contacted at Jane.Luxton@lewisbrisbois.com
Ms. Quam-Wickham may be contacted at Rose.QuamWickham@lewisbrisbois.com
Mr. Walsh may be contacted at William.Walsh@lewisbrisbois.com
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Examining Construction Defect as Occurrence in Recent Case Law and Litigation
February 05, 2014 —
Beverley BevenFlorez-CDJ STAFFIn Lexology, Stephen M. Prignano and Nora A. Valenza-Frost of Edwards Wildman Palmer LLP examined recent case law and litigation to discuss whether or not construction defects are construed as an occurrence in the current legal climate.
Prignano and Valenza-Frost stated, “The determination of whether there is coverage under a CGL policy for a construction defect claim requires an insurer to carefully examine the law of the relevant jurisdiction. Courts and legislatures continue to reach different conclusions respecting coverage, and some states have a more well-developed body of law on these issues than others.”
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Workplace Safety–the Unpreventable Employee Misconduct Defense
October 02, 2015 —
Craig Martin – Construction Contractor AdvisorI just attended an Associated Builders and Contractors meeting during which Lueder Construction discussed a fatality on one of its worksite. OSHA fully investigated the incident and did not issue a single citation. This is a testament to the safety plan and training Lueder had in place well before this incident. One defense to an OSHA citation is unpreventable employee misconduct. However, proving this defense requires substantial planning, well before an incident or investigation.
Unpreventable Employee Misconduct Defense
OSHA requires that an employer do everything reasonably within its power to ensure that its personnel do not violate safety standards. But if an employer lives up to that billing and an employee nonetheless fails to use proper equipment or otherwise ignores firmly established safety measures, it seems unfair to hold the employer liable. To address this dilemma, both the Occupational Safety & Health Review Commission and courts have recognized the availability of the unforeseeable employee misconduct defense.
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Craig Martin, Lamson, Dugan and Murray, LLPMr. Martin may be contacted at
cmartin@ldmlaw.com
