Construction Jobs Keep Rising, with April Gain of 33,000
June 10, 2019 —
Tom Ichniowski - Engineering News-RecordThe construction employment picture continues to brighten, as the industry gained 33,000 jobs in April and its jobless rate improved, the federal Bureau of Labor Statistics has reported.
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Tom Ichniowski, ENRMr. Ichniowski may be contacted at
ichniowskit@enr.com
No Choice between Homeowner Protection and Bankrupt Developers?
February 10, 2012 —
CDJ STAFFDonna DiMaggio Berger, writing in the Sun Sentinel argues those may be the only current choices in Florida. A recent court case, Lakeview Reserve HOA v. Maronda Homes has caused a swift response from the legislators. Ms. Berger notes that the construction defect bill, HB 1013, “would take away a homeowner’s rights to pursue a developer for defects to the driveways, roads, sidewalks, utilities, drainage areas and other so-called ‘off-site’ improvements.” The alternative? She notes that applying the Maronda decision would “bankrupt developers who don’t build defect-free roads and sidewalks.”
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Top 10 Construction Contract Provisions – Changes and Claims
November 03, 2016 —
James R. Lynch – Ahlers & Cressman PLLCThis is the seventh post in our “Top 10 Construction Contract Provisions” series. Prior posts discussed
Price and Payment,
Liquidated Damages,
Consequential Damages – Part I and
Part II,
Indemnity,
Scope of Work, and
Flow-Down Provisions.
Today’s topic, Changes and Claims, is a contender for the top spot on our list, for both day-to-day impact on the job and importance in disputes. In fact, these provisions[i] are so variable and are involved in so many reported construction law decisions, that this post will not attempt to survey all their various forms, uses, or potential legal ramifications, but instead focuses on bottom line “best practices”—questions to consider as a general contractor, subcontractor, or owner when drafting, negotiating, or managing the Changes and Claims provisions of a contract. There is no “ideal” here, and the changes and claims procedures should be suited to the project, owner, contractor(s), likely issues, and other project-specific considerations. Key considerations include the following:
1. How prescriptive is the Change Order process? At one end of the spectrum, a Change Order provision may include requirements for written direction and request by the owner and formal response by the contractor, with pricing and specific supporting data or documentation, in addition to strict timelines for response, execution, and performance, precise methods to determine the resulting contract adjustment, limits on the type or extent of adjustment, or terms defining the effect of a signed Change Order, e.g. to what extent related claims or impacts might be extinguished. At the other end of the spectrum, the Change Order provision might simply recognize that the owner may direct changes, and the parties intend to document the directions and resulting compensation in a Change Order, with no further elaboration. There is no universal ideal on this spectrum. A highly defined and prescriptive process may be appropriate for a complex, high value, multi-stakeholder project on which significant changes are likely. The same process would be an inefficient waste of resources on a small and simple project where significant changes are unlikely and the parties would be unlikely to comply with more formal procedures.
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James R. Lynch, Ahlers & Cressman PLLCMr. Lynch may be contacted at
jlynch@ac-lawyers.com
Contractor Not Liable for Flooding House
October 02, 2013 —
CDJ STAFFKnife River Corp was hired by the town of Post Falls, Idaho to do road and sewer construction work. In the process, they interrupted a 6-inch water supply line, sending the water into a wastewater line. From there, the water flooded a home in Post Fall. The city paid more than $7,800 in damages.
Post Falls sued Knife River’s insurer for coverage. The city has lost its lawsuit and is responsible for $18,500 in attorneys’ fees. Despite all this, the city administrator says that the city still has a good working relationship with Knife River.
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The Roads to Justice: Building New Bridges
August 23, 2021 —
Aileen Cho - Engineering News-RecordFormer U.S. Dept. of Transportation Secretary Anthony Foxx grew up on “the wrong side of the tracks.”
“My home was a stone’s throw from Interstates 85 and 77,” recalls Foxx, who grew up in Charlotte, N.C., and served as DOT Secretary from 2013-17 under President Barack Obama. “The airport was nearby. Planes flew at low altitude over our house. Whether or not I was using the system, I sure heard and saw a lot of it.” Desirable areas to live were far away from transportation infrastructure, “and the property values of those living near these projects was diminished.”
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Aileen Cho, Engineering News-Record
Ms. Cho may be contacted at choa@enr.com
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Fungi, Wet Rot, Dry Rot and "Virus": One of These Things is Not Like the Other
November 02, 2020 —
Hugh D. Hughes - Saxe Doernberger & VitaThe Hartford’s so-called virus exclusion in its commercial property forms is getting a workout, and policyholders now have an argument that may help their cases move past the pleadings stage. A U.S. District Court in Florida has deemed the exclusion ambiguous and denied an insurer’s motion to dismiss.1 The exclusion applies to “presence, growth, proliferation, spread, or any activity of ’fungi’, wet rot, dry rot, bacteria or virus.”2 The Court held that the parties did not necessarily intend to exclude a pandemic.
In Urogynecology, the plaintiff sought coverage for the loss of the usefulness and functionality of its business location due to the Florida Governor’s shutdown order. The policy contained a 'fungi', wet rot, dry rot, bacteria, or virus” exclusion.3 The carrier moved to dismiss, and the plaintiff argued that the exclusion only applied if COVID-19 was present on-site, which was not the case.
The Court addressed none of the issues regarding direct physical loss and instead decided the motion on the fungi exclusion. The Court held the exclusion ambiguous because the exclusion of virus “does not logically align with the grouping of the virus exclusion with other pollutants such that the Policy necessarily anticipated and intended to deny coverage for these kinds of business losses.”5 In addition, the Court stated that pollution case law was not on point because “none of the cases dealt with the unique circumstances of the effect COVID-19 has had on our society – a distinction this Court considers significant.”
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Hugh D. Hughes, Saxe Doernberger & VitaMr. Hughes may be contacted at
hdh@sdvlaw.com
California’s Fifth Appellate District Declares the “Right to Repair Act” the Exclusive Remedy for Construction Defect Claims
September 03, 2015 —
Stephen A. Sunseri – Gatzke Dillon & Balance LLPAugust 26, 2015 - The Fifth Appellate District ruled SB800 (California's "Right to Repair Act" [the "Act"]) provides the sole remedy for homeowners in construction defect actions. The court found "no other cause of action is allowed to recover for repair of the defect itself or for repair of any damage caused by the defect." (McMillin Albany LLC v. Superior Court of California (Aug. 26, 2015, No. F069370) __ Cal.App.4th __ [2015 WL 5029324].) The court issued a blistering criticism of the Fourth Appellate District's prior opinion in Liberty Mutual Ins. Co. v. Brookfield Crystal Cove LLC (2013) 219 Cal.App.4th 98, which severely limited the reach of the Act to actions not involving property damage and allowing property damage claims to proceed freely under common law without any constraints posed by the Act.
In McMillin, the court reviewed whether a homeowner was required to follow the Act's prelitigation procedures even after dismissing a cause of action arising under the Act. In deciding the issue, the court quoted directly from the first line of the Act (Civ. Code § 896) and found "[i]n any action seeking recovery of damages arising out of, or related to deficiencies in, the residential construction … , the claimant's claims or causes of action shall be limited to violation of" the standards set out in the Act. The court recognized the statutory exceptions to this rule, such as for claims arising under contract, or any action for fraud, personal injuries, or statutory violations. (Civ. Code., § 943.) However, this result directly conflicts with the Fourth Appellate District's decision in Liberty Mutual, which found homeowners can circumvent the entire Act by simply alleging property damage claims. McMillin rejects Liberty Mutual's "reasoning and outcome" as being inconsistent with the express language of the Act.
McMillin found that Liberty Mutual failed to fully analyze the statutory language of the Act, which (on its face) limits any action for construction deficiencies to the requirements of the Act. McMillin concludes the Legislature intended that all construction defect actions (for new residences sold on or after January 1, 2003), are subject to the requirements of the Act, including the prelitigation procedures, regardless of whether a complaint expressly alleges a cause of action under the Act or not.
McMillin is a great victory for homebuilders, but battle lines are now clearly drawn between the two appellate districts. McMillin directly conflicts with Liberty Mutual, and because of this conflict, the issue will need to be resolved by the California Supreme Court. Until such review is granted, the conflict will remain and trial courts will likely continue to conflate the issue.
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Stephen A. Sunseri, Gatzke Dillon & Balance LLPMr. Sunseri may be contacted at
ssunseri@gdandb.com
What If There Is a Design Error?
October 30, 2023 —
Scott L. Baker - Los Angeles Litigation BlogMany challenges can crop up when working on a construction project. Among these challenges, errors are the last thing that contractors or project owners want to face. Yet, they are not uncommon as you navigate the process.
Design errors or mistakes are one such issue that can result in serious construction disputes and delays. It is important to determine who is liable when it comes to defects and design errors.
So, who is responsible for design errors?
Many might assume the architect – or the person who created the project design – is responsible for design errors. That is not necessarily true.
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Scott L. Baker, Baker & AssociatesMr. Baker may be contacted at
slb@bakerslaw.com