Seattle Washington Building Expert Directory

Just Because You Record a Mechanic’s Lien Doesn’t Mean You Get Notice of Foreclosure

September 15, 2016 — Christopher G. Hill – Construction Law Musings
As longtime (or new readers for that matter) know, mechanic’s liens are near and dear to my heart here at Construction Law Musings. These powerful tools to collect for your hard work on a construction project are great when prepared and recorded in the very specific fashion required by the Virginia legislature and courts. In most situations, if done properly, a mechanic’s lien gives you some security and priority for your construction claim that you would not have with a simple judgment lien. Despite the power of a properly perfected and enforced mechanic’s lien (and the fact that the end result of a full mechanic’s lien suit that remains unsettled is in fact a foreclosure), a recent case in the Eastern District of Virginia, Weinberg v. J.P. Morgan Chase, et. al., (thanks for the head’s up on this case to the folks at the Construction Payment Blog) held that under Virginia statute mechanic’s lien holders are not entitled to notice of foreclosure. In the Weinberg case, the plaintiff, a pro se lien claimant that recorded two different liens, one pre-foreclosure and one post-foreclosure, and who had not received notice of the intervening foreclosure, argued, among other things, that he should have been given notice of the foreclosure on the deed of trust on the property by J. P. Morgan Chase. Read the court decision
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Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

Housing Starts in U.S. Drop to Lowest Level in Three Months

February 23, 2016 — Michelle Jamrisko – Bloomberg
New-home construction in the U.S. unexpectedly cooled in January, indicating there is a limit to how much gains in residential real estate will boost growth at the start of 2016. Housing starts dropped 3.8 percent to a 1.1 million annualized rate, the weakest in three months, from a 1.14 million pace the prior month, a Commerce Department report showed Wednesday in Washington. The median forecast of 76 economists surveyed by Bloomberg was 1.17 million. Permits, a proxy for future construction, were little changed. Read the court decision
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Reprinted courtesy of Michelle Jamrisko, Bloomberg

Women in Construction Aren’t Silent Anymore. They Are Using TikTok to Battle Discrimination

March 06, 2022 — Workwear Guru
How does it feel to be a woman working in a male-dominated industry? It means an everyday fight on gender bias, discrimination, pay inequality, and a bunch of mansplaining. Though the construction industry progressed– over 1.2 million women work in construction, up from 619,000 in 1985–women continue to be a minority. Among the women working in the industry, almost 9 out of 10 women have an office role, while only 2.5% are tradespeople. The situation looks grimmer for women in higher positions as only 16% hold executive roles, and only 2% are CEOs. The issue becomes troublesome considering that 45% of women indicated that the lack of women role models working in senior positions halted advancement in their careers. Gender discrimination was always prevalent in the construction industry, though it shows higher in today’s statistics. In 2020, the annual study of women in construction showed 72% of women in construction face discrimination, up from 66% in 2005. The increase doesn’t mean there is an increase in workplace discrimination; instead, it shows women are raising their voices for the issue. Today, women are using social media to show the prejudice they confront every day, inspire each other to speak up, and showcase their competencies within the industry. Read the court decision
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Reprinted courtesy of Workwear Guru

Risk Management for Condominium Conversions

July 31, 2013 — David McLain, Higgings, Hopkins, McLain & Roswell, LLC
One of the bright spots in the Colorado construction industry over the last few years has been the construction of for-rent apartments. It seems as though apartments are going up everywhere you look along the Front Range. As market forces change, it will be interesting to see whether these units will remain apartments or whether they will be converted into for-sale condominiums or townhouses. One of the risk management strategies we have recently discussed with our general contractor clients who have been asked to build apartments is to ensure that the project remains a for-rent apartment project through the applicable statute of repose, conservatively assumed to be eight years. Unfortunately this is not always feasible, usually because the owner and/or lender are not interested in encumbering the property for such a long period of time, and want to retain the ability to convert the project if and when market forces allow, even if that is before the running of the statute of repose. The purpose of this article is to discuss the insurance and risk management ramifications of converting a project too early. I have recently heard from several sources in the insurance industry that there are owners and contractors who are currently building apartments with the idea that they will be held as apartments for two to three years and then converted to for-sale condominiums or townhomes. While this strategy may have great appeal from a business point of view, it has a very serious risk management downside. Apparently, these owners and contractors are operating under the mistaken belief that they will have no liability exposure to the ultimate purchasers of the converted units or to the homeowners association for construction defects. This is an incorrect belief. Read the court decision
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Reprinted courtesy of David M. McLain
David M. McLain can be contacted at mclain@hhmrlaw.com

Approaching Design-Build Projects to Avoid (or Win) Disputes

August 07, 2023 — Stuart Eisler - Construction Executive
Stakeholders engage in design-build projects believing the collaborative nature better aligns parties' interests and reduces overall risk exposure. Each of the lead parties bases this belief on different factors—the owner sees an opportunity to reduce change-order exposure and improve delivery times, the design-builder (or contractor) aims to control design volatility by ensuring project components match budgeted projections, and the designer intends to benefit by greater constructability review from the design-builder team and often additional time to detail designs. Rarely do design-build parties contemplate claims arising while initiating a project. This being said, design-build projects carry unique, inherent risks due to the award of often fixed-price contracts utilizing incomplete, preliminary designs. As scopes creep and costs balloon, previously harmonious parties experience discord and lurking claims. While the majority of design-build projects are completed without major dispute, there are strategies available to further avoid disputes and prevail in those that are unavoidable. Reprinted courtesy of Stuart Eisler, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the court decision
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Duty To Defend Construction Defect Case Affirmed, Duty to Indemnify Reversed In Part

May 07, 2015 — Tred R. Eyerly – Insurance Law Hawaii
The Eleventh Circuit affirmed the district court's finding of a duty to defend, but reversed, in part, the insurer's duty to indemnify. Carithers v. Mid-Continent Cas. Co., 2015 U.S. App. LEXIS 5540 (11th Cir. April 7, 2015). After discovering a number of defects in their home, the Carithers sued their homebuilder, Cronk Duch Miller & Associates. Cronk Duch's insurer, Mid-Continent Casualty Company, refused to defend.The parties entered into a consent judgment for $90,000 in favor of the Carithers. Cronk Duch then assigned to the Carithers the right to collect the judgment from Mid-Continent. The Carithers then sued Mid-Continent. Florida law applied. Mid-Continent has issued four policies to Cronk Duch from March 2005 to October 2008. The parties filed cross-motions for summary judgment on the duty to defend issue. The underlying complaint alleged that the defects could not have been discovered until 2010, after the last policy period. The district court rejected Mid-Continent's argument that property damage occurred when it was discovered or when it reasonably could have been discovered. Therefore, summary judgment on the duty to defend was granted to the Carithers. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

The Risk of A Fixed Price Contract Is The Market

August 03, 2022 — David Adelstein - Florida Construction Legal Updates
When performing work on a fixed price or unit, there is risk that is being assumed on your end. One risk is the market. You are ultimately banking on the fact that the market is not going to make your fixed prices unprofitable. That’s not an unforeseeable occurrence because the market shifts and that shift can have a negative ripple effect. In a recent case out of the Federal Circuit, U.S. Aeroteam, Inc. v. U.S., 2022 WL 243176 (Fed.Cir. 2022), this market risk played a role in a fixed price contract. Here, a contractor was hired by the federal government to produce ground support trailers. A key component of these trailers was a running gear. The contractor relied on a vendor for these running gears. Due to financial difficulties, the vendor had to raise its unit price for the running gears. Based on the increased price, the contractor elected to manufacture the running gears itself. The contractor asked the government if this was ok and the government approved the request. Once the contractor started manufacturing these running gears, it had an “awe” moment – the manufacturing costs were higher than anticipated. The contractor submitted a request for equitable adjustment which the government denied. The Contractor than sued the government raising three arguments to support its entitlement to additional costs: (1) constructive change; (2) cardinal change; and (3) commercial impracticability. The contractor lost on all arguments. It probably should have lost on all arguments. 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

Coverage for Faulty Workmanship Denied

September 07, 2020 — Tred R. Eyerly - Insurance Law Hawaii
The court found that the insurer had no duty to defend claims against the insured for faulty workmanship. HT Services, LLC v. Western Heritage Ins. Co., 2020 U.S. Dist. LEXIS 123664 (D. Colo. July 10, 2020). Western Heritage Insurance Company issued three concurrent general liability policies to HT Services, LLC. The policies insured two properties owned by HT in Colorado Springs, its offices and vacant land. HT eventually developed a residential community on the vacant land. In January 2016, the homeowners' association filed suit against HT for negligent design and construction of a retaining wall at the project. HT requested Western to defend and indemnify against the suit. Western denied coverage and HT sued. HT asserted that Western had a duty to defend and asserted claims for declaratory relief, breach of contract and bad faith. HT moved for partial summary judgment on its claims for declaratory relief, seeking a determination of its rights under the policies. Western moved for summary judgment on all of HT's claims. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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