Mediation in the Zero Sum World of Construction
October 02, 2015 —
Christopher G. Hill – Construction Law MusingsConstruction is a zero sum game. What do I mean by that? I mean that even where you, a construction professional with a great construction lawyer, have reviewed and edited a subcontract presented to you or provided a well drafted contract to the other party that contains an attorney fees provision, every dollar that you spend on litigation is a dollar less of profit.
Couple the fact that no construction company can or should bid or negotiate work with an eye toward litigation (aside from having a well written contract that will be enforced to the letter here in Virginia). Particularly on “low bid” type projects, contractors and subcontractors cannot “pad” their bids to take into account the possibility of attorney fees, arbitration, or litigation. Furthermore, the loss of productivity when your “back office” personnel are tied up dealing with discovery, phone calls, and other incidents of litigation that do nothing but rehash a bad project and increase the expense saps money from the bottom line. While the possibility of a judgment including attorney fees may soften this blow, you are still out the cash.
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Christopher G. Hill, Law Office of Christopher G. Hill, PCMr. Hill may be contacted at
chrisghill@constructionlawva.com
Rattlesnake Bite Triggers Potential Liability for Walmart
February 02, 2017 —
James R. Lynch - Ahlers & Cressman, PLLCA customer shopping at Walmart’s outdoor garden center in Clarkston, Washington, reached down to brush aside a stick covering a price tag for bags of mulch stored on wooden pallets. The “stick” turned out to be a rattlesnake, and bit his hand.
The customer sued Walmart on the legal basis of “premises liability,” claiming that as Walmart’s business invitee (one who enters the owner’s property primarily for the owner’s benefit), the store owed him a duty to warn or guard against hazardous conditions such as the rattlesnake.
In many cases, a property owner’s duty to protect invitees applies only where the owner knows or reasonably should know of the hazardous condition. The owner’s liability therefore often hinges on where the hazard is located, how long it has been present, whether it has occurred in the past, and similar considerations.
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James R. Lynch, Ahlers & Cressman, PLLCMr. Lynch may be contacted at
jlynch@ac-lawyers.com
OPINION: Stop Requiring Exhibit Lists!
September 18, 2023 —
Todd Heffner - The Dispute ResolverYou are conducting the final hearing of a high-dollar construction arbitration. Opposing counsel hands you the next document that counsel plans to use in questioning the witness on the stand. You notice that the document is bates stamped but has no exhibit number. So, you quickly consult opposing counsel’s exhibit list and – gasp – you find that the document is not on the list. What do you do? Do you object?
Assuming this is not your first construction arbitration hearing, you do not object. Why? Because your objection would be futile. Construction arbitrators simply do not exclude evidence on the basis that it does not appear on an exhibit list. (Evidence not produced in discovery or otherwise previously provided might be a different case.) In an informal poll of a dozen construction lawyers conducted by this author, not one reported evidence being excluded solely because it did not appear on an exhibit list. This remained true even when the applicable case management order purported to prohibit the introduction of evidence not on an exhibit list. Thus, to be used in an arbitration hearing, documents must appear on an exhibit list, unless they don’t, in which case you can use them anyway. So far, so pointless.
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Todd Heffner, Troutman PepperMr. Heffner may be contacted at
todd.heffner@troutman.com
CGL Policy May Not Cover Cybersecurity and Data-Related Losses
March 25, 2024 —
Susana Arce - Saxe Doernberger & Vita, P.C.The construction industry, like many other industries, has experienced an increased reliance on, and implementation of, technology in the past few years. Smart phones and tablets are used on most project sites, computers are an integral part of the planning process, and various software programs are used throughout the construction process. Likewise, much of the machinery and equipment used during construction (e.g., total stations, trucks, tower cranes) is interconnected, and in some cases, operated or monitored remotely.1
With an increase in technology comes a risk of cybersecurity and data-related losses. Many large businesses purchase Commercial General Liability (“CGL”) insurance and assume cybersecurity and data-related losses are covered. Unfortunately, this is generally not the case. CGL policies typically cover three general types of damage: bodily injury, property damage, and advertising injury.
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Susana Arce, Saxe Doernberger & Vita, P.C.Ms. Arce may be contacted at
SArce@sdvlaw.com
Know Whether Your Course of Business Operations Are Covered Or Excluded By Your Insurance
December 27, 2021 —
David Adelstein - Florida Construction Legal UpdatesIt is a good idea to know what your insurance covers and does not cover. This way, if your course of business has you performing a certain (risky) operation, you know whether that operation is covered or excluded under your policy. If you are not sure, discuss with your insurance broker — this is important. There is little value performing an operation that is NOT covered by your insurance policy, as you are now performing a risk that is not covered by insurance. If you know it is not covered by insurance you may elect to change your operations or see if there is insurance to cover the risk. Below is a case study of this occurrence dealing with a commercial automobile liability policy where an insured’s operations using a crane mounted to a super duty truck was not covered under their automobile liability policy.
In People’s Trust Ins. Co. v. Progressive Express Ins. Co., 46 Fla. L. Weekly D262a (Fla. 3d DCA 2021), homeowners hired a company to install a shed. The company hired another company to deliver and install the shed using a crane; the company used a crane mounted to a Ford F-750 super duty truck. This company improperly operated the crane resulting in the shed falling and damaging the homeowner’s roof. The homeowners submitted a claim to their property insurer and their property insurer subrogated to their rights and sued. The company operating the crane’s commercial automobile liability insurer denied coverage, and thus, denied the duty to defend. As a result, a
Coblentz-type agreement was entered into where the company operating the crane consented to a judgment in favor of the property insurer (subrogee) and assigned its rights under its commercial automobile liability policy to the property insurer. The property insurer then sued the automobile liability carrier for coverage. The trial court granted summary judgment in favor of the automobile liability insurer finding there was no coverage and this was affirmed on appeal. Why?
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
The New Industrial Revolution: Rebuilding America and the World
March 04, 2019 —
Drew Buechley - Construction ExecutiveConventional thinking says the Industrial Revolution ended more than a century ago. Yet one crucial industry has lagged behind revolutionary changes stemming from the transition from hand production methods to the use of machines and rise of factory systems. In the 1800s, these transitions caused an influx of people to urban centers, where the majority of those changes were centered. The outcome? Not enough capital or time to build adequate housing, pushing low-income newcomers into overcrowded, unsanitary slums, resulting in increased death rates and endemic levels of contagious diseases. While other industries mechanized and surged, construction remained stagnant in comparison to demand.
Fast forward to the 21st century where the U.S .benefits from a developed and industrialized world. Monumental gains in technology, combined with regulations designed to protect communities from polluted waters and disease, have drastically improved quality of life. Yet one similarity remains – the industry still struggles to build enough housing for a growing population. Urban centers have been neglected for decades while the rate of urbanization increases annually. Communities still have no access to clean drinking water and many suffer from crumbling infrastructure. Home ownership is out of reach for an entire generation, with metropolitan areas unable to keep up with demand for housing. At the very center of this lies the staid construction industry. Lagging behind the rest of the industrialized world in terms of technology advances, it has severely impacted the ability to maintain a livable nation and world.
Reprinted courtesy of
Drew Buechley, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Construction Litigation Roundup: “Give a Little Extra …”
July 31, 2024 —
Daniel Lund III - LexologySurplus lines insurers in Louisiana are considered by the state to be “an alternative type of property and casualty insurance coverage for consumers who cannot get coverage on the standard market … for specialty risk or high-risk situations….”
As a quid pro quo for undertaking the exceptional risk, a surplus lines insurer argued to the United States Fifth Circuit Court of Appeals that an arbitration clause within its surplus line policy should be enforceable, notwithstanding a Louisiana statute applying to the insurance industry and prohibiting terms in insurance policies “delivered or issued for delivery” in Louisiana which have the effect of “[d]epriving the courts of this state of the jurisdiction or venue of action against the insurer.” La. R.S. 22:868.
Historically in Louisiana, arbitration clauses have been understood to divest courts of jurisdiction, and, consequently, §22:868 has been held to memorialize an “anti-arbitration policy,” although the statute does not specifically mention arbitration.
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Daniel Lund III, PhelpsMr. Lund may be contacted at
daniel.lund@phelps.com
Appeals Court Explains Punitive Damages Awards For Extreme Reprehensibility Or Unusually Small, Hard-To-Detect Or Hard-To-Measure Compensatory Damages
November 10, 2016 —
Christopher Kendrick & Valerie A. Moore – Haight Brown & Bonesteel LLPIn Nickerson v. Stonebridge Life Ins. Co. (No. B234271A, filed 11/3/16), (“Nickerson II”) a California appeals court outlined the requirements for complying with the single-digit multiplier annunciated as a Constitutional limitation on punitive damages by the United States Supreme Court in State Farm Mut. Automobile Ins. Co. v. Campbell (2003) 538 U.S. 408, for awards of punitive damages against insurers in cases of extreme reprehensibility or unusually small, hard-to-detect or hard-to-measure compensatory damages.
Reprinted courtesy of
Christopher Kendrick, Haight Brown & Bonesteel LLP and
Valerie A. Moore, Haight Brown & Bonesteel LLP
Mr. Kendrick may be contacted at ckendrick@hbblaw.com
Ms. Moore may be contacted at vmoore@hbblaw.com
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