2013 May Be Bay Area’s Best Year for Commercial Building
November 20, 2013 —
CDJ STAFFA tech boom has resulted in something of a commercial building boom for the Bay Area. The region will see about $6 billion in commercial construction projects during 2013. This is better than the totals for 2012, 2011, and 2009. During that period, however, 2010 set a record for the area with $6 billion of construction. Some estimates see 2013 beating that with as much as $6.7 billion in construction by year’s end.
The surge has been attributed to job creation. One Bay-area company, Infoblox, moved into a new office complex, after extensive renovation. The company had 250 employees and now has room to expand to 500 employees.
But 2014 could be even better. Apple is about to begin construction of its new campus, which is expected to cost the company $5 billion.
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“Bound by the Bond”
September 02, 2024 —
Daniel Lund III - LexologyA New York trial court granted judgment in favor of a performance bond surety on a construction project, based upon the failure of the claiming party to abide by the terms of the bond.
The “AIA Document A312” bond form – described by the court (quoting surety law authority) to be “one of the clearest, most definitive, and widely used type of traditional common law ‘performance bonds’ in private construction” – contains various procedures which must be honored as a “condition precedent to an action to recover” on the bond/against the surety. One of those prerequisites is a “declaration of default” concerning the contractor principal (here, a subcontractor).
The case involved the construction of an 85-story skyscraper in midtown Manhattan, and the performance of the subcontract for the building’s superstructure. The bonded contract was at a value of approximately $25,000,000 and obligated the sub to provide a performance bond “in a form similar to the [A312 bond],” and which was otherwise satisfactory to the obligee/construction manager.
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Daniel Lund III, PhelpsMr. Lund may be contacted at
daniel.lund@phelps.com
Arizona Court of Appeals Rules Issues Were Not Covered in Construction Defect Suit
December 09, 2011 —
CDJ STAFFThe Arizona Court of Appeals has ruled in the case of Peters v. Marque Homes. In this case, Walter Peters provided the land and funding for Marque Homes to build a luxury residence in Glendale, Arizona. By the terms of the “Joint Venture Agreement,” Peters provided the land and funding, while Marque would not charge Peters for overhead, profits, or supervision fees. The agreement specified that profits would be divided equally.
Two years later, Marque sued Peters claiming he had breached his obligations by refusing several offers for the home. Peters replied that Marque had “failed to complete the home so it is habitable to prospective purchasers.” Peters stated he had “retained an expert inspector who had identified numerous defects.” The court appointed a Special Commissioner to list the home for sale. Peters purchased the home with two stipulations ordered by the court. At this point, the earlier case was dismissed with prejudice.
Peters then sued Marque “asserting express and implied warranty claims arising out of alleged construction defects in the home.” Marque claimed that Peters’s claims were “precluded by the prior joint venture dispute.” The court granted Marque’s motion.
The appeals court reversed the lower court’s decision, determining that Peters’s claims were not precluded by the agreement. Although there had been a prior case between the two parties, warranty issues did not form a part of that case. “Peters never raised these allegations nor presented this evidence in support of any warranty claim.”
The court also noted that the “parties never agreed to preclude future warranty claims.” Marque and Peters “agreed in the stipulated sale order that ‘the sale of the property to a third party shall be “as is” with a 10-year structural warranty.’” The court noted that the agreement said nothing about one of the parties buying the house.
The appeals court left open a claim by Marque that there are no implied or express warranties available to Peters. They asked the Superior Court to address this.
Read the court’s decision…
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Massachusetts High Court: Attorney's Fee Award Under Consumer Protection Act Not Covered by General Liability Insurance Policy
September 19, 2022 —
Jeffrey J. Vita & David G. Jordan - Saxe Doernberger & Vita, P.C.In the case of
Vermont Mutual Insurance Co. v. Poirier, 189 N.E.3d 306 (Mass. 2022), Massachusetts’ Supreme Judicial Court concluded that an award of attorney's fees pursuant to
Chapter 93A (Massachusetts’ Consumer Protection Act) is not covered under an insured’s general liability insurance policy. Applying Massachusetts law, the Court found that a statutory award of attorney’s fees stemming from a bodily injury claim is not reasonably considered “damages because of bodily injury” or “costs taxed against the insured” so as to trigger general liability coverage.
Facts of the Case
A Servpro company (owned by Mr. and Mrs. Poirier) was hired to clean up a basement after a sewage spill. The owners of the home were injured by fumes from chemicals used in the cleanup and accordingly brought suit against the Poiriers and their Servpro business. In the lawsuit, the homeowners alleged negligence, breach of contract, and also a Chapter 93A claim, asserting breach of warranty of merchantability and warranty of fitness for a particular purpose. Prior to trial, the plaintiffs waived the negligence and breach of contract claims and sought a bench trial on the Chapter 93A claims alone.
Reprinted courtesy of
Jeffrey J. Vita, Saxe Doernberger & Vita, P.C. and
David G. Jordan, Saxe Doernberger & Vita, P.C.
Mr. Vita may be contacted at JVita@sdvlaw.com
Mr. Jordan may be contacted at DJordan@sdvlaw.com
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The Woodland Hills Office Secures a Total Defense Award on Behalf of their High-End Custom Home Builder Client!
June 04, 2024 —
Dolores Montoya - Bremer Whyte Brown & O'Meara LLPPartner Daniel Crespo and Associate Theresa Mallen secured a total defense award in arbitration. Our client is a high-end custom home builder with a decades-long flawless record of museum quality construction. Our client was accused of performing substandard construction and the homeowners asserted a multiple million-dollar cost of repair. We took a zero-liability position and argued that the alleged defects were not defects at all but were rather mere reflections of an incomplete project. In sum, our client was forced to terminate the contract and cease construction due to the homeowners’ failure to make progress payments as they became due. The arbitration endured 16 days of testimony scattered over the course of 7 months.
Ultimately, the arbitrator ruled that there were no construction defects at the project and that the homeowners “shall take nothing.” The arbitrator also ruled in favor of our client on its affirmative claim for monies owed by the homeowners’ breach of contract plus interest. A total victory for our client.
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Dolores Montoya, Bremer Whyte Brown & O'Meara LLP
Additional Dismissals of COVID Business Interruption, Civil Authority Claims
December 29, 2020 —
Tred R. Eyerly - Insurance Law HawaiiAmong the recent decisions dismissing complaints for business interruption and civil authority coverage due to closures caused by COVID-19 are Pappy's Barber Shops, Inc. v. Farmers Group, Inc., 2020 U.S. Dist. LEXIS 166808 (S.D. Calif. Sept. 11, 2020) and Sandy Point Dental v. Cincinnati Insurance Co., 2020 U.S. Dist. LEXIS 171979 (E.D. Ill. Sept. 21, 2020). The difficulty in proving "direct physical loss" was the downfall of both cases.
In Pappy's, claims were made for business income losses insured as a result of local and state closure orders. The policy required "direct physical loss of or damage to property at the described premises." Plaintiffs argued that "direct physical loss of" did not require a tangible damage or alteration to property and that the loss of the ability to continue operating their businesses as a result of the government orders met this requirement.
The court relied upon a prior decision, 10E, LLC v. Travelers Indem. Co. of Connecticut, 2020 U.S. Dist. LEXIS 165252 (C.D. Calif. Sept. 2, 2020) [post here], where the court noted that under California law, losses from inability to use property did not amount to "direct physical loss" within the meaning of the policy.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Enerpac Plays Critical Role in Industry-changing Discovery for Long Span Bridges at The University of Nebraska-Lincoln
April 19, 2022 —
EnerpacMENOMONEE FALLS, Wis. (April 18, 2022) – Three years ago when Marc Maguire, assistant professor of construction programs at the University of Nebraska-Lincoln, started investigating a new stranded wire product for bridge girder reinforcing he thought the best strands for bridge construction were the industry standard 7-wire strands.
After running a multitude of analyses, Maguire and student researchers found that 19-wire 1-1/8 in. diameter strands outperform the typical 7-wire 1-1/6 in. diameter strands and allow bridges to reach unprecedented lengths. Further tests conducted by the Durham School of Architectural Engineering and Construction with the help of Enerpac hydraulic tools examined the bond strength, force transfer, and development length of the 19-wire strands.
"Traditionally, 19-wire strands are not often used in the U.S. because they are not widely available and they are much larger than standard strands," said Maguire. "We wanted to show that there was an alternative option to the common 7-wire strand--one that can perform at the same level, if not better."
About Enerpac
Enerpac is a global market leader in high pressure hydraulic tools, controlled force products, portable machining, on-site services and solutions for precise positioning of heavy loads. As a leading innovator with a 110-year legacy, Enerpac has helped move and maintain some of the largest structures on earth. When safety and precision matters, elite professionals in industries such as aerospace, infrastructure, manufacturing, mining, oil & gas and power generation rely on Enerpac for quality tools, services and solutions. For more information, visit www.enerpac.com.
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Why 8 Out of 9 Californians Don't Buy Earthquake Insurance
August 27, 2014 —
Alyssa Abkowitz – BloombergEarly estimates suggest the economic losses from Sunday’s 6.0-magnitude earthquake in Northern California, the largest quake to hit the Golden State in 25 years, could hit $1 billion. When it comes to rebuilding, much of the cost will come out of people’s own pockets.
The percentage of homeowners with earthquake insurance in California and across the U.S. has declined, despite rising estimates of the risk of an earthquake. A survey by the Insurance Information Institute, a nonprofit that’s funded by the insurance industry, found that 7 percent of U.S. homeowners have earthquake insurance, down from 13 percent just two years ago. In the West, ground zero for U.S. quakes, 10 percent of homeowners have coverage, down from 22 percent a year ago; in California, about 12 percent do, according to the California Earthquake Authority.
But as fewer people opt for earthquake insurance, the government is upping its assessment of the risk of a sizable shake. Last month, the U.S. Geological Survey updated its seismic hazard maps for the first time since 2008. The update showed an increased earthquake risk for almost half the country. Parts of Washington, Oregon, Oklahoma, and Tennessee, among others, moved into the top two hazard zones. The San Francisco Bay area, for example, shows a 63 percent chance of one or more major earthquakes before 2036, according to the agency.
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Alyssa Abkowitz, Bloomberg
