No Signature, No Problem: Texas Court Holds Contractual Subrogation Waiver Still Enforceable
April 10, 2023 —
Gus Sara - The Subrogation StrategistIn Chubb Lloyds Inc. Co. of Tex. v. Buster & Cogdell Builders, LLC, No. 01-21-00503-CV, 2023 Tex. App. LEXIS 676, the Court of Appeals of Texas, First District (Court of Appeals) considered whether the lower court properly dismissed the plaintiff’s subrogation case by enforcing a subrogation waiver in a construction contract which was not fully executed. The contract was signed by only one of the two subrogors and was not signed by the defendant general contractor. The Court of Appeals affirmed the trial court’s decision, holding that despite the lack of signatures, the evidence established mutual assent to the contractual terms by all parties.
The plaintiff’s subrogors, Jeffrey and Mary Meyer (collectively, the Meyers), retained defendant Buster & Codgell Builders (BCB) to expand their residence. BCB drafted a contract using the American Institute of Architects (AIA) standard form contract for residential construction. The AIA contract included, by reference, a subrogation waiver that applied to BCB and its subcontractors. Prior to beginning the work, BCB emailed Jeffrey Meyer a version of the contract that only had one signature block for both Jeffrey and Mary Meyer. Minutes later, BCB sent a second version of the contract which had a signature line for each of the Meyers. However, Jeffrey Meyer signed the first version of the contract and emailed it back to BCB. In the subject line of his email, Mr. Meyers asked that BCB countersign and return the contract. BCB did not sign and return the contract.
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Gus Sara, White and WilliamsMr. Sara may be contacted at
sarag@whiteandwilliams.com
Ruling Finds Builder and Owners at Fault in Construction Defect Case
December 30, 2013 —
CDJ STAFFA Minnesota home owners association has been found 30liable for some of the damage to their homes in a jury trial. The Interlachen Propertyowners Association made a claim of construction defects against Keupers Architects and Builders who had constructed the 24-unit town home complex. According to the association’s lawyer, the half-log siding was improperly installed, leading to water intrusion and rot.
The jury did find for the homeowners on the construction defect claim, but found on a claim of negligent repairs that the association was 30% at fault, due to insufficient maintenance of the building. “We don’t think any amount of maintenance would have saved these buildings,” said Jason Tarasek, the lawyer for the association. The association is likely to appeal.
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VOSH Jumps Into the Employee Misclassification Pool
July 30, 2015 —
Christopher G. Hill – Construction Law MusingsThe proper classification of workers by construction companies has been on the radar of the Department of Labor for both the US and Virginia governments for quite a while. While most of the misclassification is innocent and not done to create issues, there have been enough instances of purposeful misclassification of certain workers as independent contractors (thus avoiding workers comp and other payroll expenses) that innocent contractors have born the brunt of these issues through increased payroll costs over those that misclassify (in the form of necessarily higher bids, higher overhead, etc.).
As an additional deterrent to improper classification of workers, the Virginia Department of Labor and Industry has issued guidelines for what will occur in Virginia Department of Safety and Health (VOSH) cases.
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Christopher G. Hill, Law Office of Christopher G. Hill, PCMr. Hill may be contacted at
chrisghill@constructionlawva.com
BIM Meets Reality on the Construction Site
September 25, 2018 —
Aarni Heiskanen - AEC BusinessBIM models are mostly used by foremen on construction sites. But what if they could be made available for workers at the press of a button? This question was what the Finnish government-funded KIRA pilot project set out to answer. As a by-product, the project also produced augmented reality (AR) solutions for construction sites.
The research project was called ”Digitalization of a construction project based on role and location information” (RoPa). It was conducted by construction company Fira and engineering consultancy Sweco.
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Aarni Heiskanen, AEC BusinessMr. Heiskanen may be contacted at
aec-business@aepartners.fi
New Jersey Law regarding Prior Expert’s Testimony
April 15, 2014 —
Beverley BevenFlorez-CDJ STAFFMary Pat Gallagher writing for the New Jersey Law Journal reported that “[l]awyers who track down an opposing expert's testimony from prior cases must disclose that fact during discovery but need not say whether they plan to use it in cross-examining the expert at trial, a New Jersey appeals court says.” In Dalton v. Crawley, the Appellate Division held that “[d]ecisions about cross-examination ‘involve the attorney's mental processes, so they are inherently work product.’”
The issue began when “one of the defense lawyers, Michael McGann, figured out from the deposition questions Mahoney directed at one of his experts that he had transcripts of testimony from earlier cases,” according to the New Jersey Law Journal. “Hit with a notice to produce the transcripts, [Plaintiff attorney Brian] Mahoney refused, saying they were ‘attorney work product and we will not be telling you what we have developed regarding this expert.’"
The New Jersey Law Journal declared that the “ruling means both sides will have to indicate what transcripts they have gathered for use—giving the name of each expert as well as the name and docket number of the prior cases where those experts testified. “
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Courts Take Another Swipe at the Implied Warranty of the Plans and Specifications
December 15, 2016 —
John P. Ahlers – Ahlers & Cressman PLLCImplied warranties are warranties created by law, legislation, or courts. In the construction industry, one of the most prominent implied warranties is that owners who provide plans and specifications to their contractors impliedly warrant the adequacy of their plans and specifications.[i] That implied warranty had its beginning in the 1918 US Supreme Court decision of U.S. v. Spearin[ii] and is, therefore, popularly known as the Spearin Doctrine. Under the Spearin Doctrine, if the contractor completes the work in accordance with the owner’s plans and specifications, but there is a deficiency or failure, the owner, not the contractor, is responsible. When the owner breaches its implied warranty, in most instances, the contractor is entitled to additional compensation for extra work performed, delays experienced, and other additional expense or loss occasioned by the warranty breach. A recent case demonstrates that this implied warranty is not “immunity.” The contractor must still act reasonably and diligently, particularly when the contract provisions so require.
In the recent Fifth Circuit case of Dallas/Ft. Worth International Airport v. INet Airport Systems,[iii] the court, despite the implied warranty that existed, did not grant the contractor summary judgment on claims involving admitted plan deficiencies, since factual issues existed regarding the contractor’s cooperation and participation in the solution to the defects.
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John P. Ahlers, Ahlers & Cressman, PLLCMr. Ahlers may be contacted at
jahlers@ac-lawyers.com
No Coverage for Homeowner Named as Borrower in Policy but Not as Insured
July 08, 2024 —
Tred R. Eyerly - Insurance Law HawaiiThe magistrate judge recommended that the homeowner's complaint seeking coverage for damage caused by Hurricanes Laura and Delta be denied because the homeowner was only named as the borrower under the policy. LeDay v. Integon Nat'l Ins. Co., 2024 U,S. Dist. LEXIS 87369 (W.D. La. April 15, 2024).
When the homeowner sought coverage for hurricane damage, it was denied. The homeowner then sued and Integon moved to dismiss. Integon argued it did not issue a policy to the homeowner, but the policy was issued to Midland Mortgage. The pro se homeowner did not respond to the motion.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Fixing That Mistake
October 25, 2021 —
Patrick Barthet - Construction ExecutiveSomeone once said, more people could learn from their mistakes if they weren’t so busy denying that they made them in the first place.
In the construction industry, mistakes are not uncommon. Addressing them, however, can be complicated. What should a contractor do when the project owner says some aspect of the project is not satisfactorily completed or isn’t performing as it should? Should the contractor wait, hoping it may get resolved without having to do anything? Or should the contractor take on the repair or replacement as soon as practically possible?
Doing nothing may be easy but can expose the contractor to significant subsequent liability. Dealing with the issue, on the other hand, could result in the destruction of what might later be required evidence in any litigation which develops. Considered “spoliation,” such manipulation or elimination of evidence is a consequence to be avoided. Even though done with the best of intentions to fix a problem, the process can wind up exposing one to liability and damages.
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Patrick Barthet, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Mr. Barthet may be contacted at
pbarthet@barthet.com