Feds to Repair Damage From Halted Border Wall Work in Texas, California
May 31, 2021 —
Mary B. Powers - Engineering News-RecordWith hurricane season fast approaching, the U.S. Dept. of Homeland Security has begun repair of large breaches in a 13-mile section of Rio Grande flood barriers in Texas caused by Trump administration border wall contractors building on them—after local officials feared "extensive problems" with their integrity and threatened to bring in their own crews.
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Mary B. Powers, Engineering News-Record
ENR may be contacted at ENR.com@bnpmedia.com
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Just Because You Allege There Was an Oral Contract Doesn’t Mean You’re Off the Hook for Attorneys’ Fees if you Lose
March 28, 2022 —
Garret Murai - California Construction Law BlogThere’s certain things in life you shouldn’t mix. Like drinking and driving. Bleach and ammonia. Triple dog dares and frozen poles. And angry lawyers and litigation.
In Spahn v. Richards, Case No. A159495 (November 30, 2021), angry lawyer Jeffrey Spahn sued general contractor Dan Richards claiming that Richards orally agreed to build Spahn’s million dollar plus house for $515,000. Not only did Spahn not recover anything from Richards, he ended up owing Richards $239,171 in attorney’s fees and costs, after he denied a request for admission asking that he admit that there was no oral contract.
The Spahn Case
In 2017, Spahn filed suit against Richards for breach of oral contract, breach of implied covenant of good faith and fair dealing, and promissory estoppel. According to Spahn, he met Richards in June 2015 and the two reached an agreement whereby Richards agreed to demolish Spahn’s house for $12,500 and build a new one for $515,000. Further according to Spahn, Richards agreed to this “fixed price” “oral contract” in June 2015, and then, on July 1, 2015, Richards “confirmed and agreed that he would perform the construction project” for $515,000 and would complete construction by May 2016.
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Garret Murai, Nomos LLPMr. Murai may be contacted at
gmurai@nomosllp.com
Performance Bond Surety Takeover – Using Terminated Contractor To Complete The Work
January 06, 2020 —
David Adelstein - Florida Construction Legal UpdatesWhen a contractor is defaulted under a performance bond, can its surety hire the same defaulted contractor to complete the work? Stated differently, can the performance bond surety engage its defaulted bond-principal in taking over and completing the same work the contractor was defaulted under? The answer is “yes” if you are dealing with a standard form AIA A312 performance bond (and other bond forms that contain analogous language), as demonstrated by the recent decision in Seawatch at Marathon Condominium Association, Inc. v. The Guarantee Company of North America, 2019 WL 4850194 (Fla. 3d DCA 2019).
In this case, a condominium association hired a contractor in a multi-million dollar contract to renovate condominium buildings. The contractor provided the association, as the obligee, a performance bond written on an AIA A312 performance bond form. During construction, the association declared the contractor in default and terminated the contractor. In doing so, the association demanded that the performance bond surety make an election under paragraph 4 of the AIA A312 bond form that gave the surety the following options:
4.1 Arrange for the CONTRACTOR, with consent of the OWNER, to perform and complete the Contract; or
4.2 Undertake to perform and complete the Contract itself, through its agents or through independent contractors; or
4.3 Obtain bids or negotiated proposals from qualified contractors acceptable to the OWNER for a contract for performance and completion of the Contract, arrange for a contract to be prepared for execution by the OWNER and the contractor selected with the OWNER’S concurrence, to be secured with performance and payment bonds executed by a qualified surety equivalent to the Bonds Issued on the Contract, and pay to the OWNER the amount of damages as described in paragraph 6 in excess of the Balance of the Contract Price incurred by the OWNER resulting from the CONTRACTOR Default; or
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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 HawaiiThe 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.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
With VA Mechanic’s Liens Sometimes “Substantial Compliance” is Enough (but don’t count on it) [UPDATE]
October 14, 2019 —
Christopher G. Hill - Construction Law MusingsVirginia mechanic’s liens are a powerful and tricky beast that in most cases require absolute precision in their preparation. However, an interesting opinion recently came out of the Virginia Supreme Court that may provide a bit of a “safe harbor” from the total form over function nature of a mechanic’s lien.
In Desai, Executrix v. A.R. Design Group Inc., the Court considered a lien memorandum that had what could be described as technical flaws in the preparation of the mechanic’s lien by A. R. Design Group. The basic facts are that A. R. Design Group used the form of lien found in Va. Code Sec. 43-5 (also found as Form CC-1512 at the Virginia Judiciary website) when it recorded two lien memoranda for two pieces of property owned by a trust. Relating to one of the two properties, the memorandum failed to identify the “Owner” as the trustee of the trust. On the memoranda relating to both properties the affidavit verifying the amounts claimed did not identify the signatory as agent for A. R. Design Group, instead listing the agent as the claimant and further failed to state a date from which interest is claimed or a date on which the debt was due.
Needless to say, the owner argued that each of these technical defects invalidated the memoranda and therefore they should have been released. Somewhat surprisingly the Fairfax, Virginia Circuit Court disagreed and held the liens to be valid. On appeal, the Virginia Supreme Court affirmed the lower court. The held that the failure to add the word “Trustee” after Ulka Desai’s name did not invalidate the lien because the trustee had all of the rights of ownership and furthermore that naming Desai in the memorandum served the purpose of putting third parties on notice of the lien.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
CCPA Class Action Lawsuits Are Coming. Are You Ready?
March 23, 2020 —
Daniel Schneider & Jeffrey Dennis – Newmeyer DillionThe only certainties in life used to be death and taxes. In 2020, it would be safe to add California Consumer Privacy Act (CCPA) class actions to that "distinguished" list. On February 3, Barnes v. Hanna Andersson, LLC, N.D. Cal., Case No. 20-cv-00812, was filed in the Northern District of California, setting in motion the certainty that CCPA class actions are on their way, if not already here.* Filed on behalf of all California residents, the Barnes complaint alleges that between September and November 2019, clothing retailer Hanna Andersson and Salesforce, its online payment services provider, failed to properly safeguard the personally identifiably information (PII) of its customers after hackers stole customers' private information and posted it to the dark web for sale.
What You Need to Know
- Under the CCPA, a data breach is any unauthorized access, theft or disclosure of a consumer's non-encrypted and non-redacted personal information that results from a company's failure to implement and maintain "reasonable" security procedures and practices. Here, the complaint alleges that the defendants failed to maintain reasonable security procedures and practices in order to protect the consumers' PII.
- Although the CCPA is largely viewed as new law related to California consumers' privacy rights (and placement of subsequent obligations to companies doing business in California), the CCPA includes potentially draconian damages for a data breach permitted by unreasonable cybersecurity. Under the new law, an individual need not show any actual harm caused by a data breach, yet he/she may seek statutory fines of up to $750 per incident per individual in the event of a breach. Plaintiffs estimate that at least 10,000 California residents could have been affected by this breach, thereby exposing defendants to up to $7.5 million dollars in damages if proven true.
- There exists a duty to monitor and ensure that third party organizations are properly safeguarding a company's data. During the course of the investigation into the breach, it was discovered that the Salesforce ecommerce platform was infected with malware which allowed the hackers to steal consumers' PII from Hanna Andersson's website.
- The CCPA went into effect on January 1, 2020, yet enforcement by the California Attorney General is not allowed until July 2020. However, no such delay is required for private litigation under the data breach portion of the CCPA. Interestingly, although the complaint alleges that the data breach occurred in 2019, the court could choose to apply the CCPA but that is still yet to be determined.
While Barnes may be the first class action lawsuit to mention violation of the CCPA, it certainly will not be the last. In fact, numerous class actions lawsuits have been filed in the new year which either mention the CCPA or utilize CCPA-like language to style particular claims. As such, it is evident that the Plaintiffs' bar sees the CCPA as a potential for extensive class action litigation. Expect to see an ongoing deluge of class action litigation in California under the data breach portions of the CCPA. In addition, although the Barnes' plaintiffs may not be able to invoke the CCPA due to the data breach occurring in 2019 (before the CCPA took affect), Barnes serves as a stark reminder that implementing and maintaining reasonable data security is vital to defend a business against CCPA claims. Newmeyer Dillion can assist companies analyze their cyber risk profile, and provide access to experienced forensic teams which can ensure reasonable security exists in your organization.
*While Barnes does not yet expressly state a cause of action under the CCPA, relying upon violations of the California Unfair Competition Law in its place, we anticipate that an amendment will soon be filed to include a CCPA claim.
Daniel Schneider is a Partner in Newmeyer Dillion's Privacy & Data Security group. Focused on advocating on behalf of clients when cyber threats inevitably happen, Dan also advises on best practices to help protect the company and mitigate future concerns. Dan can be reached at daniel.schneider@ndlf.com.
Jeff Dennis (CIPP/US) is the Head of the firm's Privacy & Data Security practice. Jeff works with the firm's clients on cyber-related issues, including contractual and insurance opportunities to lessen their risk. For more information on how Jeff can help, contact him at jeff.dennis@ndlf.com.
About Newmeyer Dillion
For 35 years, Newmeyer Dillion has delivered creative and outstanding legal solutions and trial results that achieve client objectives in diverse industries. With over 70 attorneys working as a cohesive team to represent clients in all aspects of business, employment, real estate, environmental/land use, privacy & data security and insurance law, Newmeyer Dillion delivers holistic and integrated legal services tailored to propel each client's success and bottom line. Headquartered in Newport Beach, California, with offices in Walnut Creek, California and Las Vegas, Nevada, Newmeyer Dillion attorneys are recognized by The Best Lawyers in America©, and Super Lawyers as top tier and some of the best lawyers in California and Nevada, and have been given Martindale-Hubbell Peer Review's AV Preeminent® highest rating. For additional information, call 949.854.7000 or visit www.newmeyerdillion.com.
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Bridges Crumble as Muni Rates at Least Since ’60s Ignored
June 26, 2014 —
William Selway and Brian Chappatta – BloombergNo state is needier than West Virginia when it comes to fixing crumbling highways, airports and water works, with annual repair needs of $1,035 per resident that’s three times the national average.
Yet even with borrowing costs hovering close to four-decade lows, lawmakers rejected a January proposal to sell $1 billion of bonds to repair roads that run through the Appalachian Mountains. Budget cuts were a more immediate concern, they said.
Across the U.S., localities are refraining from raising new funds in the $3.7 trillion municipal-bond market after the worst financial crisis since the Great Depression left them with unprecedented deficits. Rather than take advantage of Federal Reserve (FDTR) policy that’s held benchmark interest rates at historic lows since December 2008, they’re repaying obligations by the most on record.
Mr. Selway may be contacted at wselway@bloomberg.net; Mr. Chappatta may be contacted at bchappatta1@bloomberg.net
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William Selway and Brian Chappatta, Bloomberg
Ex-Turner Exec Gets 46 Months for Bloomberg Construction Bribes
July 11, 2021 —
Eydie Cubarrubia - Engineering News-RecordA third New York City-based construction executive was sentenced to federal prison June 15, receiving 46 months, as part of the $15-million bribery scheme involving interiors work for financial giant Bloomberg LLP at its Manhattan headquarters.
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Eydie Cubarrubia, Engineering News-Record
Ms. Cubarrubia may be contacted at cubarrubiae@enr.com
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