FAIRFIELD CONNECTICUT BUILDING EXPERT
DIRECTORY AND CAPABILITIES

DIR Public Works Registration System Down, Public Works Contractors Not to be Penalized

July 15, 2024 — Garret Murai - California Construction Law Blog
In a bit of a major freak-out this past Friday, June 28, 2024, public works contractors with Department of Industrial Relations (“DIR”) registrations expiring on June 30, 2024 were unable to renew their public works registrations. Those who had submitted checks were not receiving responses, DIR was not accepting online payments, and there was no telephone number or address to contact the DIR about the issue. This, of course, could have been a big deal since Labor Code section 1725.5 prohibits contractors and subcontractors from bidding on, being listed in a bid, or being awarded a public works contract unless registered with the DIR. Read the court decision
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Reprinted courtesy of Garret Murai, Nomos LLP
Mr. Murai may be contacted at gmurai@nomosllp.com

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In Texas, a General Contractor May be Liable in Tort to a Third-Party Lessee for Property Damage Caused by a Subcontractor’s Work

February 16, 2016 — Michael L. DeBona – White and Williams LLP
In Zbranek Custom Homes, Ltd. v. Joe Allbaugh, et al., No. 03-14-00131-CV, 2015 WL 9436630 (Tex.App.-Austin Dec. 23, 2015), the Court of Appeals of Texas, Austin, considered the circumstances under which a general contractor can be held liable for injuries to a non-contracting party’s property. The court held that, because the general contractor, Zbranek Custom Homes, Ltd. (Zbranek), exercised control over the construction of the fireplace at issue, Zbranek owed a duty of care to the first lessees of the home that Zbranek built. In Zbranek, Bella Cima Developments, L.P. (Bella Cima) hired Zbranek to act as the general contractor for the construction of a home. As the general contractor, Zbranek engaged various subcontractors to perform different aspects of the construction, including the framing, stucco and masonry work for an outdoor fireplace. Read the court decision
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Reprinted courtesy of Michael L. DeBona, White and Williams LLP
Mr. DeBona may be contacted at debonam@whiteandwilliams.com

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Exclusions Bar Coverage for Damage Caused by Chinese Drywall

July 05, 2011 — Tred R. Eyerly

The insured homeowners were unsuccessful in arguing around the policy's exclusions when seeking coverage for damage caused by Chinese drywall. Ross v. C. Adams. Constr. & Design, L.L.C., 2011 La. App. LEXIS 769 (La. Ct. App. June 14, 2011).



Before the insureds purchased and moved into their home, it was renovated. After moving in, the insures discovered foreign gypsum drywall, or Chinese drywall. The insureds submitted a claim to Louisiana Citizens Property Insurance Company. In an investigation, the insurer confirmed the presence of Chinese drywall and damage to the metal surfaces caused by corrosion. Louisiana Citizens refused coverage and the insureds sued. The trial court denied the insured's motion for summary judgment and granted summary judgment to Louisiana Citizens.



The court of appeal affirmed. Initially, the court determined the insureds sustained a direct physical loss. The inherent qualities of the Chinese drywall created a physical loss to the home and required that the drywall be removed and replaced.



Four exclusions, however, barred coverage. First, damages due to faulty or defective materials were excluded from coverage. The Chinese drywall emitted high levels of sulfuric gas which caused the damage to the insured's plumbing, electrical wiring and metal components.



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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii. Mr. Eyerly can be contacted at te@hawaiilawyer.com

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California Governor Signs SB 496 Amending California’s Anti-Indemnity Statute

June 05, 2017 — William S. Bennett - Saxe Doernberger & Vita, P.C.
The bill amends Cal. Civ. Code § 2782.8 as it applies to indemnity agreements with design professionals. The pre-existing § 2782.8 prohibited public agencies from requiring indemnity from design professionals for anything other than claims arising out of, pertaining to, or relating to the negligence, recklessness, or willful misconduct of the design professional. Under the newly passed bill, the indemnity restrictions imposed on public agencies when contracting with design professionals will now apply to all parties contracting with design professionals for professional services (effective Jan. 1, 2018). These restrictions also apply to a party contractually imposing a defense obligation on the design professional. The revised statute specifically identifies architects, landscape architects, professional engineers, and professional land surveyors as included within the meaning of “design professional,” however it is unclear whether that is the extent of the phrase’s meaning. Read the court decision
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Reprinted courtesy of William S. Bennett, Saxe Doernberger & Vita, P.C.
Mr. Bennett may be contacted at wsb@sdvlaw.com

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Pre-Judgment Interest Not Awarded Under Flood Policy

January 17, 2023 — Tred R. Eyerly - Insurance Law Hawaii
The court granted the insurer's motion to dismiss state law and extracontractual claims, including pre-judgment interest. Hurley v. Wright Nat'l Flood Ins. Co., 2022 U.S. Distl. LEXIS 203803 (W.D. La. Nov. 8, 2022). The insured suffered damage from Hurricane Delta. He filed suit, alleging that Wright National Flood Insurance Company breached the Standard Flood Insurance Policy (SFIP). The insured sought damages for state law claims for bad faith, diminution in value, actual repair costs, attorney's fees , litigation costs, and interest. Wright moved to dismiss the extracontractual state law causes of action for bad faith and various claims for damages, other than the damages sought for the alleged breach of the SFIP. The court explained that the Write-Your-Own (WYO) Program carriers issuing flood insurance under the National Flood Insurance Program (NFIP) arranged for the adjustment, settlement, payment, and defense of all claims arising from the policy. Congress underwrote all operations of the NIFP, including claims adjustment, through United States Treasury funds. A judgment against a WYO Program carrier constituted a judgment against FEMA, and consequently, a direct charge on the United States Treasury.  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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M&A Representation and Warranty Insurance Considerations in the Wake of the Coronavirus Pandemic

April 06, 2020 — Lori Smith & Patrick Devine - White and Williams Taking Care of Business Blog
Increasingly, M&A transactions are using representation and warranty insurance (RWI) to bridge the gap between a buyer’s desire for adequate recourse to recover damages arising out of breach of representations in the purchase agreement and a seller’s desire to minimize post-closing risk and holdbacks or purchase price escrows traditionally used as the means to satisfy such obligations. When it works, RWI provides a significant benefit to both parties: it mitigates the buyer’s risk in the event that the seller’s representations and warranties prove untrue, and it permits the seller to reduce the portion of the purchase price that it would otherwise have to leave in escrow to cover future claims for breach of those representations and warranties. However, as the coronavirus pandemic ravages the global economy, insurers are now expressly adding COVID-19 exclusions to their RWI policies. If RWI insurers decline coverage for these losses, the allocation of risk in the representations and warranties (and related indemnity provisions) will be more critical than the parties contemplated when they negotiated the transaction documents. Unlike in the case of a natural disaster, insurers cannot quantify the economic fallout that may result from the coronavirus pandemic. This uncertainty breeds systemic concern about the number of insurance claims that covered parties of all varieties will bring, which in turn creates an industry-wide reluctance to cover the claims. Based on discussions with market participants, we understand that, at the present time, 70% to 80% of RWI insurers are broadly excluding losses resulting from COVID-19 and similar viruses, epidemics, and pandemics (including government actions in response thereto), 5% to 10% are narrowly excluding specific coronavirus-related losses that are more likely to be implicated in a particular transaction (e.g., losses caused by business interruption), and 10% to 15% may be willing to narrow their exclusions upon completion of the underwriting process, depending on their comfort level after conducting rigorous and heightened diligence. Insurers’ concerns are wide-ranging, but the representations and warranties causing the greatest distress appear to be those regarding customer retention, supply chain matters, undisclosed liabilities, and the absence of changes between the date of the seller’s most recent financial statements and the transaction closing date. Reprinted courtesy of Lori Smith, White and Williams and Patrick Devine, White and Williams Ms. Smith may be contacted at smithl@whiteandwilliams.com Mr. Devine may be contacted at devinep@whiteandwilliams.com Read the court decision
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Trump Administration Waives Border Wall Procurement Rules

March 23, 2020 — Mary B. Powers & Debra K. Rubin - Engineering News-Record
Acting Homeland Security Secretary Chad Wolf on Feb. 20 waived federal contracting rules to expedite construction of the U.S-Mexico border wall in California, Arizona, New Mexico and Texas, citing legal authority under several U.S. laws, some dating back to the 1990s, to deal with what he claimed is "an acute and immediate need to construct physical barriers and roads ... to prevent unlawful entries." Reprinted courtesy of Mary B. Powers, Engineering News-Record and Debra K. Rubin, Engineering News-Record Ms. Rubin may be contacted at rubind@enr.com Read the full story... Read the court decision
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Mortgage Applications in U.S. Jump 11.6% as Refinancing Surges

October 22, 2014 — Danielle Trubow – Bloomberg
Mortgage applications in the U.S. soared last week as a plunge in borrowing costs led to biggest gain in home refinancing since January 2012. The Mortgage Bankers Association’s index rose 11.6 percent in the period ended Oct. 17, the biggest gain since January, after a 5.6 percent advance the week before, figures from the Washington-based group showed today. The refinancing gauge jumped 23.3 percent while the purchase applications measure dropped 4.6 percent. Read the court decision
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Reprinted courtesy of Danielle Trubow, Bloomberg
Ms. Trubow may be contacted at dtrubow@bloomberg.net

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