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Colorado homebuilders target low-income buyers with bogus "affordable housing" bill

March 05, 2015 — Jesse Howard Witt – Acerbic Witt
“Affordable housing” is the latest catchphrase for Colorado homebuilders seeking immunity from warranty claims and repair requests. In 2013, the homebuilders’ lobby said it was about public transportation. In 2014 they said it was about community building. Now it’s 2015, and the lobbyists are claiming that a lack of affordable housing is the reason why politicians should eliminate consumer protections for homebuyers. The Colorado Senate recently announced the introduction of SB 15-177. If passed, the bill will make it illegal for homeowner associations to hire construction experts or lawyers unless they can first satisfy a complicated disclosure and voting process. Although sponsors portray the bill as an innocuous measure that merely requires more community involvement, its provisions have actually been tailored to take advantage of recent court decisions that make it difficult for homeowner associations to vote on measures outside of a meeting or act quickly to resolve construction defect disputes. The intent is to make it nearly impossible for homeowners to retain construction experts or legal representation before the statute of limitations period expires, thereby making homebuilders immune from any potential claims. The bill will also eliminate the right to a jury trial in many cases, forcing any disputes that overcome the procedural hurdles into costly, private arbitration proceedings. The sponsors argue that these measures are necessary to encourage builders to erect more cheap condominiums. Read the court decision
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Reprinted courtesy of Jesse Howard Witt, The Witt Law Firm
Mr. Witt welcomes comments at www.acerbicwitt.com

U.S. Home Sellers Return for Spring as Buyers Get Relief

February 10, 2014 — Prashant Gopal – Bloomberg
Suzanne Baker and her siblings bought a foreclosed home in Atlanta two years ago, added a fourth bathroom, then waited for values to rebound before considering a sale. Now, she says, they’re ready to cash in. The family last month listed the four-bedroom house in the affluent Buckhead neighborhood for $710,000. It was purchased as an investment for about $375,000 in late 2011, before bulk buyers snapped up many of the area’s distressed homes, helping to drive up prices in Atlanta by more than 25 percent. “The market is back up,” Baker said. “We think we can make a good amount of profit so we’re going to try.” For two years, a shortage of sellers like the Bakers has propped up prices across the U.S. as shoppers jostled for a dwindling supply of houses. Now, as the market’s busiest season approaches, escalating values are spurring more listings as homeowners regain equity lost in the worst crash since the 1930s. While new-home construction at a third of its 2006 peak will keep inventory tight, the supply increase is poised to damp price gains while higher mortgage rates cut into demand. Read the court decision
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Reprinted courtesy of Prashant Gopal, Bloomberg
Mr. Gopal may be contacted at pgopal2@bloomberg.net

Texas Supreme Court Finds Payment of Appraisal Award Does Not Absolve Insurer of Statutory Liability

April 19, 2021 — Allison Griswold & Sarah Smith - Lewis Brisbois
The Texas Supreme Court recently published its long-awaited decision in the Hinojos v. State Farm Lloyds. In it, the court affirmed its holding in Barbara Technologies, finding that payment of an appraisal award does not absolve an insurer of statutory liability when the insurer accepts a claim but pays only part of the amount it owes within the statutory deadline, and a policy holder can proceed with an action under the Texas Prompt Payment of Claims Act. In 2013, Louis Hinojos made a claim for storm damage to his home. State Farm’s initial inspection resulted in an estimate below the deductible, but Hinojos disagreed and requested a second inspection. At the second inspection, the adjuster identified additional damage resulting in a payment to Hinojos of $1,995.11. Hinojos then sued State Farm – and State Farm invoked appraisal approximately 15 months after suit was filed. The appraisal resulted in State Farm tendering an additional payment of $22,974.75. State Farm moved for summary judgment, arguing that timely payment of an appraisal award precluded prompt payment (or Chapter 542) damages. The trial court granted summary judgment and Hinojos appealed (notably Barbara Technologies had not yet been decided). The Court of Appeals affirmed State Farm’s victory on the basis that “State Farm made a reasonable payment on Hinojos’s claim within the sixty-day statutory limit….” Hinojos petitioned the Texas Supreme Court for review. Reprinted courtesy of Allison Griswold, Lewis Brisbois and Sarah Smith, Lewis Brisbois Ms. Griswold may be contacted at Allison.Griswold@lewisbrisbois.com Ms. Smith may be contacted at Sarah.Smith@lewisbrisbois.com Read the court decision
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NYC Developer Embraces Religion in Search for Condo Sites

October 15, 2014 — Oshrat Carmiel – Bloomberg
Extell Development Co., the New York builder that set off a luxury residential construction boom with its One57 project, is expanding its reach on Manhattan’s west side with a pending purchase of a synagogue and a plan to redevelop a Baptist church. Extell is in advanced talks to buy the Congregation Habonim synagogue at 44 W. 66th St. in a deal valued at $75 million, with plans to build condominiums on the site, according to documents the synagogue filed in New York State Supreme Court seeking permission for a sale. Extell also is negotiating with Calvary Baptist Church for a potential project at its 123 W. 57th St. site, on the same block as One57, the church’s 2014 annual report shows. Religious institutions across New York are pursuing real estate sales as land prices escalate. Manhattan development sites sold for an average of $657 a square foot in the third quarter, up 29 percent from a year earlier and a record for the period, Massey Knakal Realty Services said this month. Three purchases completed in the quarter were for more than $1,000 a square foot, the firm’s data show. Read the court decision
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Reprinted courtesy of Oshrat Carmiel, Bloomberg
Ms. Carmiel may be contacted at ocarmiel1@bloomberg.net

Statute of Frauds Applies to Sale of Real Property

April 19, 2022 — David Adelstein - Florida Construction Legal Updates
In law school, one of the first legal doctrines we learn is known as the “statute of frauds.” The statute of frauds is essentially a defense to a contract enforcement action claiming the contract is unenforceable due to the statute of frauds. In other words, this doctrine is raised when one party seeks to enforce a contract. The other party argues, “not so fast,” because the contract is NOT enforceable in light of the statute of frauds. Common scenarios where the statute of frauds comes into play are with transactions involving real property or agreements where services are not to be performed within one year. The statue of frauds doctrine is contained in Florida Statute s. 725.01:

No action shall be brought whereby to charge any executor or administrator upon any special promise to answer or pay any debt or damages out of her or his own estate, or whereby to charge the defendant upon any special promise to answer for the debt, default or miscarriage of another person or to charge any person upon any agreement made upon consideration of marriage, or upon any contract for the sale of lands, tenements or hereditaments, or of any uncertain interest in or concerning them, or for any lease thereof for a period longer than 1 year, or upon any agreement that is not to be performed within the space of 1 year from the making thereof, or whereby to charge any health care provider upon any guarantee, warranty, or assurance as to the results of any medical, surgical, or diagnostic procedure performed by any physician licensed under chapter 458, osteopathic physician licensed under chapter 459, chiropractic physician licensed under chapter 460, podiatric physician licensed under chapter 461, or dentist licensed under chapter 466, unless the agreement or promise upon which such action shall be brought, or some note or memorandum thereof shall be in writing and signed by the party to be charged therewith or by some other person by her or him thereunto lawfully authorized.

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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

The Biggest Change to the Mechanics Lien Law Since 1963

December 08, 2016 — Wally Zimolong – Supplemental Conditions
The New Year will bring with it the biggest change to Pennsylvania’s Mechanics Lien Law since the current law was passed in 1963. These changes will impact owner, contractors, and subcontractors equally. However, the biggest benefits will probably be for real estate developers and other project owners. On December 31, 2016, Pennsylvania will go live with a website known as the State Construction Notices Directory. On that date, owners will have the option of making projects costing $1,500,000 or more “searchable projects.” An owner makes a project a searchable project by filing with the Notices Directory a “Notice of Commencement” before works begins. The Notice of Commencement must include the name, address, and email address of the contractor, full name and location of the searchable project, the county where the project is located, a legal description of the searchable property, and the name address, and email address of the searchable project owner. Importantly, the owner must also post a copy of this Notice of Commencement at the project site. Read the court decision
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Reprinted courtesy of Wally Zimolong, Zimolong LLC
Mr. Zimolong may be contacted at wally@zimolonglaw.com

California Court of Appeal Finds Coverage for Injured Worker Despite Contractor's Exclusion

August 05, 2024 — Tred R. Eyerly - Insurance Law Hawaii
The California Court of Appeal affirmed the trial court's finding that the policy covered a worker's injuries despite the Contractor's Exclusion. Cal. Spec. Insulation . Allied Work Surplus Lines, Ins. Co., 2024 Cal. App. LEXIS 317 (Cal. Ct. App. May 17, 2024). Air Control Systems, Inc. was retained by a property owner to perform improvement work on a building. Air Control retained California Specialty Insulation, Inc. (CSI) to install duct insulation. Jason Standiford, an Air Control employee, sure CSI, asserting negligence for injuries he suffered when he fell 16 to 20 feet after. A CSI employee drove a scissor lift into a ladder he was standing on. CSI was insured through a commercial general liability policy from Allied World. The policy included an endorsement titled "Bodily Injury to Any Employee or Temporary Worker of Contractors Exclusion." The Contractor Exclusion state the policy did not apply to "'Bodily injury' . . . to any 'employee' or 'ten,poary work' of any contractor or subcontractor arising out of in or the course of the rendering or performing services of any kind or nature by such contractor or subcontractor." Neither the endorsement nor the policy defined the term "contractor." 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

New Strategy for Deterring Intracorporate Litigation?: Delaware Supreme Court Supports Fee-Shifting Bylaws

May 13, 2014 — Marc Casarino and Lori Smith – White and Williams LLP
A fee-shifting bylaw of a Delaware non-stock corporation is not facially invalid according to the Delaware Supreme Court’s May 8, 2014 opinion in ATP Tour, Inc. v. Deutscher Tennis Bund. In this case, ATP Tour, Inc., a non-stock membership corporation (“ATP”) governed by a seven member board, had adopted a bylaw provision which provided that current and former members of ATP would be responsible for the litigation costs arising out of any litigation initiated by any such member against ATP or any of the other members in which the initiating party did not obtain a judgment on the merits that substantially achieved in substance and amount the full remedy sought. The bylaw provision had been adopted, in accordance with ATP’s charter, by the Board unilaterally without any consent from the members. The members had agreed at the time they joined ATP to be bound by the bylaws, as amended from time to time. Two members of ATP initiated a suit against ATP relating to certain actions taken with respect the ATP’s tournament schedule and format alleging both federal antitrust claims and Delaware fiduciary duty claims but did not prevail on any of their claims. ATP then moved to recover its legal fees relating to such actions. Reprinted courtesy of Marc Casarino, White and Williams LLP and Lori Smith, White and Williams LLP Mr. Casarino may be contacted at casarinom@whiteandwilliams.com; Ms. Smith may be contacted at smithl@whiteandwilliams.com Read the court decision
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