Unintended Consequences of New Building Products and Services
April 19, 2022 —
David S. Jaffe – National Association of Home BuildersAs home builders throughout the United States are grappling with building material price surges, and shortages or delays for certain orders, many are exploring alternatives products to complete or start projects. For example, according to a recent article, some builders are constructing homes from natural materials such as rammed earth, adobe brick, and volcanic rock. In addition to being readily available on site there may be heating and cooling benefits due to the natural insulation provided by these materials. The article cautions, however, that using these alternative materials may come with added challenges such as higher costs due to a need for skilled labor, delays by home inspectors who may be unfamiliar with the techniques and methods of construction, and energy consultants who might have difficulty calculating the value of homes with these materials. See Home Builders Are Turning to Natural Materials to Get Around Supply Chain Problems; There are advantages to buying homes made with natural materials, but expect to pay a premium, Alanna Schubach, Mansion Global (March 25, 2022).
Another caution, not addressed in the article, however, but one that should be heeded by builders considering alternative materials, is the unintended consequences that might result from using alternative products, whether they are natural products or any others. The long-term effects of material use should not be ignored.
For instance, it has been reported that earthen materials are known to contain numerous organic substances and can also harbor mold. It was not too long ago that mold was a high liability issue for builders and property owners. Similarly, the use of rapidly renewable materials - products that can be produced naturally and quickly from nature - is a key component of green building. They are also cellulose or carbohydrate-based products and as such are typically optimal food sources for mold in the presence of moisture.
To avoid mold, it is important to understand the relationship between construction materials and their susceptibility to mold in the presence of moisture. “Buildings will never be designed, built, maintained, or utilized perfectly; and weather and natural disasters cannot be predicted. The one thing we can have complete control over, the materials within the building, should be selected wisely.” See Mold Susceptibility of Rapidly Renewable Building Materials Used in Wall Construction, AM Cooper, Master's thesis, Texas A&M University (2007) (Samples of wool, cork, straw, and cotton-- rapidly renewable materials used as exterior wall insulation products--were exposed to different moisture amounts in an encapsulated environment, representing the environment within a wall cavity when exposed to water from pipes, leaks, condensation and absorption, or from initial construction. The samples were monitored over time for mold growth).
Mold-related issues are just one example of the potential for unintended consequences from the use of alternative materials. Carefully reviewing building material choices in advance may help eliminate non-conforming building materials, returns and possibly disputes. NAHB has developed a guide,
Assessing Building Materials, for builders who may not have their own review process for gathering information from manufacturers and distributors when considering the selection of new building materials.
The guide is intended to arm members with the most important factor when evaluating new materials or products: information. Use the guide to step through the information collection process to make an informed decision on deploying new products or materials. The guide is not intended to be exhaustive or all-inclusive, but it will help builders ask the right questions and seek the most relevant information.
Copyright © 2022 by the National Association of Home Builders of the United States. All rights reserved.
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David S. Jaffe, NAHBMr. Jaffe may be contacted at
DJaffe@nahb.org
Cybersecurity on Your Project: Why Not Follow National Security Strategy?
August 28, 2018 —
Rick Erickson - Snell & Wilmer Real Estate Litigation BlogIn its recent Cybersecurity Strategy, the U.S. Department of Homeland Security (DHS) defined “cyberspace” as “the independent network of information technology infrastructure, including the Internet, telecommunications networks, computers, information and communications systems, and embedded processors and controllers.” To DHS, protecting cyberspace includes threats against “federal and nonfederal information systems.” In other words, both private and public interests are at risk. In his 2018 National Defense Strategy, U.S. Department of Defense Secretary, Jim Mattis, essentially concurred in declaring cyberspace a “warfighting domain” and promising to “invest in cyber defense, resilience, and the continued integration of cyber capabilities into the full spectrum of military operations.”
The construction industry is a key player in cybersecurity because contractors, designers and owners are responsible for building and delivering projects providing critical public services like national defense, health care, law enforcement, transportation, and utilities. Like any business reckoning with risks in cyberspace, moreover, everyone on a construction project has valuable data and confidentialities to protect. Cyber breaches on a project may also compromise electrical power, physical safety and, inevitably, a lot more than the critical path schedule and profit margins. Cybersecurity insurance is not very affordable or comprehensive, either, and it usually excludes any property damage or bodily injury resulting from a cyber event.
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Rick Erickson, Snell & WilmerMr. Erickson may be contacted at
rerickson@swlaw.com
Insurer Liable for Bad Faith Despite Actions of Insured Contributing to Excess Judgment
January 02, 2019 —
Tred R. Eyerly - Insurance Law HawaiiReversing the intermediate appellate court, the Florida Supreme Court held the insurer liable for bad faith despite imperfect actions by the insured. Harvey v. GEICO Gen. Ins. Co., 2018 Fla. LEXIS 1705 (Fla. Sept. 20, 2018).
Insured James Harvey was involved in an auto accident in which the other driver, 51 year old John Potts, was killed. Harvey's vehicle was registered in both his name and his business's name, and was covered under a $100,000 liability policy. Harvey reported the accident to his insurer, GEICO. The claim was assigned to a claims adjuster, Fran Korkus.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
OSHA Begins Enforcement of its Respirable Crystalline Silica in Construction Standard. Try Saying That Five Times Real Fast
November 02, 2017 —
Garret Murai - California Construction Law BlogOn October 23, 2017, the U.S. Occupational Safety and Health Administration (OSHA) began enforcement of its Respirable Crystalline Silica in Construction Standard (Construction Silica Standard). OSHA enforcement of its Construction Silica Standard actually began on September 23, 2017, but for a period of 30 days, OSHA offered compliance assistance in lieu of enforcement for employers who were making good faith efforts to comply with the Construction Silica Standard.
California’s Occupational Safety and Health Administration (Cal/OSHA) has a nearly identical construction silica standard that requires employers to limit worker exposure to respirable crystalline silica above 25 micrograms per cubic meter of air (25 μg/m3) as an 8-hour time-weighted average (TWA) under any foreseeable condition.
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Garret Murai, Wendel Rosen Black & Dean LLPMr. Murai may be contacted at
gmurai@wendel.com
Canada Cooler Housing Market Boosts Poloz’s Soft Landing
April 15, 2014 —
Greg Quinn – BloombergDeclines in housing starts and building permits data suggest Canada is headed for the soft landing in real estate that policy makers have forecast, damping concern that a rapid fall in home prices could hobble the world’s 11th-largest economy.
Home construction dropped 18 percent in March to the lowest annual pace since the 2009 recession, Canada Mortgage & Housing Corp. said from Ottawa today. Residential building permits also dropped 21 percent in February from January’s record high, Statistics Canada said in a separate report.
Bank of Canada Governor Stephen Poloz has said the housing market is heading for a “soft landing” with consumer debts as a share of income stabilizing around record highs. The International Monetary Fund said today that house prices and household finances remain a “key vulnerability” for Canada.
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Greg Quinn, BloombergMr. Quinn may be contacted at
gquinn1@bloomberg.net
Perez Broke Records … But Should He Have Settled Earlier?
February 19, 2024 —
Sofya Uvaydov & John F. Watkins - Kahana FeldIn 2021, Mark Perez’ Labor Law 240(1) lawsuit made legal news by breaking the record of the highest appellate-sustained pain and suffering award in New York history. While that record was short-lived, it still maintains its place as New York’s highest-ever pain and suffering award for a brain injury. This January 17th, the Appellate Division, First Department revisited the litigation but, this time, in a dispute between Perez and his then-lawyer, Ben Morelli and the Morelli Law Firm. Mr. Perez claims breach of contract over a 10% additional contingency fee charge related to the Perez v. Live Nation appeal and breach of fiduciary duty by his counsel in failing to convey settlement offers during the lifetime of the case. The Morelli firm counters, among other things, that the prior settlement offers – a $30 million offer during the 2019 trial and intermediate sums during the appellate stage – were still lower than the ultimate $55 million settlement. No harm, Mr. Morelli argues, and thus no foul in failing to convey the offers.
But is that so? Did Mark Perez ultimately receive more money in his $55 million settlement than from the $30 million settlement offer mid-trial? Despite the glaring $25 million difference, the surprising calculations show that Perez would have been financially better off taking the $30 million mid-trial settlement.
Reprinted courtesy of
Sofya Uvaydov, Kahana Feld and
John F. Watkins, Kahana Feld
Ms. Uvaydov may be contacted at suvaydov@kahanafeld.com
Mr. Watkins may be contacted at jwatkins@kahanafeld.com
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Breach Of Duty of Good Faith And Fair Dealing Packaged With Contract Disputes Act Claim
March 27, 2023 —
David Adelstein - Florida Construction Legal UpdatesAn interesting opinion on a motion to dismiss came out of the United States Court of Federal Claims dealing with the claim that the government breached its duty of good faith and fair dealing in administering the prime contract. The contractor’s argument was that the government breached its duty of good faith and fair dealing by denying the contractor’s claim under the Contract Disputes Act (CDA). This was a creative claim and argument that deserves consideration because it tied in the contracting officer’s denial of the CDA claim for additional money with a breach of the duty of good faith and fair dealing.
In this case, Aries Construction Corp. v. U.S., 2023 WL 2146598 (Fed. Cl. 2023), a prime contractor was hired for a water pipeline construction project. The contractor encountered unexpected difficult site conditions that required additional equipment and labor. The contractor informed the contracting officer and alleged it was instructed to proceed with the additional equipment and labor. The contractor submitted a claim under the CDA but the contracting officer denied the claim. The contractor pursued the claim in the United States Court of Federal Claims arguing the government breached the contract and, of interest, breached its duty of good faith and fair dealing.
The government moved to dismiss the breach of good faith and fair dealing claim arguing that besides failing to state a cause of action the Court of Federal Claims had no jurisdiction because the breach of the duty of good faith and fair dealing was not properly presented to the contracting officer under the CDA. The Court of Federal Claims denied the government’s motion.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
The Private Works: Preliminary Notice | Are You Using the Correct Form?
August 20, 2019 —
William L. Porter, Esq. - Porter Law GroupThe Private Works – Preliminary Notice form which contractors, subcontractors and suppliers had become accustomed to using for many years changed in 2004. Despite this change in law, many in the construction industry have still not started using the correct new form. Changes in the law, championed by the American Subcontractors’ Association, gave a significant new benefit to subcontractors and suppliers by giving the subcontractor or supplier some expectation of actually receiving notice of when a Notice of Completion or a Notice of Cessation has been recorded on many private works projects. The law also changed the language of the California Preliminary Notice that subcontractors and suppliers must use to protect their mechanics’ lien, bond claim and stop payment notice rights. If Owners do not send out the Notice of Completion as required by law they incur a diminishing of the protections afforded to them when they record a Notice of Completion or Notice of Cessation on many private works projects.
The revised law requires private project owners to notify all subcontractors and suppliers within 10 days after recording a Notice of Completion or Notice of Cessation that a Notice of Completion or a Notice of Cessation has actually been recorded. In order to receive such notice, the subcontractor or supplier must properly serve the new form of Preliminary Notice. If this properly occurs and the private project owner provides the required notice, then the subcontractor or supplier will have 30 days to record a Mechanics’ Lien. However, if an owner under such circumstances fails to properly notify a subcontractor or supplier within 10 days after recording a Notice of Completion or Notice of Cessation, then the Subcontractor or supplier will have 90 days to record a Mechanics’ Lien. The details of the law can be found in California Civil Code sections 8190, 8414 and 8416.
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William L. Porter, Esq., Porter Law GroupMr. Porter may be contacted at
bporter@porterlaw.com
