Subsequent Owners of Homes Again Have Right to Sue Builders for Construction Defects
October 07, 2016 —
Mark L. Parisi – White and Williams LLPOwners of homes with damage from construction defects have long had the standing to sue the builders of their homes using the legal theories of 1) breach of contract, 2) breach of implied warranty, and 3) breach of Pennsylvania’s consumer fraud statute, the Unfair Trade Practices and Consumer Protection Law (UTPCPL).
Before the 2014 decision of the Pennsylvania Supreme Court in Conway v. Cutler, even owners who were not the original purchasers of their homes, so-called subsequent owners, had a right to sue the builder of their homes using implied warranty as the legal theory. But the Supreme Court in Conway said in 2014 that even though an implied warranty theory is not based on a written contract, it is a quasi contract theory and because subsequent owners never had a contractual relationship with the builder of their home, the implied warranty cause of action was not available. Subsequent purchasers were thus left without a remedy for damage from defective construction in their homes and builders had a second safe harbor from claims regarding homes they built. The first safe harbor is Pennsylvania’s Statute of Repose. If the home was completed more than 12 years before a lawsuit was filed, the Statute of Repose bars the claim. But after Conway, if the home was sold, this also cut off a builder’s potential liability for construction defects in the home.
ENTER THE UTPCPL
On July 26, 2016 the Pennsylvania Superior Court in the case of Adams v. Hellings Builders issued a non-published (and therefore non-precedential) decision in a stucco construction defect case that held that subsequent purchasers could sue their home’s builder under the UTPCPL because the Act had no requirement that the purchaser of a product, or home, be the original purchaser. The decision cites several other appellate cases not involving construction defect claims that held that the UTPCPL was a valid legal theory for claims regarding products purchased second hand by the plaintiffs in those other cases. The court in Adams held that there was no reason that a suit regarding construction defects in a home should be treated any differently.
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Mark L. Parisi, White and Williams LLPMr. Parisi may be contacted at
parisim@whiteandwilliams.com
Important Information Regarding Colorado Mechanic’s Lien Rights.
November 07, 2012 —
David McLain, Colorado Construction LitigationWith payment problems in the construction economy having accelerated over the past few years, there has been a substantial increase in mechanic’s lien activity and associated litigation. The typical mechanic’s lien claimant is a material supplier, a trade subcontractor, or even a general contractor that has not been paid by the developer/owner of the construction project. The reason for filing a mechanic’s lien claim is that it offers the prospect in many cases to make the unpaid construction professional a priority creditor, with a lien on the real estate that is superior to the construction lender.
One of the primary rules governing a mechanic’s lien claim is that the creditor’s formal written “Notice of Intent to File a Mechanic’s Lien” (hereafter “Lien Notice”) must be (1) served on the owner of the property for which the work was done or the materials used, and (2) served at the same time on the general contractor who has handled the construction project. After the creditor has made service of the lien claim by USPS certified mail (using the green return receipt card for proof of service) or separate personal delivery of the notice to the property owner and general contractor, ten full days must pass (not including the date of mailing of the notices) before the lien notice is filed in the public records.
After ten days have expired following the date of mailing using certified mail, or personal delivery of the notice to the property owner and the general contractor, the lien notice can be filed to make the lien valid.
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David M. McLain, Higgins, Hopkins, McLain & Roswell, LLC.Mr. McLain can be contacted at
mclain@hhmrlaw.com
Construction Defects Claims Can Be Limited by Contract Says Washington Court
February 11, 2013 —
CDJ STAFFThe firm Lane Powell has issued a construction law update on the recent Washington Supreme Court decision in Washington State Major League Baseball Public Facility District v. The Baseball Club of Seattle, LP. In the underlying construction defect claim, the Public Facility District found defects in the structural steel at Seattle’s Safeco Field. The contractor, Huber, Hunt & Nichols-Kiewit Construction Company claimed that construction claims could not be made, as it was barred by the statue of repose.
Washington State has a six-year limitation on its statute of repose, however, the court noted that the contract contained a clause that, as noted by Lane Powell, “any alleged causes of action automatically accrue at substantial contemplation,” instead of within six years of substantial completion. The court concluded that the statue of repose could be rendered inoperative by contract. Further, the court found that these contract clauses pertained to subcontractors as well.
Nevertheless, as PFD is a subdivision of the state, the court found that no statue of limitations could be appled.
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Injury to Employees Endorsement Eliminates Coverage for Insured Employer
February 01, 2021 —
Tred R. Eyerly - Insurance Law HawaiiThe court granted summary judgment to the insurer based upon an endorsement which barred coverage for injuries to employees. Northfield Ins. Co. v. Z&J Mgt. LLC, 2020 N.Y. Misc. LEXIS 10801 (N.Y. Sup. Ct. Dec. 18, 2020).
Ravi Sooklal sued his employer, Z&J Management LLC (Z&J), for injuries at the job site. Northfield, who had issued a CGL policy to Z&L, denied coverage based upon two endorsements. The first was titled "Injury to Employees of Insureds" and the second was "Employers' Liability." Northfield sued for a declaratory judgment and now moved for summary judgment.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Century Communities Acquires Dunhill Homes Las Vegas Operations
April 08, 2014 —
Beverley BevenFlorez-CDJ STAFFAccording to Big Builder, “Colorado-based Century Communities” has acquired “the Las Vegas operations team and 1,849 lots of Dunhill Homes.” This brings Century’s “total land position of owned and controlled lots to 10,095, an increase of 21% since the end of 2013.”
“More than the homes and land inventory, this acquisition allows us to add an experienced operations team, with a reputation of delivering quality homes in well-located communities,” stated Robert Francescon and Dale Francescon, Co-Chief Executive Officers of Century Communities, in a statement as quoted by Big Builder. “Additionally, Las Vegas remains a land constrained market, and we are now uniquely positioned within communities that would be very difficult to replicate today, with land inventory to drive future growth.”
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A Homeowner’s Subsequent Action is Barred as a Matter of Law by way of a Prior “Right to Repair Act” Claim Resolved by Cash Settlement for Waiver of all Known or Unknown Claims
February 26, 2015 —
Richard H. Glucksman, Esq., Jon A. Turigliatto, Esq., and David A. Napper, Esq. – Chapman Glucksman Dean Roeb & Barger BulletinDavid Belasco v. Gary Loren Wells et al. (2015) B254525
OVERVIEW
In a decision published on February 17, 2015, the Second District Court of Appeal made clear that settlement agreements containing waivers of unknown claims in connection with a construction of a property, absent fraud or misrepresentation, will be upheld. In brief, the homeowner plaintiff had made a claim against the builder pursuant to California Code of Civil Procedure Section 896 (“Right to Repair”) and settled for a cash payment and obtained a Release of all Claims including for all known and unknown claims. The court held that homeowner’s subsequent construction defect claim was barred pursuant to the terms and conditions of the earlier release.
DISCUSSION
Plaintiff and Appellant, David Belasco ("Belasco"), purchased a newly construction home in Manhattan Beach from builder Gary Loren Wells ("Wells"). Two years after purchasing the property, Belasco filed a Complaint for construction defects, which eventually resulted in settlement between the parties. The settlement agreement included a California Civil Code Section 1524 waiver of all known or unknown claims with the word "claims" defined in part as “any and all known and unknown construction defects." Six years later in 2012, Belasco filed a Complaint alleging a claim, amongst others, that the defective and leaky roof breached the statutory warranty on new construction under California Civil Code section 896 ("Right to Repair Act").
Relying on San Diego Hospice v. County of San Diego (1995) 31 Cal.App.4th 1048, Wells and Wells' surety, American Contractors Indemnity Company (collectively "Wells"), filed a motion for summary judgment contending that the 2012 action was barred by the settlement of Belasco’s prior Complaint against Wells for construction defects to his home. When the trial court ruled in favor of Wells, Belasco appealed. Belasco, a patent attorney, made the following contentions:(1) the general release and section 1542 wavier in the settlement agreement for patent construction defects is not a "reasonable release" of a subsequent claim for latent construction defects within the meaning of section 929 and the “Right to Repair” Act; (2) a reasonable release can only apply to a "particular violation" and not to a latest defect under the language of section945.5, subdivision (f), and the settlement was too vague to be valid because it does not reference a "particular violation;" (3) section 932 of the California Civil Code specifically authorizes an action on "[s]subsequently discovered claims of unmet standards;" (4) public policy prohibits use of a general release and section 1542 waiver to bar a subsequent claim for latent residential construction defects; and (5) a genuine issue of material fact exists concerning Belasco's fraud and negligence claims that would have voided the settlement pursuant to section 1668.
Pursuant to the "Right to Repair Act" Section 929 subsection (a), a builder can make a cash offer in lieu of a repair and the homeowner is free to accept or reject such offer. Section 929subsection (b) goes on to state that
"[t]he builder may obtain a reasonable release in exchange for the cash payment. The builder may negotiate the terms and conditions of any reasonable release in terms of scope and consideration in conjunction with a cash payment under this chapter."
The Second District Court of Appeal ruled that the prior cash settlement, with a release and section 1524 wavier, was a "reasonable release" under the language of California Civil Code Section 929.
On multiple occasions, the Court noted that Belasco is an attorney and was represented by an attorney during the negotiation of the settlement agreement. By executing the agreement with express language regarding what claims were to be release, Belasco released Wells of "any and all claims" due to "any and all known and unknown construction defects." The Court reasoned that because Belasco is an attorney in his own right, he should have understood the import of the Section 1542 waiver and had the opportunity to reject or revise the settlement agreement prior to binding himself to it. The Court further found that the agreement "could not have been more clear" regarding the waiver of all unknown and known construction defect claims and therefore was not vague. Belasco's additional contentions were found to be without merit because Belasco availed himself of the statutory remedy of a cash settlement in lieu of repairs and voluntarily entered into a negotiated settlement agreement. Lastly, Belasco failed to present any evidence regarding his misrepresentation claim.
When a homeowner files a "Right to Repair Act" claim, often it seems that only two options exist: either repair the alleged defects or go to court. However, Belasco is a reminder to builders that the "Right to Repair Act" does offer an avenue for settlement. The Second District Court of Appeal presented a clear, unqualified opinion regarding the validity and enforceability of settlement agreements releasing all known or unknown construction defects in a single family home case. The Court will hold parties to the settlements they agree to. This is especially so when one of the parties is an attorney and provides deposition testimony expressly acknowledging that he understood the scope of the agreement. Attorneys for builders should always include a waiver of all known and unknown claims, which pursuant to Belasco and San Diego Hospice, will ensure that any future claims at the property will be effectively barred by the terms of the settlement agreement.
Reprinted courtesy of Chapman Glucksman Dean Roeb & Barger attorneys
Richard H. Glucksman,
Jon A. Turigliatto and
David A. Napper
Mr. Glucksman may be contacted at rglucksman@cgdrblaw.com
Mr. Turigliatto may be contacted at jturigliatto@cgdrblaw.com
Mr. Napper may be contacted at dnapper@cgdrblaw.com
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White and Williams LLP Secures Affirmation of Denial to Change Trial Settings Based on Plaintiffs’ Failure to Meet the Texas Causation Standard for Asbestos Cases
July 06, 2020 —
Christian Singewald & Rochelle Gumapac - White and Williams LLPThe Delaware Supreme Court, in a rare split opinion, affirmed the trial court’s denial of Plaintiffs’ Request to Change Trial Settings in favor of all defendants, including a major automotive manufacturer represented by White and Williams LLP, in a mesothelioma case with a young decedent who had an alleged economic loss claim exceeding $9,000,000, in Shaw v. American Friction, Inc. et al., No. 86, 2019. This decision operates to dismiss all of Plaintiffs’ claims based on their failure to meet Delaware’s strict expert deadlines and establish a prima facie case under Texas law.
Plaintiffs’ Complaint invoked the application of Texas substantive law and alleged that multiple manufacturers were negligent and strictly liable for failing to warn the decedent of the alleged dangers posed by the use of asbestos-containing products. Plaintiffs’ alleged asbestos exposures from defendants’ products caused Mr. Shaw’s disease and subsequent death.
In 2007, Texas instituted its now well-known causation requirement, which requires the “dose” of asbestos exposure from each defendant’s products to be quantified by an expert. Borg-Warner Corp. v. Flores, 232 S.W.3d 765, 773 (Tex. 2007). Prior to decedent’s death, Plaintiffs’ counsel deposed decedent and his father for product identification purposes. During the depositions, Plaintiffs’ counsel failed to obtain the necessary factual information from his clients for an expert to be able to opine as to alleged exposure doses from any defendant’s product. Despite lacking the requisite information for a prima facie case under Texas law, Plaintiffs sought and were given placement in an expedited trial setting, which had strict, defined deadlines.
Reprinted courtesy of
Christian Singewald, White and Williams LLP and
Rochelle Gumapac, White and Williams LLP
Mr. Singewald may be contacted at singewaldc@whiteandwilliams.com
Ms. Gumapac may be contacted at gumapacr@whiteandwilliams.com
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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
