Arizona Court Affirms Homeowners’ Association’s Right to Sue Over Construction Defects
October 15, 2024 —
Melissa Kenney - White and Williams LLPIn Gallery Community Association v. K. Hovnanian at Gallery LLC, No. 1 CA-CV 23-0375, 2024 Ariz. App. Unpub. LEXIS 696 (Ct. App.), the Court of Appeals of Arizona (Court of Appeals) discussed whether a homeowners’ association can file an action for breach of the implied warranty of workmanship and habitability arising from construction defects. At issue was whether the implied warranty extended to the areas within the community that the association maintained, including the common areas. The Court of Appeals held that homeowners’ associations can sue builder-vendors for breach of the implied warranty arising from construction defects.
In this case, a homeowners’ association, responsible for managing and maintaining a community of townhomes, sued the developer/builder for alleged construction defects in the common area and exteriors of homes that the association maintained for the homeowners in the community. The alleged defects included the pool cabana and staircase walls in the common areas and the exterior walls, roofs, and staircases on the separately owned townhomes in the community. The builder filed a motion for summary judgment, arguing that the implied warranty extended to dwelling actions initiated by homeowners – not homeowners’ associations – and that the alleged construction defects at issue were not related to a dwelling. The trial court granted the motion. The Court of Appeals vacated the trial court’s grant of summary judgment and remanded for further proceedings. In reaching its decision, the Court of Appeals determined that both common law and statutory law authorized the homeowners’ association’s breach of implied warranty claim.
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Melissa Kenney, White and WilliamsMs. Kenney may be contacted at
kenneyme@whiteandwilliams.com
When an Insurer Proceeds as Subrogee, Defendants Cannot Assert Contribution Claims Against the Insured
July 15, 2019 —
Shannon M. Warren - The Subrogation StrategistIn Farmers Mut. Ins. Co. of Mason County v. Stove Builder Int’l, 2019 U.S. Dist. Lexis 46993 (E.D. Ky.), the United States District Court for the Northern Division of the Eastern District of Kentucky, by adopting a Magistrate Judge’s report and recommendations, see Farmers Mut. Ins. Co. v. Stove Builder, Int’l, Inc., 2019 U.S. Dist. LEXIS 48103 (E.D. Ky. Feb. 11, 2019), considered whether to allow the defendants to file a third-party complaint against the plaintiff’s insureds-subrogors. Finding that the defendants could not pursue contribution claims against the plaintiff’s insureds-subrogors, the court denied the defendant’s motion to file a third-party complaint.
The underlying subrogation action involved allegations of strict liability, negligence and breach of warranty against a pellet heater manufacturer and the retailer who sold the heater. The claims arose from a fire allegedly originating from the heater, which spread to the insureds-subrogors’ home causing property damage, along with consequential damages. Pursuant to the applicable insurance policy, the insureds-subrogors’ insurer issued payments to its insureds-subrogors. Thereafter, the insurer filed suit against the heater manufacturer and retailer.
The defendants filed a motion for leave to file a third-party complaint against the plaintiff’s insureds-subrogors, seeking to assert a contribution claim. The defendants alleged that the insureds-subrogors failed to properly install and maintain the pellet heater. The defendants also sought a jury instruction that would permit the jury to apportion fault to the insureds-subrogors, resulting in a reduction of the plaintiff’s recovery. The court looked to federal procedural law, but Kentucky substantive law to decide the defendants’ motion.
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Shannon M. Warren, White and WilliamsMs. Warren may be contacted at
warrens@whiteandwilliams.com
Occurrence Definition Trends Analyzed
August 27, 2014 —
Beverley BevenFlorez-CDJ STAFFIn The Legal Intelligencer, Gordon S. Woodward, partner at Schnader Harrison Segal & Lewis, analyzed the changing definition of occurrence in the insurance industry, and more specifically in Pennsylvania.
Woodward begins by going over “the traditional view of occurrence as it relates to coverage for faulty products or defective work,” in which “the existence of a defect in a product or an event in which a defective product injures only itself does not constitute an occurrence.” However, he stated that “there is a growing trend in favor of finding that an occurrence can include the circumstance where defective work results in damage only to the work or product itself (so long as the damage was neither intended nor expected by the insured).” Woodward also explained Pennsylvania developments and legislative changes (such as a South Carolina statute).
These changes need to be monitored, Woodward stated, “as they have the potential to dramatically alter the coverage landscape from one jurisdiction to the next.”
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Renters ‘Sold Out’ by NYC Pensions Press Mayor on Housing
May 19, 2014 —
Martin Z. Braun – BloombergElevators break down, ceilings leak and security is lax at the Metro North apartments overlooking the East River in Harlem, says retired rehabilitation technician Bob Montesi, who’s lived there for more than three decades.
Even as deterioration accelerates at the 761-unit complex, which used to be in a state affordable-housing program, some tenants are facing rent increases of as much as 80 percent.
For Montesi, 74, who worked at a New York City-run hospital for 41 years, the changes are especially galling. One of the owners of the building is his pension fund.
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Martin Z. Braun, BloombergMr. Braun may be contacted at
mbraun6@bloomberg.net
2018 Super Bowl US. Bank Stadium in Minneapolis
February 07, 2018 —
Dave Suggs - CDJ STAFFAfter the collapse of the Viking’s previous stadium due to snow in 2010, it was clear that a new facility was needed to endure the Minnesota weather. The new U.S. Bank Stadium was built to withstand the harshest of weather conditions while also saving energy according to Marlene Cimons’ article “Cutting-Edge Design on Display at Super Bowl LII” featured on Nexus Media website.
The stadium’s roof melts snow quickly by deflecting sunlight and because of its sharp pitch the snow slides easily into a big gutter. The roof also lets in sunlight which saves electricity and creates the feeling of being outdoors. Solar heating is used to recirculate warm air from above down to spectators below. “It is also the first NFL stadium to be built with LED lighting, which uses 75 percent less electricity than metal halide lighting typically deployed in stadiums.” The stadium is dedicated to becoming a zero-waste facility and currently saves water by using low-flow faucets.
Sport and Sustainability chairman Allen Hershkowitz said of the stadium, “as one of the most visible sporting events in the world, the Super Bowl has a unique opportunity to promote environmental literacy and reduce cultural polarization related to climate change.”
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Standard For Evaluating Delay – Directly from An Armed Services Board Of Contract Appeal’s Opinion
October 04, 2021 —
David Adelstein - Florida Construction Legal UpdatesSometimes, it is much better to hear it from the horse’s mouth. That is the case here. The Armed Services Board of Contract Appeal’s (ASBCA) opinion in Appeals of -GSC Construction, Inc., ASBCA No. 59402, 2020 WL 8148687 (ASBCA November 4, 2020) includes an informative discussion of a contractor’s burden when it encounters excusable delay and, of importance, the standard for evaluating delay. It’s a long discussion but one that parties in construction need to know, appreciate, and understand. EVERY WORD IN THIS DISCUSSION MATTERS.
Construction projects get delayed and with a delay comes money because time is money. Many claims are predicated on delay. These can be an owner assessing liquidated damages due to a delayed job or a contractor seeking its costs for delay. Either way, the standard for evaluating delay and the burdens imposed on a party cannot be understated and, certainly, cannot be overlooked. For this reason, here is the discussion on evaluating delay directly from the horse’s mouth in the Appeal of-GSC Construction, Inc.:
The critical path is the longest path in the schedule on which any delay or disruption would cause a day-for-day delay to the project itself; those activities must be performed as they are scheduled and timely in order for the project to finish on time. Wilner v. United States, 23 Cl. Ct. 241, 245 (1991). In Yates-Desbuild Joint Venture, CBCA No. 3350 et al., 17-1 BCA ¶ 36,870, our sister board compiled an excellent and very helpful synopsis of the standards for evaluating delay claims, which I adopt nearly verbatim among the discussion that follows.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
No Coverage for Faulty Workmanship Where Underlying Claim is Strictly Breach of Contract
June 30, 2016 —
Tred R. Eyerly – Insurance Law HawaiiConsidering certified questions from the federal district court, the Arkansas Supreme Court followed a prior decision in deciding there was no coverage for property loss caused by faulty workmanship based solely on breach of contract. Columbia Ins. Group, Inc. v. Cenark Project Mgt. Services, Inc., 2016 Ark. LEXIS 185 (Ark. April 28, 2016).
The homeowners entered a contract in 2005 with Arkansas Infrastructure, Inc. (AII) to construct pads for the construction of six homes. The contract provided that AII would perform the work in accordance with the plans, specifications, and drawings developed by CENARK Project Management Services, Inc.
In 2012, the homeowners sued AII for breach of contract, alleging that AII had failed to construct the pads in accordance with the plans and specifications designed by CENARK.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
New York Preserves Subrogation Rights
September 06, 2023 —
Lian Skaf - The Subrogation StrategistThe insurer’s right of subrogation is equitable in nature, even if not based in contract. However, since the insurer steps into the shoes of its insured and is limited to the rights of its insured, an integral part of the investigation process is determining what rights the insured has. Whether or not the insured can settle with the tortfeasor and that whether the settlement would also apply to the subrogated carrier is a question the Supreme Court of New York, a trial court, recently addressed.
In Utica First Ins. Co. v. Homeport I LLC, et al., No. 150448/2022, 2023 N.Y. Misc. LEXIS 3087 (N.Y. Sup. Ct.), the plaintiff insurance carrier’s insured, SI Waterfront Management Inc. (SI Waterfront), owned and operated a restaurant called Wynwood at 24 Navy Pier Court in Staten Island, New York. The owner of the property was Homeport I LLC (Homeport). Significant construction work pertaining to plumbing and draining lines at the property was done by Ironstate Holdings, LLC (Ironstate), the plumbing portion of which was conducted by subcontractor Claire Construction Corp. (Claire). As a result of the construction work, on June 8, 2021, SI Waterfront allegedly sustained property damage from flooding.
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Lian Skaf, White and Williams LLPMr. Skaf may be contacted at
skafl@whiteandwilliams.com
