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DIRECTORY AND CAPABILITIES

California Appeals Court Remands Fine in Late Completion Case

November 18, 2011 — CDJ STAFF

The California Court of Appeals in Stanislaus County has reversed the decision of the lower court in Greg Opinski Construction Inc. v. City of Oakdale. The earlier court had awarded the city of judgment of $54,000 for late completion, $3,266 for repair of construction defects and interest, and $97,775 in attorneys’ fees. The late completion of the project was due to actions by the City of Oakdale, however, the court rejected Opinski’s argument that the California Supreme Court decision in Kiewit did not allow this, as his contract with the city established a procedure for claiming extensions.

The appeals court noted that the Kiewit decision has been “criticized as an unwarranted interference in the power of contracting parties to shift the risk of delays caused by one party onto the other party by forcing the second party to give the first notice of any intention to claim an extension of time based on delays caused by first.” They cited Sweet, a professor at Boalt Hall, UC Berkeley’s law school, that Kiewit “gutted” the “provision that conditions the contractor’s right to claim an extension of time for delays beyond his control.”

Further changes in California law in response to the Kiewit decision lead to the current situation which the court characterized as “if the contractor wished to claim it needed an extension of time because of delays caused by the city, the contractor was required to obtain a written change order by mutual consent or submit a claim in writing requesting a formal decision by the engineer.”

Opinski also argued that the lower court misinterpreted the contract. The Appeals court replied that “Opinski is mistaken.” He cited parts of the contract regarding the increase of time, but the court rejected these, noting that “an inability to agree is not the same as an express rejection.”

The court also rejects Opinski’s appeal that “the evidence the project was complete earlier than September 30, 2005, is weightier than the evidence to the contrary,” which they describe as “not a winning appellate argument.” The court points out that the role of an appeals court is not to reweigh the evidence, but to determine “whether the record contains substantial evidence in support of the judgment.”

The court did side with Opinski on one question of the escrow account. They rejected most of his arguments, repeating the line “Opinski is mistaken” several times. They decided that he was mistaken on the timing of the setoff decision and on whether the city was the prevailing party. However, the appeals court did find that Opinski was not liable for interest on the judgment.

The appeals court rejected the awarding of prejudgment interest to the city as the funds from which the judgment was drawn was held in an escrow account. The court noted that the city had access to the funds and could “access the funds when it determined that Opinski had breached the contract.” The appeals court noted that the judgment exhausted the escrow balance and remanded the case to the lower court to determine the amount own to Opinski.

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Insurers' Motion to Knock Out Bad Faith, Negligent Misrepresentation Claims in Construction Defect Case Denied

August 27, 2013 — Tred Eyerly - Insurance Law Hawaii
Having previously decided that construction defect claims did not arise from an occurrence and were consequently not covered under Hawaii law, the Hawaii Federal District Court refused to dismiss the insured's second amended counterclaim alleging various claims for relief. Ill. Nat'l Ins. Co. v. Nordic PCL Construc., Inc., 2013 U.S. Dist. LEXIS 108932 (D. Haw. July 31, 2013). In earlier proceedings, the court determined that the Nordic's allegedly deficient performance on construction contracts was not an "occurrence." The court also rejected Nordic's argument that the Hawaii legislature's Act 83 required the court to deviate from the Ninth Circuit's opinion in Burlington Ins. Co. v. Oceanic Design & Constr., Inc., 383 F.3d 940 (9th Cir. 2004) or the Hawaii Intermediate Court of Appeals' decision in Group Builders, Inc. v. Admiral Ins. Co., 123 Haw. 142, 231 P.3d 67 (Haw. Ct. App. 2010). Admiral now moved for summary judgment on its complaint and for dismissal of Nordic's second amended counterclaim, alleging bad faith and negligent misrepresentation, among other counts. Summary judgment as to the Safeway claim was denied. Read the court decision
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Reprinted courtesy of Tred Eyerly
Tred Eyerly can be contacted at te@hawaiilawyer.com

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What is the Effect of an Untimely Challenge to the Timeliness of a Trustee’s Sale?

April 13, 2017 — Ben Reeves - Snell & Wilmer Real Estate Litigation Blog
Ever wonder what happens if a person challenges the timeliness of a trustee’s sale after the sale already occurred? Waiver of the argument of course! And, in the case of Wells Fargo Bank, N.A. v. Waltner, the affirmance of an eviction judgment. In the Waltner case, Wells Fargo Bank, N.A., as Trustee for WaMu Mortgage Pass-Through Certificates, Series 2005-PR4 Trust (the “Bank”), purchased a residential property at a trustee’s sale in September 2015. The Bank gave the occupant of the house, Sarah Waltner (“Waltner”), notice to vacate the property, but she did not do so. Accordingly, the Bank filed a summary action to evict Waltner, which the trial court ultimately granted. After the trial court granted the Bank relief, Waltner filed a motion to dismiss and a motion to vacate the eviction judgment arguing, among other things, that the judgment was void because the Bank conducted the trustee’s sale after the statute of limitations expired. Both motions were denied, and Waltner appealed. Read the court decision
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Reprinted courtesy of Ben Reeves, Snell & Wilmer
Mr. Reeves may be contacted at breeves@swlaw.com

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Insurance and Your Roof

November 13, 2013 — CDJ STAFF
Those seeking home insurance should look up. Bankrate points out that the type of roof a home has can affect how much it costs to insure it. “The roof is the first layer that wind, hail, wildfire and other hazards really begin to act on,” Tim Reinhold, the chief engineer at the Insurance Institute for Business and Home Safety, told the site. For insurers, the most problematic roof type is probably wood shakes. “Some companies won’t even insure certain roof types, such as wood shakes, in high fire-risk areas,” said Robert Hunter, the director of insurance for the Consumer Federation of America. Not that other roof types are problem-free. Metal roofs can corrode, particularly when two different metals touch. Shingles age more quickly than other roof types, becoming brittle, and they can blow off in high winds. Tile roofs are expensive, something insurers are guaranteed to factor into the insurance rates. Read the court decision
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Lack of Flood Insurance for New York’s Poorest Residents

September 10, 2014 — Beverley BevenFlorez-CDJ STAFF
Property Casualty 360 reported that for residents of the flood-prone area of Queens, New York, even “the slightest downpour could mean evacuating their homes for a night or even weeks at a time.” The problem is that “[m]uch of Southeast Queens, an area that includes the neighborhoods of Jamaica, St. Albans and Hollis, and parts of the Rockaways, sits on a massive aquifer that swells with groundwater and spills over into streets and eventually into basements and homes after heavy rains.” However, according to Property Casualty 360, Southeast Queens residents “have been battling insurance agencies for over a decade.” “I would say more than 90% of the homeowners I speak to out here, they’re looking for insurance and they’re not getting it,” Councilman Donovan Richards, who represents Roseland and Far Rockaway, told Property Casualty 360. “Insurance companies obviously don’t want to take the risk.” Read the court decision
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2023 Executive Insights From Leaders in Construction Law

June 12, 2023 — Construction Executive
If a major project is interrupted or canceled, are there any laws that provide protection for unpaid contractors that have performed work? Angela Richie Partner, Co-Chair, Construction Practice Group Gordon Rees Scully Mansukhani With the current volatility and uncertainty in the economy, project interruptions and cancellations are on the rise; hence, you need to take steps now to make sure you have a method to get paid for the work you have performed. For private projects, make sure you have followed the pre-lien notification requirements for the state in which the project is located before you start work, if they are required. Then, be sure to follow the lien notice and lien filing requirements for the state. Each state is different, so you want to be ready with the appropriate documentation in advance of the project interruption or cancellation. Reprinted courtesy of Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the court decision
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First Circuit Finds No Coverage For Subcontracted Faulty Work

December 17, 2024 — Eric Hermanson & Austin Moody - White and Williams LLP
After almost two years' deliberation, the First Circuit last week issued its long-awaited decision in Admiral Ins. Co. v. Tocci Bldg. Corp.[1]: affirming on other grounds, and leaving in place a district court decision that found subcontracted faulty work was not an "occurrence" and did not lead to covered “property damage” under Massachusetts law. The decision leaves Massachusetts among a number of states where general contractors should not expect coverage from their commercial general liability (CGL) insurers for damage falling within the contractor’s scope of work. Since the "scope of work" – where general contractors are involved – often encompasses an entire project, contractors who want coverage in Massachusetts should take care to make alternative arrangements: transferring risk to subcontractors through indemnity provisions and additional-insured endorsements, or relying on other policy forms where available. Reprinted courtesy of Eric Hermanson, White and Williams LLP and Austin Moody, White and Williams LLP Mr. Hermanson may be contacted at hermansone@whiteandwilliams.com Mr. Moody may be contacted at moodya@whiteandwilliams.com Read the court decision
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Florida Decides Against Adopting Daubert

January 28, 2019 — Rahul Gogineni - The Subrogation Strategist
In Delisle v. Crane Co., 2018 Fla. LEXIS 1883, 43 Fla. L. Weekly S 459, the Supreme Court of Florida reaffirmed that the appropriate test for admissibility of an expert opinion about new or novel scientific evidence is the “Frye” test, not the “Daubert” test. As result of developing mesothelioma, Richard Delisle sued sixteen defendants, including Crane Company (Crane) and R.J. Reynolds, claiming that each exposed him to asbestos, which is a leading cause of mesothelioma. At trial, Crane and R.J. Reynolds sought to preclude the expert opinions of Mr. Delisle’s causation experts. The trial denied the motions and the jury awarded Mr. Delisle $8 million. Read the court decision
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Reprinted courtesy of Rahul Gogineni, White and Williams
Mr. Gogineni may be contacted at goginenir@whiteandwilliams.com

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