Microsoft Urges the Construction Industry to Deliver Lifecycle Value
June 25, 2019 —
Aarni Heiskanen - AEC BusinessDigitalization is changing the way that we operate and use buildings. Salla Palos is directing Microsoft towards a future that inspires innovative changes in both the mindset and the business models of AECO industry stakeholders.
Salla Palos moved from Finland to the United States in July 2015 and settled down in Seattle, one of the fastest growing areas in the USA. She was versed in digitalization of construction industry in Finland as well as Europe and sought the opportunity to bring that knowledge into the US market.
As the Director of Emerging Technology and Innovation for Sellen Construction, one of the largest general contractor companies in the Pacific Northwest United States, Salla started developing digital building lifecycle as a strategy to solve number of industry problems.
“I zeroed in on developing digital construction strategy, re-engineering processes, and innovating how emerging technology supports digital construction. My approach was open innovation, pulling the industry along with our own digital transformation. I set up collaboration with both local and international partners to be successful in driving change and transforming AEC,” Salla recalls.
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Aarni Heiskanen, AEC BusinessMr. Heiskanen may be contacted at
aec-business@aepartners.fi
What I Love and Hate About Updating My Contracts From an Owners’ Perspective
July 25, 2022 —
ConsensusDocsThe Construction Owners Association of America
(COAA) is the largest association of construction owners in the United States. COAA just held its Spring Connect conference in downtown Baltimore on the University of Maryland, Baltimore (UMB) campus. One session featured “What I Love and Hate About Updating My Contracts from an Owners’ Perspective.”
ConsensusDocs’ Executive Director & Senior Counsel Brian Perlberg spoke on a panel with Joe Cleves of Taft Law and Pen Wolf from the Cleveland Clinic.
Pen Wolf from Cleveland Clinic outlined the process he used to update his contracts recently. The Cleveland Clinic builds facilities annually and owns different facilities at different locations. The clinic employs over 75,000 employees. For an owner with a broad reach like the Cleveland Clinic, Wolf recommended using outside counsel with construction expertise to update contracts. He concluded that while it was a significant effort, the endeavor to update the Clinic’s contracts was absolutely worth the time commitment and expense. Wolf shared that updating the Clinic’s contracts has generated positive reviews internally and externally. Now their written agreements better reflect their business practices in their construction design and construction program.
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ConsensusDocs
Shifting Fees and Costs in Nevada Construction Defect Cases
November 26, 2014 —
Casey J. Quinn - Newmeyer & Dillion LLPIn Nevada, homeowners who sue a builder for residential constructional defects may recover attorneys’ fees and costs caused by the defect. Many times, the request for attorneys’ fees can outpace the size of the actual claim for defects. However, Nevada provides builders with two ways to potentially shift the right to recover attorneys’ fees and costs away from the homeowner and to the builder.
The first arises during the Nevada Revised Statutes (NRS) Chapter 40 process (Nevada’s Right to Repair law). After a builder receives notice of construction defects, it is required to provide the claimant with a written response to each defect, which may include a proposal for monetary compensation (including contribution from a subcontractor, supplier, or design professional). See NRS 40.6472. If a claimant unreasonably rejects a reasonable written offer of settlement included in the response and decides to commence litigation, the court may deny the claimant’s attorneys’ fees and costs and award attorneys’ fees and costs to the builder. See NRS 40.650. Thus, by including a reasonable offer of monetary compensation in a Chapter 40 response, a builder could possibly avoid paying any fees and costs and even recover its own fees in defending against the claim.
A second method for shifting fees and costs is through a written offer of judgment (OOJ). See NRS 17.115 and NRCP 68. Not limited solely to construction defect matters, an OOJ is a useful tool in all kinds of litigation. OOJs are designed to facilitate and encourage pre-trial settlement by incentivizing parties to make reasonable settlement offers that—when unreasonably rejected—have the consequence of shifting the right to recover attorneys’ fees. Basically, when a party rejects an OOJ and fails to obtain a more favorable judgment, the court cannot award any attorneys’ fees and costs to the rejecting party and may award attorneys’ fees incurred from the date of the offer to the entry of judgment, as well as all reasonable costs, to the party who made the offer. In a recent decision, the Nevada Supreme Court affirmed that when a homeowner rejects an OOJ and fails to obtain a more favorable judgment, it can wipe out that homeowner’s right to Chapter 40 fees and costs. See Gunderson, et al. v. D.R. Horton, 130 Nev. Adv. Op. 9 (Feb. 27, 2014). In other words, “While NRS Chapter 40 permits an award of reasonable attorney fees proximately caused by a construction defect, it does not guarantee it.” Id.
Because of the potentially harsh consequences of rejecting an OOJ, there are specific requirements that must be met to trigger them. An offer of judgment must be made in writing, can be made at any time at least 10 days before trial, and is irrevocable for 10 days with no provision for withdrawal before the 10 days expire. See Nava v. Second Judicial Dist. Court, 118 Nev. 396, 46 P.3d 60 (2002). A party may make successive offers of judgment, but the most recent offer extinguishes previous offers and is controlling for determining the date from which attorneys’ fees may be awarded. See Albios v. Horizon Communities, Inc. 132 P.3d 1022 (2006).
In Beattie v. Thomas, 99 Nev. 579, 668 P.2d 268, 274 (1983), the Nevada Supreme Court explained that the purpose of OOJs are not to cause plaintiffs to unfairly forego legitimate claims. However, when a valid offer of judgment is made, the offer is rejected, and the party rejecting the offer fails to obtain a more favorable judgment, a court must evaluate whether the plaintiff's claim was brought in good faith; whether the offer of judgment was reasonable and in good faith in both its timing and amount; whether the plaintiff's decision to reject the offer and proceed to trial was grossly unreasonable or in bad faith; and whether the fees sought by the offer are reasonable and justified. “After weighing the foregoing factors, the district judge may, where warranted, award up to the full amount of fees requested.” Id.
It is worth noting that in Albios v. Horizon Communities, Inc. 132 P.3d 1022 (2006), the Nevada Supreme Court held that when a party rejects a reasonable OOJ and is foreclosed from recovering fees and costs, the party is likewise foreclosed from an award of fees and costs under Chapter 40. This means that even if a builder fails to include a monetary settlement offer as part of a Chapter 40 response, it may still avoid paying the claimant’s fees and costs with a reasonable and timely OOJ.
Finally, it is important to remember that OOJs are a powerful tool that can cut both ways. If an OOJ is not reasonable and timely, or if it fails to contemplate all the potential recovery of an offeree, the OOJ may have no effect on the outcome of a case. Moreover, if a party rejects an OOJ and fails to obtain a more favorable judgment, that party could end up paying the offeror’s costs and attorney’s fees incurred from the date of the offer. Given this powerful impact, OOJs should be an integral part of pre-litigation planning and overall litigation strategy.
About the Author
Casey J. Quinn is an associate in the Las Vegas office of
Newmeyer & Dillion LLP. His practice focuses on complex commercial, construction, and insurance litigation and appellate work. Casey can be reached by email at Casey.Quinn@ndlf.com.
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On Rehearing, Fifth Circuit Finds Contractual-Liability Exclusion Does Not Apply
November 26, 2014 —
Tred R. Eyerly – Insurance Law HawaiiOn rehearing, the Fifth Circuit determined that the contractual-liability exclusion did not apply to bar coverage for damage caused by the insured contractor to the home it constructed. Crownover v. Mid-Continent Cas. Co., 2014 U.S. App. LEXIS 20727 (5th Cir. Oct. 29, 2014).The court withdrew its prior opinion, summarized here.
Arrow Development, Inc. contracted with the Crownovers to construct a home. The contract had a warranty-to-repair clause, which, in paragraph 23.1, provided that Arrow would "promptly correct work . . . failing to confirm to the requirements of the Contract Documents." After the Crownovers moved in, cracks began to appear in the walls and foundation of the home. Additional problems with the heating, ventilation, and air conditioning ("HVAC") caused leaking in the exterior lines and air ducts inside the home. To compensate for defects in the HVAC system, the system's mechanical units ran almost continuously in order to heat or cool the home. Because they were overburdened, the mechanical units had to be replaced. The Crownovers paid several hundred thousand dollars to fix the problems with the foundation and HVAC system.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Housing Stocks Rally at End of November
December 04, 2013 —
CDJ STAFFThe homebuilding industry had something to be thankful for this year. In a report on stocks issued just before the Thanksgiving holiday, Standard Pacific Group and Toll Brothers where outperforming the S&P 500 (Gafisa S.A., a Brazilian firm that trades on the New York Stock Exchange also outperformed the index). Both of the U.S. firms traded about their 50-day moving averages. A third U.S. home builder, The Ryland Group, traded above its 50-day moving average, but did not outperform the S&P 500.
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Construction Jobs Keep Rising, with April Gain of 33,000
June 10, 2019 —
Tom Ichniowski - Engineering News-RecordThe construction employment picture continues to brighten, as the industry gained 33,000 jobs in April and its jobless rate improved, the federal Bureau of Labor Statistics has reported.
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Tom Ichniowski, ENRMr. Ichniowski may be contacted at
ichniowskit@enr.com
Beyond the COI: The Importance of an Owner's or Facilities Manager's Downstream Insurance Review Program
March 15, 2021 —
Hugh D. Hughes, Eric M. Clarkson & Mollie H. Levy - Saxe Doernberger & Vita, P.C.The risk of bodily injury lawsuits is an unavoidable reality for property owners and facilities managers (“FMs”) of large commercial sites such as universities, malls, office buildings, or stadiums. Any person who steps foot on the property is a potential plaintiff, including students, tenants, customers, contractors, and vendors.
Insurance mitigates these risks, but a property owner’s or FM’s risk transfer strategy should include more than their own suite of general liability and other third-party policies. Ensuring additional insured status on a vendor’s or contractor’s policy is also essential to a comprehensive risk transfer strategy. In a functional risk transfer program, a vendor’s or contractor’s general liability insurer should defend and indemnify property owners or FMs as additional insureds (“AIs”) for liability for bodily injury caused, in whole or in part, by the vendor’s or contractor’s operations. When this works as intended, it effectively transfers costs associated with such a lawsuit from the owner or FM to the vendor’s or contractor’s insurer. It also increases the insurance limits available for a loss.
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Hugh D. Hughes, Saxe Doernberger & Vita, P.C.,
Eric M. Clarkson, Saxe Doernberger & Vita, P.C. and
Mollie H. Levy, Saxe Doernberger & Vita, P.C.
Mr. Hughes may be contacted at HHughes@sdvlaw.com
Mr. Clarkson may be contacted at EClarkson@sdvlaw.com
Ms. Levy may be contacted at MLevy@sdvlaw.com
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5 Ways Equipment Financing is Empowering Small Construction Businesses
August 24, 2017 —
Duane Craig - Construction InformerSmall construction businesses can often get 100% equipment financing, eliminating the down payment, and freeing up cash, according to the Equipment Leasing and Finance Association (ELFA).
Most small businesses need equipment in order to operate and grow, and each business must decide on an acquisition strategy that is right for it. But, a majority of businesses turn to equipment leasing and financing so they can take advantage of a range of benefits.
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Duane Craig, Construction InformerMr. Craig may be contacted at
dtcraig@constructioninformer.com
