Seattle Washington Building Expert Directory

Business Risk Exclusions Bar Coverage for Construction Defect Claims

June 28, 2013 — Tred Eyerly
The federal district court assumed there was "property damage" caused by an "occurrence," but found the business risk exclusions barred coverage for construction defect claims. Hubbell v. Carney Bros. Constr., 2013 U.S. Dist. LEXIS 68331 (D. Colo. May 13, 2013). The plaintiffs entered a construction contract with the insured general contractor to build a home. After the project was one-third completed, plaintiffs terminated the contract. Experts hired by plaintiffs found a failure to properly site the residence, as the house was constructed 48 feet from the intended location; violations of county height restrictions; failure to follow building plans, which were themselves deficient; and an improperly poured foundation. The experts estimated that the costs of repairing the property to be between $1.3 and $1.5 million, and that the cost of demolishing the structure and rebuilding it would be between $1.1 and $1.3 million. After plaintiff filed suit, a stipulated judgment of $1.952 million was entered. Read the court decision
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Reprinted courtesy of Tred Eyerly
Tred Eyerly can be contacted at te@hawaiilawyer.com

United States Supreme Court Upholds Class Action Waivers in Arbitration Agreements

May 24, 2018 — Amy R. Patton, Jason I. Bluver, & Jeffrey K. Brown - Payne & Fears LLP
On May 21, 2018, the United States Supreme Court held, in a 5-4 decision, that arbitration agreements which mandate individualized resolution of claims (as opposed to class or collective resolution) are enforceable under the Federal Arbitration Act ("FAA"). In doing so, the Court rejected the argument that such "class action waivers" violate Section 7 of the National Labor Relations Act ("NLRA"), which generally protects employees' rights to act "in concert" with one another. The Court addressed a split created by decisions from three Federal Circuit Courts of Appeal: Epic Systems Corp v. Lewis (7th Circuit), Ernst & Young v. Morris (9th Circuit) and National Labor Relations Board v. Murphy Oil USA (5th Circuit). All three cases involved employees who sought to bring collective or class actions under the Fair Labor Standards Act (the "FLSA"), and their respective employers who sought to enforce pre-dispute arbitration agreements which waived such collective actions and mandated "one-on-one" arbitration of wage disputes. In support of their position, the employees argued that the class and collective action waivers were illegal because they violated the NLRA's prohibition on barring employees from engaging in "concerted activities." Reprinted courtesy of Payne & Fears LLP attorneys Amy R. Patton, Jason I. Bluver and Jeffrey K. Brown Ms. Patton may be contacted at arp@paynefears.com Mr. Bluver may be contacted at jib@paynefears.com Mr. Brown may be contacted at jkb@paynefears.com Read the court decision
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Texas EIFS Case May Have Future Implications for Construction Defects

October 02, 2013 — CDJ STAFF
Lennar Homes addressed a problem with EIFS in homes built in Texas in the 1990s by replacing every roof they had built. Some of those homes had problems with leaks, rotting, or termites, but other roofs hadn’t suffered any problems. Lennar’s insurers initially refused coverage. Lennar managed to settle with all but one, Markel American Insurance. Their dispute formed the case Lennar Corp. v. Markel American Insurance Co. This was first tried before a jury and eventually appealed to the Texas Supreme Court. Brian S. Martin of Thompson Coe Cousins & Irons LLP discusses this case at Insurance Journal. Markel’s claim was that under the policy language, Lennar could not make voluntary payments without getting Markel’s consent, which they did not. But the Texas Supreme Court disagreed, determining that Lennar took, as Mr. Martin notes, “a reasonable approach to a serious problem.” Markel also made the claim that the whole amount of the damages was not covered by the policy, as they did not view the policy as covering the cost of determining the extent of the damage. The Court disagreed, noting that “under no reasonable construction of the phrase can the cost of finding EIFS property damage in order to repair it not to be considered ‘because of the damage.’” Mr. Martin concludes by calling the Texas Supreme Court decision “a frontal assault on several critical provisions of liability policies that will assuredly lead to further litigation.” He also notes that the decision “may indicate a shift in the Court’s approach in insurance cases to a more result-oriented jurisprudence.” Read the court decision
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Arizona Supreme Court Confirms a Prevailing Homeowner Can Recover Fees on Implied Warranty Claims

November 21, 2017 — Rick Erickson - Snell & Wilmer Real Estate Litigation Blog
Originally published by CDJ on August 30, 2017 On August 9th, in Sirrah Enterprises, L.L.C. v. Wunderlich, the Arizona Supreme Court settled the question about recovery of attorneys’ fees after prevailing on implied warranty claims against a residential contractor. The simple answer is, yes, a homeowner who prevails on the merits can recover the fees they spent to prove that shoddy construction breached the implied warranty of workmanship and habitability. Why? Because, as Justice Timmer articulated, “[t]he implied warranty is a contract term.” Although implied, the warranty is legally part of the written agreement in which “a residential builder warrants that its work is performed in a workmanlike manner and that the structure is habitable.” In other words, a claim based on the implied warranty not only arises out of the contract, the claim is actually based on a contract term. Since, in A.R.S. § 12-341.01, Arizona law provides for prevailing parties to recover their fees on claims “arising out of contract” and because the implied warranty is now viewed by the courts as a contract term, homeowners can recover their fees after successfully proving breach of the implied warranty. Read the court decision
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Reprinted courtesy of Rick Erickson, Snell & Wilmer
Mr Erickson may be contacted at rerickson@swlaw.com

Recommencing Construction on a Project due to a Cessation or Abandonment

October 26, 2017 — David Adelstein - Florida Construction Legal Updates
There are instances where the owner of a construction project terminates its general contractor prior to the completion of the project. There are instances where the owner suspends the work prior to the completion of the project, meaning there is a cessation in the construction. And, there are instances where the project is simply abandoned. I have been involved in all instances, and the owner’s reasons vary…from an owner claiming a termination for default, termination for convenience, or a suspension or abandonment due to the market or financial factors. Regardless of the owner’s reasoning, at some point—hopefully—the owner will want to resume or, more properly stated, recommence construction and complete the project. Read the court decision
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Reprinted courtesy of David Adelstein, Florida Construction Legal Updates
Mr. Adelstein may be contacted at Dadelstein@gmail.com

No Prejudicial Error in Refusing to Give Jury Instruction on Predominant Cause

November 11, 2024 — Tred R. Eyerly - Insurance Law Hawaii
The California Court of Appeal affirmed the trial court's judgment after the jury determined there was no coverage for a leaking pipe. Mendoza v. Pacific Spec. Ins. Co., 2024 Cal. App. Unpub. EXIS 5477 (Cal. Ct. App. Aug. 20, 2024). The Mendoza's third amended complaint alleged their home was damaged "by overflow of water from the dwelling's plumbing system resulting from a broken pipe, which overflow undermined the structural integrity of the dwelling." The Mendozas insured their home under a policy issued by Pacific. The policy insured the property against "sudden and accidental direct physical loss" except where expressly excluded. The Mendozas submitted a claim Pacific paid approximately $1800 for the loss and closed the claim. The amount paid did not include payment for any structural damage to the home. The Mendozas alleged that Pacific's failure to conduct a full and fair investigation into the structural damage and its inadequate payment of benefits was a breach of the implied covenant of good faith and fair dealing. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

World’s Biggest Crane Lifts Huge Steel Ring at U.K. Nuclear Site

January 25, 2021 — Rachel Morison - Bloomberg
The world’s largest crane hoisted the first of three massive steel rings that will encase one of the reactors at Electricite de France SA’s nuclear construction site in the U.K., a key milestone in getting the project completed on time. Operators of the 250-meter (820-foot) tall crane, affectionately known as “Big Carl,” lifted the ring that weighs as much as a jumbo jet overnight to take advantage of windless conditions. Hinkley Point C is the U.K.’s first new nuclear power plant in more than two decades. Once up and running the reactor will generate electricity for six million homes by 2025. It’s the largest and most advanced infrastructure project in the country and, when finished, will contain 3 million tons of concrete and 50,000 tons of structural steel, enough to build a railway line between London and Rome. Read the court decision
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Reprinted courtesy of Rachel Morison, Bloomberg

Sometimes You Get Away with Unwritten Contracts. . .

July 28, 2018 — Christopher G. Hill - Construction Law Musings
I have spoken often regarding the need for a well written construction contract that sets out the “terms of engagement” for your construction project. A written construction contract sets expectations and allows the parties to the contract to determine the “law” of their project. An unwritten “gentleman’s agreement” can lead to confusion, faulty memories, and more money paid to construction counsel than you would like as we lawyers play around in the grey areas. One other area where the written versus unwritten distinction makes a difference is in the calculation of the statute of limitations. In Virginia, a 5 year statute of limitations applies to written contracts while a 3 year statute of limitations applies to unwritten contracts. This distinction came into stark relief in the case of M&C Hauling & Constr. Inc. v. Wilbur Hale in the Fairfax, Virginia Circuit Court. In M&C Hauling, M&C provided hauling services to the defendant through a subcontract with Hauling Unlimited in 2014, the last of which was in July. M&C provided over 2000 hours of hauling and provided time tickets (that were passed to Mr. Hale on Hauling Unlimited letterhead and signed by Mr. Hale or his agent) and an invoice stating the price term of $75.00 per hour. No separate written contract between M&C and Hauling Unlimited or Mr. Hale existed. Read the court decision
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Reprinted courtesy of Christopher G. Hill, The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

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