Homebuilders See Record Bearish Bets on Shaky Recovery
June 18, 2014 —
Callie Bost – BloombergSomeone thinks the housing rebound is built on shaky foundations.
A record 180,000 puts traded on the SPDR S&P Homebuilders (XHB) exchange-traded fund on June 11, according to data compiled by Bloomberg. The contract with the highest ownership pays off in the event of a 20 percent slump by December in the ETF tracking stocks from DR Horton Inc. to Williams-Sonoma Inc.
Prospects for rising interest rates and an uneven recovery in the housing market have hurt returns this year, sending the SPDR Homebuilders ETF down 3.3 percent. While economic data yesterday showed that builders broke ground on 1 million U.S. homes in May, permits, a proxy for future construction, decreased because of fewer applications for condominiums and apartment buildings.
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Ms. Bost may be contacted at
cbost2@bloomberg.net
South Carolina Supreme Court Requires Transparency by Rejecting an Insurer’s “Cut-and-Paste” Reservation of Rights
February 16, 2017 —
Theresa A. Guertin & H. Scott Williams - Saxe Doernberger & Vita, P.C.In a decision rendered on January 11, 2017, the Supreme Court of South Carolina reminded policyholders that they are entitled to an explanation of any and all grounds upon which their insurer may be contesting coverage in a reservation of rights letter. Specifically, in Harleysville Group Insurance v. Heritage Communities, Inc. et al., 1 the court found that an insurer’s reservation of rights, which included a verbatim recitation of numerous policy provisions that the court identified as the “cut-and-paste” method, was insufficient to reserve its rights to contest coverage.
In 2003, Heritage Communities, Inc. (“Heritage”), a parent company of several corporate entities engaged in developing and constructing condominium complexes from 1997 to 2000, was sued by multiple property owners’ associations. The lawsuits sought actual and punitive damages against Heritage as a result of alleged construction defects, including building code violations, structural deficiencies, and significant water intrusion. During the period of construction, Heritage was insured by Harleysville Group Insurance (“Harleysville”) under several primary and excess general liability insurance policies.
Reprinted courtesy of
Theresa A. Guertin, Saxe Doernberger & Vita, P.C. and
H. Scott Williams, Saxe Doernberger & Vita, P.C.
Ms. Guertin may be contacted at tag@sdvlaw.com
Mr. Williams may be contacted at hsw@sdvlaw.com
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Walkability Increases Real Estate Values
June 18, 2014 —
Beverley BevenFlorez-CDJ STAFFCNBC reported that environmentally-conscious Millennials are looking for homes that are within walking or biking distance to stores and work. The “areas that offer so-called walkability should see more home buyers and renters than those that don't.”
"Cities that want to thrive in our new economic and demographic realities will need to find ways to create and support more of these dynamic, productive walkable districts that are in high demand," Geoff Anderson, CEO of Smart Growth America, told CNBC. Anderson, “in conjunction with George Washington University School of Business, released a new report ranking the walkability of the nation's 30 largest metropolitan areas.”
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Give Way or Yield? The Jurisdiction of Your Contract Does Matter! (Law note)
March 05, 2015 —
Melissa Dewey Brumback – Construction Law in North CarolinaHave you ever been to England? If so, you’ve likely seen their version of our “Yield” sign– the “Give Way” sign. It is a bit jarring to those from this side of the “big pond”.
Similarly, contracts can be worded differently– and, interpreted differently– depending on the state that you are in. This is why it is always a good idea to have your contract or proposal vetted for the state(s) where you provide professional services.
When confronted with a “give way” sign you have the general idea of yielding, but might be confused by that whole “left side of the road” thing in some countries, where if you are turning right, you must give way to all vehicles coming towards you including those turning left. Likewise, you might have a good understanding of your construction contract in one state, but not how it would be interpreted in another state.
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Melissa Dewey Brumback, Construction Law in North CarolinaMs. Brumback may be contacted at
mbrumback@rl-law.com
Busting Major Alternative-Lending Myths
July 22, 2024 —
Warren Miller - Construction ExecutiveAlternative capital is a broad term for financing provided by institutions or firms that typically fall outside of the purview of the larger, regulated institutions (i.e., not traditional banks). While these funding sources may not always be the first option for many businesses, alternative lending is a perfect option for many small and mid-sized capital-intensive companies, like construction companies, which often require fast access to capital that is incompatible with the stringent and laborious processes imposed by traditional banks.
Construction companies should take a closer look at alternative financing, understand its benefits, and evaluate its usefulness for achieving their unique funding requirements.
REALITY 1: ALTERNATIVE LENDING IS SAFE AND PROVEN
Private lending has been around for a long time, and has become increasingly common since the 1990s, when major consolidation took place in the banking industry. As the large, consolidated banks set their sights on providing loans to large enterprises, they left a gap in the small and mid-size market that was filled by alternative lenders. By 2000, alternative lenders had overtaken traditional banks for the majority of corporate loans. Stricter regulation of banks following the Global Financial Crisis of 2007 intensified underwriting standards for bank loans and further diminished banks’ appetites for SMB lending.
Reprinted courtesy of
Warren Miller, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Accident/Occurrence Requirement Does not Preclude Coverage for Vicarious Liability or Negligent Supervision
June 06, 2018 —
Christopher Kendrick & Valerie A. Moore - Haight Brown & Bonesteel, LLPIn Liberty Surplus Ins. Corp. v. Ledesma & Meyer Construction Co., Inc. (No. S236765, filed 6/4/18) (L&M), the California Supreme Court ruled that the liability insurance requirement that injury be caused by an “occurrence,” defined as an “accident,” does not preclude coverage of an employer’s independent tort liability for injury deliberately caused by its employee.
In L&M, Liberty insured a construction company that contracted to manage a construction project at a middle school in San Bernardino, California. A 13-year-old student subsequently sued the company in state court, alleging that she had been sexually molested by a company employee, Hecht. Among others, she alleged a cause of action for negligent hiring, retention and supervision of the employee. The construction company tendered to Liberty, which defended the employer under a reservation of rights while seeking declaratory relief in federal court. The district court granted summary judgment for Liberty, ruling that the injury was not caused by an “occurrence.” On appeal, the 9th Circuit Court of Appeals certified the question to the California Supreme Court as a matter of state law.
Reprinted courtesy of
Christopher Kendrick, Haight Brown & Bonesteel LLP and
Valerie A. Moore, Haight Brown & Bonesteel LLP
Mr. Kendrick may be contacted at ckendrick@hbblaw.com
Ms. Moore may be contacted at vmoore@hbblaw.com
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Motion for Reconsideration Challenging Appraisal Determining Cause of Loss Denied
November 16, 2023 —
Tred R. Eyerly - Insurance Law HawaiiThe court rejected the insurer's motion for reconsideration attempting to set aside the appraisal award that determined the cause of loss. Mesco Mfg., LLC v. Motorists Mut. Ins. Co., 2023 WL 5334659 (S.D. Ind. Aug. 18, 2023).
Mesco suffered a loss to the roofs of its facilities due to hail damage. Mesco sued Motorists alleging it breached the policy by failing to pay the full amount of the claim. The claim went to appraisal. The policy's appraisal provision reserved Motorists' right to deny the claim despite an appraisal going forward. The appraisal award noted that the loss was caused by hail.
Cross-motions for summary judgment were filed. The court found that Motorists had breached the policy by failing to pay the arbitration award and granted summary judgment to the insured. The "right to deny" clause did not give Motorists the unfetterd right to disregard the umpire's award if it disgreed about the amount of loss caused by hail. The only dispute was whether the damage was caused by hail, and the umpire found that it was.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
CAUTION: Terms of CCP Section 998 Offers to Compromise Must Be Fully Contained in the Offer Itself
May 12, 2016 —
Jesse M. Sullivan & R. Bryan Martin – Haight Brown & Bonesteel LLPIn Sanford v. Rasnick, (Ct. of Appeal, 1st App. Dist., No. A145704) the First Appellate District addressed whether a CCP § 998 Offer to Compromise requiring plaintiff to execute a release and enter into a separate settlement agreement was valid. Because the settlement agreement could potentially contain additional terms not stated in the CCP 998 Offer, the Court of Appeal held that it was not.
Plaintiff alleged he was injured when the 17-year-old Defendant ran a stop sign and struck his motorcycle. Plaintiff sued the 17-year-old and his father (the owner of the vehicle) for vehicular negligence and general negligence.
Just after discovery closed, defendants jointly served a CCP § 998 Offer to Compromise to plaintiff in the amount of $130,000. The offer contained a condition requiring that in order to accept, plaintiff must provide a “notarized execution and transmittal of a written settlement agreement and general release. Each party will bear its own fees, costs and expenses.”
Mr. Sullivan may be contacted at jsullivan@hbblaw.com
Mr. Martin may be contacted at bmartin@hbblaw.com
Reprinted courtesy of
Jesse M. Sullivan, Haight Brown & Bonesteel LLP and
R. Bryan Martin, Haight Brown & Bonesteel LLP
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