California Homeowners Can Release Future, Unknown Claims Against Builders
June 10, 2015 —
Edward A. Jaeger, Jr. and William L. Doerler – White and Williams LLPIn Belasco v. Wells, 183 Cal. Rptr.3d 840, 234 Cal. App. 4th 409 (2015), the California Court of Appeals for the Second District addressed the question of whether a homeowner, when settling an administrative complaint against a licensed homebuilder, can release future, unknown claims. Despite the presence of a California statute, Cal. Civ. Code § 1542, stating that a general release does not extend to claims that the releasor does not know about, the court held that the homeowner’s express release of future claims was enforceable. Thus, the homeowner’s release - signed as part of a 2006 settlement of the homeowner’s construction defect claims against the defendant, a homebuilder - barred the homeowner’s 2012 claims against the builder based on latent defects in the roof of the home that the homeowner discovered in 2011.
Background
The plaintiff, David Belasco, a patent attorney, bought a newly-constructed home from the defendant-builder, Gary Wells, in 2004. Wells holds a Class B General Building Contractor license issued by the Contractors State License Board (the Board). In 2006, Belasco filed a complaint against Wells with the Board based on alleged construction defects in the home.
As a result of Belasco’s complaint to the Board, the parties engaged in arbitration. At the arbitration, both parties were represented by counsel. Wells offered to settle the dispute for the sum of $25,000 and Belasco accepted Wells’ offer.
Reprinted courtesy of
Edward A. Jaeger, Jr., White and Williams LLP and
William L. Doerler, White and Williams LLP
Mr. Jaeger may be contacted at jaegere@whiteandwilliams.com; Mr. Doerler may be contacted at doerlerw@whiteandwilliams.com
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Wait, You Want An HOA?! Restricting Implied Common-Interest Communities
September 17, 2018 —
Neil McConomy - Snell & Wilmer Real Estate Litigation BlogWhile the butt of many jokes and a thorn in the side of some property owners, homeowners associations (“HOAs”) serve the vital function of collecting and disbursing funds to care for and maintain common areas of residential developments. Without HOAs, neighborhood open spaces, parks, and other amenities risk falling into disrepair through a type of tragedy of the commons, wherein residents use such amenities but refuse to subsidize care and maintenance for these common areas believing someone else will pony-up the funds. HOAs, when properly organized and managed, avoid this problem by ensuring everyone pays their fair shares for the common areas. Colorado’s Common Interest Ownership Act (“CCIOA”), C.R.S. § 38-33.3-101 et seq., sets forth the manner in which such common-interest communities, and their related associations, must be established.
Earlier this summer, the Colorado Supreme Court issued an opinion limiting the application of previous case law that allowed for the establishment of common-interest communities (and their related HOAs) by implication. See McMullin v. Hauer, 420 P.3d 271 (Colo. 2018). Prior to McMullin, Colorado courts had been increasing the number of factual scenarios implying the creation of common-interest communities under CCIOA. See e.g., Evergreen Highlands Assoc. v. West, 73 P.3d 1 (Colo. 2003) (finding an implied obligation of landowners to fund a pre-existing HOA’s obligations); DeJean v. Grosz, 412 P.3d 733 (Colo. App. 2015) (finding an implied right of a homeowner to found an HOA after the developer filed a declaration expressing an intent to form one but ultimately failed to do so); and Hiwan Homeowners Assoc. v. Knotts, 215 P.3d 1271 (Colo. App. 2009) (finding the existence of an HOA despite no common property existing within the development). The McMullin opinion highlights the importance of strict compliance with CCIOA to preserve common areas in a development, ensure the ability to fund maintenance of such areas, and avoid future litigation.
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Neil McConomy, Snell & WilmerMr. McConomy may be contacted at
nmcconomy@swlaw.com
Crisis Averted! Pennsylvania Supreme Court Joins Other Courts in Finding that Covid-19 Presents No Physical Loss or Damage for Businesses
October 21, 2024 —
Edward M. Koch & Marc L. Penchansky - White and Williams LLPSeeking to find some relief from business losses experienced during the COVID-19 pandemic, many businesses turned to their property insurers for coverage for their lost income. A clear national trend emerged among courts deciding the issue, as most businesses could not establish coverage because they had not experienced a “direct physical loss of or damage to their covered property” as required by most policies.
While this legal question may have become an afterthought for many attorneys, the question remained an open one in Pennsylvania while the Pennsylvania Supreme Court considered two contradictory holdings issued in the Superior Court on this topic. Compare Macmiles, LLC v. Erie Ins. Exch., 286 A.3d 331 (Pa. Super. 2022) (holding there was no coverage for loss of use of a commercial property unaccompanied by any physical alteration or other physical condition that rendered the property unusable or uninhabitable) with Ungarean v. CNA, 286 A.3d 353 (Pa. Super. 2022) (holding that the policy at issue was ambiguous and therefore the policy covered the insured for COVID-related business losses). Last week, the Supreme Court considered the Superior Court’s holdings in Macmiles and Ungarean and held, at long last, that COVID-19 did not cause a direct physical loss of or damage to covered property.
Reprinted courtesy of
Edward M. Koch, White and Williams LLP and
Marc L. Penchansky, White and Williams LLP
Mr. Koch may be contacted at koche@whiteandwilliams.com
Mr. Penchansky may be contacted at penchanskym@whiteandwilliams.com
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No Bond, No Recovery: WA Contractors Must Comply With WA Statutory Requirements Or Risk Being Barred From Recovery If Their Client Refuses To Pay
September 18, 2018 —
Joshua Lane - Ahlers Cressman & Sleight PLLCThe risk that a contractor’s client may refuse to pay the full contract balance is a day-to-day reality for every contractor. That risk – and the stress it causes in the mind of any contractor – is tempered by the knowledge that Washington statutes provide contractors with ready access to the courts to file a lawsuit and be fully compensated for the work performed. But a recent case provides a grim reminder that the same statutes that giveth court access can also taketh away.
Washington’s Contractor Registration Act (“WCRA”)[1] requires every contractor engaging or offering to engage in services in Washington to register with the Department of Labor and Industries (”L&I”). In order to sue to collect compensation for work or to enforce a contract, a contractor must prove that he/she “was a duly registered contractor and held a current and valid certificate of registration at the time he or she contracted for the performance of such work or entered into such contract.”[2] In order to conclude that a contractor has substantially comply with these requirements, a court must find that:
(1) The department has on file the information required by RCW 18.27.030; (2) the contractor has at all times had in force a current bond or other security as required by RCW 18.27.040; and (3) the contractor has at all times had in force current insurance as required by RCW 18.27.050.[3]
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Joshua Lane, Ahlers Cressman & Sleight PLLCMr. Lane may be contacted at
joshua.lane@acslawyers.com
Traub Lieberman Partners Lenhardt and Smith Obtain Directed Verdict in Broward County Failed Repair Sinkhole Trial
September 03, 2019 —
Michael Francis Lenhardt & Burks A. Smith, III - Traub LiebermanOn Tuesday, July 16, 2019, Traub Lieberman Partners Michael Lenhardt and Burks Smith won a Directed Verdict at trial in a dispute over Sinkhole Loss coverage in Broward County Circuit Court. The lawsuit arose out of a claim for Breach of Contract involving an alleged “failed repair” of a 2005 sinkhole at the insureds’ property. The Plaintiffs argued that their Policy Limits did not apply because the carrier allegedly undertook the subsurface repairs, relying on Drew v. Mobile USA Ins. Co., 920 So.2d 832 (Fla. 4thDCA 2006). The Plaintiffs asserted that because the insurance company allegedly hired the below ground repair company, a “new contract” was formed, and the Plaintiffs should be entitled to limitless repairs to their home, notwithstanding the Policy Limits. This argument obviously presented the carrier with very significant exposure.
Attorneys Lenhardt and Smith provided a vigorous defense for the insurance company at trial, during which they presented the jury with evidence that the carrier did not, in fact, hire the subsurface repair company. They further established to the jury that the insureds actually signed a contract with the repair company directly, and that the defendant did not invoke the Our Option repair clause of the Policy. After the Plaintiffs rested their case, Mr. Lenhardt and Mr. Smith moved the Court for entry of a directed verdict. The defense argued to the Court that the Plaintiffs could not prove their case to the jury based upon the facts presented as a matter of law, thus entitling the insurance company to a defense verdict.
Reprinted courtesy of
Michael Francis Lenhardt, Traub Lieberman and
Burks A. Smith, III, Traub Lieberman
Mr. Lenhardt may be contacted at mlenhardt@tlsslaw.com
Mr. Smith may be contacted at bsmith@tlsslaw.com
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One World Trade Center Tallest Building in US
November 13, 2013 —
CDJ STAFFIt’s official! The tallest building in the United States is in New York. For forty years, the tallest building in the United States has been the Willis Tower in Chicago (better known by its former name, the Sears Tower). Now, the Council on Tall Buildings and Urban Habitat has decreed that One World Trade Center edges it out with its 1,776 feet of height, surpassing the Willis by 325 feet.
There is a caveat. The antennas on the top of the Willis building aren’t counted in. The mast on the top of One World Trade Center is, and it adds 441 feet to the height of the building. If the mast weren’t counted, One World Trade Center would be 116 feet shorter than the building in Chicago.
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How to Prevent Forest Fires by Building Cities With More Wood
December 16, 2023 —
Leslie Kaufman - BloombergDeep in Colville National Forest in eastern Washington state, Russ Vaagen is pointing to a delineation between woods that have been selectively thinned and those that haven’t. One side is light-filled and punctuated with meadows; the other is dense and dark and loaded with trees losing a Darwinian battle for water and life.
To Vaagen it’s proof that America’s sawmills and lumberjacks can help head off the forest conflagrations that are becoming
ever more common, and at the same time provide raw material for an
emerging industry, known as
mass timber, that makes sustainable wood building components.
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Leslie Kaufman, Bloomberg
CGL Coverage for Liquidated Damages and the Contractual Liability Exclusion
October 09, 2023 —
Stu Richeson - The Dispute ResolverLiquidated delay damages are common in construction contracts and are generally imposed when a contractor fails to achieve substantial completion within the time required by the contract. While contracts like the AIA A201-2017 have provisions for extending the time to achieve substantial completion when delays are caused by circumstances beyond the contractor’s control, delays can result from factors other than improper management or planning and the like, for which the owner is not required to give the contractor additional time. Courts are split on whether there is ever coverage under a CGL policy for contractually agreed upon liquidated delay damages.
Liquidated delay damages are often excluded under the contractual liability exclusion of most CGL policies. The contractual liability exclusion excludes coverage for “liability for which the Insured is obligated to pay damages by reason of the assumption of liability in a contract or agreement.” Courts often find the contractual liability exclusion in a CGL policy precludes coverage for liquidated delay damages, because such damages are contractual in nature and are triggered by the failure to bring the contract to substantial completion by a fixed deadline, regardless of the cause of the delay. However, some courts will look to the cause of the delay and find that there is coverage under a CGL policy for liquidated delay damages that are the result of property damage caused by an accident or occurrence.
In Clark Const. Grp., Inc. v. Eagle Amalgamated Serv., Inc., 01-2478-DV, 2005 WL 2092998, at *1 (W.D. Tenn. Aug. 24, 2005) a general contractor entered a contract for the renovation of the convention center in Memphis. Part of the project included the demolition of a structure attached to the convention center. The demolition work was improperly performed by a subcontractor and resulted in damage to the convention center.
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Stu Richeson, PhelpsMr. Richeson may be contacted at
stuart.richeson@phelps.com
