Fairfield Connecticut Building Expert Directory

Insuring Lease/Leaseback Projects

August 19, 2024 — David G. Jordan & Jeffrey J. Vita - Saxe Doernberger & Vita, P.C.
Overview Several states utilize a unique statutory mechanism to allow school districts to finance the construction of public-school facilities. This arrangement (known as a “lease-leaseback agreement”) allows a school district to lease property to a contractor/developer, who then constructs or renovates a school facility on the property. Once the work is completed, the contractor/developer leases the school building back to the school district. The school district then makes lease payments over time, often many years, which can be structured in various ways to spread out the cost of construction. The arrangement typically requires a site lease for the land leased to the contractor/developer, a facilities lease for the lease-back of the school building to the school district and a traditional construction agreement. In some ways, the arrangement resembles a Public-Private Partnership (PPP) whereby a public entity collaborates with a private entity for the purpose of financing and delivering a project traditionally provided solely by the public sector. Reprinted courtesy of David G. Jordan, Saxe Doernberger & Vita, P.C. and Jeffrey J. Vita, Saxe Doernberger & Vita, P.C. Mr. Jordan may be contacted at DJordan@sdvlaw.com Mr. Vita may be contacted at JVita@sdvlaw.com Read the court decision
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Grenfell Fire Probe Faults Construction Industry Practices

November 28, 2022 — Peter Reina - Engineering News-Record
"Incompetence and poor practices in the construction industry" and among others led to the June 2017 fire at London's Grenfell residential high-rise building, causing 72 deaths, according to the lead counsel for the public inquiry that ended Nov. 10. Reprinted courtesy of Peter Reina, Engineering News-Record Mr. Reina may be contacted at reina@btinternet.com Read the full story... Read the court decision
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Is Your Design Professional Construction Contract too Friendly? (Law Note)

July 09, 2014 — Melissa Dewey Brumback – Construction Law North Carolina
My husband often travels the back roads between Chapel Hill and Fuquay Varina to visit friends. En route (a circuitous route that goes past Sharon Harris Nuclear Power Plant, among other places), he passes by the “Friendly Grocery.” [Sign] No *Loitering*Littering*Alcoholic Beverages on Premises*Bike*Skateboard* *10 minutes Parking Limit*Towing Enforced* I’m not sure which is the “friendly” part of that sign. In fact, the sign seems to be the antithesis of friendly. What does this have to do with your construction contracts? Sometimes, in an effort to please the client and/or secure the project, architects and engineers have the habit of being too friendly in their contract language. That is, you make promises or proposals that may promise too much of a good thing for the client. This can cause big problems. Bigger than being towed away from a rural grocery store in the middle of nowhere. You could be putting your insurance coverage at risk. Have you ever promised to use “best efforts” in your design or plans? Promised to design to a specific LEED standard? Guaranteed 100% satisfaction? You might be putting your errors & omission coverage at issue. By warrantying or guaranteeing something, you are assuming a level of liability well beyond the standard of care required by law. By law, you only need to conform to the standard of care, and your insurance will only provide coverage up to that standard of care. In other words, if you make guarantees or promise “best efforts,” you are contracting to something that will *not* be insured. If something goes wrong, you will be without the benefit of your professional liability coverage. Read the court decision
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Reprinted courtesy of Melissa Dewey Brumback, Construction Law in North Carolina
Ms. Brumback may be contacted at mbrumback@rl-law.com

Housing Starts Plunge by the Most in Four Years

March 19, 2015 — Bloomberg News
(Bloomberg) -- Housing starts plummeted in February by the most since 2011 as plunging temperatures and snow became the latest hurdles for an industry struggling to recover. Work began on 897,000 houses at an annualized rate, down 17 percent from January and the fewest in a year, the Commerce Department reported Tuesday in Washington. The pace was slower than the most pessimistic projection in a Bloomberg survey of 81 economists. “Today’s report leaves me a little concerned,” said Michelle Meyer, deputy head of U.S. economics at Bank of America Corp. in New York. “While the initial reaction is to dismiss much of the drop because of the bad weather, the level of home construction continues to be depressed.” Read the court decision
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Reprinted courtesy of Bloomberg News
Michelle Jamrisko may be contacted at mjamrisko@bloomberg.net

In Contracts, One Word Makes All the Difference

July 21, 2018 — Christopher G. Hill - Construction Law Musings
Here at Musings, I sometimes feel as if I am beating the “contract is king” drum to death. However, each time I start to get this feeling, a new case out of either the Virginia state courts or the Fourth Circuit Court of Appeals here in Richmond reminds me that we all, lawyers and contractors alike, need to be reminded of this fact on a regular basis. The terms written into a construction contract (or any other contract for that matter) will control the outcome of any dispute in just about every case. A recent 4th Circuit case takes this to the extreme in pointing out the the choice which of two tiny words can change the entire set of procedural rules and even the courthouse in which your dispute will be decided. In FindWhere Holdings Inc. v. Systems Env. Optimization LLC, the Fourth Circuit looked at a forum selection clause found in a contract between the parties. In this case, the clause stated that any dispute would be litigated in the courts “of the State of Virginia.” When the defendants tried to remove the case from Virginia state court to the Eastern District of Virginia federal courts, the federal court remanded the case, sending it back to the Circuit Court of Loudoun County, Virginia. 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

Eleventh Circuit Rules That Insurer Must Defend Contractor Despite “Your Work” Exclusion, Where Damage Timing Unclear

May 13, 2019 — Michael S. Levine & David M. Costello - Hunton Andrews Kurth
The Eleventh Circuit has reversed an insurer’s award of summary judgment after finding that uncertainty about when the alleged property damage occurred raised questions about whether the damage came within the scope of the “Your Work” exclusion. More specifically, the court found unclear whether the damage occurred before or after the contractor abandoned the job, thereby triggering an exception to the “Your Work” exclusion for damage to work that had “not yet been completed or abandoned.” The decision illustrates how timing can be a critical factor when it comes to triggering coverage for work and completed operations. In Southern-Owners Insurance Company v. MAC Contractors of Florida, LLC, a pair of trustees hired MAC Contractors (doing business as KJIMS Construction) to serve as the general contractor for a custom residence. After construction began, disputes between the trustees and KJIMS caused the contractor to abandon the job before completing the project. The trustees followed with a lawsuit alleging, among other things, that KJIMS had damaged wood floors and a metal roof, which KJIMS had promised to remediate but never did. Reprinted courtesy of Michael S. Levine, Hunton Andrews Kurth and David Costello, Hunton Andrews Kurth Mr. Levine may be contacted at mlevine@HuntonAK.com Mr. Costello may be contacted at dcostello@HuntonAK.com Read the court decision
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Jury's Verdict for Loss Caused by Collapse Overturned

September 18, 2023 — Tred R. Eyerly - Insurance Law Hawaii
The Florida Court of Appeal overturned the jury's verdict findng loss caused by collapse. Universal Prop. & Cas. Ins. Co. v. Caboverde, 2023 Fla. App. LEXIS 4474 (Fla. Ct. App. June 28, 2023). The insured homeowners had two claims. One was a 2016 ceiling collapse; the second was loss caused by Hurricane Irma in 2019. The homeowners' policy covered collapse defined as "an abrupt falling down or caving in of a building or any part of a building with the result that the building . . . cannot be occupied for its intended purpose." Collapse had to be caused by, among other things, decay or insect damage that was hidden from view. 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

Hawaii Court Looks at Changes to Construction Defect Coverage after Changes in Law

November 06, 2013 — CDJ STAFF
A construction defect case lead at the U.S. District Court for Hawaii involved the insurer’s changed views on what was covered based on court decisions that came after the policy was written. John R. Casciano and Jessica L. Urban of Steptoe & Johnson LLP discuss the case on their firm’s website. They note that in Illinois National Insurance Company v. Nordic PCL Construction, Inc., Nordic built a retail building which soon afterwards had water leaks and property damage, due to alleged defects in the roof construction. Nordic had purchased comprehensive general liability and umbrella polices, with coverage that included property damage. Mr. Casciano and Ms. Urban note that “at the time of contracting, the Ninth Circuit had predicted that, ‘if the Hawaii Supreme Court examined the matter, it would rule that, for purposes of insurance coverage, construction defects were “not occurrences.”’” After the policy was written, the Hawaii Intermediate Court of Appeals did rule that “construction defect claims do not constitute an ‘occurrence’ under a CGL policy.” On the basis of this, Illinois National determined that they had no duty to defend or indemnify their client. Nordic made a claim of bad faith, but the court determined that “an insurer that denies coverage based on an open question of law does not act in bad faith, an insurer that actually relies on governing law, even if the insurer only belatedly learns of the law, cannot be said to thereby act in bad faith.” However, the court denied a summary judgment of Nordic’s claim of negligent misrepresentation, determining that there was “a question of fact as to whether the Policies covered [or were represented as covering] only damage to third parties caused by subcontractors’ defective work.” Finally, the court found that “a reasonable jury could infer that, at the time the Polices were issued, the insurers meant to cover claims arising out of the defective work” of Nordic’s subcontractors. They conclude that the Nordic decision “recognizes the varying consequences for coverage claims when post-contracting changes to the law may not coincide with the expectations of at least one of the parties at the time of contracting.” Read the court decision
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