Homeowner Alleges Pool Construction Is Defective
November 13, 2013 —
CDJ STAFFA Texas man is suing the contractor who built his pool alleging that within months of construction, the pool began to crack and leak water. According to the lawsuit from Larry Merendino, when the concrete contractor, PC Construction, removed some concrete, they found PVC joints that were not glued properly and were leaking.
Mr. Merendino is suing the company and five other firms, claiming that the construction of his pool was negligent and that the companies operated by deceptive trade practices.
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Senate’s Fannie Mae Wind-Down Plan Faces High Hurdles
March 19, 2014 —
Clea Benson, Cheyenne Hopkins and Kathleen Hunter – BloombergA bipartisan U.S. Senate plan to dismantle Fannie Mae (FNMA) and Freddie Mac must clear many political hurdles in a short time if it is to become law, leaving narrow chances of a housing-finance overhaul being enacted this year.
Senate Banking Committee leaders said the proposal, which they plan to release later this week, would replace the two U.S.-owned mortgage financiers with government bond insurance that would kick in only after private capital suffered severe losses.
It will be left to the courts to decide how investors in Fannie Mae and Freddie Mac are treated as the two companies are wound down, Mike Crapo, an Idaho Republican who co-wrote the bill, said today in an interview on Bloomberg Television. Investors including Perry Capital and Fairholme Capital Management are suing the U.S. to challenge an arrangement in which all the companies’ profits go to the Treasury.
Ms. Benson may be contacted at cbenson20@bloomberg.net; Ms. Hunter may be contacted at khunter9@bloomberg.net; Ms. Hopkins may be contacted at chopkins19@bloomberg.net
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Clea Benson, Cheyenne Hopkins and Kathleen Hunter, Bloomberg
New York State Trial Court Addresses “Trigger of Coverage” for Asbestos Claims and Other Coverage Issues
January 21, 2019 —
Paul Briganti - White and WilliamsOn November 21, 2018, the New York Supreme Court, Onondaga County, issued a summary-judgment ruling on a number of coverage issues arising from asbestos-related bodily injury claims against plaintiffs Carrier Corporation (Carrier) and Elliott Company (Elliott). See Carrier Corp., et al. v. Travelers Indem. Co., et al., Index No. 2005-EG-7032 (N.Y. Sup. Ct. Nov. 21, 2018).
First, the court held that under New York’s “injury in fact trigger of coverage,” injury occurs from the first date of exposure to asbestos through death or the filing of suit. The court primarily relied on: (1) New York federal court decisions and the Delaware Supreme Court’s decision in In re Viking Pump, Inc., 148 A.3d 633 (Del. 2016) holding that injury continues from first exposure through death or the assertion of a claim; and (2) medical and scientific evidence that the plaintiffs had submitted in support of their motion. The court specifically declined to follow Continental Cas. v. Wausau, 60 A.D.3d 128 (1st Dep’t 2008) (Keasbey), in which the New York Appellate Division found a question of fact whether injury occurs from exposure to asbestos through manifestation and that summary judgment was therefore inappropriate. The Carrier court stated that Keasbey was distinguishable because it “involved operations coverage, a non-product claim, and thus the [Keasbey] Court required a more stringent proof of injury in fact than is necessary here, in a products case.” Carrier, op. at 8. The Carrier court was also dismissive of affidavits offered by the defendant-insurer’s medical experts, finding that the affidavits did not create an issue of fact. See Op. at 2-9.
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Paul Briganti, White and WilliamsMr. Briganti may be contacted at
brigantip@whiteandwilliams.com
Mediation Confidentiality Bars Malpractice Claim but for How Long?
April 01, 2015 —
Jennifer K. Saunders – Haight Brown & Bonesteel LLPThe California Court of Appeal yesterday upheld application of the mediation confidentiality statutes to bar a malpractice action which was based on the attorneys’ actions during mediation. John Amis vs. Greenberg Traurig LLP, et al. (3/18/15) Court of Appeal, Second Appellate District, No. B248447. Inferences about the attorneys’ conduct during mediation were also determined to be unusable in an attempt to circumvent the privilege.
Plaintiff, John Amis, filed an action against his former attorneys, Greenberg Traurig, alleging they were negligent by “causing” him to execute a settlement agreement during a two-day mediation which converted a corporate obligation into a personal obligation. The causes of action included breach of fiduciary duty, malpractice and breach of a conflict waiver, in support of which Amis alleged that the attorneys failed to advise him of the risk involved in entering into the settlement agreement, “drafted, structured and caused it to be executed” during mediation and breached a conflict waiver by failing to negotiate a settlement that provided him with financial security. During plaintiff’s deposition he admitted that all of the advice he had received in connection with the settlement agreement occurred during mediation and that all the damages incurred were from his execution of that agreement during mediation. Greenberg Traurig filed a motion for summary judgment based upon plaintiff’s deposition admissions and argued that since the mediation confidentiality statutes barred each side from presenting testimony as to what occurred during mediation, the plaintiff could not establish the elements of his claims and they could not defend against those allegations. The trial court agreed with the defense, granting summary judgment.
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Jennifer K. Saunders, Haight Brown & Bonesteel LLPMs. Saunders may be contacted at
jsaunders@hbblaw.com
Insured Cannot Sue to Challenge Binding Appraisal Decision
December 16, 2023 —
Tred R. Eyerly - Insurance Law HawaiiThe court dismissed the insured condominium association's challenge to an appraisal award. The Courtyards at Prairie Fields Condominium Association v. West Band Mut. Ins. Co., 2023 U.S. Dist. LEXIS 169458 (N. D. Ill. Sept. 22, 2023).
In July 2020, the insured filed a claim with West Bend for damage to the property's roof and other building components as a result of wind and hail. West Bend inspected and estimated the replacement cost for the damage was $60,989.54. This amount was paid to the insured minus the $10,000 deductible. The insured believed the damage was so severe that the roofs need to be replaced, which the insured estimated would cost $1,389,600. The insured demanded an appraisal.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Difficulty in Defending Rental Supplier’s Claim Under Credit Application
October 11, 2021 —
David Adelstein - Florida Construction Legal UpdatesIn construction, one of the easiest claims to prove from a burden of proof standpoint is that of a supplier, particularly a rental equipment supplier. Oftentimes, these claims are more in the realm of a collection claim because a rental supplier will generally be able to establish that a party opened an account with them, signed a credit application and personal guaranty, and equipment was rented and even delivered to a specific jobsite during set dates. Defending these claims is not so easy. And even if there is a defense as it relates to some amounts, there needs to be an upside challenging those amounts when factoring in the attorney’s fees, costs, and interest on the other amounts and on continuing the dispute.
An example of the difficulty in defending these claims from rental suppliers can be found in the recent case of Custom Design Expo, Inc. v. Synergy Rents, Inc., 2021 WL 4125806 (Fla. 2d DCA 2021). Here, a contractor rented equipment (e.g, forklifts) from a supplier. The equipment was rented on an open account and the contractor signed a personal guaranty. The supplier sued the contractor for about $81,000 that remained unpaid. The supplier appeared to waste no time and moved for summary judgment with an affidavit from its credit manager. The credit manager affirmed that the contractor executed a credit application for purposes of renting equipment on an open account, the application contained a personal guaranty, and the credit application formed the basis of a contract. The credit manager authenticated the credit application and affirmed that the contractor owed it about $81,000 in unpaid amounts for rental equipment that was furnished under the credit application.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
When to Withhold Retention Payments on Private or Public Projects
August 29, 2018 —
Nicholas Karkazis - Gordon & Rees Construction Law BlogTo ensure that construction contractors and subcontractors receive timely progress and retention payments, the California Legislature enacted statutes that impose deadlines and penalties on owners and direct (general) contractors who delay payments. (Cal. Civ. Code, §§ 8800, 8802, 8812, 8814; Pub. Contract Code, §§ 7107, 10262.5; Bus. & Prof. Code, § 7108.5.) However, there is an exception to these deadlines and penalties on both private and public projects. The exception allows an owner or direct contractor to withhold payment1 when there is a good faith dispute between an owner and a direct contractor or between a direct contractor and a subcontractor. (Civ. Code, §§ 8800, subd. (b), 8802, subd. (b), 8812, subd. (c), 8814, subd. (c); Pub. Contract Code, §§ 7107, subds. (c), (e), 10262.5, subd. (a); Bus. & Prof. Code, § 7108.5, subd. (a).)
But the term “good faith dispute” has been a source of confusion where direct contractors owe subcontractors retention payments, but want to withhold the payment because of a dispute.2 California appellate courts were split, with one court finding that any type of bona fide dispute justified withholding, and another finding that only disputes related to the payment itself justified withholding. (Compare Martin Brothers Construction, Inc. v. Thompson Pacific Construction, Inc. (2009) 179 Cal.App.4th 1401 [any bona fide dispute could justify withholding] with East West Bank v. Rio School Dist. (2015) 235 Cal.App.4th 742 [disputes related to the payment itself may justify withholding].) In May 2018, the California Supreme Court clarified that for a direct contractor to withhold a retention payment on a private project, the good faith dispute must somehow relate to the payment itself. (United Riggers & Erectors, Inc. v. Coast Iron & Steel Co. (2018) 4 Cal.5th 1082, 1097-1098.)
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Nicholas Karkazis, Gordon & Rees Scully MansukhaniMr. Karkazis may be contacted at
nkarkazis@grsm.com
California Federal Court Finds a Breach of Contract Exclusion in a CGL Policy Bars All Coverage for a Construction Defect Action
July 19, 2021 —
Robert Dennison - Traub LiebermanThe Southern District of California published a decision in May 2021 in Associated Industries Ins. Co. v. Mt. Hawley Ins. Co., 2021 WL 1921016 (S.D. Cal. 5/12/21) concerning the scope of a breach of contract exclusion in a general liability insurance policy as applied to a construction defect action.
The suit was filed by Associated Industries Insurance Company against Mt. Hawley Insurance Company for equitable contribution for amounts spent to defend and indemnify the parties co-insured, referred to as JGCI in the decision. JGCI agreed to build a building for a third party pursuant to a written construction contract. The City of Davis issued a certificate of occupancy for the building on May 6, 2005. The City’s permits stated the building was final on that date. Mt. Hawley issued the first of several annual general liability insurance policies in September 2005.
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Robert Dennison, Traub LiebermanMr. Dennison may be contacted at
rdennison@tlsslaw.com
