Settlement Reached in California Animal Shelter Construction Defect Case
May 13, 2014 —
Beverley BevenFlorez-CDJ STAFFA construction defect case involving an animal shelter in Healdsburg, California has settled after two years of litigation, according to The Press Democrat. The $3.5 million, 7,500-square foot building had been “built largely with a behest from the estate of the late vintner Rodney Strong and his wife, Charlotte.” However, “shortly before the facility could be completed in late 2011, general contractor Syd Kelly went bankrupt. Unpaid sub-contractors filed liens for payment against the Healdsburg Animal Shelter, which in turn alleged construction and design defects in the building.”
The Press Democrat reported that “[t]he most visible signs of problems were cracks in the cement foundation.” Robert Wilkie, the Healdsburg Animal Shelter board’s secretary-treasurer, stated that the shelter is “perfectly structurally viable and a rather attractive building” and that “the defects that make it not usable today can be mitigated in a variety of different ways.”
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Florida Court of Appeals Rejects Insurer’s Attempt to Intervene in Underlying Lawsuit to Submit Special Interrogatories
October 09, 2018 —
Jeremy Macklin - TLSS Insurance Law BlogOn August 10, 2018, the Florida Court of Appeals for the Second District upheld a trial court’s dismissal of an insurance company’s intervention in a tort lawsuit brought against its insured for the purposes of submitting special interrogatories and verdict forms.
In Houston Specialty Ins. Co. v. Vaughn, 2018 Fla. App. LEXIS 11197, 2018 WL 3795785 (Fla. 2d DCA Aug. 10, 2018), the insured, All Florida Weatherproofing and Construction, Inc. (“All Florida”) provided pressure washing, roof coating, and other roof-related services. Houston Specialty issued a general liability policy to All Florida. In 2012, a worker fell off a roof while applying protective coating on behalf of All Florida. The worker and his family sued All Florida in connection with the worker’s injuries.
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Jeremy Macklin, Traub Lieberman Straus & Shrewsberry LLPMr. Macklin may be contacted at
jmacklin@tlsslaw.com
A Word to the Wise: The AIA Revised Contract Documents Could Lead to New and Unanticipated Risks - Part II
October 16, 2018 —
George Talarico - Construction ExecutivePart I addressed general conditions, revised insurance terms, revisions that affect owner’s required insurance and revisions that affect contractor’s required insurance.
REVISIONS THAT AFFECT DISPUTE RESOLUTION
A seemingly minor but noteworthy change is to the definition of “Claim.” Under Section 15.1 a “Claim” is defined to:
- include a request for a modification of contract time; and
- exclude any requirement that an owner must file a claim to impose liquidated damages.
Notably, any request relating to contract time must be brought within the specified time period for Notice of Claim and in the prescribed manner. There are at least two traps for the unwary. First, even though email is regularly used for communications among the parties, the revised contract documents do not recognize email as an acceptable form of delivery of a Notice of Claim. Second, an unwary contractor may wrongly assume that an owner’s failure to assert a claim for LDs means that LDs will not be imposed. This may lull the contractor into failing to timely assert its own claim for a time extension and thereby waiving its ability to do so.
Reprinted courtesy of
George Talarico, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Mr. Talarico may be contacted at
gtalarico@sillscummis.com
Going Digital in 2019: The Latest Technology for a Bright Future in Construction
February 18, 2019 —
Jim Romeo - Construction ExecutiveThe spectrum of technology available to today’s contractors is wide and deep. This techno-ecosystem will change just about every operational tick and tock needed to build world-class projects—from where and how people work to what equipment they use and how they record payments.
“Generally speaking, the use of technology in construction is surging, particularly in the past three to five years,” says Chris Amato, principal and national advisory leader for the Chicago-based management consultancy Grant Thornton. “It’s becoming the cost of doing business; every player, at some point or another, is going to need to embrace it to some degree. The key questions are where to start, where to invest and how to minimize risk.”
Reprinted courtesy of
Jim Romeo, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Insurance Law Client Alert: California Appeals Court Refuses to Apply Professional Services Exclusion to Products-Completed Operations Loss
March 19, 2014 —
Valerie A. Moore and Chris Kendrick - Haight Brown & Bonesteel LLPIn North Counties Engineering v. State Farm (No. A133713, filed 3/13/14), State Farm insured an engineering company under CGL insurance that had a professional services exclusion and included products-completed operations (PCO) coverage. The owner of the engineering company, NCE, contracted with a winery to construct a dam and associated works. Also on the project was the owner's son, who had his own construction company, NCD. There were multiple contracts, both oral and written, variously naming one company or the other. The evidence later showed that the father performed hands-on work for the project.
After completion, the winery was sued over sediment and erosion caused by the dam. State Farm denied coverage on the ground that the professional services exclusion applied, as well as a mistaken belief that the policy had no PCO coverage. State Farm then changed its position and agreed to defend, but only going forward. The insured sued State Farm over past defense fees, alleging breach of contract and bad faith. The case went to trial and after testimony detailing State Farm's claim handling, the trial judge granted a nonsuit, finding that the professional services exclusion barred all coverage:
"[I]f you look at the pleadings, the legal pleadings and the contracts, the NCE role is, as the engineering company, the support company, and that company was overseeing the [sic] NCD to make sure that whatever they did was done right.... NCE is the expert on the job, the professional providing professional services, design and construction, and also overseeing the work of NCD, the son’s business, which is doing more of the physical activity.... That takes professional expertise and I think all of what Mr. Akerstrom did was professional.... It was this professional work, and not 'something incidental to their professional involvement' that gave rise to the underlying actions. In this situation, it’s not a malpractice or E and O policy. It’s a business policy, which has good benefits, but is subject to the professional services exclusion."
Reprinted courtesy of
Valerie A. Moore and
Chris Kendrick of Haight Brown & Bonesteel LLP
Ms. Moore may be contacted at vmoore@hbblaw.com; Mr. Kendrick may be contacted at ckendrick@hbblaw.com
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Disappearing Data: Avoid Losing Electronic Information to Avoid Losing the Case
February 01, 2022 —
Daniel C. Wennogle & Jennifer Knight Lang - Construction ExecutiveIt happens: A contractor on a delayed project ends up in litigation over liquidated damages, but the key communications regarding delays and approvals were sent and received by the project manager on a mobile device using text messages and personal email accounts. Unfortunately, the project manager left the company a year ago on bad terms and has changed phones. The information that would serve to mitigate the contractor’s liability has disappeared. With better awareness and policies for capturing and managing electronic information, this is avoidable.
Proactive and effective management of electronically stored information on construction projects can not only reduce costs and discovery disputes should litigation arise but can also provide critical evidence in reducing liability exposure in such disputes. The Federal Rules of Civil Procedure (as well as most state rules, which often mirror federal rules), provide for sanctions if a party fails to preserve electronically stored information (ESI) that should have been preserved in anticipation of litigation but is lost due to the failure to take reasonable steps to preserve it.
Even in arbitration, where discovery and disclosure obligations are often more limited than in the court setting, preservation of ESI can help strengthen claims and defenses, avoiding accusations of spoliation that can derail a case. Arbitrators can also fashion appropriate sanctions for destruction of relevant evidence, not to mention the impact that apparent spoliation can have on a party’s credibility.
Reprinted courtesy of
Daniel C. Wennogle & Jennifer Knight Lang, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
Ms. Lang may be contacted at jennifer.lang@moyewhite.com
Mr. Wennogle may be contacted at daniel.wennogle@moyewhite.com
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There's No Such Thing as a Free House
April 01, 2015 —
Megan McArdle – BloombergShould people be able to get a free house by refusing to pay their mortgage?
That's the question Florida has to answer. The housing crisis is over, and the housing market is healing itself, though slowly in some places. But a backlog of foreclosures still remains ... and it has been going on so long that some homes are now past the statute of limitations for collecting debt. Lawyers for the homeowners are arguing that this means they get to keep the house. Lawyers for the banks are, unsurprisingly, arguing that each month they fail to pay the mortgage payment starts the statutory clock anew.
Both arguments create problems if the courts endorse them. If failing to pay really restarted the clock every month, then there wouldn't be a statute of limitations on debt -- creditors could just keep sending you bills forever and dun you right up to the edge of your grave. There's a very good reason that we have statutes of limitations on most crimes and most debts: The law recognizes that our interests in justice and contract rights must be balanced against other considerations. People need to be able to plan their lives without decades-old problems coming back to bite them, and also, as cases age, they get harder and harder to prove as witnesses die, evidence gets lost and memories fade.
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Megan McArdle, BloombergMs. McArdle may be contacted at
mmcardle3@bloomberg.net
COVID-19 Business Interruption Claims Four Years Later: What Have We Learned?
September 23, 2024 —
Patrick McKnight - The Dispute ResolverFour and half years ago the COVID-19 pandemic spread around the globe, bringing with it interesting, but challenging, legal problems for construction attorneys. Construction projects ground to a halt. Ever-changing guidance from authorities ranging from the U.S. Department of Labor to local health authorities resulted in a web of evolving obligations for general contractors and subs alike. One of the most closely watched legal questions was the wave of business interruption claims filed by plaintiffs, many of whom owned businesses impacted by government shutdowns. During the opening months of the pandemic, I
noted that hundreds of business interruption claims had been filed by insureds across the country. At that time, the only thing certain was that although the outcome remained unknown, virus exclusions were likely to become more likely in the future. Needless to say, much has happened since early 2020.
What does the data say about the outcome of business interruption claims?
In sum, plaintiffs have had an uphill battle. A helpful resource for analyzing the outcome of business interruption suits is the
Covid Coverage Litigation Tracker (“Tracker”), an insurance law analytics tool offered by Penn Carey Law of the University of Pennsylvania. According to its website, “[t]he Covid Coverage Litigation Tracker is a multi-sourced database and dashboard through which to view the unfolding insurance litigation arising out of the pandemic in federal and state courts. Widely cited in briefs, judicial opinions, and the press, the tracker also serves as a proof of concept for new methods to identify, track, and understand emerging case congregations in real time.”
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Patrick McKnight, Fox Rothschild LLPMr. McKnight may be contacted at
pmcknight@foxrothschild.com
