Seattle Washington Building Expert Directory

UK Construction Defect Suit Lost over One Word

October 16, 2013 — CDJ STAFF
In the UK, be careful what you tell your insurer; the Court of Appeal has upheld the legality of basis clauses. As Paul Lewis and Janetta Gibbs of Herbert Smith Freehills LLP explain, “a basis clause is a provision set out in the proposal form or in the insurance contract itself, to the effect that all or any of the answers to the questions in the proposal shall form the basis of the contract of insurance.” The catch, as they point out, is that “should any of those answers — whether material to the risk or not — prove to be untrue, the insurer may repudiate the policy and treat itself as never having been on risk.” There is a move in the UK to abolish the use of basis clauses in business insurance, but currently they are still legal. This came up in a construction defect case covering latent defects in a public housing project. The contract between the owner, Genesis Housing Association Limited, and the contractor, Time and Tide (Bedford) Ltd, required TT Bedford to indemnify Genesis if it became insolvent. In the contract with the insurer, representatives of Bedford and Genesis referred to the contractor as “TT Construction.” While the courts concluded that Bedford and Genesis were not guilty of misrepresentation or intent to defraud, they did note that neither party thought the firm’s name was “TT Construction.” Therefore, over the failure to name the builder correctly, the court found that the insurance contract was invalid. Read the court decision
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The Leaning Tower of San Francisco

January 24, 2018 — Dave Suggs - CDJ STAFF
The Millennium Tower located at 301 Mission Street in San Francisco, California opened in 2009 and is fifty-eight stories high. It is comprised of expensive apartments with price tags in the millions. “Yet for all its curb appeal, the building has, quite literally one fundamental problem: it’s sinking into mud and tilting towards its neighbors” reports John Wetheim of CBS News in the 60 Minutes segment about the condition of the tower “San Francisco’s Leaning Tower of Lawsuits.” In the Tower’s basement along columns that protrude from the foundation of the building there are stress gauges lining the walls illustrating cracks with slow growth which is cause for concern. The tower is tilting a total of 14 inches toward the northwest and has sunk 17 inches so far. Petar Marinkovic, an engineer for the European Space Agency estimates that the tower is sinking 1.5 to 2 inches per year. Jerry Cauthen, a local engineer, weighs in on what he believes is the cause of the sinking and leaning; it was built from concrete instead of steel. “Concrete is often cheaper. And it’s just as good, but it is a lot heavier. And so you got to design your foundation and your sub-surface to support that higher weight.” A local geotechnical engineer, Larry Karp agrees stating that the foundation of a building of this size and weight should be on solid rock (bedrock). The Millennium Tower is sitting on layers debris from the 1906 earthquake, a gold rush landfill, as well as clay, mud, and sand. There over 20 parties involved in the Millennium Tower lawsuits so far. Solutions to “fix” the tower’s issues range from removing 20 stories from the top of the building to perpetually freezing the ground beneath the building. There are also ongoing mediation talks to determine the feasibility of drilling down to bedrock under a building where a thousand residents are still upstairs. Read the court decision
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Sustainability Is an Ever-Increasing Issue in Development

November 21, 2022 — Scott L. Baker - Los Angeles Litigation Blog
Businesses must be open to change. It is essential to survive in the business world, regardless of the industry. This goes hand-in-hand with the necessity to change along with consumer needs and values as well. With the increasing emphasis on sustainability across industries, many businesses have had to make their processes and products more environmentally friendly. However, in terms of real estate construction, there are some challenges. SUSTAINABILITY IN NEW CONSTRUCTION IS NOW A MATTER OF LAW – NOT JUST A PREFERENCE The push to become greener comes from many fronts. Property owners, potential buyers and even lawmakers all expect the real estate industry to go greener. For example, homeowners and businesses often want their properties to meet their personal values of sustainability. Read the court decision
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Reprinted courtesy of Scott L. Baker, Baker & Associates
Mr. Baker may be contacted at slb@bakerslaw.com

Ortega Outbids Pros to Build $10 Billion Property Empire

March 19, 2014 — Jesse Drucker – Bloomberg
Amancio Ortega Gaona, already the world’s fourth-richest person based on the success of his Zara fashion retail stores, has quietly amassed a real estate empire worth as much as $10 billion and is emerging as a formidable competitor for prime properties from London to Beverly Hills. Relying on all-cash offers, he has outbid the world’s biggest institutional funds and professional property investors, such as Tishman Speyer Properties LP. “He’s at the very highest levels of high net worth investment and competing with some of the biggest sovereign wealth funds for the primest properties in the market,” said Joseph Kelly, director of market analysis for Real Capital Analytics in London, a real estate research firm. Read the court decision
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Reprinted courtesy of Jesse Drucker, Bloomberg
Mr. Drucker may be contacted at jdrucker4@bloomberg.net

California Fire Lawyers File Suit Against PG&E on Behalf of More Than 50 Wildfire Victims

November 15, 2017 — David Suggs – Bert L. Howe & Associates, Inc.
Digital Journal reports that the California fire lawyers are comprised of four law firms, Baron & Budd, Singleton Law Firm, Dixon Diab & Chambers LLP, and Thornes Bartolotta McGuire. These firms filed suit against PG&E (Pacific Gas and Electric Company) on October 27th alleging that the brutal wildfires that swept through Northern California started when electrical infrastructure encountered vegetation. According to Digital Journal, more than 50 plaintiffs are being represented in this case who endured damages including “wrongful death, personal injuries, damage to or destruction of property, loss of cherished possessions, medical bills, evacuation expenses and lost wages.” John Fiske, an attorney at Baron & Budd stated, “through our team’s investigation to date, we believe that PG&E may have played a role in causing these fires.” Holding PG&E accountable for the 40 people killed, 8,400 structures destroyed, and 210,000 acres burned is their goal. Read the court decision
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Subcontractor Strikes Out in its Claims Against Federal Government

July 08, 2024 — David Adelstein - Florida Construction Legal Updates
Is it a good idea for a subcontractor to sue the federal government? A recent case would suggest NO–way too many huge hurdles for the subcontractor to overcome. No matter how creative the arguments may be, it’s a high mountain to climb. In Fox Logistics & Construction Co. v. U.S., 2024 WL 2807677 (Fed.Cl. 2024), a subcontractor sued the federal government when it was not paid by the prime contractor. The subcontractor claimed it was a third-party beneficiary under the government’s modifications to the prime contractor’s payment procedure, or alternatively it had an implied-in-fact contract with the government. The Court of Federal Claims granted summary judgment in favor of the government. The subcontractor, while creative, struck out in its claims based on the hurdles in a subcontractor suing the federal government. This case involved upgrading an air force base. The subcontractor performed most of the work. The prime contractor had cash flow problems and did not pay the subcontractor. The government got involved to enforce provisions of its contract to force the prime contractor to pay subcontractors and even modified the payment procedure by having future payments to the prime contractor deposited into a new bank account that government could monitor. This ultimately did not work, and the prime contractor filed for bankruptcy. The subcontractor claimed it was owed millions–apparently, it was not able to recover the money through the prime contractor’s bankruptcy—and pursued claims against the federal government in an effort to recover money it was owed. Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

Recent Statutory Changes Cap Retainage on Applicable Construction Projects

March 11, 2024 — Patrick McKnight - The Dispute Resolver
Recent reforms to certain state retainage laws have reduced the lawful amount of withholding permitted on construction projects. In theory, retainage allows an owner to mitigate the risk of incomplete or defective work by withholding a certain portion of payment until the construction project is substantially complete. Recent statutory developments in Washington, New York, and Georgia represent significant changes in how much an owner may retain on applicable construction projects in those jurisdictions. The details of each state’s retainage laws vary in many important respects. Most states set caps at 5% or 10%, with important variations depending on the type of project and the amount of progress completed. Some states require retainage to be held in an escrow account, but most do not. Many federal construction projects allow up to 10% retainage, while other federal agencies do not require any retention. See 48 CFR § 52.232-5(e) - Payments Under Fixed-Price Construction Contracts. The ongoing motivation for retainage reform is typically framed in terms of reducing delays in getting payment to subcontractors who complete their scope of work on time and free from defects. Read the court decision
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Reprinted courtesy of Patrick McKnight, Fox Rothschild LLP
Mr. McKnight may be contacted at pmcknight@foxrothschild.com

NYC Landlord Accused of Skirting Law With Rent-Free Months Offer

October 15, 2024 — Natalie Wong - Bloomberg
The opening of Tower 28, one of the tallest residential towers in New York City outside Manhattan, brought rent-stabilized units to Long Island City roughly seven years ago, adding affordable listings to a neighborhood where soaring prices were increasingly squeezing out many renters. Now, three tenants at the 58-story building have filed a class-action lawsuit alleging the landlord sought to evade New York City rent regulations in order to raise prices even higher over time. The lawsuit against the limited liability company tied to 42-12 28th St. in Queens claims that the property owner recorded initial rents with the New York State Division of Housing and Community Renewal that were higher than what the first tenant was actually charged and paid. In doing so, any future rent increases were based off a higher figure, according to the lawsuit. Read the court decision
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Reprinted courtesy of Natalie Wong, Bloomberg

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