Supreme Court Grants Petition for Review Regarding Necessary Parties in Lien Foreclosure Actions
August 17, 2017 —
Lindsay K. Taft - Ahlers & Cressman PLLCFor several years, the requirements for which parties must be named in a lien foreclosure action when a release of lien bond is in place have been cloudy. RCW 60.04 et seq., the “mechanics’ lien” or “construction lien” statute, provides protection for a party or person who provides labor, materials, or equipment to a construction project. That person or party, if not paid, can file a lien against the construction project property to secure recovery. As the lien impacts the property by “clouding title” and could potentially result in foreclosure of the property, the statute sets forth strict requirements with respect to timing, notice, and parties. For example, the lien must be recorded within 90 days of the person or party’s last day of work or materials or equipment supplied, and the lien claimant must then give a copy of the claim of lien to the owner or reputed owner within 14 days of the lien recording. RCW 60.04.081.
The statute also allows a property owner or other party to “free” the property from the lien prior to the claim being resolved by issuing a release of lien bond. While the claim is still in dispute, the lien then attaches to the bond and not the property. The same rules about foreclosure, however, still apply but not without some confusion.
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Lindsay K. Taft, Ahlers & Cressman PLLCMs. Taft may be contacted at
ltaft@ac-lawyers.com
Firm Announces Remediation of Defective Drywall
October 16, 2013 —
CDJ STAFFThe residents of Villa Lago at Renaissance Commons will be relieved of their problems with defective Chinese drywall, according to an announcement from their legal counsel, Whitfield Bryson & Mason. Gary E. Mason, a founding member of the firm, announced to homeowners that remediation would begin on November 1. “The project will start with about 30 units on the top floor and will continue floor by floor for the next 12 months.” Residents will be moved out of their units for about three months while all drywall is removed and replaced.
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Unfinished Building Projects Litter Miami
November 18, 2011 —
CDJ STAFFBuildings born in ambitious development plans that were never brought to completion form a grim reminder of the building bust in Miami, according to an article in the Miami Herald. One project started in 2007 as a residential project, later there were hopes to develop it as a hotel. These plans are ten months old with no work done.
Another project was projected as a 30-story office and commercial tower. Four were built before the project was abandoned. The article describes the site as “squalid.” Another project completed the planned 17 stories, but no work has been done beyond constructing the shell. Once planned as luxury condos, the owner owes more than $30,000 in property taxes.
Each of the three sites profiled in the Miami Herald have become dumping grounds for trash. The building skeletons have also become damaged by the elements. Some abandoned projects have been taken over by homeless people. Businesses near the abandoned properties have been hurt. The buildings also represent failed obligations to subcontractors who have put liens on the properties for work they performed but were never paid for.
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As Evidence Grows, Regions Prepare for Sea Level Rise
July 02, 2018 —
Pam Radtke Russell - Engineering News RecordCities, states and regions are taking steps to prepare their buildings, infrastructure and homes for the impacts of climate change as bad news continues to mount about rising sea levels.
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Pam Radtke Russell, ENRMs. Russell may be contacted at
Russellp@bnpmedia.com
Construction and AI: What Contractors Need to Know from ABC’s New Report
November 05, 2024 —
Aarni Heiskanen - AEC BusinessThe Associated Builders and Contractors (ABC) has just released its fourth annual construction
technology report, which dives deep into AI’s evolving role in the construction industry.
“ABC contractor members and the overall contracting community want more information on AI and how it can help them improve safety, quality and profitability—and win more work,” said Matt Abeles, ABC vice president of construction technology and innovation. The newly released ABC AI Tech Report delivers on this need, highlighting AI-driven case studies, resources, and thought leadership from ABC’s Tech Alliance.
Understanding AI’s Role in Construction
The report provides a comprehensive AI Resource Guide, breaking down the basics of artificial intelligence and how it applies to construction. Understanding AI is key for contractors to stay competitive in the rapidly changing industry.
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Aarni Heiskanen, AEC BusinessMr. Heiskanen may be contacted at
aec-business@aepartners.fi
Zombie Foreclosures Plaguing Various Cities in the U.S.
July 16, 2014 —
Beverley BevenFlorez-CDJ STAFFMany homeowners are simply abandoning their homes before banks have completed the foreclosure process, according to USA Today. Banks are not always in a hurry to take ownership of property, and often will wait until they are ready to dispose of it before doing so:
“There are two primary things that can factor into their decision," Eric Eckardt, vice president and general manager of Hubzu.com, told the Mail Tribune. "One, they may have a surplus of REO properties they're trying to move off the balance sheet. The second is, costs associated with foreclosure may be greater than the value. At the end of the day, it's really a case-by-case matter.”
USA Today reported that “[t]he length of the entire foreclosure process is a major contributor to vacancy rates because homeowners are more likely to give up on their homes the longer they have to wait for a resolution.”
These abandoned homes may have a negative impact on sales of neighboring homes, according to the Mail Tribune. Gary Poulos, a retired Harry & David systems engineer, lives next door to a ‘zombie foreclosure,’ and spent a year trying to get maintenance work completed on the neighboring property so that he could be in a position to sell his own. He created a blog about his experience (myneighborchasebank.blogspot.com).
Big Builder analyzed May 2014 data from CoreLogic, and identified the five states with the highest foreclosure inventory: New Jersey, Florida, New York, Hawaii, and Maine. While the five states with the lowest foreclosure inventory were Alaska, Nebraska, North Dakota, Wyoming, and Minnesota.
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Prospective Additional Insureds May Be Obligated to Arbitrate Coverage Disputes
September 07, 2020 —
Danielle S. Ward - Balestreri Potocki & HolmesThe Court of Appeal closed out 2019 by ruling that an additional insured can be bound to the arbitration clause in a policy when a coverage dispute arises between that additional insured and the carrier. (Philadelphia Indemnity Ins. Co. v. SMG Holdings, Inc. (2019) 44 Cal. App. 5th 834, 837.)
In 2009, Future Farmers of America (“Future Farmers”) entered into a license agreement with SMG Holdings Incorporated (“SMG”) to use the Fresno Convention Center. As part of the agreement, Future Farmers was required to secure comprehensive general liability (“CGL”) coverage and name SMG and the City of Fresno as additional insureds (“AI”) on its policies.
Future Farmers purchased a general liability policy from Plaintiff Philadelphia Indemnity Insurance Company (“Philadelphia”). Neither SMG nor the City of Fresno were added as AIs, but the policy contained a “deluxe endorsement” which extended coverage to lessors of premises for “liability arising out of the ownership, maintenance or use of that part of the premises leased or rented” to the named insured. The policy also contained an endorsement that extended coverage where required by a written contract for liability due to the negligence of the named insured. Philadelphia’s policy also stated that if the insurance company and insured “do not agree whether coverage is provided . . . for a claim made against the insured, then either party may make a written demand for arbitration.”
A patron to Future Farmer’s event at the Fresno Convention Center was seriously injured after he tripped over a pothole in the parking lot and hit his head. He sued both Fresno and SMG. In turn, Fresno and SMG tendered their defense to Philadelphia. Philadelphia denied coverage finding that the incident did not arise out of Future Farmer’s negligence, and that SMG had the sole responsibility for maintaining the parking lot. Consequently, Philadelphia concluded that neither Fresno nor SMG qualified “as an additional insured under the policy” for the injury in the parking lot.
The coverage dispute continued, and in 2016, Philadelphia issued a demand for arbitration which was rejected by SMG. Philadelphia then petitioned the state court to compel arbitration arguing that SMG could not avoid the burdens of the policy while seeking to obtain policy benefits. SMG used Philadelphia’s conclusion that it did not qualify as an AI under the policy to argue that Philadelphia was “estopped from demanding arbitration”. In other words, SMG argued that it could not be held to the burdens of the policy without being provided with the benefits of the policy.
The trial court sided with SMG finding that there was no arbitration agreement between the parties. The court noted that while third party beneficiaries can be compelled to arbitration there was no evidence that applied here, and Philadelphia could not maintain its inconsistent positions on the policy as its respects SMG.
Disagreeing with the trial court, the Court of Appeal concluded that SMG was a third-party beneficiary of the policy. The AI obligations in the license agreement and the deluxe endorsement in the Philadelphia policy collectively establish an intended beneficiary status. The Court saw SMG’s tender to Philadelphia as an acknowledgement of that status.
Relatedly, the Court found that SMG’s tender to Philadelphia – its demand for policy benefits – equitably estopped them from avoiding the burdens of the policy. The Court stated it defied logic to require a named insured to arbitrate coverage disputes but free an unnamed insured demanding policy coverage from the same requirement. Conversely, the Court found no inconsistency in Philadelphia’s denial of coverage to SMG and its subsequent demand for arbitration. Philadelphia did not outright reject SMG’s status as a potential insured, but rather concluded that there was no coverage because the injury occurred in the parking lot. In other words, the coverage determination turned on the circumstances of the injury not SMG’s status under the policy.
In short, the Court concluded that the potential insured takes the good with the bad. If one seeks to claim coverage as an additional insured, they can be subject to the restrictions of the policy including arbitration clauses even if they did not purchase the policy.
Securing additional insurance has become increasingly more difficult and limited over the years, and this holding presents yet another hurdle to attaining AI coverage. For those seeking coverage, it is important to note that the Court’s ruling may have turned out differently had the carrier outright denied SMG’s AI status, rather than concluding that the injury was not covered.
Your insurance scenario may vary from the case discussed above. Please contact legal counsel before making any decisions. BPH’s attorneys can be reached via email to answer your questions.
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Danielle S. Ward, Balestreri Potocki & HolmesMs. Ward may be contacted at
dward@bph-law.com
Ex-San Francisco DPW Director Sentenced to Seven Years in Corruption Case
September 26, 2022 —
James Leggate - Engineering News-RecordA federal judge sentenced Mohammed Nuru, the former San Francisco public works director, to seven years in prison for bribery and kickbacks.
Nuru, 59, pleaded guilty to the charge of defrauding the public of its right to honest services earlier this year amid a federal investigation into public corruption in San Francisco’s government.
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James Leggate, Engineering News-Record
Mr. Leggate may be contacted at leggatej@enr.com
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