Fairfield Connecticut Building Expert Directory

California Expands on Scope of Coverage for Soft Cost Claims

February 14, 2023 — Caitlin N. Rabiyan - Saxe Doernberger & Vita, P.C.
The California federal district court case of KB Home v. Illinois Union Insurance Co., No. 8:20-cv-00278-JLS-JDE, (C.D. Cal. August 23, 2022), provides much needed guidance for cases involving builder's risk insurance claims for soft cost coverage. The case stems from damage to several of KB Home’s residential building sites caused by a severe rainstorm in January 2017. Each home site was a smaller part of a large housing development project. The damage caused significant delay in the completion of some individual home sites, although there was limited evidence of delay to the overall housing development project. As a result, KB Home sought coverage under a builder’s risk policy purchased from Illinois Union for both hard costs and soft costs. “Hard costs” are the costs directly associated with repairing property damage to the sites. Conversely, “soft costs” are indirect expenses associated with project delays caused by such property damage and repair efforts. For example, hard costs would include labor and materials, whereas the soft costs claimed by KB Home included additional real estate taxes, construction loan interest, and advertising and promotional expenses incurred because of the delays. Illinois Union paid the claim for the hard costs, but denied the soft costs claim. KB Home filed suit and Illinois Union eventually filed a motion for summary judgment. Read the court decision
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Reprinted courtesy of Caitlin N. Rabiyan, Saxe Doernberger & Vita, P.C.
Ms. Rabiyan may be contacted at CRabiyan@sdvlaw.com

Performance Bond Primer: Need to Knows and Need to Dos

February 01, 2022 — Rafael Boza - Gravel2Gavel Construction & Real Estate Law Blog
If you are a construction contractor, you deal with performance bonds as part of your business and daily work. They are necessary for almost every project you are participating or will participate in, and, along with other sister bonds, constitute a basic tool to be able to work in construction. However, how much do you really know about this tool? Who in your organization knows how to use it? Are you relying on your insurance broker to procure the bonds? Can your broker competently review the terms of the bond? Are you, as a contractor, relying on the surety to explain and determine what you need for the project—a fox guarding the hen house? To understand how a performance bond works and how to effectively tailor it to your needs, we need to understand the basics. What is a performance bond? Who are the parties to a performance bond? What does performance bond not do? What should be covered under a performance bond? How does a performance bond fit in a company’s overall risk management processes? A clear understanding of these and other basic topics will facilitate operations and reduce the risk of claims. Read the court decision
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Reprinted courtesy of Rafael Boza, Pillsbury
Mr. Boza may be contacted at rafael.boza@pillsburylaw.com

Failing to Pay Prevailing Wages May Have Just Cost You More Than You Thought

April 01, 2015 — Garret Murai – California Construction Law Blog
Mechanics lien claims, payment bond claims, stop payment notice claims, delay claims, defect claims, abandonment claims . . . With the variety of claims unique to construction projects it’s easy to forget that construction disputes are simply a category of business disputes in which broader business-related torts apply. In Roy Allan Slurry Seal, Inc. v. American Asphalt South, Inc., Case No. B255558 (February 20, 2015), the California Court of Appeal for the Second District held for the first time that a second-place bidder on a public works contract may sue a winning bidder – who failed to pay its workers prevailing wages – under the business tort of intentional interference with prospective economic advantage. Read the court decision
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Reprinted courtesy of Garret Murai, Wendel Rosen Black & Dean LLP
Mr. Murai may be contacted at gmurai@wendel.com

Jury Convicts Ciminelli, State Official in Bid-Rig Case

August 14, 2018 — Engineering News-Record
After a four-week trial but with less than two days of deliberation, a Manhattan federal jury convicted Louis Ciminelli, former head of the now-defunct Buffalo, N.Y., contractor LPCiminielli, and Alain Kaloyeros, the fired ex-head of SUNY Polytechnic Institute in Albany, N.Y., of fraud and conspiracy in a scheme to rig bids on a $750-million upstate New York manufacturing project. Read the court decision
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Reprinted courtesy of Engineering News-Record
ENR may be contacted at ENR.com@bnpmedia.com

Living Not So Large: The sprawl of television shows about very small houses

March 12, 2015 — S Jhoanna Robledo – Bloomberg
Vince and Sam are newlywed twentysomethings who’ve been bunking with family for a year. Finally, they’ve saved up enough to buy a palace to call their own. Well, sort of: They want to shrink their footprint and expenses by living in a custom-built, 204-square-foot standalone house in southern New Jersey. It has to have room for gym equipment—they’re fitness buffs—and a study for Sam, who’s in medical school. Even Vince’s adorably headbanded mom isn’t sure how it will all fit. When Vince and Sam first see their new digs under construction, tall and narrow like a top-heavy garage, Vince admits they’re “freaking out on the inside.” So goes a standard episode of Tiny House Nation, the first of a half-dozen miniaturized real estate shows that have recently premiered. “We discovered that for millennials, there was an overriding social trend of extreme downsizing, and we wanted to dig deep into that,” says Gena McCarthy, executive producer of the show, which began airing last year after the Biography Channel morphed into the youth-focused FYI network. Last summer’s first season averaged 257,000 viewers per week, according to Nielsen; this season’s average viewership is up 77 percent, to 465,000. Read the court decision
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Reprinted courtesy of S Jhoanna Robledo, Bloomberg

Traub Lieberman Partner Greg Pennington and Associate Kevin Sullivan Win Summary Judgment Dismissing Homeowner’s Claim that Presented an Issue of First Impression in New Jersey

December 02, 2019 — Gregory S. Pennington & Kevin Sullivan - Traub Lieberman
On July 12, 2019, Traub Lieberman Straus & Shrewsberry LLP’s Gregory S. Pennington and Kevin Sullivan secured summary judgment dismissing a homeowner’s claim for damaged flooring. The claim at issue arose from the homeowners’ attempt to discard their refrigerator. In the process of removing the refrigerator, the homeowners scratched their kitchen and dining room floors. The homeowners made a claim under their homeowners policy for the cost to repair and replace the damaged flooring. Their homeowners’ insurer denied their claim based on a policy exclusion barring coverage for damage consisting of or caused by marring and scratching. When their insurer denied coverage, the homeowners filed suit in the New Jersey Superior Court, Law Division in Bergen County. The case presented the issue of first impression in New Jersey of whether a homeowner’s self-inflicted, but accidental damaging of its own floors was barred by the homeowner’s policy’s marring or scratching exclusion. Greg and Kevin successfully argued that the exclusion applied to bar coverage. Reprinted courtesy of Gregory S. Pennington, Traub Lieberman and Kevin Sullivan, Traub Lieberman Mr. Pennington may be contacted at gpennington@tlsslaw.com Mr. Sullivan may be contacted at ksullivan@tlsslaw.com Read the court decision
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Pacing in Construction Scheduling Disputes

September 14, 2017 — Luke Mecklenburg - Snell & Wilmer Real Estate Litigation Blog
On a high level, construction delay litigation involves sorting out the impacts to the critical project path and determining which party is responsible for those impacts. One of the more difficult elements of this process is determining whether a delay would have occurred regardless of one party’s critical path impact due to a separate, independent impact to the critical path by the other party. For example, a contractor cannot collect delay damages for delays caused by the owner if the contractor itself was causing independent impacts that would have pushed off the completion date anyway. However, the concept of “pacing” provides a potential defense for a party who is not on pace with the as-planned schedule for noncritical activities, even where those activities are still ongoing after the planned completion date. “Pacing delays” are a type of concurrent delay that occur when one party makes a conscious decision to decelerate or slow down the pace of noncritical activities to keep pace with the critical delays of another party. A more formal definition would be “deceleration of the work of the project, by one of the parties to a contract, due to a delay caused by the other party, so as to maintain steady progress with the revised overall project schedule.” Zack, Pacing Delays–The Practical Effect, Construction Specifier 47, 48 (Jan. 2000). A party to the construction process may decide to slow down its performance of noncritical activities to keep pace with the delayed progress. For example, contractors may adjust the pace of their work in light of delays in owner-furnished equipment, delays by other multiple prime contractors, delays in permits, limited access, or differing site conditions. Owners may slow down their response time to requests for information or submittals, or postpone the delivery of owner-furnished equipment or the processing of change orders. Id. at 48. Read the court decision
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Reprinted courtesy of Luke Mecklenburg, Snell & Wilmer
Mr. Mecklenburg may be contacted at lmecklenburg@swlaw.com

Yet ANOTHER Reason not to Contract without a License

October 25, 2021 — Christopher G. Hill - Construction Law Musings
Remember when I stated that you cannot lawfully perform construction work in Virginia without a contractor’s license? Remember when I said that you risk non-payment if you do so? If you needed another reason, a relatively recent Virginia Court of Appeals decision upholding a criminal conviction for performing construction work without a license should be that reason. In Riddel v. Commonwealth, the Court took up an appeal from the conviction of Jeff Riddel where Mr. Riddel was verbally asked by homeowners to inspect and then repair their septic system. Mr. Riddel then contracted with Fairfax Suburban Septic to pump out and repair the system. Mr. Riddel then delivered the homeowners an invoice from Fairfax Suburban Septic and instructed the homeowners to pay Fairfax Suburban Septic directly. After payment, the homeowners became aware that the work was not completed and that neither Mr. Riddel nor his subcontractor was licensed to perform septic work in Virginia. During the trial, Mr. Riddel argued on a Motion to Strike the Commonwealth’s evidence that (1) he merely arranged for licensed contractors to perform the repairs to the septic system, arguing that Virginia Code §§ 54.2-801 to 802 permitted Riddel to arrange the work without a contractor’s license and (2) no written contract to perform a septic inspection or repairs existed. The Circuit Court denied the motion and Mr. Riddel was convicted under Va. Code 54.1-111 for performing the work without a license. Needless to say, he appealed. Read the court decision
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Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

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