Changing Course Midstream Did Not Work in River Dredging Project
December 10, 2015 —
Craig Martin – Construction Contractor AdvisorA contractor learned a $12M lesson when it tried to change course on a Corps of Engineer river dredging project. The case also illustrates the importance of documenting problems on a project and providing notice of those problems to the owner.
In Weston/Bean Joint Venture v U.S., Weston/Bean was awarded a Corps of Engineers project to provide maintenance dredging on the Miami River to a depth of 15 feet. The contract noted that the contractor may experience sediment, debris and rock, including soft to moderately hard limestone.
The contractor encountered rocks early on in the project, but consistently submitted reports to the Corps of Engineers that nothing was experienced on the project that would lead to a change order or claim. And, for the first year of operations, the contractor made no claim for differing site conditions. Instead, the contractor terminated the subcontractor for not being able to process the rock uncovered during the dredging process.
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Craig Martin, Lamson, Dugan and Murray, LLPMr. Martin may be contacted at
cmartin@ldmlaw.com
Commencing of the Statute of Repose for Construction Defects
November 08, 2021 —
David Adelstein - Florida Construction Legal UpdatesFlorida has a ten-year statute of repose which applies predominantly to construction defect claims. This can be found in Florida Statute s. 95.11(3)(c). After ten years, any rights relative to a construction defect claim are time-barred. However, the statute of repose date has been watered down and can be made to be more of a factual question due to the lack of objectivity as to the date that starts the ten-year repose clock. The watering down of the statute of repose date benefits parties asserting construction defect claims provided they strategically appreciate the question of fact that can be created when up against the statute of repose. Stated differently, when up against the clock to assert a construction defect claim, strategically develop those facts, evidence, and arguments to maximize creating a question of fact as to when the statute of repose clock commenced. Conversely, as a defendant sued for construction defects, you want to maximize the facts, evidence, and arguments to fully establish the date the statute of repose clock had to commence for purposes of a statute of repose defense.
The recent opinion in Spring Isle Community Association, Inc. v. Herme Enterprises, Inc., 46 Fla. L. Weekly D2306b (Fla. 5th DCA 2021) demonstrates the factual question associated with the clock that starts the statute of repose date. This factual question is created by Florida Statute s. 95.11(3)(c) that provides:
[T]he action [founded on the design, planning, or construction of an improvement to real property] must be commenced within 10 years after the date of actual possession by the owner, the date of the issuance of a certificate of occupancy, the date of abandonment of construction if not completed, or the date of completion or termination of the contract between the professional engineer, registered architect, or licensed contractor and his or her employer, whichever date is latest.
Spring Isle Community Association, supra. (Note, see also current s. 95.11(3)(c) version in effect per hyperlink above.)
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
Judge Who Oversees Mass. Asbestos Docket Takes New Role As Chief Justice of Superior Court
January 02, 2024 —
Lewis Brisbois NewsroomBoston, Mass. (December 13, 2023) - Judge Michael Ricciuti, who presides over the Massachusetts state asbestos litigation docket, has been appointed to a new role as Chief Justice of Massachusetts Superior Court, effective December 22, 2023. The appointment is expected to result in the end of his tenure overseeing the state asbestos litigation.
Judge Ricciuti was appointed by Governor Charlie Baker to the Superior Court in 2017. He has served in five counties and serves six-month rotations in the Business Litigation Session, in addition to his role overseeing the Massachusetts Asbestos Litigation docket. His current committee participation includes serving on the Superior Court Judicial Education Committee and the Supreme Judicial Court Advisory Committee on Massachusetts Evidence Law. He also serves as a judicial mentor.
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South Carolina Court of Appeals Diverges from Damico Opinion, Sending Recent Construction Defects Cases to Arbitration
October 24, 2023 —
Laura Paris Paton - Gordon Rees Construction Law BlogCould the latest opinion from the South Carolina Court of Appeals be the distant ringing of a death knell for runaway construction defects verdicts? On the heels of the Damico ruling earlier this year, the courts have issued several opinions distinguishing various arbitration agreements from the one analyzed in Damico and have sent subsequent cases to arbitration.
This summer, the Supreme Court and Court of Appeals compelled arbitration in Cleo Sanders v. Savannah Highway Automotive Company, et al. Appellate Case No. 2021-000137 / Opinion No. 28168 (petition for rehearing pending) and Joseph Abruzzo v. Bravo Media Productions, et al. Appellate Case No. 2020-001095 / Opinion 6004. Now, in the matter of Jonathan Mart, on behalf of himself and others similarly situated, Respondent, v. Great Southern Homes, Inc., Appellant, Appellate Case No. 2018-001598, the Court of Appeals reversed the circuit court’s order denying a homebuilder’s motion to dismiss and compelled arbitration in this action, which was brought by the homeowner, individually and on behalf of other similarly situated homeowners.
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Laura Paris Paton, Gordon Rees Scully MansukhaniMs. Paton may be contacted at
lpaton@grsm.com
Limiting Plaintiffs’ Claims to a Cause of Action for Violation of SB-800
November 18, 2011 —
Samir R. Patel, Esq., Lorber, Greenfield, & Polito, LLPThere has been a fair share of publicity about the SB-800 amendments to the Civil Code (Civil Code section 896, et seq.) that codified construction defect litigation in 2002. Most of the publicity is geared toward the pre-litigation standards allowing a builder the right to repair before litigation is commenced by a homeowner. Less focus and attention has been given to the fact that violation of the SB-800 performance standards is being used by plaintiff’s counsel as an additional tool in the plaintiff’s pleading tool box against builders. Closer scrutiny to SB-800 reveals that those provisions should in fact act as a limitation to the pleading tools available to plaintiffs and an additional tool for builders in the defense of cases governed by SB-800.
The typical construction defect complaint contains the boiler plate versions of numerous causes of action. These causes of action include Strict Liability, Negligence, Negligence Per Se, Breach of Contract, Breach of Contract – Third-Party Beneficiary, Breach of Express Warranties, Breach of Implied Warranties, among others. The wide array of causes of action leave a defendant “pinned to the wall” because they require a complex defense on a multitude of contract and tort related causes of action. Furthermore, the statutes of limitations as to these claims widely differ depending upon if the particular defect is considered latent or patent. The truth of the matter remains, no matter what the circumstances, if a construction defect matter ultimately goes to trial, it is inevitable that plaintiffs will obtain a judgment on at least one of these causes of action.
On its own, the Strict Liability cause of action can be a thorn in a defendant’s side. A builder is obviously placing a product into the stream of commerce and strict liability is a tough standard to defend against, particularly when it concerns intricate homes comprised of multiple components that originally sold for hundreds of thousands of dollars. A Negligence cause of action can also be difficult to defend because the duty of care for a builder is what a “reasonable” builder would have done under the circumstances. An interpretation of this duty of care can easily sway a jury that will almost always consist of sympathetic homeowners. A Negligence Per Se cause of action can also leave a defendant vulnerable to accusations that a builder violated the Uniform Building Code or a multitude of other obscure municipal construction-related code provisions during the construction of the home. Lastly, the Breach of Contract cause of action leaves a builder relying on dense and intricate purchase and sale agreements with dozens of addenda which leave the skeptical jurors turned off by what they view as one-side, boilerplate provisions. Ultimately, when a matter is about to go to trial, the complexity of these complaints can benefit a plaintiff and increase a plaintiff’s bargaining power against a defendant who is attempting to avoid a potentially large judgment.
Enter the SB-800 statutes. The SB-800 statutes apply to all homes sold after January 1, 2003. Civil Code section 938 specifically states that “[t]his title applies only to new residential units where the purchase agreements with the buyer was signed by the seller on or after January 1, 2003.” (Civil Code §, 938.) As time progresses, more residential construction defect cases will exclusively fall under the purview of SB-800. Slowly but surely more SB-800 governed litigation is being filed, and its exclusive application is looming on the horizon.
On its surface, this “right to repair” regime has left builders with a lot to be desired despite the fact that it is supposed to allow the builder the opportunity to cure any deficiencies in their product before litigation can be filed by potential plaintiffs. However, the application of the time line for repair has shown to be impractical for anything but the most minor problems involving only small numbers of residential units. Moreover, the fact that the fruits of the builder’s investigation into the claimed defects in the pre-litigation context can freely be used as evidence against it in litigation makes builders proceed with trepidation in responding with a repair. For these reasons, more SB-800 litigation can be expected to result due to the shortcomings of the pre-litigation procedures, and savvy defense counsel should anticipate the issues to be dealt with in presenting the defense of such cases at trial.
This fact should not necessarily be met with fear or disdain. Within the SB-800 statutes, the legislature made it clear that they were creating a new cause of action for construction defect claims, but it further made it clear that this cause of action is a plaintiff’s exclusive remedy. The legislature giveth, but at the same time, the legislature taketh away. Throughout numerous provisions within the SB-800 statutes, the Civil Code states that claims for construction defects as to residential construction are exclusively governed by the Civil Code, and that the Civil Code governs any and all litigation arising under breaches of these provisions. Civil Code section 896 specifically states:
In any action seeking recovery of damages arising out of, or related to deficiencies in, the residential construction … the claimant’s claims or causes of action shall be limited to violation of, the following standards, except as specifically set forth in this title. (Civil Code §, 896.)
Civil Code section 896 then provides approximately fifty-plus standards by which a construction defect claim is assessed under that provision. Civil Code section 896 covers everything from plumbing to windows, and from foundations to decks, and in several instances expressly dictates statutes of limitations as to specific areas of construction that severely truncate the 10-year latent damage limitations period. As for any construction deficiencies that are not enumerated within Civil Code section 896, Civil Code section 897 explicitly defines the intent of the standards and provides a method to assess deficiencies that are not addressed in Civil Code section 896. Civil Code section 897 states:
Intent of Standards
The standards set forth in this chapter are intended to address every function or component of a structure. To the extent that a function or component of a structure is not addressed by these standards, it shall be actionable if it causes damage. (Civil Code §, 897.)
Therefore, Civil Code section 897 acts as a catch-all by which defects that are not covered within Civil Code section 896 can be evaluated on a damage standard mirroring the Aas case (damages must be present and actual). The result of sections 896 and 897 being read in combination is a comprehensive, all-inclusive set of performance standards by which any defect raised by Plaintiffs can be evaluated and resolved under a single SB-800 based cause of action.
Civil Code section 943 makes clear that a cause of action for violation of SB-800 performance standards is a plaintiff’s sole remedy for a residential construction defect action. Specifically, Civil Code section 943 states:
Except as provided in this title, no other cause of action for a claim covered by this title or for damages recoverable under 944 is allowed. In addition to the rights under this title, this title does not apply to any action by a claimant to enforce a contract or express contractual provision, or any action for fraud, personal injury, or violation of a statute. (Civil Code §, 943.)
Civil Code section 944 provides the method for computing damages within a construction defect action, as follows:
If a claim for damages is made under this title, the homeowner is only entitled to damages for the reasonable value of repairing any violation of the standards set forth in this title, [and] the reasonable cost of repairing any damages caused by the repair efforts… . (Civil Code §, 944.)
A cursory review of these statutes yields the conclusion that the legislature was attempting to create an exclusive cause of action that trumps all other causes of action where SB-800 applies. The remedy available to plaintiffs is limited to that allowed by the Civil Code. As noted above, “[n]o other cause of action for a claim covered by this title…is allowed.” (Civil Code §, 943.) Therefore, Civil Code sections 896, 897, 943, and 944 specifically prohibit the contract-based and tort-based causes of action typically pled by plaintiffs.
Plaintiff’s counsel has seized upon the language of section 943 to advance the argument that SB-800 still allows a plaintiff to advance typical contract and tort based causes of action. On the surface, this argument may seem compelling, but a minimum of scrutiny of the express language of section 943 dispels this notion. Section 943 says that it provides rights “[i]n addition” to those under the SB-800 Civil Code provisions. Clearly, the language in section 943 is intended to expressly underscore the fact that a plaintiff is not precluded from seeking relief in addition to that allowed under SB-800 for damages not arising from a breach of the SB-800 standards or for damages in addition to those recoverable under Section 944. This language does not provide an unfettered license to bring a Strict Liability, Negligence or other cause of action against a builder where SB-800 applies.
In fact, this language only keeps the door open for plaintiffs to pursue such causes of action not arising from a breach of the SB-800 standards should there be such supporting allegations. For example, if a plaintiff alleges that a builder breached an “express contractual provision” related to the timing of the completion of the home and close of escrow, and the contract specifies damages in this regard, a plaintiff may have a viable separate cause of action for Breach of Contract for recovery of those damages precisely because that is not an issue expressly dealt with in SB-800 in the performance standards under sections 896 and 897, or in the damage recovery terms under 944. As it stands, the vast majority of complaints are seeking redress for violation of the same primary right; that is, defects specifically outlined in Section 896 and 897 or which result in damages as stated in Section 944.
So, how does a builder defend against a complaint that contains multiple causes of action regarding construction defects for a home sold after January 1, 2003? There are numerous ways to approach this. First and foremost, these superfluous and improper causes of action can be attacked by demurrer seeking dismissal of all causes of action other than the cause of action alleging violation of SB-800. If the the time period within which to file a demurrer has passed already, a motion for judgment on the pleadings can be utilized to attack the improper causes of action in the same way as a demurrer can be used for this purpose.
The limitation to a demurrer or motion for judgment on the pleadings is that the judge is restricted to viewing only the four corners of the pleading when making a ruling. It is typical for plaintiffs’ counsel to cleverly (or one might even say, disingenuously) leave the complaint purposely vague to avoid a successful defense attack on the pleadings by not including the original date the residence was sold. In that instance, a motion for summary adjudication can be used to attack a plaintiff’s complaint. By simply providing evidence that the homes were originally sold after January 1, 2003, the improper causes of action should be subject to dismissal by summary adjudication. If the plaintiff is a subsequent purchaser, the builder still has recourse to enforce the pleading limitations under SB-800. Civil Code section 945 states that “[t]he provisions, standards, rights, and obligations set forth in this title are binding upon all original purchasers and their successors-in-interest.” (Civil Code §, 945.)
Attacking a plaintiff’s complaint to eliminate multiple causes of action can have numerous benefits. The practical result is that a plaintiff will only have one viable cause of action. The advantage is that the SB-800 performance standards include the defined performance standards and shortened statutes of limitations periods with regard to specific issues. Furthermore, as to defects which are not specifically provided for in Civil Code section 896, Civil Code section 897 requires a proof of actual damages. Therefore, a plaintiff must provide evidence of current damages and not simply conditions that may potentially cause damage in the future.
The Appellate Courts have yet to directly address and interpret these SB-800 provisions. The time for that is undoubtedly drawing near. For now, however, plaintiffs will have to find ways to accurately plead construction defect claims within the confines of one cause of action for breach of the performance standards enumerated within the Civil Code.
Printed courtesy of Lorber, Greenfield & Polito, LLP. Mr. Patel can be contacted at spatel@lorberlaw.com and Mr. Verbick at tverbick@lorberlaw.com.
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Court Agrees to Stay Coverage Matter While Underlying State Action is Pending
October 29, 2014 —
Tred R. Eyerly – Insurance Law HawaiiThe federal district court granted the insured's motion to stay the coverage action while the construction defect case was pending in state court. Auto Owners Ins. Co. v. Essex Homes Southeast, Inc., 2014 U.S. Dist. LEXIS 133120 (D. S.C., Sept. 23, 2014).
The homeowners sued Essex Homes in state court for construction defects in a home built and sold to them by Essex Homes. The suit sought damages for property damage based on negligence, breach of implied warranty, and breach of express warranties arising out of the alleged construction defects. The complaint alleged that a water leak in the house caused water damage and resulted in mold growth that was not discovered for several years.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
California Contractors: Amended Section 7141.5 Provides Important License Renewal Safety Net
July 25, 2021 —
Amy L. Pierce, Mark A. Oertel, John Lubitz & Adam B. Wiens - Lewis BrisboisUnder California’s Contractors State License Law, Cal. Bus. & Prof. Code §§ 7000 et seq., contractors’ licenses expire two years from the last day of the month in which the license was issued or two years from the date on which the renewed license last expired. The Contractors State License Board (CSLB) sends licensees a renewal application 60 to 90 days in advance of the date the license is set to expire. Even with various controls in place, mistakes happen and a renewal application filing deadline can be missed.
During the August 5-6, 2019 Executive, Licensing, and Legislative Committee Meetings, the CSLB discussed proposed amendments to Section 7141.5 to reduce both the burden on it to review applications for retroactive renewal of a license that had not been timely submitted and to provide contractors with some relief from the high burden to establish “the failure to renew was due to circumstances beyond the control of the licensee.” Not long after, the CSLB’s Board of Directors gave staff approval to seek an author for the bill and, on September 29, 2020, Governor Newsom signed Senate Bill 1474 into law, which includes the CSLB’s proposed amendments to Section 7141.5, effective January 1, 2021.
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Amy L. Pierce, Lewis Brisbois,
Mark A. Oertel, Lewis Brisbois,
John Lubitz, Lewis Brisbois and
Adam B. Wiens, Lewis Brisbois
Ms. Pierce may be contacted at Amy.Pierce@lewisbrisbois.com
Mr. Oertel may be contacted at Mark.Oertel@lewisbrisbois.com
Mr. Lubitz may be contacted at John.Lubitz@lewisbrisbois.com
Mr. Wiens may be contacted at Adam.Wiens@lewisbrisbois.com
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Contractor Sues Yelp Reviewer for Defamation
February 05, 2014 —
Beverley BevenFlorez-CDJ STAFFContractor Christopher Dietz sued Jane Perez, a Virginia homeowner who “wrote a pair of scathing reviews of his services” on Yelp, according to Yahoo Finance. Dietz sued for “defamation and” sought “$750,000 in damages.”
The Fairfax, Virginia jury did find the reviews to be defamatory, but they also “found that Dietz had defamed her as well when he responded to her negative reviews with accusations of his own.” The jury decided that “neither deserved to recoup damages.”
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