Cambridge Massachusetts Building Expert Directory

Tennessee High Court Excludes Labor Costs from Insurer’s Actual Cash Value Depreciation Calculations

May 27, 2019 — Michael S. Levine & Geoffrey B. Fehling - Hunton Andrews Kurth
The Tennessee Supreme Court has refused to construe an ambiguous definition of actual cash value to allow for deduction of labor costs as part of depreciation calculations where that subset of repair costs are not clearly addressed in the policy. Despite the split of authority nationwide, the Tennessee case presents a straightforward application of policy interpretation principles to a common valuation issue in first-party property claims. In Lammert v. Auto-Owners (Mutual) Insurance Co., No. M2017-2546-SC-R23-CV (Tenn. Apr. 15, 2019), insureds brought a class-action lawsuit against their property insurer, Auto-Owners, alleging breach of contract. The plaintiffs each owned buildings damaged by a hail storm and had each submitted claims to Auto-Owners. Auto-Owners accepted the claims and determined that the losses would be determined on an actual cash value basis. In performing those valuations, Auto-Owners depreciated both the building materials and the labor costs associated with repairing the properties. The insureds challenged the labor cost depreciation. Auto-Owners moved to dismiss the lawsuit. In response, the insureds requested that the district court certify to the Tennessee Supreme Court whether, “[u]nder Tennessee law, may an insurer in making an actual cash value payment withhold a portion of repair labor as depreciation when the policy (1) defines actual cash value as ‘the cost to replace damaged property with new property of similar quality and features reduced by the amount of depreciation applicable to the damaged property immediately prior to the loss,’ or (2) states that ‘actual cash value includes a deduction for depreciation?”’ Reprinted courtesy of Michael S. Levine, Hunton Andrews Kurth and Geoffrey B. Fehling, Hunton Andrews Kurth Mr. Levine may be contacted at mlevine@HuntonAK.com Mr. Fehling may be contacted at gfehling@HuntonAK.com Read the court decision
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Business Interruption Claim Granted in Part, Denied in Part

February 16, 2016 — Tred R. Eyerly – Insurance Law Hawaii
The court granted portions of the business interruption claim, while denying other portions. Phoenix Ins. Co. v. Infogroup, Inc., 2015 U.S. Dist. LEXIS 162810 (S. D. Iowa Nov. 30, 2015). Phoenix insured Infogroup's business buildings and personal business property, including data and data processing equipment. In late May 2011, warnings were issued of possible flooding from the Missouri River. On June 1, 2011, Infogroup moved and relocated its business operations and data centers away from the river and did not intend to return to the facilities. On July 19, 2011, Phoenix advanced $500,000 to Infogroup for anticipated claims under the policy. On August 22, 2011, heavy rain left surface water in the parking lot at Infogroup's facilities. Infogroup claimed that it suffered minor property damage during July and August, 2011, including damage to an uninterruptable power source and damage to a server. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

OSHA Issues Final Rule on Electronic Submission of Injury and Illness Data

September 25, 2023 — Garret Murai - California Construction Law Blog
The U.S. Occupational Safety and Health Administration (OSHA) has issued its final rule (Final Rule) on electronic submission of injury and illness information. The Final Rule applies to employers with 100 or more employees in certain high-hazard industries, including construction, and requires such employers to electronically submit injury and illness information to OSHA on a yearly basis. If you fall into that category, here’s what you need to know to comply: Who do the Final Rules apply to? The Final Rules apply to companies with 100 or more employees in certain high-hazard industries. This includes construction companies with 100 or more employees working on federal construction projects. The “100 or more employees” threshold applies to companies with 100 or more employees at any time during the previous calendar year. Read the court decision
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Reprinted courtesy of Garret Murai, Nomos LLP
Mr. Murai may be contacted at gmurai@nomosllp.com

Lennar Profit Tops Estimates as Home Prices Increase

March 26, 2014 — John Gittelsohn – Bloomberg
Lennar Corp. (LEN), the biggest U.S. homebuilder by market value, reported a fiscal first-quarter profit that beat analysts’ estimates as the company sold more homes at increased prices. Net income climbed to $78.1 million, or 35 cents a share, in the three months through February, from $57.5 million, or 26 cents, a year earlier, the Miami-based company said in a statement today. Analysts expected earnings of 28 cents a share, the average of 17 estimates compiled by Bloomberg. Publicly traded builders have been increasing prices to take advantage of a tight supply of new and existing homes while using their economies of scale to reduce costs and widen profit margins. Lennar’s profit, deliveries and orders grew even as inclement weather threatened home sales in much of the U.S. during the quarter, according to Drew Reading, a Bloomberg Industries analyst. “Lennar followed KB Home (KBH) in reporting order trends indicating a strong start to the spring selling season,” Reading said in a note after the earnings were released. Read the court decision
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Reprinted courtesy of John Gittelsohn, Bloomberg
Mr. Gittelson may be contacted at johngitt@bloomberg.net

America’s Infrastructure Gets a D+

March 16, 2017 — Garret Murai – California Construction Law Blog
The American Society of Civil Engineers (ASCE) has issued their 2017 Infrastructure Report Card, which assigns a letter grade to the nation’s infrastructure. Our country’s grade in 2017? A disappointing D+. Although, if you’re a glass half full kind of person (bless your soul) at least our grade didn’t fall since the last report card was issued in 2013, when our grade was a D+ as well. In short, we suck. Although, apparently, we don’t suck evenly across the board. ASCE has divided its cumulative GPA into grades for specific courses, if you will. Our transit systems received a grade of D-; our airports, dams, drinking water and waste water plants, inland waterways, levees and roads received a grade of D; our power plants, hazardous waste plants, public parks and schools received a grade of D+; our bridges, ports and solid waste plants a grade of C+, and our rail systems received a grade of B. 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

The New “White Collar” Exemption Regulations

August 19, 2015 — Craig Martin – Construction Contractor Advisor
This summer the Department of Labor’s Wage and Hour Division issued proposed changes to the white-collar overtime regulations under the Fair Labor Standards Act (FLSA). The white collar exemptions include the executive, administrative, professional, outside sales and computer employee exemptions. The focus of the proposed regulations is to increase the salary level required to qualify for the exemption from $23,660 per year to $50,440 per year. The DOL predicts this will cause employers to change the exempt status of nearly 5 million workers who are currently exempt from overtime requirements to non-exempt status – requiring the payment of overtime. Current Regulations Under today’s regulations, the white collar exemption applies to employees who are paid at least $455 per week ($23,660 per year) and who customarily and regularly perform any one or more of the exempt duties or responsibilities of an executive, administrative or professional employee. Proposed Changes The most significant change is the sizeable increase in the minimum salary requirements for the exemptions. The proposed regulations more than double the current minimum salary of $455 per week to $921. This corresponds to the 40th percentile of weekly earnings projected for the first quarter of 2016, based on the Bureau of Labor Statistics. The DOL also proposes annual adjustments to the minimum salary requirements. Read the court decision
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Reprinted courtesy of Craig Martin, Lamson, Dugan and Murray, LLP
Mr. Martin may be contacted at cmartin@ldmlaw.com

Newark Trial Team Secures Affirmance of ‘No Cause’ Verdict for Nationwide Housing Manager & Developer

January 07, 2025 — Lewis Brisbois Newsroom
Newark, N.J. (December 30, 2024) - Newark Partner Afsha Noran and Managing Partner Colin Hackett recently obtained a ruling by a New Jersey Appellate Division panel affirming a unanimous "no cause" defense verdict obtained on behalf of a nationwide housing developer and manager. In this case, the plaintiff and her two minor children brought suit against the firm's client. They appealed a unanimous no-cause jury verdict rendered in May 2023 that found the defendants not liable for mold exposure in their apartment. The plaintiffs argued that several trial errors, including improper jury instructions, a confusing verdict sheet, and prejudicial remarks by defense counsel led to an unjust result. However, the appellate court affirmed the trial court's decision, concluding that there was no miscarriage of justice and that the trial court properly exercised its discretion in handling the case. Read the court decision
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Reprinted courtesy of Lewis Brisbois

In Texas, a General Contractor May be Liable in Tort to a Third-Party Lessee for Property Damage Caused by a Subcontractor’s Work

February 16, 2016 — Michael L. DeBona – White and Williams LLP
In Zbranek Custom Homes, Ltd. v. Joe Allbaugh, et al., No. 03-14-00131-CV, 2015 WL 9436630 (Tex.App.-Austin Dec. 23, 2015), the Court of Appeals of Texas, Austin, considered the circumstances under which a general contractor can be held liable for injuries to a non-contracting party’s property. The court held that, because the general contractor, Zbranek Custom Homes, Ltd. (Zbranek), exercised control over the construction of the fireplace at issue, Zbranek owed a duty of care to the first lessees of the home that Zbranek built. In Zbranek, Bella Cima Developments, L.P. (Bella Cima) hired Zbranek to act as the general contractor for the construction of a home. As the general contractor, Zbranek engaged various subcontractors to perform different aspects of the construction, including the framing, stucco and masonry work for an outdoor fireplace. Read the court decision
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Reprinted courtesy of Michael L. DeBona, White and Williams LLP
Mr. DeBona may be contacted at debonam@whiteandwilliams.com

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