Estoppel Certificate? Estop and Check Your Lease
May 06, 2019 —
Lauren Podgorski - Snell & Wilmer Real Estate Litigation BlogIf you are leasing space in a building, there may come a time when you receive a request from your landlord to fill out and sign an estoppel certificate. Estoppel certificates are usually sent to tenants in connection with the sale or refinance of a building, and a third party may rely on the accuracy of the statements and information contained in the estoppel certificate in connection with that transaction. Estoppel certificates can range from a very simple, one-page document, to several pages.
I’ve received an estoppel certificate in the mail. What do I do now?
Consider the following:
Check your lease. Your lease may require you to deliver the signed estoppel certificate and may even give you a timeframe within which you are required to return it. A form of estoppel certificate may also be included in your lease as an exhibit. If you’ve previously agreed to a form of estoppel certificate in your lease, check to ensure the one you have received matches the form you previously agreed to and if it doesn’t make sure to review it carefully to make sure it is acceptable.
Review the estoppel certificate and confirm that all of the information is accurate. Be on the lookout for any terms or provisions that you did not agree to in your lease. If it seems like the landlord is trying to modify your lease, you likely do not need to consent to the change in this document. Cross off (or modify or delete, if you have an electronic copy) any information that is inaccurate. Fill in all blanks (if the blank is not applicable, write “N/A”), and if any exhibits are referenced in the body of the document, make sure they are actually attached.
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Lauren Podgorski, Snell & WilmerMs. Podgorski may be contacted at
lpodgorski@swlaw.com
Accounting for Payments on Projects Became Even More Crucial This Year
September 21, 2020 —
Christopher G. Hill - Construction Law MusingsI discussed
several of the statutory changes affecting the construction industry here at Construction Law Musings in the run-up to July 1, 2020. One of those changes, an amendment to
Virginia Code Section 43-13, may add another arrow to the collection quiver of subcontractors and suppliers. As part of the previously-linked rundown, I highlighted one of the big additions in 2020, namely the amendment making those pesky clauses that let those up the payment chain from you hold money on “this or any other project” void as against public policy.
The other big addition to 43-13 is the change that adds a possible civil cause of action for downstream and unpaid subcontractors and suppliers in the event that funds paid to a general contractor or subcontractor are not first used to pay their downstream contractors and suppliers. Prior to July 1, 2020, this statute provided criminal penalties for such behavior but did not contain the possibility of a civil penalty. The operative language for the change is as follows:
The use by any such contractor or subcontractor or any officer, director, or employee of such contractor or subcontractor of any moneys paid under the contract before paying all amounts due or to become due for labor performed or material furnished for such building or structure for any other purpose than paying such amounts due on the project shall be prima facie evidence of intent to defraud. Any breach or violation of this section may give rise to a civil cause of action for a party in contract with the general contractor or subcontractor, as appropriate; however, this right does not affect a contractor’s or subcontractor’s right to withhold payment for failure to properly perform labor or furnish materials on the project.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Illinois Court Determines Duty to Defend Construction Defect Claims
March 22, 2021 —
Tred R. Eyerly - Insurance Law HawaiiGiven the underlying allegations of damage to personal property, the court determined the insurer had a duty to defend. Certain Underwriters at Lloyd's London v. Metropolitan Builders, Inc., 2019 Ill. App. LEXIS 979 (Ill. Ct. App. Dec. 18, 2019).
Metropolitan was hired as the general contractor for construction, renovation and demolition at contiguous properties - the 1907 Property, 1909 Property, and 1911 Property. During construction activities, the structures on the 1907 Property and 1909 Property collapsed. The existing structures on the properties were later deemed unsafe and were demolished by the city of Chicago.
AIG insured the owner of the buildings and paid over $1.8 million for repairs and associated expenses arising from the collapse. AIG then invoked its rights of subrogation against Metropolitan by filing suit. Metropolitan tendered the suit to its insurer, Lloyd's, who denied coverage and filed for a declaratory judgment. The trial court found the underlying complaint alleged property damage, but not an occurrence. Summary judgment was awarded to Lloyd's.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Deference Given To Procuring Public Agency Regarding Material Deviation
April 10, 2019 —
David Adelstein - Florida Construction Legal UpdatesDeference will be given to a procuring public agency in a bid protest, particularly when the issue involves whether a bid is non-responsive and constitutes a material deviation from the solicitation. You do not believe me? Perhaps you will after this holding in Biscayne Marine Partners, LLC v. City of Miami, Florida, 44 Fla.L.Weekly D467a (Fla. 3d DCA 2019):
Consequently, no principle of law is clearly established…as to any obligation of the trial court (and, by analogy, an administrative hearing officer) [in a bid protest] to decide or to defer [whether a bid constitutes a material deviation from the solicitation]. If anything, the existing and clearly established principle of law inclines toward judicial deference in public agency competitive bidding disputes when the agency has exercised it discretion absent illegality, fraud, oppression or misconduct.
I do not know about you, but that last underlined sentence is pretty strong language regarding judicial deference!
In this case, Miami (the procuring public agency) issued a Request for Proposals (RFP) for the redevelopment and lease of waterfront property, for the operation of a marina, boatyard, restaurant, wet slips, and a dry storage facility on the property. Miami issued five addenda to the RFP. There were three bidders.
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David Adelstein, Kirwin NorrisMr. Adelstein may be contacted at
dma@kirwinnorris.com
Federal Judge Issues Preliminary Injunction Blocking State's Enforcement of New Law Banning Mandatory Employee Arbitration Agreements
February 24, 2020 —
Amy R. Patton, Jeffrey K. Brown & Tyler B. Runge - Payne & FearsOn January 31, 2020, Judge Kimberly Mueller issued a preliminary injunction "in full" preventing the State of California from enforcing AB 51, the state's new law effectively banning mandatory employee arbitration agreements.
As we previously reported, AB 51 adds section 432.6 to the Labor Code and section 12953 to the Government Code, which together prohibit employers from requiring an employee, as a condition of employment, continued employment, or receipt of employment-related benefits, to waive any right, forum, or procedure to pursue a claim under the California Fair Employment and Housing Act or the Labor Code. In other words, AB 51 bans mandatory employment arbitration agreements for employment-related claims.
In early December 2019, the U.S. Chamber of Commerce and a coalition of business organizations sued the state of California in federal court in a bid to have AB 51 declared preempted --- and therefore unenforceable --- by the Federal Arbitration Act. The case is Chamber of Commerce of the United States v. Becerra, Case No. 2:19-cv-2456 KJM DB (E.D. Cal.).
On December 30, 2019, Judge Mueller issued a temporary restraining order preventing the state from enforcing AB 51 pending the resolution of plaintiffs' motion for a preliminary injunction. You can read our report
here.
Reprinted courtesy of Payne & Fears attorneys
Amy R. Patton,
Jeffrey K. Brown and
Tyler B. Runge
Ms. Patton may be contacted at arp@paynefears.com
Mr. Brown may be contacted at kb@paynefears.com
Mr. Runge may be contacted at tbr@paynefears.com
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Seattle’s Newest Residential Developer
March 13, 2023 —
Michael J. Yelle - Ahlers Cressman & SleightOn February 14, 2023, Seattle voters passed Initiative 135, creating the “Seattle Social Housing Developer” (“Public Developer” or “PD”) and the initiative was signed into law by Mayor Bruce Harrel on March 1, 2023.
[1] With this initiative, voters created Seattle’s newest housing developer. The PD aims to develop, own, and maintain housing in the City of Seattle.
[2] In addition, the PD also intends to retrofit acquired properties to increase energy efficiency and bring them into compliance with accessibility standards.
[3] Contractors, subcontractors, and suppliers may see this as an opportunity to compete for and build everything from new multi-unit housing to handrail installation projects. This post will explore some of the basics of contracting with a public corporation like the Public Developer and what contractors may want to consider in their business planning.
What is the PD?
The Public Developer is a political subdivision of the State of Washington, like a port or fire district.
[4] The Public Developer is not an agency or department of the City of Seattle. In this way, it is like Seattle Public Schools (SPS) because both SPS and the PD operate within the City of Seattle, but have (or will have) their own staff, procurement rules, and standard contracts distinct from the City’s. Like SPS, the PD can also enter construction and supply contracts, sue, and be sued.
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Michael J. Yelle, Ahlers Cressman & Sleight
Illinois Appellate Court Finds Insurer Estopped From Denying Coverage Where Declaratory Judgment Suit Filed Too Late
August 07, 2018 —
TLSS Insurance Law BlogIn an unpublished opinion from the Illinois Appellate Court, Country Mutual Insurance Co. v. Badger Mutual Insurance Co., 2018 IL App (1st) 171774-U, the court held that because an insurer breached its duty to defend and failed to file a declaratory judgment action before the underlying lawsuit was resolved, it was estopped from denying coverage for the default judgment entered against its insured in the underlying lawsuit.
The underlying lawsuit concerned a claim that plaintiff’s property allegedly sustained damage when the insured performed work on the plaintiff’s residence. The complaint in the underlying lawsuit did not specifically identify when the property damage occurred. However, the complaint did state that the insurer’s investigator alerted it in 2010 that the property damage was due to the insured’s faulty work during the policy period. The insurer did not defend the insured during the action and a default judgment was entered against the insured.
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Traub Lieberman Straus & Shrewsberry LLP
Receiving a $0 Verdict and Still Being Deemed the Prevailing Party for Purposes of Attorney’s Fees
May 24, 2018 —
David Adelstein - Florida Construction Legal UpdatesLow and behold, a party can be the prevailing party for purposes of attorney’s fees even if that party is awarded $0. That’s right, even if the party is awarded a big fat zero, they can still be the prevailing party for purposes of being entitled to attorney’s fees. This is because a party is the prevailing party if they prevail on the significant issues in the case. A party can prevail on the significant issues even if that party is awarded $0. Whoa!
For example, in Coconut Key Homeowner’s Association, Inc. v. Gonzalez, 43 Fla.L.Weekly D1045a (Fla. 4th DCA 2018), a homeowner sued her homeowner’s association claiming the association breached its governing documents. There was a basis for fees under Florida’s homeowner’s association law (and there likely was a basis under the governing documents). At trial, the jury held that the association breached its governing documents, but awarded the homeowner nothing ($0). The trial court also issued injunctive relief in favor of the homeowner. The homeowner claimed she should be deemed the prevailing party for purposes of attorney’s fees; however, this was denied by the trial court based on the $0 verdict and no fees were awarded to the homeowner.
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David Adelstein, Florida Construction Legal UpdatesMr. Adelstein may be contacted at
dadelstein@gmail.com
