Navigating Construction Contracts in the Energy Sector – Insights from Sheppard Mullin’s Webinar Series
October 01, 2024 —
Cesar Pereira - Sheppard MullinConstruction contracts in the energy sector involve unique challenges and risks, particularly with respect to bonds and mechanic’s liens.
Understanding how to navigate these challenges is key to protecting your projects from disputes with general contractors, subcontractors and suppliers.
In our recent webinar, “
Construction Contracts: Bond and Mechanic’s Lien Primer for Energy Projects,” I was joined by my Sheppard Mullin colleagues Chris Kolosov and Emily Anderson to discuss navigating common contract pitfalls and negotiation strategies to protect your interests.
Here are our key takeaways.
- Know Local Mechanic’s Lien Laws: Mechanic’s liens are statutory and vary significantly from state to state. It is critical to understand the local laws and regulations at play in your project’s jurisdiction.
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Cesar Pereira, Sheppard MullinMr. Pereira may be contacted at
cpereira@sheppardmullin.com
Illinois Supreme Court Rules Labor Costs Not Depreciated to Determine Actual Cash Value
November 19, 2021 —
Tred R. Eyerly - Insurance Law HawaiiThe Illinois Supreme Court determined that a homeowner insurer may not depreciate labor costs in calculating actual cash value (ACV) after a loss under the policy. Sproull v. State Farm Fire and Casualty Co., 2021 Ill. LEXIS 619 (Ill. Sept. 23, 2021).
Plaintiff was insured under a homeowner's policy that provided replacement cost coverage for structural damage. Under the policy, the insured would initially receive an ACV payment but then could receive replacement cost value (RCV) if repairs or replacement were completed within two years and the insurer was timely notified. The policy did not define "actual cash value."
Plaintiff suffered wind damage to his residence and timely submitted a property damage claim to State Farm. The adjuster determined that the building sustained a loss with RCV of $1711.54. In calculating ACV, State Farm began with the RCV and then subtracted plaintiff's $1000 deductible and an additional $394.36, including taxes, for depreciation. Plaintiff thus received an ACV payment of $317.18. Plaintiff claimed that he was underpaid on his ACV claim because State Farm depreciated labor, which is intangible and thus not subject to wear, tear, and obsolescence. Further, labor should not have been depreciated because it was not susceptible to aging or wearing and its value did not diminish over time.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Ackman Group Pays $91.5 Million for Condo at NYC’s One57
April 15, 2015 —
David M. Levitt and Oshrat Carmiel – BloombergA group including billionaire investor Bill Ackman paid $91.5 million for a duplex penthouse at Extell Development Co.’s One57 condominium tower, one of New York City’s most expensive home purchases ever.
The purchase of unit 75 in the luxury skyscraper overlooking Central Park closed on March 27, according to property records filed Thursday. The buyer was listed as 57157 Co. LLC, a single-purpose entity that Ackman controls.
The 13,554-square-foot (1,259-square-meter), six-bedroom home spans the 75th and 76th floors of the 90-story skyscraper. Ackman last year told the New York Times it was “the Mona Lisa of apartments.” Monthly common charges on the unit were estimated at $23,595, according to documents Extell filed with the state attorney general’s office.
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David M. Levitt, Bloomberg and
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Who is a “Contractor” as Used in “Unlicensed Contractor”?
June 08, 2020 —
Taylor Orgeron - Autry, Hall & Cook, LLPA recent Georgia Court of Appeals case established a rule concerning the effect of an unlicensed contractor failing to disclose that he is unlicensed. In Fleetwood v. Lucas,[1] the contractor was hired by the homeowners to perform renovations on two homes. One of the projects went over budget, and the homeowners failed to pay the remaining balances on both projects. Following their failure to pay, the contractor sued the homeowners for breach of contract, and the jury delivered a verdict in his favor. The homeowners appealed on the grounds that the contractor was barred from bringing suit because the contractor did not have a license to perform the work.
Generally, if a contractor does not have a residential or general contractor’s license but performs work when a license is required, the contract is unenforceable. O.C.G.A. § 43-41-17(b). However, under O.C.G.A. § 43-41-17(g), a contractor may perform repair work without a license if the contractor discloses that he does not have a license, and the work does not affect the structural integrity of the project. In this case, the contractor failed to disclose that he did not have a license.
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Taylor Orgeron, Autry, Hall & Cook, LLPMr. Orgeron may be contacted at
orgeron@ahclaw.com
Fannie-Freddie Elimination Model in Apartments: Mortgages
April 08, 2014 —
Sarah Mulholland – BloombergThe apartment-lending units of Fannie Mae (FNMA) and Freddie Mac were among their few money makers after the U.S. housing collapse. Now they should help transform the U.S. mortgage industry.
Lawmakers seeking to eliminate the two government lenders, which were seized by regulators during the 2008 credit crisis, see an antidote to the reckless lending that blew up the U.S. housing market in the structure of the firms’ multifamily operations, which share risks with lenders.
Senate Banking Committee Chairman Tim Johnson and Republican Mike Crapo are proposing legislation to create a new government-backed reinsurer of mortgage bonds that would require private investors to bear losses on the first 10 percent of capital. The model for the provision mirrors Fannie Mae and Freddie Mac (FMCC)’s multifamily lending operations, requiring lenders to shoulder some of the risk on loans they originate.
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Sarah Mulholland, BloombergMs. Mulholland may be contacted at
smulholland3@bloomberg.net
ASCE Joins White House Summit on Building Climate-Resilient Communities
October 09, 2023 —
The American Society of Civil EngineersRESTON, Va. – The White House Climate Policy Office hosted the Summit on Building Climate Resilient Communities today and unveiled its
National Climate Resilience Framework for communities to build more resiliently as they face increasingly severe weather events. The framework features comprehensive recommendations and opportunities for action, including partnerships between federal agencies and leading standards development organizations such as the
American Society of Civil Engineers (ASCE), to improve the resilience of buildings and other infrastructure. ASCE president Maria Lehman, P.E., was in attendance for the Summit.
ASCE's most widely adopted standard,
ASCE 7-22, is the primary reference of structural design requirements in all U.S. building codes and is updated every six years to reflect the latest data and trends presented by an ever-changing climate. Its most recent update, published in 2022, includes updates to environmental hazards used for building design including new wind speeds along the hurricane coastline, a completely new chapter for tornado loads, and the most substantial update to its chapter on flood loads since the inception of ASCE 7-22 – calling for structures to be built to withstand 500-year floods rather than the previous standard of 100-year flood mitigation.
Although modern codes and standards, such as ASCE 7-22, can mitigate climate hazards, many communities throughout the U.S. have not yet adopted these practices. The new White House framework calls for ensuring federal funding requires climate-resilient infrastructure investments by encouraging government at all levels to adopt consensus-based engineering standards, which would go a long way towards addressing vulnerabilities posed by future climate impacts.
ASCE, in conjunction with industry leaders represented at the Summit, supports federal efforts to improve climate data, enforce the most stringent codes and standards, and provide technical assistance to building and infrastructure stakeholders. To learn more about environmental hazard mitigation resources, follow
ASCE's Pathways to Resilient Communities Toolkit, a plain-language guide for federal, state, and local leaders as they seek out standards, best practices, data, and strategies that can be implemented to safeguard communities across the country from increasingly severe weather events.
ABOUT THE AMERICAN SOCIETY OF CIVIL ENGINEERS
Founded in 1852, the American Society of Civil Engineers represents more than 150,000 civil engineers worldwide and is America's oldest national engineering society. ASCE works to raise awareness of the need to maintain and modernize the nation's infrastructure using sustainable and resilient practices, advocates for increasing and optimizing investment in infrastructure, and improve engineering knowledge and competency. For more information, visit www.asce.org or www.infrastructurereportcard.org and follow us on Twitter, @ASCETweets and @ASCEGovRel.
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Sellers of South Florida Mansion Failed to Disclose Construction Defects
October 08, 2014 —
Beverley BevenFlorez-CDJ STAFFA couple who reportedly sold their custom, beach-front home on Golden Beach for more money than any other home in that town previously, may have failed to disclose construction defects, according to Daily Business Review.
The original owners, reported Daily Business Review, claimed (according to court documents) that “they were ‘unable to spend even one night because an overwhelming smell of mold in the home triggered a severe reaction in Mrs. Hochberg.’" They also alleged the new home had “cracked walls, drafty doors, leaky windows, poorly cut marble and peeling stucco.” The owners sued the subcontractors, but lost due to not filing within the four-year statute of limitations.
While water leaks were disclosed during the sale with a notation that all leaks had been repaired, “the extent of the home's repair history was not discussed during nearly eight months of haggling over the property, the buyer's broker said.”
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#8 CDJ Topic: The Las Vegas HOA Fraud Case Concludes but Controversy Continues
December 30, 2015 —
Beverley BevenFlorez-CDJ STAFFIn the long-running case involving the scheme to take over and defraud homeowner associations in Las Vegas, Nevada, the
Las Vegas Review-Journal reported that a “total of 43 defendants either pleaded guilty or were convicted at trial in what prosecutors say is the largest public corruption case ever in Nevada.” Despite the conclusion of the trial and the convictions, “U.S. Magistrate Judge George Foley Jr. denied a June request by the Las Vegas Review-Journal to dissolve two protective orders keeping secret 6 million pages of documents, including 10,000 pages of FBI and other law enforcement reports.”
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Reported in an editorial, the Las Vegas Review-Journal attorney Maggie McLetchie stated after Judge Foley’s ruling: “It’s our view the public and the newspaper should be able to evaluate a law enforcement investigation including assessing why the government may have gone more lightly on some people. Given the issues…within the U.S. attorney’s office, it’s in the public’s interest to probe what occurred.”
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