Fairfield Connecticut Building Expert Directory

Construction Litigation Roundup: “Builder’s Risk Indeed”

October 24, 2023 — Daniel Lund III - Lexology
A contractor for a hotel in Seattle was tasked with constructing the hotel utilizing premanufactured modular hotel rooms. The modular unit portion of the project was the subject of a $15.8 million subcontract between the general contractor and the manufacturer. The manufacturer was also responsible to the GC for shipping and installing the modular units. Shipping was to be “DDP,” or “Delivery Duty Paid” – which, according to a New York federal court, “is an international shipping term meaning that the seller assumes all responsibilities and costs for delivering property to the named place of destination, including export and import clearance, fees, duties, and taxes.” Additionally, per the subcontract, the manufacturer was responsible for “ensur[ing] all modular units [were] covered, secured[,] and protected from damage during the shipping process….” The modular units were shipped from Poland to Seattle. In the shipping process, the units spent some time in the Port of Everett in Washington state, where the units sustained water damage while sitting in port. A related damage claim made by the subcontractor against the general contractor’s builder’s risk policy. On the face of the policy, the policy covered subcontractors as “additional insured” parties, covered all manner of materials and the like to be used on the project, and would provide that coverage in the process of transporting the materials insofar as “inland or coastal waters” were concerned. Yet, the builder’s risk insurer refused to cover the claim for the damages to the modular units which occurred while sitting in port in Everett. Read the court decision
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Reprinted courtesy of Daniel Lund III, Phelps
Mr. Lund may be contacted at daniel.lund@phelps.com

That’s What I have Insurance For, Right?

December 31, 2014 — Craig Martin – Construction Contractor Advisor
Ah, the age old question, What does my insurance really cover? A federal court in Georgia recently weighed in on this issue in Standard Contractors, Inc. v. National Trust Insurance Company, and ruled that a contractor’s commercial general liability insurer did not have to pay for damage caused by a subcontractor. Standard Contractors was hired to renovate the pool on an army base. Standard hired a subcontractor to for design and installation work. The subcontractor’s work was subpar in that the subcontractor omitted a number of parts, installed the wrong parts, and caused more than $400,000 in damage to the pool. Standard submitted a claim to its insurer seeking coverage for the loss under its commercial general liability policy. 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

Insured's Claim for Cyber Coverage Rejected

December 29, 2020 — Tred R. Eyerly - Insurance Law Hawaii
Having failed to adequately secure cyber coverage, the insured law firm's lawsuit was properly dismissed by the trial court on summary judgment. Johnson v. Smith Bros. Ins., LLC, 2020 Vt. Unpub. LEXIS 98 (Vt. Sept. 4, 2020). The law firm attended a CLE seminar presented by the Vermont Attorneys Title Insurance Corporation. Scott Garcia, an employee of Smith Brothers, an insurance agency, gave a presentation on professional liability insurance focusing on cybersecurity issues, including fraudulent scams. After the presentation, one of the law firms members spoke with Garcia and expressed an interest in securing a professional malpractice policy with cyber security coverage. Garcia said he would check the firm's current policy, but was confident he could provide better coverage. It was unclear whether the firm ever provided its current policy. A couple of weeks later, the firm submitted an online application for professional liability coverage through the Smith Brothers' website. The application neither referenced the conversation with Garcia nor specifically requested cybersecurity coverage. Smith Brothers then sent the policy covering a one-year period. The policy included coverage for up to $10,000 for losses resulting from a network or security breach in the performance of professional services. A year later, the firm renewed the same policy. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

VOSH Jumps Into the Employee Misclassification Pool

July 30, 2015 — Christopher G. Hill – Construction Law Musings
The proper classification of workers by construction companies has been on the radar of the Department of Labor for both the US and Virginia governments for quite a while. While most of the misclassification is innocent and not done to create issues, there have been enough instances of purposeful misclassification of certain workers as independent contractors (thus avoiding workers comp and other payroll expenses) that innocent contractors have born the brunt of these issues through increased payroll costs over those that misclassify (in the form of necessarily higher bids, higher overhead, etc.). As an additional deterrent to improper classification of workers, the Virginia Department of Labor and Industry has issued guidelines for what will occur in Virginia Department of Safety and Health (VOSH) cases. Read the court decision
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Reprinted courtesy of Christopher G. Hill, Law Office of Christopher G. Hill, PC
Mr. Hill may be contacted at chrisghill@constructionlawva.com

When Construction Contracts Go Sideways in Bankruptcy

February 16, 2017 — Tracy Green - California Construction Law Blog
The contractor on a project files a bankruptcy case. How should the property owner and subcontractors proceed? When a party to a contract files bankruptcy, the other party’s actions are constrained by the bankruptcy code. Types of Bankruptcies The typical bankruptcy case involves a chapter 7 complete liquidation, chapter 13 reorganization for an individual, or a chapter 11 reorganization or liquidation. In a chapter 7 the business ceases to operate and a panel trustee is appointed immediately upon the filing of the case. The chapter 7 trustee’s duties are to liquidate assets for the benefit of creditors and to prosecute litigation that can result in assets for the creditors. In a chapter 13, the individual debtor continues to operate, and there is a trustee, but the trustee’s roll is limited to reviewing the chapter 13 plan and making sure that the plan is performed. In a chapter 11, the debtor retains control of its assets and continues to operate its business until a plan is confirmed. During the chapter 11 period before a plan is approved, the debtor will decide which contracts it wants to assume or reject, all while operating the company and preparing a plan. Read the court decision
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Reprinted courtesy of Tracy Green, Wendel Rosen Black & Dean LLP
Ms. Green may be contacted at tgreen@wendel.com

Privity Problems Continue for Additional Insureds in the Second Circuit

November 08, 2017 — Samantha M. Martino – Saxe Doernberger & Vita, P.C.
On October 4, the Second Circuit held that Harleysville Insurance Company had no duty to defend or indemnify a project owner or general contractor as additional insureds under a sub-subcontractor’s commercial general liability (CGL) policy due to lack of direct contractual privity. 1 The underlying claim arose when an employee of The Kimmell Company, Inc. (Kimmell) was injured while repairing an HVAC system at a building owned by the University of Rochester Medical Center (UR). The injured employee sought damages for his injuries and fi led suit against (1) UR; (2) LeChase Construction Corp. (LeChase), the general contractor for the project; and (3) J.T. Mauro Co. Inc. (Mauro), a subcontractor hired by LeChase. Mauro hired Kimmell as a sub-subcontractor to perform HVAC services at the project. The Mauro-Kimmel contract required Kimmel to add Mauro, UR, and LeChase as additional insureds under Kimmell’s CGL policy. Read the court decision
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Reprinted courtesy of Samantha M. Martino, Saxe Doernberger & Vita, P.C.
Ms. Martino may be contacted at smm@sdvlaw.com

Guessing as to your Construction Damages is Not the Best Approach

November 18, 2019 — David Adelstein - Florida Construction Legal Updates
Arbitrarily guessing as to your construction damages is NOT the best approach. Sure, experts can be costly. No doubt about it. Having an expert versus guessing as to your construction damages caused by another party’s breach of contract is a no brainer. Engage an expert or, at a minimum, be in a position to competently testify as to your damages caused by another party’s breach of contract. Otherwise, the guessing is not going to get you very far as a concrete subcontractor found out in Patrick Concrete Constructors, Inc. v. Layne Christensen Co., 2018 WL 6528485 (W.D. New York 2018) where the subcontractor could not competently support its delay-related damages or change orders and, equally important, could not support that the damages were proximately caused by the general contractor’s breach of the subcontract. In this case, the concrete subcontractor entered into a subcontract to perform concrete work for a public project. The project was delayed and the general contractor was required to pay liquidated damages to the owner. Not surprisingly, the subcontractor disputed liability for delays and sued the general contractor for all of its delay-related damages “in the form of labor and materials escalation, loss of productivity, procurement and impact costs, field and home office overhead, idle equipment, inability to take on other work, lost profits, and interest.” Patrick Concrete Constructors, 2018 WL at *1. The general contractor moved for summary judgment as to the plaintiff’s delay-related damages – the subcontractor’s damages were nothing but guesses and the subcontractor could not prove the general contractor was the cause of the subcontractor’s damages. Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

Reasons to Be Skeptical About a Millennial Homebuying Boom in 2016

December 10, 2015 — Patrick Clark – Bloomberg
Predicting whether millennials are finally going to start buying homes in large numbers has become a seasonal sporting event for real estate experts (also something resembling a periodic parental nag). There's good reason for the abiding fixation. Millennials are the largest generation in the U.S. labor force and something akin to guppies in the housing market food chain: When a first-time buyer moves into an entry-level house, it lets the sellers upgrade. But they've been held back by housing price increases that outpace wage hikes, not to mention limited access to credit, and rising rents that make it harder to save for a down payment. Will next year be the year that millennials1 finally satisfy builders and real estate agents (not to mention mom and dad) by making their presence felt in the housing market? Yes, but not to the degree that many might hope. Millennials will make up the largest share of homebuyers in 2016 This is more of a demographic inevitability than a prediction. Historically, the largest share of U.S. homebuyers have been between 25 and 34 years old. Millennials will buy one out of three homes in 2016, predicts Jonathan Smoke, chief economist for Realtor.com, a small uptick from this year. If you prefer your glass half empty, though, Zillow Chief Economist Svenja Gudell thinks the median age of first-time home buyers will hit a new high next year. In either case, Americans will continue the trend of buying their first homes later in life than they did in past decades, as the chart below shows—likely due to some mix of wage stagnation, rising housing costs, and a tendency to start families later in life. Read the court decision
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Reprinted courtesy of Patrick Clark, Bloomberg

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