Building Down in November, Even While Home Sales Rise
January 17, 2013 —
CDJ STAFFThe Chicago Sun-Times reports that construction saw a small decline in November, the first since the spring. Happily, though this was the first dip in eight months, construction spending dropped only 0.3 percent, compared to October. The Sun-Times noted that the level of construction is well below what is considered healthy for the economy, while still being above the low of February 2011.
While fewer homes (and other buildings) were built, sales of new homes were up 4.4 percent in November. Home purchases were at their highest rate in more than two years.
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Meritage Acquires Legendary Communities
July 23, 2014 —
Beverley BevenFlorez-CDJ STAFFAccording to Big Builder, Meritage entered Atlanta through its acquisition of Legendary Communities for $130 million, “completing a two-year quest.”
“Probably for about two years, we’ve been looking in the market, talking to builders, and studying the geography, and meeting different people to learn who the players are and learn about the area,” Meritage Homes chairman and CEO Steven J. Hilton told Big Builder.
This acquisition makes Meritage Homes “the number one builder in the Greenville-Anderson-Mauldin, S.C. market, owning more than 16 percent of the 2013 market share with 266 closings, according to Metrostudy data. It also owns almost seven percent of the market share in nearby Spartanburg, S.C. with 44 closings.”
Legendary fits “in very nicely with what we do at Meritage,” Hilton said to Big Builder. “We’re a strong first and second move up builder, as are they at Legendary. It’s a very complementary fit between the two companies.”
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ConsensusDOCS Updates its Forms
October 21, 2015 —
Christopher G. Hill – Construction Law MusingsAs reported recently in ENR Magazine, among other publications, the ConsensusDOCS folks have updated their contract forms. Why is this news?
First of all, it’s only been around three and a half years since these documents were officially released and this release is about 18 months sooner than anticipated (the original revision cycle was to be 5 years). Why the revision? According to my friend and counsel to ConsensusDOCS, Brian Perlberg, one major rationale is that “the economics of the construction industry today looks nothing like it did [in 2007.”
Among the changes are several terminology changes (“constructor” instead of “contractor” for instance), the addition of mandatory green building design as a basic service (these forms already have a Green Building Addendum) if included in the Owner’s plan and the ability to provide for prevailing party attorney fees (before both sides of a dispute bore their own fees).
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Christopher G. Hill, Law Office of Christopher G. Hill, PCMr. Hill may be contacted at
chrisghill@constructionlawva.com
Insured's Failure to Challenge Trial Court's Application of Exclusion Makes Appeal Futile
November 15, 2022 —
Tred R. Eyerly - Insurance Law HawaiiThe Texas Court of Appeals affirmed the trial court's granting of summary judgment to the insurer because the appeal failed to challenge the exclusion under which the insurer found no coverage. Sosa v. Auto Club Indemn. Co., 2022 Tex. App. LEXIS 6520 (Tex. Ct. App. Aug. 30, 2022).
Sosa's house was damaged during Hurricane Harry on August 26, 2017. Sosa filed a claim with Auto Club. She reported that two feet of floodwater had entered her home, her roof was missing shingles and was leaking, and she had sustained interior damage. An adjuster estimated the cost to prepare the roof damage was $1,191.96, less that her deductible. Auto Club determined that any remaining damage was caused by flood water, which was expressly excluded from coverage.
On November 11, 2020, Sosa filed suit against Auto Club for breach of the policy. Among other things, she argued the adjuster spent minimal time at her home inspecting and was inexperienced. In its answer, Auto Club asserted Sosa's claim was time-barred by the statute of limitations. Sosa then filed an amended complaint and changed the date of the loss from August 26, 2017, to June 28, 2019.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Economic Loss Rule Bars Claims Against Manufacturer
November 02, 2020 —
David Adelstein - Florida Construction Legal UpdatesThe economic loss rule lives to bar a claim against a product manufacturer in a real estate transaction. In a products liability action, there needs to be personal injury or property damage, other than to the property itself, in order to recover economic damages. Otherwise, the economic loss rule will bar the recovery of such economic losses when the economic losses deal to the product itself. This is important to keep in mind in any product liability action against a manufacturer.
In a recent case, 2711 Hollywood Beach Condominium Assoc’n, Inc., v. TRG Holiday, Ltd., 45 Fla. L. Weekly D2179a (Fla. 3d DCA 2020), a condominium association purchased the condominium from the developer. Subsequently, it noticed leaks with the fire suppression system in the condominium and sued multiple parties for damages for repairs due to the leaks and the replacement of the fire suppression system. One of the parties sued in negligence and strict liability was a manufacturer of pipe fittings used in the fire suppression system. The manufacturer moved for summary judgment based on the economic loss rule and relying on the 1993 Florida Supreme Court opinion in Casa Clara Condominium Assoc’n v. Charley Toppino & Sons, Inc., 620 So.2d 1244 (Fla. 1993), holding “the economic loss rule limited a defendant’s tort liability for allegedly defective products to injuries caused to persons or damage caused to property other than the defective product itself.” 2711 Hollywood Beach Conominium Assoc’n, supra. The trial court agreed with the manufacturer and granted summary judgment. On appeal, the Third District affirmed based on the economic loss rule:
The Association bargained for, purchased and received a building; [the manufactuer’s] fittings were only a component of the FSS [fire suppression system], incorporated into the building. Applying the rule set forth in Casa Clara, the Association purchased a completed building from the developer. [The manufactuer’s] fittings were “an integral part of the finished product and, thus, did not injure ‘other’ property.” Injury to the building itself is not injury to “other” property because the product purchased by the Association was the building. See Casa Clara, 620 So. 2d at 1247. The economic loss rule therefore bars the Association’s recovery as to [the manufacturer] to the extent that it sought damages to replace the FSS [fire suppression system] and repair damage to the building.
2711 Hollywood Beach Conominium Assoc’n, supra (internal citations omitted).
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
One Nation, Under Renovation
November 07, 2022 —
Zach Mortice - BloombergIn late 2019, Chicago Mayor Lori Lightfoot announced a landmark investment in some of the city’s poorest neighborhoods. Invest South/West would direct $1.4 billion in total, including $750 million in public funds, to redevelop properties across the city’s South and West Sides.
Focused on 10 specific neighborhoods, the program’s first projects broke ground in August and September. Teams of workers will turn a firehouse into a culinary hub and event space; a stately Art Deco bank is set to be converted into an art space that will anchor an attached mixed-use development. Another former bank, in Humboldt Park, will be renovated into Latino-owned commercial offices, an entrepreneurial incubator space, and a Latino cultural center, as well as housing. These reuse projects aim to do more than fill the gaps of Chicago’s legendary vacant-property crisis: In reanimating shuttered historic buildings, the initiative aims to restore the economies of commercial corridors that were victims of destructive mid-20th-century “urban renewal” initiatives.
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Zach Mortice, Bloomberg
Late Filing Contractor Barred from Involving Subcontractors in Construction Defect Claim
March 01, 2012 —
CDJ STAFFThe Colorado Court of Appeals looked at that state’s Construction Defect Action Reform Act in determining if a general contractor could add subcontractors as third-party defendants to a construction defect lawsuit. Shaw Construction, LLC was the general contraction of the Roslyn Court condominium complex, and was sued by the homeowners’ association in a construction defect case. United Builder Services was the drywall subcontractor on the project. MB Roofing had installed roofs, gutters, and downspouts. The certificate of occupancy for the last building was issued on March 10, 2004. The project architect certified completion of all known remaining architectural items in June, 2004.
The HOA filed a claim against the developers of the property on January, 21, 2009. A week later, the HOA amended its complaint to add Shaw, the general contractor. Shaw did not file its answer and third-party complaint until March 29, 2010, sending its notice of claim under the CDARA on March 30.
The subcontractors claimed that the six-year statute of limitations had ended twenty days prior. Shaw claimed that the statute of limitations ran until six years after the architect’s certification, or that the HOA’s suit had tolled all claims.
The trial court granted summary judgment to the subcontractors, determining that “substantial completion occurs ‘when an improvement to real property achieves a degree of completion at which the owner can conveniently utilize the improvement of the purpose it was intended.’”
The appeals court noted that “Shaw correctly points out that the CDARA does not define ‘substantial completion.’” The court argued that Shaw’s interpretation went against the history and intent of the measure. “Historically, a construction professional who received a complaint responded by ‘cross-nam[ing] or add[ing] everybody and anybody who had a part to play in the construction chain.’” The court concluded that the intent of the act was to prevent unnamed subcontractors from being tolled.
The court further rejected Shaw’s reliance on the date of the architect’s certification as the time of “substantial completion,” instead agreeing with the trial court that “the architect’s letter on which Shaw relies certified total completion.”
The appeals court upheld the trial court’s determination that the statute of limitation began to run no later than March 10, 2004 and that Shaw’s complaint of March 29, 2010 was therefore barred. The summary judgment was upheld.
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What is a “Force Majeure” Clause? Do I Need one in my Contract? Three Options For Contractors, Subcontractors and Suppliers to Consider
June 20, 2022 —
William L. Porter - Porter Law GroupIn the world of the building and construction industry, the general rules of contracting are fairly simple. A supplier agrees to supply equipment or materials for a specific price and within a certain time frame, does so, and is paid an agreed sum. Likewise, contractors and subcontractors agree to build structures per plans and specifications within certain time frames and are paid accordingly. Pretty simple. But what happens when some outside event makes performance impossible or unduly expensive or substantially delayed? What happens, for example, if a ship is sitting off the coast of Long Beach for three months with equipment ordered for the project and it cannot be unloaded due to a labor shortage? What if government mandates cause factories that build needed equipment to close due to an epidemic or pandemic? What if the supply warehouse holding the equipment until it is ready for installation unexpectedly burns to the ground? What if a Russian missile blows up the factory in Ukraine where the intended equipment is being manufactured? What happens then? Who bears the financial consequence?
A properly constructed “force majeure” clause may provide the answer to these questions. The Marriam-Webster Dictionary defines “force majeure” as a literal translation from the French meaning “a superior or irresistible force.” It further defines the term as “an event or effect that cannot be reasonably anticipated or controlled.” The Oxford Dictionary defines force majeure as “unexpected circumstances, such as a war, that can be used as an excuse when they prevent somebody from doing something that is written in a contract.”
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William L. Porter, Porter Law GroupMr. Porter may be contacted at
bporter@porterlaw.com
