Rikus Locati Selected to 2024 Northern California Rising Stars!
August 05, 2024 —
Dolores Montoya - Bremer Whyte Brown & O'Meara LLPCongratulations to BWB&O’s 2024 Northern California Super Lawyers Rising Stars!
BWB&O is proud to announce that Walnut Creek Associate
Rikus Locati has been selected to the 2024 Northern California Super Lawyers list as Rising Stars for his work in Personal Injury.
Super Lawyers is a rating service of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement. The objective of Super Lawyers’ patented multiphase selection process is to create a credible, comprehensive, and diverse listing of outstanding attorneys that can be used as a resource for attorneys and consumers searching for legal counsel.
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Dolores Montoya, Bremer Whyte Brown & O'Meara LLP
Customer’s Agreement to Self-Insure and Release for Water Damage Effectively Precludes Liability of Storage Container Company
December 16, 2019 —
Christopher Kendrick & Valerie A. Moore – Haight Brown & Bonesteel LLPIn Kanovsky v. At Your Door Self Storage (No. B297338; filed 11/25/19), a California appeals court held that a waiver of liability and agreement to self-insure in a storage container contract barred coverage for water damage to goods stored in the container.
In Kanovsky, plaintiffs contracted for portable storage containers when moving. They loaded their washing machine into one of the containers without checking whether it was fully drained. They locked the containers and reopened them four years later to discover water damage to the contents. They sued the storage company, alleging causes of action for breach of contract; tortious breach of covenant; negligence; and violation of the Consumer Legal Remedies Act, Civil Code section 1750. The storage company’s insurer intervened and moved for summary judgment, which was granted.
The appeals court affirmed. The storage company’s contract contained a release of liability stating that personal property was stored “at the customer’s sole risk” and the owners “shall not be liable for any damage or loss,” including water damage. Further, the contract stated that the containers were not waterproof, and again that the storage company was not liable for water damage. The contract attached an addendum further stating that the owner was “a landlord renting space, is not a warehouseman, and does not take custody of my property.” The addendum went on with an acknowledgement that the owner: “2. Is not responsible for loss or damage to my property; 3. Does not provide insurance on my property for me; and 4. Requires that I provide my own insurance coverage or be ‘Self-Insured’ (personally assume risk of loss or damage).”
Reprinted courtesy of
Christopher Kendrick, Haight Brown & Bonesteel LLP and
Valerie A. Moore, Haight Brown & Bonesteel LLP
Mr. Kendrick may be contacted at ckendrick@hbblaw.com
Ms. Moore may be contacted at vmoore@hbblaw.com
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Bad Faith and a Partial Summary Judgment in Seattle Construction Defect Case
February 10, 2012 —
CDJ STAFFThe US District Court of Washington has issued a ruling in the case of Ledcor Industries v. Virginia Surety Company, Inc. Ledcor was the builder of a mixed-use real estate project in Seattle called the Adelaide Project. Ledcor purchased an insurance policy from Virginia Surety covering the project. After the completion of the project, Ledcor received complaints of construction defects from the homeowners, which they forwarded to Virginia Surety.
Virginia Surety denied coverage on several grounds. Absent any lawsuit, Virginia claimed that there was “not yet any duty to defend or indemnify.” Further, as the policy commenced ten days after work on the project was substantially completed, Virginia cited a provision in the policy that excluded coverage for damage that occurred before the policy began. As problems included water intrusion, Virginia noted an exclusion for fungal damage. Finally, Virginia noted that it was not clear whether damage was due to Ledcor’s own actions.
The homeowners sued over the construction defects. Ledcor settled these suits before trial. In this, they were defended by, and settlements were paid by American Home, another of Ledcor’s insurers. Ledcor claims that Virginia Surety acted in bad faith by denying coverage and by its failure to investigate the ongoing nature of the work at the project.
The judge determined that Virginia Surety acted in bad faith when it invoked the fungus exclusion. Virginia noted that fungal damage “‘would have been’ referenced in the list of construction defects,” however, the HOAs claimed only “water stains” and “water damage,” and made no mention of mold or fungus. The court found that Virginia Surety “was not entitled to deny coverage simply because it may have suspected that mold or fungus damage existed.” The court noted that further proceedings would be needed to determine what portion of the settlement Virginia is obligated to pay.
The court found that there were matters of fact to be determined on the further issues in the case. The judge wrote that although Virginia acted in bad faith in invoking the fungus exclusion, it still had to be determined if they were in breach of contract by failing to defend Ledcor. Ledcor still needs to show that the damages claimed by the HOA were due to work actually covered by Virginia Surety.
Ledcor made an additional claim that Virginia Surety violated Washington’s laws concerning the insurance industry. Here, the court noted that the improper exclusion for fungus issues “constitutes a per se unfair trade practice.” Six other claims were made under this law. The court found that Virginia Surety did not misrepresent “pertinent facts or insurance policy provisions.” It also issued its denial letter promptly, satisfying the fifth provision. However, Virginia Surety did violate the second provision, in that it failed “to acknowledge and act reasonably promptly upon communications with respect to claims.” Two other issues could not be determined.
Judge Martinez’s decision granted a summary judgment to Ledcor on the issue of bad faith. An additional summary judgment was granted that Virginia Surety violated Washington’s Insurance Fair Conduct Act. Judge Martinez did not grant summary judgment on any of the other issues Ledcor raised.
Read the court’s decision…
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EPA and the Corps of Engineers Repeal the 2015 “Waters of the United States” Rule
January 13, 2020 —
Anthony B. Cavender - Gravel2GavelThe pre-publication version of the final rule to be promulgated by EPA and the U.S. Army Corps of Engineers (ACOE) to repeal the 2015 redefinition of the Clean Water Act’s term “Waters of the United States” which is the linchpin of these agencies’ regulatory power under the CWA, was made available on September 12, 2019. The rule should be published in the Federal Register in the next few weeks, and it will be effective 60 days thereafter. Many challenges are expected to be filed in the federal courts.
The 2015 rule was very controversial, and petitions challenging the rule were filed in many federal district courts, several courts of appeal, and finally in the Supreme Court (see NAM v. Department of Defense), which held that all initial challenges must be filed in the federal district courts. The upshot of these challenges is that, at this time, the 2015 rule has been enjoined in more than half the states while the other states are bound by the 2015 rule, a situation which is frustrating for everyone.
In addition to repealing the 2015 rule, the agencies also restored the pre-2015 definition had had been in place since 1986. As a result, the pre-2015 definition of waters of the U.S. will again govern the application of the following rules: (a) the ACOE’s definition of “waters of the U.S.” at 33 CFR Section 328.3; (b) EPA’s general Oil Discharge rule at 40 CFR Section 110; (c) the SPCC rules at 40 CFR Part 112; (d) EPA’s designation of hazardous substances at 40 CFR Part 116; (e) EPA’s hazardous substance reportable quantity rule at 40 CFR Part 117; (f) the NPDES permitting rules at 40 CFR Part 122; (g) the guidelines for dredged or fill disposal sites at 40 CFR Part 230; (g) Exempt activities not requiring a CWA 404 permit (guidelines for 404 disposal sites at 40 CFR Part 232); (h) the National Contingency Plan rules at 40 CFR Part 300; (i) the designation of reportable quantities of hazardous substances at 40 CFR Part 302; and (j) EPA’s Effluent Guidelines standards at 40 CFR Part 401.
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Anthony B. Cavender, PillsburyMr. Cavender may be contacted at
anthony.cavender@pillsburylaw.com
The Looming Housing Crisis and Limited Government Relief—An Examination of the CDC Eviction Moratorium Two Months In
December 14, 2020 —
Zachary Kessler - Gravel2GavelMonths after the Centers for Disease Control and Prevention (CDC) issued a nationwide eviction moratorium using its emergency pandemic powers under the Public Health Service Act, the efficacy of this unprecedented measure remains unclear. While the Order ostensibly protects tenants facing homelessness or housing insecurity due to the financial impacts of the COVID-19 pandemic through the end of 2020, legal challenges have been initiated in Ohio and Georgia, with additional lawsuits appearing likely. Further, even barring legal challenges, courts have not handled these cases in a uniform manner. With lawmakers unable to reach any stimulus or COVID-19 relief agreement before the election, the CDC Order appears likely to remain the only federal eviction moratorium through its expiration on December 31, 2020.
Since the Order’s enactment, the CDC has since released new guidance, answering some of the open questions not covered by the initial Order. This guidance, while non-binding, is largely more favorable to landlords and property management companies than the initial text of the Order, as it provides that landlords are not required to make tenants aware of the Order’s protections and may challenge the truthfulness of the tenants’ declarations in any state or municipal court. The guidance also clarified the potential criminal penalties for violating the Order and the criminal penalties for perjury for bad faith submissions of the requisite declaration by tenants.
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Zachary Kessler, PillsburyMr. Kessler may be contacted at
zachary.kessler@pillsburylaw.com
JPMorgan Blamed for ‘Zombie’ Properties in Miami Lawsuit
June 18, 2014 —
Christie Smythe – BloombergJPMorgan Chase & Co. (JPM) engaged in a “pattern of discriminatory” lending that led to foreclosures, the city of Miami said in a lawsuit filed last week in federal court, the latest in a series of similar claims against the nation’s largest banks.
Last month, Banco Santander SA’s (SAN) U.S. unit was sued by the city of Providence, Rhode Island, over claims it stopped issuing mortgages in minority neighborhoods after the housing bubble burst. Santander Bank, previously named Sovereign Bank, pulled out of the neighborhoods and focused on white communities after being acquired by the Madrid-based lender in 2009, the city alleged.
Miami and Los Angeles are among cities to have filed similar lawsuits against Bank of America Corp., Citigroup Inc. (C) and Wells Fargo & Co. (WFC) for allegedly “red-lining” black and Hispanic areas as no-loan zones, and then “reverse red-lining,” flooding the areas with predatory mortgages even when minorities qualified for better terms.
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Christie Smythe, BloombergMs. Smythe may be contacted at
csmythe1@bloomberg.net
The Road to Hell is Paved with Good Intentions: A.B. 1701’s Requirement that General Contractors Pay Subcontractor Employee Wages Will Do More Harm Than Good
November 02, 2017 —
Steven M. Cvitanovic & Omar Parra - Haight Brown & Bonesteel LLPTales of subcontractors who close up shop before paying their employees are not all that uncommon, but they are certainly not common enough to require General Contractors to pay for that same labor twice. Last month, the California Legislature passed Assembly Bill No. 1701, which requires the General Contractor of a private construction project to pay all unpaid wages and fringe benefits owed to an employee of a subcontractor, irrespective of the tier, and even if the General Contractor made the payment. With the Governor’s recent signature, Assembly Bill No. 1701 is now the law of the land. Here is what you need to know:
- It applies to all private (but not public) construction contracts entered into on or after January 1, 2018;
- It gives a subcontractor’s employee a direct cause of action against the General Contractor for any unpaid wages and fringe benefits, even if the General Contractor has fully paid the subcontractor;
- It gives a third party owed fringe or other benefits a cause of action against the General Contractor;
- All actions by the employee or third party must be filed within one year of the earliest of the recordation of the notice of completion, the recordation of the notice of cessation of work, or the actual completion of the work;
- The General Contractor cannot contract to avoid the liability imposed by Assembly Bill No. 1701, but it can seek indemnity from the subcontractor; and
- At the General Contractor’s request, the subcontractor shall provide the General Contractor with its payroll records.
Reprinted courtesy of
Steven Cvitanovic, Haight Brown & Bonesteel LLP and
Omar Parra, Haight Brown & Bonesteel LLP
Mr. Cvitanovic may be contacted at scvitanovic@hbblaw.com
Mr. Parra may be contacted at oparra@hbblaw.com
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BIM Legal Liabilities: Not That Different
February 10, 2020 —
Christopher G. Hill - Construction Law MusingsFor this week’s Guest Post Friday here at Musings, we welcome Scott P. Fitzsimmons. Scott is an attorney with the construction law firm Watt, Tieder, Hoffar & Fitzgerald, where he represents contractors, subcontractors, owners, and engineers. He is also a LEED AP and an instructor for AGC of D.C., where he teaches BIM Contract Negotiation and Risk Allocation as part of AGC’s Certificate of Management, Building Information Modeling program.
When a new technology is introduced to the construction industry, contractors inevitably ask themselves one question “Great, how can this new gadget get me into trouble?” Building Information Modeling (BIM) is exactly the kind of technology that raises this fear. But, BIM has been around for a few years now, and the construction industry has done a good job of curtailing the fear of unanticipated legal liability.
Nevertheless, contractors should be aware of the pitfalls BIM introduces and should know how to limit their risk arising from this new “gadget.”
Often described as “CAD on Steroids,” BIM is truly much more than a simple design program. Along with early clash detection, BIM provides time and cost integration; calculates energy efficiency; and assists building maintenance long after project completion. Unlike CAD, BIM also modifies the collaborative nature of a construction project. Thus, subcontractors no longer review a design, submit shop drawings, and go to work. Rather, subcontractors are brought into the design process early in the project and often are asked to contribute to the design long before construction begins.
Asking a contractor or subcontractor to provide design services appears to shift the roles of an architect and a contractor. So, the questions abound: Is a contractor now responsible for design? Can the contractor be held responsible for defective design? Do not fret. To date, there has been only one advertised case addressing BIM liability. The reason is simple. For almost a hundred years, the United States Supreme Court has held that contractors are not responsible for defective design on a traditional design-bid-build project. Using BIM, therefore, should not modify a contractor’s responsibility. But, to ensure that your obligations do not extend beyond construction, all BIM requirements should be in writing and made part of your contract.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
