Homebuilders Opposed to Potential Change to Interest on Construction Defect Expenses
January 22, 2013 —
CDJ STAFFIn 2008, the Colorado Supreme Court concluded that in calculating interest on the expense of repairing construction defects would start at the time that the defect was repaired. In 2009, the Colorado State Legislature introduced a bill that would have made homeowners eligible for interest back to the purchase date of their homes. The Colorado Springs Business Journal notes that the Colorado Springs Housing and Building Association is concerned that the legislature might take up the issue again, in which case, the HBA would oppose it.
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Real Estate & Construction News Round-Up (05/18/22)
June 13, 2022 —
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law BlogBusinesses renovate office spaces at a historic pace, China plans to build a 3D-printed hydropower dam without human workers, the U.S. infrastructure package has thousands of projects underway, and more.
- Miami’s crypto-real estate boom has been challenging all conventional wisdoms as the price of crypto currencies like Bitcoin have surged, which could spill over into other popular real estate markets. (Peter Lane Taylor, Forbes)
- China is planning to build the world’s first 3D-printed hydropower dam in Tibet, with an AI-powered design and no human workers. (Matthew Loh, Business Insider)
- With the hybrid work model here to stay, businesses are having their offices renovated at a historic pace. (Joe Dyton, Connected Real Estate Magazine)
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Pillsbury's Construction & Real Estate Law Team
Georgia Supreme Court Rules Construction Defects Can Constitute an Occurrence in CGL Policies
April 05, 2011 —
Beverley BevenFlorez CDJ STAFFRecently, the Supreme Court of Georgia reversed the decision in American Empire Surplus Lines Insurance Company v Hathaway Development Company, Inc. stating that because Whisnant’s faulty workmanship caused damage to the surrounding properties, the construction defects constituted “occurrences” under the Commercial General Liability (CGL) policy. Unlike the South Carolina Supreme court ruling in the case of Crossman Communities v Harleysville Mutual, the Georgia Supreme Court stated that an accident can happen intentionally if the effect is not the intended result.
Interestingly, the only dissenting judge, J. Melton, disagreed with his colleagues on the basis that “although the term ‘accident’ is not specifically defined in the policy, it is axiomatic that an ‘accident’ cannot result from ‘intentional’ behavior.” It is clear that what constitutes an occurrence in CGL policies is still being hotly debated.
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Potential Construction Liabilities Contractors Need to Know
September 21, 2020 —
Manipal Dhariwal - Construction ExecutiveThe outbreak of COVID-19 started in early December 2019, gradually expanding to the other countries of the world. The spread of the pandemic did not just affect the world in terms of health, but also made industries suffer across all verticals—leading to a few unique challenges for construction contractors.
From financial imbalance to trouble retaining cash flow, the circumstances have turned to be completely unfavorable for the contractors that rely on banks for essential surety credits to sustain. To prevent loss of liquidity, the contractors are leaning toward construction accounting software and other technology to keep their accounting data in place and avoid risks with project deliveries.
But still, there are many other factors that must be considered to maintain cash flow for potential credit availability such as debt agreements and lines of credit, which involve financing of equipment and vehicles.
Nevertheless, it is completely the responsibility of the contractors to stick with the guidelines related to the line of credit and debt agreements which in most cases are covenant ratios.
Reprinted courtesy of
Manipal Dhariwal, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Las Vegas’ McCarran Tower Construction Issues Delays Opening
August 13, 2014 —
Beverley BevenFlorez-CDJ STAFFThe Las Vegas Review-Journal reported that an improperly applied chemical coating might delay the opening of McCarran International Airport’s Federal Aviation Administration tower by a year and cost millions of dollars to repair.
The chemical coating was intended “to prevent the spread of toxic fungus,” but was “improperly applied and is ineffective,” workers on the site told the Las Vegas Review-Journal.
“Officials said the” $99 million, 352-foot “tower was expected to be operational by 2015, but the FAA now says it won’t be able to use the facility until late 2016 or early 2017.”
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Being the Bearer of Bad News (Sounding the Alarm on Construction Issues Early and Often) (Law Note)
October 02, 2023 —
Melissa Dewey Brumback - Construction Law in North CarolinaOur recent look into termination brings up another issue important to architects and engineers– how to sound the alarm about construction or building code violations. Sometimes, a project owner may be so focused on project completion that they want to overlook the sub-par work that may be occurring in an effort to get project open “on time.” In such cases, only if a life safety violation is reported to the authority having jurisdiction will the owner finally terminate a faulty contractor from a construction project.
Even if the work is not a life/safety issue, it is important that when delivering bad news about the quality of work that your notice be early, loud, and frequent. Basically, everyone involved should be aware, through written communications, that there is an issue that needs to be addressed on site, the contractor is messing up the construction, and what needs to be done to fix the issue(s). If the owner is willing to live with the faulty work (and it is not a life/safety matter), then at least you’ve provided notice and warned them of the issue.
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Melissa Dewey Brumback, Ragsdale LiggettMs. Brumback may be contacted at
mbrumback@rl-law.com
Only Two Weeks Until BHA’s Texas MCLE Seminar in San Antonio
April 28, 2014 —
Beverley BevenFlorez-CDJ STAFFThere are just two weeks remaining to sign up for Bert L. Howe & Associate’s inaugural Texas MCLE seminar, “THE RESIDENTIAL CONSTRUCTION PROCESS & CONSTRUCTION DEFECT LITIGATION.” This activity will be presented on Friday, May 9th at noon in BHA’s San Antonio offices, located at 17806 IH 10, Suite 300, San Antonio, TX 78256. There is no cost for attendance at this seminar and lunch will be provided.
This course has been approved for Minimum Continuing Legal Education credit by the State Bar of Texas Committee on MCLE in the amount of 1.0 credit hours, of which 0.0 credit hours will apply to legal ethics/professional responsibility credit. The seminar will be presented by Don MacGregor, general contractor and project manager.
Water intrusion through doors, windows and roofing systems, as well as soil and foundation-related movement, and the resultant damage associated therewith, are the triggering effects for the vast majority of homeowner complaints today and serve as the basis for most residential construction defect litigation. The graphic and animation-supported workshop/lecture activity will focus on the residential construction process from site preparation through occupancy, an examination of associated damages most often encountered when investigating construction defect claims, and the inter-relationships between the developer, general contractor, sub trades and design professionals. Typical plaintiff homeowner/HOA expert allegations will be examined in connection with those building components most frequently associated with construction defect and claims litigation.
The workshop will examine:
* Typical construction materials, and terminology associated with residential construction
* The installation process and sequencing of major construction elements, including interrelationship with other building assemblies
* The parties (subcontractors) typically associated with major construction assemblies and components
* An analysis of exposure/allocation to responsible parties.
Attendance at THE RESIDENTIAL CONSTRUCTION PROCESS & CONSTRUCTION DEFECT LITIGATION seminar will provide the attendee with:
* A greater understanding of the terms and conditions encountered when dealing with common construction defect issues
* A greater understanding of contractual scopes of work encountered when reviewing construction contract documents
* The ability to identify, both quickly and accurately, potentially responsible parties
* An understanding of damages most often associated with construction defects, as well as a greater ability to identify conditions triggering coverage
Course #: 901290467 / Sponsor #: 14152.
To register for the event, please email Don MacGregor at dmac@berthowe.com. If you have any questions, please feel free to contact Don at (210) 540-9017 (office) or (714) 713-4956 (cell).
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Delaware Court Holds No Coverage for Faulty Workmanship
May 07, 2015 —
Tred R. Eyerly – Insurance Law HawaiiA Delaware trial court found that the carrier properly denied coverage to a contractor who allegedly caused property damage due to faulty workmanship. Westfield Ins. Co., Inc. v. Miranda & Hardt Contracting and Building Serv., L.L.C., 2015 Del. Super. LEXIS 160 (Del. Super. Ct. March 30, 2015).
In 2004 and 2005, Miranda built a home pursuant to a contract with Fenwick Ventures, LLC. The homeowners purchased the home from Fenwick in 2006. In 2012, the homeowners contacted Fenwick to complain about defects in the home's construction. In 2014, the homeowners filed a complaint against Fenwick and Miranda.
The lawsuit alleged that during the construction of the home, Miranda used inadequate building materials, improperly installed building materials, violated building codes, and fraudulently represented that the home was properly constructed.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com