Party Cannot Skirt Out of the Very Fraud It Perpetrates
January 09, 2023 —
David Adelstein - Florida Construction Legal UpdatesAn interesting case came out of Florida’s Fourth District Court of Appeal that touches upon two important points.
First, the
independent tort doctrine does not apply when there is not a contract between the parties.
Second, an officer cannot escape fraud simply by claiming his or her actions were done as an officer of the company when he or she actively participated in the fraud.
Both of these points are best explained by initially going into the facts of this case. As you will see, the Court’s rationale relates to the premise that a party should not be able to skirt out of the very fraud it perpetrates.
Factual Background
Costa Investors, LLC v. Liberty Grande, LLC, 48 Fla.L.Weekly D7b (Fla. 4th DCA 2022) involved the ultimate development and construction of four adjacent properties into the Costa Hollywood Hotel. The properties were purchased by a company called Liberty Grande. Its president / manager was also the president of Liberty Grande’s wholly owned subsidiary called Costa Hollywood Property. Liberty Grande transferred the properties to Costa Hollywood Property and the deed was signed by the president / manager.
Read the court decisionRead the full story...Reprinted courtesy of
David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
Parties Can Agree to Anything In A Settlement Agreement………Or Can They?
October 17, 2023 —
Alexa Stephenson & Ivette Kincaid - Kahana FeldA settlement agreement is a contract. When parties to pending litigation enter into a settlement, they enter into a contract. Such a contract is subject to the general law governing all contracts. (T. M. Cobb Co. v. Superior Court (1984) 36 Cal.3d 273, 280 [204 Cal. Rptr. 143, 682 P.2d 338] [offers by a party to compromise under Code Civ. Proc., § 998].) Courts seek to interpret contracts in a manner that will render them “lawful, operative, definite, reasonable, and capable of being carried into effect’” without violating the intent of the parties. (Robbins v. Pacific Eastern Corp. (1937) 8 Cal.2d 241, 272–273; Kaufman v. Goldman, (2011) 195 Cal. App. 4th 734, 745.
A settlement agreement like a contract is a document that is typically negotiated between the parties to the agreement and it is up to the parties to determine its terms. Settlements take time and sometimes negotiating the settlement terms takes longer. This is especially true in complex litigation and multiparty matters where negotiating the settlement terms is just as contentious as litigating the matter. Just like contracts, in a settlement agreement the parties cannot agree to terms that violate public policy. A contract is thought to be against public policy if it results in a breach of law, harms citizens, or causes injury to the state. Contracts that are voided on public policy grounds carry no legal obligations. For example, an employer cannot force an employee to sign a contract that forbids the worker from joining a union.
Reprinted courtesy of
Alexa Stephenson, Kahana Feld and
Ivette Kincaid, Kahana Feld
Ms. Stephenson may be contacted at astephenson@kahanafeld.com
Ms. Kincaid may be contacted at ikincaid@kahanafeld.com
Read the court decisionRead the full story...Reprinted courtesy of
Halliburton to Pay $1.1 Billion to Settle Spill Lawsuits
September 03, 2014 —
David Wethe, Margaret Cronin Fisk and Laurel Calkins – BloombergHalliburton Co. agreed to pay $1.1 billion to settle a majority of lawsuits brought over its role in the largest offshore oil spill in U.S. history.
The agreement is subject to court approval and includes legal fees, the Houston-based company said in a statement today. Halliburton was accused by spill victims and BP Plc of doing defective cementing work on the Macondo well before the April 2010 Gulf of Mexico oil spill. Halliburton blamed the incident on decisions by BP, which owned the well.
The settlement comes as the judge overseeing oil-spill cases weighs fault for the disaster. An agreement now averts the company’s risk of a more costly judgment for some spill victims and removes much of the uncertainty that has plagued Halliburton for the past four years as investors waited to see the payout tally. With its biggest piece of liability resolved, Halliburton can refocus its attention on developing new oilfield technology that will help it boost profits worldwide.
Reprinted courtesy of Bloomberg journalists
David Wethe,
Margaret Cronin Fisk and
Laurel Calkins
Mr. Wethe may be contacted at dwethe@bloomberg.net; Ms. Fisk may be contacted at mcfisk@bloomberg.net; and Ms. Calkins may be contacted at lcalkins@bloomberg.net
Read the court decisionRead the full story...Reprinted courtesy of
Late Progress Payments on Local Public Works Projects Are Not a Statutory Breach of Contract
May 10, 2022 —
Ted Senet & Christopher Trembley - Gibbs GidenCalifornia local public agencies and their contractors should take note of a recent appellate decision pertaining to late progress payments on public works projects. In Clark Bros., Inc. v. North Edwards Water Dist., 2022 Cal. App. LEXIS 331, filed on April 22, 2022, the Court of Appeal for the Fourth Appellate District held that a local agency’s late progress payments to a general contractor did not constitute breach of contract under the prompt payment penalty statute, Public Contract Code § 20104.50. Notwithstanding this holding, the contractor recovered damages, interest, fees, and costs in excess of its contract amount.
In 2013, the North Edwards Water District awarded a $6.2 million contract to Clark Bros., Inc. to construct a water treatment facility. The District’s water contained excessive levels of arsenic, and the project was sponsored by the State of California with funds earmarked to provide safe drinking water. The State agreed to disburse funds to the District during construction upon the State’s review and approval of the contractor’s progress payment applications. The contract required completion of the work within one year following the District’s issuance of a notice to proceed to the contractor.
As a result of factors arguably outside the control of the contractor, including unforeseen site conditions and the failure of the District’s equipment supplier to meet delivery deadlines, the project was significantly delayed beyond the deadline for completion. The District nonetheless terminated the contractor, which in turn filed suit against the District and the State. The contractor asserted claims for breach of contract, including breach of contract for the District’s failure to pay the contractor’s progress payment applications within the time specified under Public Contract Code § 20104.50. Subsection (b) of the statute provides:
Any local agency which fails to make any progress payment within 30 days after receipt of an undisputed and properly submitted payment request from a contractor on a construction contract shall pay interest to the contractor equivalent to the legal rate set forth in subdivision (a) of Section 685.010 of the Code of Civil Procedure.
Reprinted courtesy of
Ted Senet, Gibbs Giden and
Christopher Trembley, Gibbs Giden
Mr. Senet may be contacted at tsenet@gibbsgiden.com
Mr. Trembley may be contacted at Ctrembley@gibbsgiden.com
Read the court decisionRead the full story...Reprinted courtesy of
Don’t Believe Everything You Hear: Liability of Asbestos Pipe Manufacturer Upheld Despite Exculpatory Testimony of Plaintiff
May 24, 2021 —
Garret Murai - California Construction Law BlogIn the next case, Morgan v. J-M Manufacturing Company, Inc. 60 Cal.App.5th 1078 (2021), the 2nd District Court of Appeal upheld a $7 million personal injury verdict against an asbestos-cement pipe manufacturer despite exculpatory testimony from the plaintiff, holding that the testimony was an issue of witness credibility rather than sufficiency of the evidence, and holding that the trial court’s denial of a jury instruction requested by the pipe manufacturer was appropriate because, while the requested jury instruction was a recitation of undisputed facts, the purpose of jury instructions is to recite the law rather than facts, even undisputed ones.
The Morgan Case
Norris Morgan was exposed to asbestos at construction sites where he worked in the 1970s and 80s. After he was diagnosed with mesothelioma in December 2017, Morgan and his wife sued a number of defendants, including J-M Manufacturing for personal injuries and loss of consortium.
Read the court decisionRead the full story...Reprinted courtesy of
Garret Murai, Nomos LLPMr. Murai may be contacted at
gmurai@nomosllp.com
Connecticut Crumbling Concrete Cases Not Covered Under "Collapse" Provision in Homeowner's Policy
July 01, 2019 —
Kerianne E. Kane - Saxe Doernberger & Vita, P.C.What do you do when your house falls out from underneath you? Over the last few years, homeowners in northeastern Connecticut have been suing their insurers for denying coverage for claims based on deteriorating foundations in their homes. The lawsuits, which have come to be known as the “crumbling concrete cases,” stem from the use of faulty concrete to pour foundations of approximately 35,000 homes built during the 1980s and 1990s. In order to save their homes, thousands of homeowners have been left with no other choice but to lift their homes off the crumbling foundations, tear out the defective concrete and replace it. The process typically costs between $150,000 to $350,000 per home, and homeowner’s insurers are refusing to cover the costs. As a result, dozens of lawsuits have been filed by Connecticut homeowners in both state and federal court.
Of those cases, three related lawsuits against Allstate Insurance Company were the first to make it to the federal appellate level.1 The Second Circuit Court of Appeals was tasked with deciding one common issue: whether the “collapse” provision in the Allstate homeowner’s policy affords coverage for gradually deteriorating basement walls that remain standing.
The Allstate policies at issue were “all-risk” policies, meaning they covered “sudden and accidental direct physical losses” to residential properties. While “collapse” losses were generally excluded, the policies did provide coverage for a limited class of “sudden and accidental” collapses, including those caused by “hidden decay,” and/or “defective methods or materials used in construction, repair or renovations.” Covered collapses did not include instances of “settling, cracking, shrinking, bulging or expansion.”
Read the court decisionRead the full story...Reprinted courtesy of
Kerianne E. Kane, Saxe Doernberger & Vita, P.C.Ms. Kane may be contacted at
kek@sdvlaw.com
Green Buildings Could Lead to Liabilities
March 28, 2012 —
CDJ STAFFAttempts to build “green,” reducing energy costs and increasing the use of sustainable building materials, may lead to more lawsuits, according to a report issued by the British Columbia Construction Association. The report warned those who were going to build green look into the implications. The report looked at the result of green building practices and requirements adopted in the United States.
The report warns that “the use of novel, less harmful building material or new construction techniques may give rise to liability due to: contractor inexperience with installation; lack of long-term evaluation of green materials; lack of understanding of how new building materials may impact existing traditional building systems; or warranties provided unintentionally about the durability or effectiveness of unproven materials or techniques.”
Manley McLachlan, president of the BCAA noted that they are aware of “legal action around the performance of the buildings,” noting that while fast-growing trees help toward LEED certification, their wood is more prone to mold. He also felt that low-VOC paints needed more testing to prove their durability as exterior finishes.
Read the full story…
Read the court decisionRead the full story...Reprinted courtesy of
Home Prices Expected to Increase All Over the U.S.
July 09, 2014 —
Beverley BevenFlorez-CDJ STAFFAccording to a survey of the National Association of Realtors (as quoted by the Housing Wire), home prices are expected “to increase in all states and the District of Columbia over the next 12 months, with most of the heavy growth in Florida, Texas, and California, among other states.”
The highest expected price growth was “in states with low inventory levels, strong cash sales, and strong growth sectors (e.g., technology, oil).”
Read the court decisionRead the full story...Reprinted courtesy of
