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DIRECTORY AND CAPABILITIES

Texas Supreme Court: Breach of Contract Not Required to Prevail on Statutory Bad Faith Claim

June 06, 2018 — Bethany L. Barrese - Saxe Doernberger & Vita, P.C.
In USAA Texas Lloyds Company v. Menchaca, the Supreme Court of Texas clarified long-standing confusion regarding whether damages for bad faith are recoverable in the absence of a breach of contract under Texas law. The Menchaca case takes an in-depth dive into decades’ worth of Texas precedent and concludes that, under certain circumstances, an insured can recover policy benefits as damages for bad faith without finding that the insurer was in breach of contract. The story of this case begins with Hurricane Ike in September 2008. Homeowner Gail Menchaca contacted her homeowner’s insurance company, USAA Texas Llloyds Company (“USAA”) to report that the storm had damaged her home. USAA sent an adjuster to investigate the claim, and USAA determined that although the policy covered some of the damage, no benefits would be paid under the policy because the repair estimate did not exceed the policy deductible. Five months later, at Ms. Menchaca’s request, another USAA adjuster inspected the property and reached the same conclusion. Read the court decision
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Reprinted courtesy of Bethany L. Barrese, Saxe Doernberger & Vita, P.C.
Ms. Barrese may be contacted at blb@sdvlaw.com

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An Overview of the New EPA HVAC Refrigerant Regulations and Its Implications for the Construction Industry

September 30, 2024 — Stefanie A. Salomon, Nadia Ennaji & Ali Heyat - Peckar & Abramson, P.C.
The U.S. Environmental Protection Agency (EPA) recently announced a series of significant changes to the rules governing the use of refrigerants in heating, ventilation, and air conditioning (HVAC) systems. These changes, which were promulgated under the American Innovation and Manufacturing (AIM) Act, are designed to phase down the use of hydrofluorocarbons (HFCs), a class of potent greenhouse gases. The AIM Act: A Game-Changer for HVAC Industry The recent changes to refrigerant regulations by the EPA signify a substantial shift in environmental policy that will have profound implications for the construction industry. For the construction industry, this means a transition to next-generation technologies that do not rely on HFCs. The AIM Act’s sector-based restrictions will affect a wide range of equipment, including refrigeration and air conditioning systems integral to building design and function. Starting January 1, 2025, the manufacturing or importing of any product in specified sectors that uses a regulated substance with a global warming potential of 700 or greater is prohibited (40 C.F.R. § 84.54(a)). The specified sectors listed include R-410A, the most common refrigerant used in the HVAC industry. The installation of systems using a regulated substance with a global warming potential of 700 or greater in specified sectors is allowed until January 1, 2026, provided that all system components are manufactured or imported before January 1, 2025. See 40 C.F.R. § 84.54 (c). “Installation” of an HVAC system is defined as the completion of assembling the system’s circuit, including charging it with a full charge, such that the system can function and is ready for its intended purpose. See 40 C.F.R. § 84.52. Reprinted courtesy of Stefanie A. Salomon, Peckar & Abramson, P.C. and Nadia Ennaji, Peckar & Abramson, P.C. Ms. Salomon may be contacted at ssalomon@pecklaw.com Ms. Ennaji may be contacted at nennaji@pecklaw.com Read the court decision
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Conn. Appellate Court Overturns Jury Verdict, Holding Plaintiff’s Sole Remedy for Injuries Arising From Open Manhole Was State’s Highway Defect Statute

June 14, 2021 — Christy Jachimowski - Lewis Brisbois
Section 13a-149 of the Connecticut General Statutes, commonly known as Connecticut’s highway defect statute, provides that claims arising from injuries or damages to people or property resulting from a defective road or bridge can be asserted against a party responsible for maintaining that road or bridge. Conn. Gen. Stat. §13a-149. The statute also extends to sidewalks and further provides that written notice of an alleged injury must be given to a defendant municipality within ninety days of the injury. Recently, in Dobie v. City of New Haven, 2021 Conn. App. LEXIS 162 (App. Ct. May 1, 2021), the Connecticut Appellate Court overturned the trial court’s denial of a municipal defendant’s post-trial motion to dismiss. The court held that even though the plaintiff attempted to assert allegations of negligence against the defendant municipality, Connecticut’s highway defect statute was the plaintiff’s exclusive remedy. Since the plaintiff failed to meet the requisite notice requirements, pursuant to the statute, the Appellate Court held that the trial court erred in denying the municipality’s motion to dismiss for lack of subject matter jurisdiction. The Underlying Case In February of 2013, Plaintiff William Dobie filed suit against the City of New Haven alleging injuries and damages as a result of the negligence of a City of New Haven snowplow operator. Dobie’s claims arose from an incident that occurred on January 21, 2011, in which he was driving behind the City snowplow driver, who was in the process of plowing snow from a municipal street located in New Haven, Connecticut. As the defendant employee was operating his snowplow, he knocked off a manhole cover, causing Dobie’s vehicle to drive over the open manhole. Dobie claimed personal injuries as a result of his vehicle dropping into the open manhole, including injuries to his jaw. Read the court decision
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Reprinted courtesy of Christy Jachimowski, Lewis Brisbois
Ms. Jachimowski may be contacted at Christy.Jachimowski@lewisbrisbois.com

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Fed. Judge Blocks Release of Records on FIU Bridge Collapse, Citing NTSB Investigation

October 23, 2018 — Miami Herald - Engineering News-Record
Oct. 05 --A federal judge Friday blocked the release of documents that could shed light on why a busy road outside Miami was not shut down before a brand-new bridge developing severe cracks collapsed and killed six people. Judge William Stafford said the National Transportation Safety Board , the federal agency investigating the Florida International University bridge disaster, "was exercising its valid federal regulatory authority" in keeping the documents confidential from the media. Read the court decision
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Reprinted courtesy of Engineering News-Record
ENR may be contacted at ENR.com@bnpmedia.com

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Real Estate & Construction News Round-Up (08/10/22)

August 29, 2022 — Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
The Senate passes the Inflation Reduction Act, construction costs continue to rise across the U.S., commercial real estate advances the adoption of ESG strategies, and more.

• The recently-passed Inflation Reduction Act of 2022 leaves out the carried interest tax hike, much to the relief of real estate investors worldwide. (Taylor Driscoll, Bisnow)
• Commercial real estate continues to push forward ESG strategies, given the significant carbon footprints left by most office buildings. (Ted Jackson, CFO)
• “Space as a Service” tech company Neighbor, which re-purposes under-utilized real estate into storage for tenants, hits its stride in the post-pandemic landscape as the excess of unprofitable space rises. (The Real Deal)

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Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team

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Brooklyn’s Industry City to Get $1 Billion Modernization

March 12, 2015 — David M. Levitt – Bloomberg
(Bloomberg) -- A late 19th century industrial complex on New York’s Brooklyn waterfront is slated for a $1 billion makeover that aims to transform the property into a modern hub for manufacturing and technology. The owners of Industry City, Atlanta-based Jamestown and its partners, plan to invest about $890 million over the next 12 years, and anticipate tenants will put in about $150 million of their own money, according to a proposal announced Monday. The project will create one of the largest centers for the “innovation economy” in the U.S., and one of New York’s biggest engines of job growth, said Andrew Kimball, chief executive officer of Industry City. Read the court decision
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Reprinted courtesy of David M. Levitt, Bloomberg
Mr. Levitt may be contacted at dlevitt@bloomberg.net

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United States Supreme Court Backtracks on Recent Trajectory Away from Assertions of General Jurisdiction in Mallory v. Norfolk Southern

August 01, 2023 — Charles S. Anderson - Lewis Brisbois
Washington, D.C. (June 28, 2023) – On June 27, 2023, the U.S. Supreme Court issued a sharply divided opinion that appears to backtrack on the Court’s steady trajectory away from assertions of general jurisdiction in recent years, e.g. Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011), Daimler AG v. Bauman, 134 S. Ct. 746 (2014), BNSF Railway Co. v. Tyrrell, 2017, 137 S. Ct. 1549 (2017). Relying on a case from 1917, Pennsylvania Fire Ins. Co. of Philadelphia v. Gold Issue Mining & Milling Co., 243 U. S. 93 (1917), Justice Gorsuch, writing on behalf of the plurality, (Justices Gorsuch, Thomas, Sotomayor, and Jackson) (Justice Alito concurring) found that Norfolk Southern “consented” to jurisdiction in Mallory via 42 Pa. Cons. Stat. §5301(a)(2)(i),(b) by registering to do business in Pennsylvania. This statute, 42 Pa. Cons. Stat. §5301, specifically permits jurisdiction over a corporation “incorporat[ed] under or qualifi[ed]as a foreign corporation under the laws of this Commonwealth … for any cause of action that may asserted against him, whether or not arising from acts enumerated in this section.” In Pennsylvania Fire, the U.S. Supreme Court addressed the Due Process Clause of the U.S. Constitution in connection with a Missouri law that required an out-of-state insurance company desiring to transact any business in the state to file paperwork agreeing to (1) appoint a state official to serve as the company’s agent for service of process and (2) accept service on that official as valid in any suit. After more than a decade of complying with the law, Pennsylvania Fire was served with process and argued that the Missouri law violated due process. The Court unanimously found that there was “no doubt” that Pennsylvania Fire could be sued in Missouri because it had agreed to accept service of process in Missouri on any suit as a condition of doing business there. Read the court decision
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Reprinted courtesy of Charles S. Anderson, Lewis Brisbois
Mr. Anderson may be contacted at Charles.Anderson@lewisbrisbois.com

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“Pay When Paid” Provisions May Not Be Dead, at Least Not Yet

August 24, 2020 — Garret Murai - California Construction Law Blog
Sophisticated contractors know that in California contractual “pay when paid” provisions are enforceable but that “pay if paid” provisions are not. “Pay If Paid” v. “Pay When Paid” Provisions A “pay if paid” provision is one in which a higher tier party agrees to pay a lower tier party “if” it is paid in turn by a still higher party. Most commonly they are found in subcontracts between general contractors and subcontractors and provide that the general contractor will pay the subcontractor “if” the general contractor is paid by the project owner. However, they can also be found in subcontracts between higher and lower tiered subcontractors and between subcontractors and material suppliers and equipment lessors. In California, such provisions, which create a condition precedent to payment, namely, a condition that must precede payment to a lower tiered party, are void as a matter of law. Read the court decision
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Reprinted courtesy of Garret Murai, Nomos LLP
Mr. Murai may be contacted at gmurai@nomosllp.com

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