Florida Lien Law and Substantial Compliance vs. Strict Compliance
April 20, 2017 —
David Adelstein - Florida Construction Legal UpdatesThere are literally some (or, perhaps, many!) disputes that will make you say “hmm!” The “hmm” is a euphemism for “what is a party thinking?!?” The case of Trump Endeavor 12 LLC v. Fernich, Inc., 42 Fla. L.Weekly D830a (Fla. 3d DCA 2017) is one of these cases because a party (the owner) is banking its defense on a technical “all-or-nothing” argument pertaining to whether a lienor (a supplier) substantially complied with Florida’s Lien Law because a supplier’s Notice to Owner identified the wrong general contractor. This is a challenging argument because the owner has to prove how they were adversely affected / prejudiced by the lack of substantial compliance, which is not an easy burden.
This case concerns the Trump National Doral Miami project. The project consisted of a lodge project and a separate clubhouse project, both of which had different general contractors. On the lodge project, the general contractor hired a painter which, in turn, procured paint from a supplier (the lienor). The supplier visited the project and obtained the Notice of Commencement from the owner so that it could perfect its lien rights. The owner furnished the supplier the Notice of Commencement for the clubhouse project that had a different general contractor. Relying on this Notice of Commencement, the supplier served a Notice to Owner. The Notice to Owner was timely serviced however it identified the wrong contractor – it identified the general contractor for the clubhouse project instead of the lodge project. Although the supplier later learned there was a different general contractor on the lodge project, it did not remedy the issue by serving a Notice to Owner on the correct contractor. Indeed, the contractor for the lodge project learned of the Notice to Owner furnished by the supplier and that the supplier was furnishing paint to the painting subcontractor for purposes of that project.
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David Adelstein, Florida Construction Legal UpdatesMr. Adelstein may be contacted at
Dadelstein@gmail.com
Insurer's Failure to Settle Does Not Justify Multiple Damages under Unfair Claims Settlement Law
February 04, 2013 —
Tred R. EyerlyAlthough the insurer failed to understand the pertinent law that mandated coverage under the policy, its actions did not rise to an unfair claim settlement practice justifying multiple damages. Gelwan v. Vermont Mut. Ins. Co., 2013 U.S. app. LEXIS 210 (2nd Cir. Jan. 4, 2013).
In 1999, a contractor re-roofed the insureds' home. The job was poorly done, and an imperfect seal was created. Over several years, various structures within the house were damaged by water, which caused the rotting of structural beams and joists.
The insureds sued for coverage under their homeowners policy.
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Tred Eyerlyte@hawaiilawyer.com
What Cal/OSHA’s “Permanent” COVID Standards Mean for Employers
March 06, 2023 —
Payne & Fears LLPEffective Feb. 3, 2023, California has implemented new, “permanent,” COVID-19 standards. The new regulations were adopted by Cal/OSHA on Dec. 15, 2022, but only became effective upon the review and final approval by the Office of Administrative Law. These non-emergency regulations—slated to remain in effect for two years—supplant the COVID-19 Prevention Emergency Temporary Standard (ETS) that have been in effect since early in the pandemic.
The non-emergency regulations abandon core parts of the ETS, include new definitions for key terms, and update requirements for important provisions. We discuss the primary changes below. The regulation itself is available online, as well as a copy provided by Cal/OSHA comparing the differences between the ETS and the new regulation.
An End to Exclusion Pay
The non-emergency regulations do not require employers to maintain exclusion pay (an excluded employee’s earnings, seniority, rights, and benefits). All that employers must do under the new regulations is inform confirmed COVID-19 cases and close contacts about potential COVID-19 benefits under federal or local laws (where applicable). This does not affect employees who may receive paid time off under other federal, state, and local laws, as well as through collective bargaining agreements or other employer policies.
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Payne & Fears LLP
Can I Be Required to Mediate, Arbitrate or Litigate a California Construction Dispute in Some Other State?
September 19, 2022 —
William L. Porter - Porter Law GroupIt is not uncommon in the construction industry for an out-of-state general contractor to include a provision in a subcontract requiring a California subcontractor to resolve disputes outside the state of California, even though the work is to be performed within California. Fortunately, most California subcontractors are immune from this tactic. California law generally prohibits clauses requiring subcontractors to travel outside California to resolve construction disputes.
California Code of Civil Procedure Section 410.42, [CCP 410.42 Link] renders “void and unenforceable,” any provision in a contract that “purports to require any dispute to be litigated, arbitrated, or otherwise determined outside this state,” so long as the contract is “between the contractor and a subcontractor with principal offices in the state, for the construction of a public or private work of improvement in this state.” Similarly, this law voids any similar contractual term that might prevent the California subcontractor from commencing an action, obtaining a judgment, or resolving its dispute in the courts of California.
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William L. Porter, Porter Law GroupMr. Porter may be contacted at
bporter@porterlaw.com
Buyer's Demolishing of Insured's Home Not Barred by Faulty Construction Exclusion
June 21, 2017 —
Tred R. Eyerly - Insurance Law HawaiiLoss of the insured's home caused by a renter who demolished the home was covered under the homeowner's policy. Fisher v. Garrison Prop. & Cas. Ins. Co., 2017 Idaho LEXIS 143 (Idaho May 26, 2017).
The insured, Shammie L. Fisher, entered a Purchase Agreement to sell her home to Ron Reynoso. The purchase of the property was contingent upon Reynoso obtaining financing. Before completing the purchase, he would lease the property. The Agreement stated, "Buyer intends to make certain improvements to the property upon possession, with the intent to sell the property for a profit."
Within two months of renting the property to Reynoso, Fisher learned that he had demolished the entire house down to the foundation. He then ceased work and left. Fisher made a claim under her policy, but Garrison Property and Casualty Insurance Company denied coverage based upon the exclusion for faulty, inadequate or defective work. When Fisher sued, the trial court granted summary judgment to Garrison.
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Tred R. Eyerly - Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Do Not Pass Go! Duty to Defend in a Professional Services Agreement (law note)
April 03, 2019 —
Melissa Dewey Brumback - Construction Law in North CarolinaRecently a client asked me to review a contract for his Firm. The Owner, who had prepared the draft, had inserted a rather stringent “duty to defend” clause.
As I told my client, a duty to defend clause is not a good idea for a couple of reasons. First, if you agree to provide a defense, what that means is that you are footing the bill for the Owner if the Owner is sued by another party. Think about that for a minute. You are paying legal fees for someone else’s legal defense. You may or may not be able to direct the litigation or have a say in who is hired. Can you say open check book?
Secondly, and more importantly, the duty to defend is almost never insurable. What that means is that your professional liability carrier will not be footing the bill—your Firm will be doing it. This is not a case of adding the Owner as an additional insured, so do not confuse the two. Agreeing to a duty to defend is an extremely burdensome, and potentially costly, mistake.
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Melissa Dewey Brumback, Ragsdale Liggett PLLCMs. Brumback may be contacted at
mbrumback@rl-law.com
Owners and Contractors Beware: Pennsylvania (Significantly) Strengthens Contractor Payment Act
June 13, 2018 —
Wally Zimolong – Supplemental Conditions Yesterday, Governor Tom Wolf signed into law House Bill 566 which make major changes to Pennsylvania’s Contractor and Subcontractor Payment Act. Owners and General Contractors that fail to take head of the changes could face significant financial consequences.
The Pennsylvania Contractor and Subcontractor Payment Act, known as CAPSA or simply the Payment Act, was passed into law in 1994. The intent was “to cure abuses within the building industry involving payments due from owners to contractors, contractors to subcontractors, and subcontractors to other subcontractors.” Zimmerman v. Harrisburg Fudd I, L.P., 984 A.2d 497, 500 (Pa. Super. Ct. 2009). In reality, abuses still occurred. While the Payment Act purportedly dictated a statutory right to payment within a certain amount of time and imposes stiff penalties for failure make payment, including 1% interest per month, 1% penalty per month, and reasonable attorneys fees, the language of the Payment Act left recalcitrant contractors with wiggle room. Particularly, the Payment Act allowed owners and higher tier subcontractors to withhold payment “deficiency items according to the terms of the construction contract” provided it notified the contractor “of the deficiency item within seven calendar days of the date that the invoice is received.” 73 P.S. Section 506. The problem was that the Payment Act did not expressly state where the notice must be in written, what it must say, and what happened if notice was not given.
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Wally Zimolong, Zimolong LLCMr. Zimolong may be contacted at
wally@zimolonglaw.com
Suppliers of Inherently Dangerous Raw Materials Remain Excluded from the Protections of the Component Parts Doctrine
December 02, 2015 —
Leah B. Mason & Michael J. Worth – Haight Brown & Bonesteel, LLPIn Brady v. Calsol, Inc. 2015 No. B262028, the California Court of Appeal, Second District, reversed summary judgment for a raw materials supplier where there was a triable issue of fact as to whether the benzene levels contained in the supplier’s mineral spirits could have caused plaintiffs’ leukemia.
Plaintiffs were mechanics Ernest Brady and David Gibbs, who used Safety-Kleen solvent to degrease automotive parts. Brady and Gibbs were diagnosed with leukemia allegedly caused by exposure to Safety-Kleen solvent during the course of their employment. In 2008, Plaintiffs sued Calsol, Inc., a distributor of mineral spirits for the ultimate manufacturer, Safety-Kleen Systems, Inc. Plaintiffs asserted negligence and strict products liability claims. Specifically, plaintiffs alleged that benzene, a carcinogen found in mineral spirits, caused their leukemia. Benzene is only carcinogenic to humans at certain levels. The parties dispute the levels of benzene found in the mineral spirits supplied to Safety-Kleen. Calsol contended the benzene levels were present only in low concentrations. Plaintiffs alleged the benzene levels were capable of causing injury.
Reprinted courtesy of
Leah B. Mason, Haight Brown & Bonesteel LLP and
Michael J. Worth, Haight Brown & Bonesteel LLP
Ms. Mason may be contacted at lmason@hbblaw.com
Mr. Worth may be contacted at mworth@hbblaw.com
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