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DIRECTORY AND CAPABILITIES

Does the UCC Apply to the Contract for the Sale of Goods and Services

July 03, 2022 — David Adelstein - Florida Construction Legal Updates
What governs the transaction for the hybrid contract that includes both goods and services–the Uniform Commercial Code (UCC) or the common law? A question that is asked in numerous disputes. A good example is the recent case out of the Eleventh Circuit Court of Appeals, Wadley Crushed Stone Company, LLC v. Positive Step, Inc., 2022 WL 1639011 (11th Cir. 2022), dealing with Alabama law. In this case, the plaintiff (buyer) wanted to build a granite plant in Alabama that would process 500 tons of granite per hour. The plaintiff reached out to a defendant company to start the process of building a granite plant. The defendant company engaged vendors and professionals in the due diligence process to determine the equipment the plaintiff would need. After this due diligence, plaintiff and defendant entered into a contract that included equipment and services. Thereafter, the parties modified the contract to reduce the amount for the erection, installation, and electrical work (about $1.5 Million) as plaintiff planned to independently hire the contractor to perform that work. The modified contract was worth $4,059,224.43 of which there were 25 lines items for equipment totaling $3,887,274.43 with the balance (less than 5% of the contract amount) for engineering (done by a third party), installation, setup, and calibration of scales. Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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HOA Foreclosure Excess Sale Proceeds Go to Owner

August 15, 2022 — Ben Reeves - Snell & Wilmer Real Estate Litigation Blog
Over the last few years, the Arizona Court of Appeals wrestled with the question of who should receive the excess proceeds from a foreclosure sale. We’ve blogged about some these past unreported decisions here and here. Those decisions, somewhat inexplicably, required excess sale proceeds to be paid to senior creditors. As we noted at the time, these unreported (and non-precedential) decisions did not seem to make much sense in the context of debtor/creditor rights. Thankfully, a reported opinion finally sets the record straight. Excess sale proceeds should be paid downstream. In Tortosa Homeowners Assoc. v. Garcia, et al., No. 2 CA-CV 2021-0114 (Ct. App. Aug. 1, 2022), the Court of Appeals held that after the foreclosing lienholder is paid in full, then the excess sale proceeds should be paid to claimants in the order of their priority after the foreclosing lienholder. In other words, if a junior lienholder forecloses, then any creditors behind (i.e., junior to) the foreclosing creditor should be paid, and if all such creditors are paid, then the rest should be given to the owner. Creditors senior to the foreclosing creditor should not be paid anything from the foreclosure sale. This makes sense from a policy perspective, because the senior creditor retains its lien against the property and the bidder presumably took the presence of the senior lien into account when it made its bid for the foreclosed property. Read the court decision
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Reprinted courtesy of Ben Reeves, Snell & Wilmer
Mr. Reeves may be contacted at breeves@swlaw.com

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Massachusetts Clarifies When the Statute of Repose is Triggered For a Multi-Phase or Multi-Building Project

December 07, 2020 — Jeffrey J. Vita & Anna M. Perry - Saxe Doernberger & Vita, P.C.
Lennar Hingham Holdings, LLC (“Lennar”) built a twenty-eight-building, 150-unit condominium project containing twenty-four discrete phases over a seven-year span. The condominium association subsequently brought an action against Lennar and others alleging design and construction defects to four main components of the common elements: “decks and columns,” “roofing/flashing,” “exterior walls/flashing/building envelope,” and “irrigation system.” In response, the defendants argued that the plaintiff’s claims with respect to six of the twenty- eight buildings were barred by Massachusetts’s six-year statute of repose, G. L. c. 206 § 2B. The United States District Court for the District of Massachusetts previously held that all twenty-eight of the condominium’s buildings should be treated as a single improvement for purposes of application of the statute of repose. Subsequently, the court certified the following question to the Massachusetts Supreme Judicial Court: Where the factual record supports the conclusion that a builder or developer was engaged in the continuous construction of a single condominium development comprising multiple buildings or phases, when does the six-year period for an action of tort relating to the construction of the condominium’s common or limited common elements start running? Reprinted courtesy of Jeffrey J. Vita, Saxe Doernberger & Vita, P.C. and Anna M. Perry, Saxe Doernberger & Vita, P.C. Mr. Vita may be contacted at JVita@sdvlaw.com Ms. Perry may be contacted at APerry@sdvlaw.com Read the court decision
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Wildfire Risk Scores and Insurance Placement: What You Should Know

July 15, 2024 — Louis "Dutch" Schotemeyer & Molly L. Okamura - Newmeyer Dillion
What Are Wildfire Risk Scores and How Are They Calculated? Wildfire risk scores are scores assigned to properties by third-party vendors based on the likelihood of direct or indirect exposure to a wildfire. Wildfire risk scores can be a factor used by insurance companies when making coverage decisions. Additionally, wildfire risk scores can be a helpful metric for real estate developers to consider when determining whether to buy a piece of property. There are a variety of vendors that use unique methods to calculate wildfire risk scores. For example, CoreLogic, FireLine, and RedZone are vendors used by insurance companies in California. Some vendors' scoring scales are from 1-10, and some are from 1-100, but generally the higher the score, the higher the likelihood of a wildfire impacting the property. There is no national, standardized scoring scale. Reprinted courtesy of Louis "Dutch" Schotemeyer, Newmeyer Dillion and Molly L. Okamura, Newmeyer Dillion Mr. Schotemeyer may be contacted at dutch.schotemeyer@ndlf.com Ms. Okamura may be contacted at molly.okamura@ndlf.com Read the court decision
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Construction Defect Claim Must Be Defended Under Florida Law

February 15, 2018 — Tred R. Eyerly – Insurance Law Hawaii

The Eleventh Circuit found that the insured caused property damage to areas beyond its own work, obligating the insurer to defend. Addison Ins. Co. v. 4000 Island Blvd. Condo. Ass'n, 2017 U.S. App. LEXIS 26870 (11th Cir. Dec. 28, 2017).

The condominium association contracted with Poma Construction Corp. to replace the building's aging concrete balcony railings with new aluminum and glass railings. Poma subcontracted with Windsor Metal Specialties, Inc. to paint the new railings. Work was completed on February 24, 2012. Poma issued a 10-year warranty covering its installation of the railings. Windsor issued a 20-year limited warranty covering the paint job.

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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Insurer's Withheld Discovery Must be Produced in Bad Faith Case

November 03, 2016 — Tred R. Eyerly – Insurance Law Hawaii
The United States District Court for the Western District of Washington granted the insureds' motion to compel and ordered that the insurer produce withheld discovery. Bagley v. Travelers Home & Marine Ins. Co., 2016 U.S. Dist. LEXIS 115028 (W.D. Wash. Aug. 25, 2016). The insureds' dock and boat ramp were damaged in a storm. Travelers refused to pay for the damage, arguing it was not covered. After Plaintiffs filed suit, Travelers admitted coverage and agreed to pay. The insureds' suit included a claim that Travelers wrongfully denied coverage, thereby costing the insureds money. The insureds moved the court to compel Travelers to respond to certain discovery requests. First, the insureds requested the claims file Travelers maintained on their claim. The court did not order the production of privileged documents, but documents related to claims handling were not privileged. Travelers was ordered to produce all documents in the insureds' claim file that related to claim handling, even if the documents were created after the commencement of litigation. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Insurer's Daubert Challenge to Insured's Expert Partially Successful

November 03, 2016 — Tred R. Eyerly – Insurance Law Hawaii
The insurer was partially successful in challenging two of the insureds' experts in a bad faith case. Estate of Arroyo v. Infinity Indem. Ins. Co., 2016 U.S. Dist. LEXIS 115669 (S.D. Fla. Aug. 29, 2016). The Estate sought to qualify two experts, Lewis N. Jack and James P. Schratz. They were to opine on Infinity's handling of the Estate's insurance claims and the extent of damages warranted in the case. Jack was to testify on Infinity's duties to the insured, its investigation of the case, its reliance on Infinity's agents, and his belief that Infinity could have settled the case. Schratz's opinions mostly concerned Infinity's handling of its investigation. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Sanctions Award Against Pro Se Plaintiff Upheld

June 22, 2020 — Tred R. Eyerly - Insurance Law Hawaii
The plaintiff's failure to timely name an expert witness in his bad faith action led to sanctions being awarded against him in favor of the insurer. Black v. Fireman's Fund Ins. Co., 2020 Cal. App. Unpub. LEXIS 2477 (Cal. Ct. App. April 23, 2020). After Black's claim was denied by Fireman's Fund, he communicated with company through letters, emails and phone conversations. Black complained that Fireman's Fund handled his claim improperly, engaged in illegal activities and had ties to the Nazi regime in Germany. Fireman's Fund sued Black alleging that his communications amounted to civil extortion, interference with contractual relations, interference with prospective economic advantage, and unfair business practices. Fireman's Fund eventually dismissed its complaint without prejudice. Black, however, had filed a cross-complaint in which he asserted a number of claims, including bad faith. Black designated attorney Randy Hess as an expert on insurance claims. Over the next year and a half, Fireman's Fund repeatedly attempted to take Hess's deposition. In March 2018, Fireman's Fund moved to compel the deposition or exclude the testimony. The court set a July 20, 2018 deadline for the disposition to take place or else the testimony would be excluded. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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