In Massachusetts, the Statute of Repose Applies to Consumer Protection Claims Against Building Contractors
January 28, 2019 —
Shannon M. Warren - The Subrogation StrategistIn Bridgwood v. A.J. Wood Construction, Inc., 105 N.E.3d 224 (Mass. 2018), the Supreme Court of Massachusetts determined that the statute of repose barred the plaintiff’s consumer protection claims commenced more than six years after the occurrence of the event that gave rise to the claims. In Bridgwood, the homeowner filed suit against the contractors who had performed renovations 15 years earlier. The homeowner asserted that concealed faulty electrical work caused a fire 11 years after the work was completed. The complaint alleged that the contractors, by violating Mass. Gen. Laws. Chapter 142A §17(10), committed an unfair and deceptive act pursuant to Mass. Gen. Laws Chapter 93A.
Section 17(10) prohibits contractors from violating building laws and specifically states that a violation of Section 17(10) constitutes an unfair and deceptive act as defined by Chapter 93A. Chapter 93A is regarded as one of the most stringent consumer protection statutory schemes in the nation, and allows litigants to seek remedies such as treble damages and attorney fees.
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Shannon M. Warren, White and WilliamsMs. Warren may be contacted at
warrens@whiteandwilliams.com
California Senator Proposes Bill to Require Contractors to Report Construction Defect Cases
January 04, 2018 —
David Suggs - Bert L. Howe & Associates, Inc.According to Renne Schiavone’s of Patch.com in her article “Sen. Hill Wants Contractors to Report Construction Defect Cases”, Senator Jerry Hill of San Mateo County proposed a bill on December 21st, 2017 requiring construction defect settlements to be reported by contractors to the licensing board. This proposal comes after the tragic incident that took place back on June 16, 2015 during which a balcony on the fifth floor of a Berkeley apartment complex collapsed. This resulted in the death of six students and serious injuries for an additional seven individuals.
An investigation revealed that three years prior to the balcony collapse, Segue Construction, who built the apartment complex, had paid $26.5 million in construction defect lawsuit settlements. Since the law doesn’t require these settlements to be reported by contractors, the Contractors State License Board (CSLB) wasn’t aware of the case.
"Working together we can take even stronger steps to protect the public by ensuring that this critically important data is accessible to the Contractors State License Board," said Senator Hill. Senate Bill 465 will aim to protect consumers with more regulation and transparency. Senator Hill is also working on Senate Bill 721 which would require periodic condo and apartment building inspections of exterior elevated walking surfaces, stairwells, and balconies.
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Three Reasons Lean Construction Principles Are Still Valid
February 27, 2019 —
Kevin Clary - Construction ExecutiveWhen lean principles were first introduced to the construction industry five years ago, project managers raced to implement the production method. The internet was rife with content about how to easily overhaul a jobsite and transform it into the picture of efficiency.
However, the number of lean construction critics have multiplied significantly in recent months. They claim concepts are near impossible to implement or, even worse, automation eliminates the need for deliberate human processes. These ideas are misleading. Lean principles are still valid for a few key reasons.
1. Lean involves seeing things from the customer’s point of view
One of the defining principles of lean construction is understanding value from the customer’s point of view. The concept encourages stakeholders, including the owner, contractor and supplier, to come together during the early planning stage of the project. The significant level of trust created from this exercise can’t be replicated by machinery. It involves compassion, collaboration and a sense of creativity that artificial intelligence is yet to possess. Moreover, the rapport gained through this service-oriented exercise is worth the time investment.
Reprinted courtesy of
Kevin Clary, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Don’t Just Document- Document Right!
February 06, 2019 —
Christopher G. Hill - Construction Law MusingsI have stated to clients on many occasions that paper is a lawyer’s best friend. Because of a recent case from the Virginia Supreme Court, I should modify that to the correct paper is a lawyer’s best friend. In Commonwealth v. AMEC Civil, LLC, AMEC sued the Virginia Department of Transportation (“VDOT”) seeking more than $21 million in damages. The Mecklenburg County Circuit Court granted AMEC almost all of its damages and found that AMEC’s notice of intent to make a claim was proper under the Virginia Code even if it was not in the proper form.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
SB800 CONFIRMED AS EXCLUSIVE REMEDY FOR CONSTRUCTION DEFECT CLAIMS
January 24, 2018 —
Jeffrey Brower and Nathan Owens - Newmeyer & Dillion, LLPIn
McMillin Albany LLC v. Superior Court (Cal. Ct. App., Aug. 26, 2015) 2015 Daily Journal D.A.R. 9931 (“
McMillin”), the Fifth Appellate District Court of Appeal in California published a resounding win for builders, general contractors, and others entities seeking the protections of the Right to Repair Act, Civil Code sections 895, et seq. (“SB800”). The
McMillin Court firmly rejected the reasoning and outcome of both
Liberty Mutual Ins. Co. v. Brookfield Crystal Cove LLC (2013) 219 Cal.App.4th 98 (“
Liberty Mutual”) and
Burch v. Superior Court (2014) 223 Cal.App.4th 1411 (“
Burch”), and held that:
the Legislature intended that all claims arising out of defects in residential construction, involving new residences sold on or after January 1, 2003 (§ 938), be subject to the standards and the requirements of the Act; the homeowner bringing such a claim must give notice to the builder and engage in the prelitigation procedures in accordance with the provisions of Chapter 4 of the Act prior to filing suit in court.
(
McMillin, Opinion, p. 15.) The
McMillin Court further held that even if the claimant’s counsel intentionally pleads around SB800 by asserting only tort causes of action, SB800 still applies to all defect claims and a stay of the action to require SB800 compliance is appropriate.
Newmeyer & Dillion has strongly supported builders’ efforts to enforce the Right to Repair Act since its inception. The firm filed an amicus brief in
McMillin on behalf of Leading Builders of America (“LBA”), an association of the leading residential homebuilders in the United States. For years, LBA members developed their warranty and dispute resolution procedures according to the Right to Repair Act and performed prelitigation repairs to the satisfaction of thousands of homeowners.
Liberty Mutual and
Burch undermined the Right to Repair Act by allowing plaintiffs’ attorneys to circumvent the prelitigation procedures to the detriment of homeowners and builders, resulting in confusion and increased litigation. The
McMillin decision breathes new life into the Right to Repair Act and sets the stage for future review by the California Supreme Court.
The
McMillin Court focused on the express language of the Right to Repair Act to arrive at its conclusion that Civil Code sections 896, 897, 943 and 944 demonstrate a clear Legislative intent to occupy the field of construction defect litigation – a belief held by nearly all in the construction industry and the California Superior Courts before
Liberty Mutual. The
McMillin Court found further support for SB800’s comprehensive nature in the Legislative history, which consistently described the Act as “groundbreaking reform” and a “major change” in construction defect litigation, designed to “significantly reduce the cost of construction defect litigation and make housing more affordable.” (
McMillin, Opinion, pp. 18-19.) The
McMillin Court found it inescapable that the Right to Repair Act exclusively governs construction defect litigation involving homes sold on or after January 1, 2003.
The
McMillin, decision will have a significant impact on construction litigation moving forward in two respects. First,
McMillin, is the only appellate decision to date to address whether a builder has the right to enforce SB800 when the claimant’s counsel deliberately attempts to plead around SB800 by asserting only tort claims. Second, the decision provides trial courts with the authority and precedent to ensure compliance with the Right to Repair Act. Trial courts may also find it necessary to revisit prior rulings against builders that relied on
Liberty Mutual.
Newmeyer & Dillion will continue to advocate in support of builders and general contractors by working vigorously to gain further support for the
McMillin, decision and setting the stage for review by the California Supreme Court.
Jeffrey R. Brower is an associate at the Newport Beach office of Newmeyer & Dillion, LLP. His practice focuses on business and construction litigation. Jeffrey can be reached at jeffrey.brower@ndlf.com.
Nathan Owens is the managing partner of the Las Vegas office for Newmeyer & Dillion, LLP. He represents businesses and individuals operating in a wide array of economic sectors including real estate, construction, insurance and health care in all stages of litigation in state and federal court. Nathan can be reached at nathan.owens@ndlf.com.
About Newmeyer & Dillion
For more than 30 years, Newmeyer & Dillion has delivered creative and outstanding legal solutions and trial results for a wide array of clients. With over 70 attorneys practicing in all aspects of business, employment, real estate, construction and insurance law, Newmeyer & Dillion delivers legal services tailored to meet each client’s needs. Headquartered in Newport Beach, California, with offices in Walnut Creek, California and Las Vegas, Nevada, Newmeyer & Dillion attorneys are recognized by The Best Lawyers in America©, and Super Lawyers as top tier and some of the best lawyers in California, and have been given Martindale-Hubbell Peer Review's AV Preeminent® highest rating. For additional information, call 949.854.7000 or visit
www.ndlf.com
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Client Alert: Court of Appeal Applies Common Interest Privilege Doctrine to HOA Litigation Meetings
March 19, 2014 —
David W. Evans, Steven M. Cvitanovic, and Michael C. Parme - Haight Brown & Bonesteel LLPIn Seahaus La Jolla Owners Assoc. v. Superior Court (No. D064567, March 12, 2014), the California Court of Appeal held a homeowners association’s (“HOA”) litigation meetings related to the HOA’s construction defect lawsuit were subject to protection under the attorney-client privilege. Specifically, the court concluded the common interest doctrine applied to the subject litigation meetings, thereby barring the defendants in the HOA’s lawsuit from seeking discovery related to the content and disclosures made during those meetings.
The plaintiff HOA initiated a construction defect lawsuit against a residential developer and builder, seeking damages for construction defects related to common areas. The defendants took the depositions of individual homeowners and inquired regarding the communications and disclosures made at informational litigation update meetings. The meetings were conducted by the HOA’s counsel with groups of homeowners, some of whom had filed their own, separate lawsuits against the same defendants. Motions to compel were filed after attorney-client privilege objections were asserted by counsel for the HOA. After the court-appointed discovery referee opined that the common interest doctrine applied and that the communications presented at the meetings were subject to the attorney-client privilege, the trial court rejected this recommendation and overruled the HOA’s privilege objections. The HOA filed a petition for a writ of mandate.
The defendants argued the privilege had been waived based on the presence of persons who were not the clients of the HOA’s attorney, that the subject communications were not “confidential communications” and that the individual homeowners and the HOA did not share common interests at the time. After setting forth a comprehensive discussion of the statutory principles underlying the attorney-client privilege and the bases for waiver, as provided in California Evidence Code §§ 912 and 952, and summarizing applicable decisional law, the court specifically analyzed the question of whether the common interest doctrine applied in the context of the disputed HOA litigation meetings. The common interest doctrine protects confidential communications made by counsel to third parties if the third parties are present to further the interest of the client or are those to whom disclosure is reasonably necessary for the transmission of the information or the accomplishment of the purpose for which the lawyer was consulted.
Reprinted courtesy of
David W. Evans,
Steven M. Cvitanovic, and
Michael C. Parme of Haight Brown & Bonesteel LLP
Mr. Evans may be contacted at devans@hbblaw.com, Mr. Cvitanovic may be contacted at scvitanovic@hbblaw.com, and Mr. Parme may be contacted at mparme@hbblaw.com
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Court Clarifies Sequence in California’s SB800
December 20, 2012 —
CDJ STAFFAs California’s Right-To-Repair law, SB800, nears its ninth birthday, it has remained “largely untested in the legal system” as noted by Megan MacNee of Wood, Smith, Henning & Berman LLP on the site RealEstateRama. She writes that some homeowners have requested documents prior to filing a claim, which she describes as an attempt to “game the system,” and “analogous to requiring a party to litigation to comply with discovery before a complaint is filed.”
The court determined that homeowners may not request documents from the builder until they have actually filed a claim. The court noted that SB800 lacks any clear indication that homeowners may request documents before filing a claim (and also does not indicate that a builder would have to provide documents in these circumstances). The court concluded that the section that sets up the prelitigation procedures occurs before they section on documents discovery. “Because the document request is part of the prelitigation procedure, and the prelitigation procedure does not begin until the homeowner has served notice of a claim, it follows that there can be no prelitigation obligation to produce documents under section 912, subdivision (a) unless the homeowner has commenced the prelitigation procedure by serving notice of a claim.”
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Litigation Privilege Saves the Day for Mechanic’s Liens
November 23, 2020 —
Stephen M. Tye & Lawrence S. Zucker II - Haight Brown & BonesteelIn RGC Gaslamp v. Ehmcke Sheet Metal Co., the Fourth Appellate District held that a trial court properly granted an anti-SLAPP motion because the recording of a mechanic’s lien is protected by the litigation privilege.
In RGC Gaslamp, subcontractor Ehmcke Sheet Metal Company (“Ehmcke”) recorded a mechanic’s lien to recoup payment due for sheet metal fabrication and installation done at a luxury hotel project in downtown San Diego. Project owner RGC Gaslamp, LLC (“RGC”) recorded a release bond for the lien. Thereafter, Ehmcke recorded three successive mechanic’s liens identical to the first, prompting RGC to sue it for quiet title, slander of title, and declaratory and injunctive relief. After retaining California counsel, Ehmcke then released its liens and advised it did not intend to record any more. Ehmcke then filed a special motion to strike under the anti-SLAPP statute (Code Civ. Proc. § 425.16.) which was granted.
Reprinted courtesy of
Stephen M. Tye, Haight Brown & Bonesteel LLP and
Lawrence S. Zucker II, Haight Brown & Bonesteel LLP
Mr. Tye may be contacted at stye@hbblaw.com
Mr. Zucker may be contacted at lzucker@hbblaw.com
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