Construction Trust Fund Statutes: Know What’s Required in the State Where Your Project Is Underway
June 22, 2020 —
Christopher D. Cazenave - ConsensusDocsConstruction trust fund statutes have been around for decades. At least 15 states have passed similar statutes. Other states, but not all, do not have an express statute but have interpreted state law to hold that payments received by a general contractor and deposited in a business account establishes a “trust fund.” See e.g., Cal. Bus. & Prof. Code § 7108.
The purpose of these laws is straightforward—protect contractors and suppliers against nonpayment for the labor and materials provided for the construction or repair of property. But while the purpose is straightforward, each state’s law differs by imposing different requirements, different privileges, and different remedies. This article provides an overview of how these statutes work as well as a sampling of important requirements and potential pitfalls that you should look out for when a construction trust fund statute applies to your project.
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Christopher D. Cazenave, Jones Walker LLPMr. Cazenave may be contacted at
ccazenave@joneswalker.com
Summary Judgment for Insurer on Construction Defect Claim Reversed
January 07, 2025 —
Tred R. Eyerly - Insurance Law HawaiiThe Fifth Circuit reversed the district court's granting of summary judgment to the insurer on a construction defect claim asserted against the insured. TIG Ins. Co. v. Woodsboro Farmers Cooperative, 2024 U.S. App. LEXIS 24003 (5th Cir. Sept. 20, 2024).
In March 2013, Woodsboro Farmers Cooperative contracted with E.F. Erwin, Inc. to construct two Brock 105' diameter grain silos. Erwin hired subcontract AJ Constructors, Inc. (AJC) to construct the silos. Erwin was responsible for supervising the work.
Brock silos were kits shipped by the manufacturer and then assembled according to the manufacturer's manuals and specifications. The silos are constructed section by section. AJC began erecting the silos in May 2013 and completed its work in June or early July. Erwin occasionally inspected the work and found the silos were structurally sound and not defective. AJC left the job site after completing the assembly.
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Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
French Laundry Spices Up COVID-19 Business Interruption Debate
April 20, 2020 —
Jeffrey J. Vita & Melanie A. McDonald - Saxe Doernberger & VitaOn March 26, 2020, Michelin-rated Napa Valley restaurants, French Laundry and Bouchon Bistro, and their celebrity chef, Thomas Keller, filed the second known
coronavirus-related declaratory judgment (DJ) lawsuit by a restaurant. The restaurants filed their DJ against Hartford Fire Insurance Company just seven days after Napa County issued a Shelter at Home Order.1 Chef Keller’s suit comes on the heels of the first such suit by a restaurant seeking to recover business income losses, filed by iconic New Orleans French Quarter restaurant Oceana Grill2 on March 17, just four days after the Louisiana governor issued an order prohibiting gatherings of more than 250 people.
As local governments seek to protect their citizens and prevent an onslaught of cases in area hospitals, they are issuing various “stay home,” “shelter at home,” and similar orders to force social distancing and to help flatten the curve of the growth in COVID-19 cases. Restaurants nationwide are especially hard hit by these orders, as many of these orders contain size limitations on gatherings, which have required that restaurants and bars limit capacity (as in the March 13th Louisiana order). Other such orders require non-essential businesses to “cease all activities in the County” (as in the Napa County Shelter at Home order). The Napa County order does not exempt restaurants as “essential businesses,” except when providing food for take-out or delivery. Other orders, still, directly address restaurants and require them to cease allowing public consumption of food and beverages (as in the subsequent, March 17th Louisiana order).
Reprinted courtesy of
Jeffrey J. Vita, Saxe Doernberger & Vita, P.C. and
Melanie A. McDonald, Saxe Doernberger & Vita, P.C.
Mr. Vita may be contacted at jjv@sdvlaw.com
Ms. McDonald may be contacted at mam@sdvlaw.com
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Creating a Custom Home Feature in the Great Outdoors
July 09, 2014 —
Beverley BevenFlorez-CDJ STAFFWhen a resort designer and a spa director join together to create a custom home, what do you get? An outdoor tub that resides on a balcony overlooking the San Francisco Bay.
According to Custom Home, Scott Lee, president of SB Architects, and his wife had the “custom cast concrete tub…craned into place on the third-story deck while avoiding an established oak tree.” A radiant heat lamp makes the outdoor bathing area practical, while the curved backrest, remote controlled dimmable lights, and music make the experience luxurious.
“Tubs are more about relaxing then getting clean,” Lee told Custom Home. “Being out here among the branches with views of San Francisco, it really is like a resort.”
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Anchoring Abuse: Evolution & Eradication
October 09, 2023 —
Tim Capowski & Chris Theobalt - Kahana FeldOver the past few years, the plaintiff bar has expanded its use of improper anchoring tactics. Historically, improper anchoring was seen as a risky tactic in which a plaintiff’s counsel would suggest an outrageous figure for pain and suffering during summation in the hope that the lay jury would either award it or split the difference (cut the suggested figure by half) and, either way, return an excessive or runaway verdict. Plaintiff counsel deployed the tactic infrequently through the turn of the century for fear of alienating the jury by appearing greedy.
Two interrelated factors happened to change this dynamic. First, the plaintiff bar worked extremely hard in the intervening years with great success to shed its “ambulance chaser” stereotype by marketing itself as the “protector of the vulnerable”. Second, with the rise in Reptile and punitive tactics spawned in part by the publication of the Reptile handbook, the plaintiff bar also discovered that juries were not alienated by outrageous anchors as long as they were preceded by Reptile commentary essentially to “prime” the jury to punish the defendant rather than compensate the plaintiff with its award.
This is not speculation. I recall sitting outside a courtroom with one of New York’s top plaintiff attorneys in 2006 during deliberations on a catastrophic personal injury trial, during which he conceded to me that he was worried he had asked the jury for too large a figure (it was not even eight figures). A decade later in 2016, that same attorney felt no trepidation in requesting nearly $100 million for a comparable injury. He fed the jurors a steady diet of Reptile tactics from start to finish and they dutifully awarded the requested figure. Our research confirms that this two-step strategy (Reptile + improper anchor) preceded every New York nuclear verdict returned from 2010-2022. The same is almost certainly true of most nuclear verdicts in other jurisdictions.
Reprinted courtesy of
Tim Capowski, Kahana Feld and
Chris Theobalt, Kahana Feld
Mr. Capowski may be contacted at tcapowski@kahanafeld.com
Mr. Theobalt may be contacted at ctheobalt@kahanafeld.com
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Hunton Insurance Group Advises Policyholders on Issues That Arise With Wildfire Claims and Coverage – A Seven-Part Wildfire Insurance Coverage Series
June 27, 2022 —
Scott P. DeVries & Yosef Itkin - Hunton Insurance Recovery BlogWildfires destroy millions of acres a year in the United States, spewing smoke across much of the nation. The cost of damage alone over the past several years soars into the hundreds of billions. As wildfires continue to spread, particularly as we enter wildfire season, policyholders’ claims will rise and with that, so too will wildfire insurance coverage issues. Many believe that when a fire damages their property and/or interrupts their business operations, a claim gets submitted and is automatically paid; sadly, this is often not the case.
In a seven-part series delving into issues relating to wildfire insurance coverage, the Hunton insurance group provides a comprehensive understanding of the types of policies that may be available, legal and factual issues that may arise, and steps policyholders can take – both in advance and during the claims process – to maximize recovery. The following issues will be addressed:
- Part One: Types of Wildfire-Related Losses and the Policies That May Provide Coverage
- Part Two: Coverage for Smoke-Related Damages
- Part Three: Standard Form Policy Exclusions
- Part Four: Coverage for Supply Chain Related Losses
- Part Five: Valuation of Loss, Sublimits, and Amount of Potential Recovery
- Part Six: Ensuring Availability of Insurance and State Regulations
- Part Seven: How to Successfully Prepare, Submit and Negotiate the Claim
Reprinted courtesy of
Scott P. DeVries, Hunton Andrews Kurth and
Yosef Itkin, Hunton Andrews Kurth
Mr. DeVries may be contacted at sdevries@HuntonAK.com
Mr. Itkin may be contacted at yitkin@HuntonAK.com
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White and Williams Announces Partner and Counsel Promotions
February 19, 2024 —
White and Williams LLPPHILADELPHIA–White and Williams LLP is pleased to announce the promotion of the following attorneys: Paul A. Briganti, Patrick A. Haggerty, Timothy (T.J.). Keough, Randy J. Maniloff, and Eric A. Sauter. All five attorneys have been promoted to the Firm’s partnership. The Firm has also promoted Michael L. DeBona, Lynndon K. Groff, and Susan J. Zingone from Associate to Counsel.
“All of our new Partners and Counsel enrich the firm both internally and externally. They have demonstrated a deep commitment to providing our clients with best-in-class service and through their dedication and leadership earned elevation to partner and counsel at White and Williams,” said firm Managing Partner Tim Davis. “We look forward to their many continued successes and contributions to the Firm.”
Paul A. Briganti practices out of the Philadelphia office and represents national and international insurance companies in coverage disputes and complex commercial litigation. He has significant experience litigating and advising clients on issues arising under various lines of coverage, including general liability, cyber, D&O, employers liability, commercial auto and homeowners. In addition, Paul is an editor of the firm’s Complex Insurance Coverage Reporter newsletter and a regular pro bono volunteer with the Senior Law Center. He received his J.D. from Villanova University School of Law.
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White and Williams LLP
Select the Best Contract Model to Mitigate Risk and Achieve Energy Project Success
October 17, 2022 —
Gregory S. Seador - Construction ExecutivePower and energy projects are inherently complex and risky. Therefore, management and proper allocation of risk among project participants are essential to success.
Careful drafting of the engineering, procurement and construction (EPC) contract is a critical first step in managing risk. The standard contract format used for power and energy construction projects is the EPC contract. In its traditional form, the EPC contract makes the EPC contractor responsible for the entire project, including engineering (design of the power plant), procurement (purchase, installation and performance of all equipment) and construction (construction of the plant).
EPC contracts can, however, employ different contract models and pricing structures, each of which carries differing levels of risk for project participants. Selecting the appropriate contract model and pricing structure to meet the unique needs of the project is important.
Reprinted courtesy of
Gregory S. Seador, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Mr. Seader may be contacted at
seador@slslaw.com
