Seattle Washington Building Expert Directory

Hamptons Home Up for Foreclosure That May Set Record

May 13, 2014 — Prashant Gopal – Bloomberg
A home in New York’s Hamptons on Further Lane, where comedian Jerry Seinfeld and hedge-fund manager Steven A. Cohen own estates, is up for auction in what will be one of the area’s biggest foreclosure sales. More than $10.5 million is owed on the 1.8-acre (0.7-hectare) property at 80 Further Lane in East Hampton, according to Daniel Murphy, the Riverhead, New York-based attorney who is scheduled to conduct the sale on June 10. Read the court decision
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Reprinted courtesy of Prashant Gopal, Bloomberg
Mr. Gopal may be contacted at pgopal2@bloomberg.net

Connecticut Court Clarifies Construction Coverage

June 28, 2013 — CDJ STAFF
The Connecticut Supreme Court has recently ruled on a case in which breach of contract and bad-faith claims were made against an insurer in an construction defect case. Joseph K. Scully of Day Pitney LLP discussed the case in a piece on Mondaq. Mr. Scully noted that the background of the case was that Capstone Building was the general contractor and project developer of a student housing complex for the University of Connecticut. Unfortunately, the building had a variety of problems, some of which were violations of the building code. Mr. Scully noted that the building had “elevated carbon monoxide levels resulting from inadequate venting, improperly sized flues.” Capstone entered into mediation with the University of Connecticut. Capstone’s insurer, the American Motorists Insurance Company (AMICO), declined involvement in the participation. Afterward, Capstone sued AMICO. The issues the court covered involved the insurance on this project. The court addressed three questions. The first was “whether damage to a construction project caused by construction defects and faulty workmanship may constitute ‘property damage’ resulting from an ‘occurrence.’” The court concluded that it could “only if it involved physical injury or loss of use of ‘nondefective property.’” The second question dealt with whether insurers were obligated to investigate insurance claims. The court, “agreeing with the majority of jurisdictions,” did not find “a cause of action based solely on an insurer’s failure to investigate a claim.” Under the terms of the contract, it was up to AMICO to decide if it was going to investigate the claim. Thirdly, the court examined whether “an insured is entitled to recover the full amount of a pre-suit settlement involving both covered and noncovered claims after an insurer wrongfully disclaims coverage.” The court concluded that the limits are that the settlement be reasonable, the policy limit, and the covered claims. Mr. Scully concludes that the decision will limit “the scope of coverage for construction defect claims” and “also imposes reasonable requirements on an insured to allocate a settlement between covered and noncovered claims. Read the court decision
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Reprinted courtesy of

Understand the Dispute Resolution Provision You Are Agreeing To

September 20, 2021 — David Adelstein - Florida Construction Legal Updates
When negotiating a contract, do not overlook the dispute resolution provision. It is one of the more important provisions in your construction contract. This provision will come into play and have ramifications if there is a dispute, which is certainly not uncommon on a construction project. In dispute resolution provisions in subcontracts on federal projects, it is not unusual for that provision to include language that requires the subcontractor to STAY any dispute that concerns actions or inactions of the owner pending the resolution of any dispute between the owner and prime contractor relating to that action or inaction. A provision to this effect should be included for the benefit of the prime contractor. For instance, the provision may say the subcontractor agrees to stay any such claim against the prime contractor or prime contractor’s surety pending the outcome of any pass-through claim (or otherwise) submitted under the Contract Disputes Act. 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

Anti-Concurrent Causation Clause Eliminates Loss from Hurricane

September 06, 2021 — Tred R. Eyerly - Insurance Law Hawaii
The court found the insured was not covered for losses caused by Hurricane Laura due to the implementation of the policy's anti-concurrent causation clause. Aegis Sec. Ins. Co. v. Lejeune, 2021 U.S. Dist. LEXIS 106804 (W. D. La. June 7, 2021). At the time of the hurricane, the insureds' home was covered by a manufactured home insurance policy issued by Aegis. The policy excluded coverage for damage "caused by, contributed to or aggravated by" flooding. The policy's anti-concurrent causation clause read, "We do not pay for loss to the types of property covered under this policy caused by any of the following. Such loss is excluded regardless of any other cause or event contributing concurrently or in any sequence to the loss." The policy's exceptions followed. After the storm, the insureds submitted their claim. Aegis filed suit for declaratory judgment. Aegis relied upon reports that the manufactured home and barn owned by the insureds were damaged by winds, then displaced and destroyed by storm surge associated with the hurricane. The home first sustained damage from the storm's high winds before it was displaced from its concrete piers by a 12 to 16 foot storm surge. 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

U.S. Home Sellers Return for Spring as Buyers Get Relief

February 10, 2014 — Prashant Gopal – Bloomberg
Suzanne Baker and her siblings bought a foreclosed home in Atlanta two years ago, added a fourth bathroom, then waited for values to rebound before considering a sale. Now, she says, they’re ready to cash in. The family last month listed the four-bedroom house in the affluent Buckhead neighborhood for $710,000. It was purchased as an investment for about $375,000 in late 2011, before bulk buyers snapped up many of the area’s distressed homes, helping to drive up prices in Atlanta by more than 25 percent. “The market is back up,” Baker said. “We think we can make a good amount of profit so we’re going to try.” For two years, a shortage of sellers like the Bakers has propped up prices across the U.S. as shoppers jostled for a dwindling supply of houses. Now, as the market’s busiest season approaches, escalating values are spurring more listings as homeowners regain equity lost in the worst crash since the 1930s. While new-home construction at a third of its 2006 peak will keep inventory tight, the supply increase is poised to damp price gains while higher mortgage rates cut into demand. Read the court decision
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Reprinted courtesy of Prashant Gopal, Bloomberg
Mr. Gopal may be contacted at pgopal2@bloomberg.net

Are Proprietary Specifications Illegal?

April 11, 2018 — Wally Zimolong – Supplemental Conditions
A friend came to me with a question regarding a case he was working: “can a public owner require that bidders use a specific brand name product?” “Of course not,” I said “proprietary specifications are illegal.” Or, at least that’s what I assumed. To my surprise, the law in the Commonwealth of Pennsylvania is not as clear as it is in other jurisdictions. What is a proprietary specification? A proprietary specification lists a product by brand name, make, model and/model that a contractor must (shall) utilize in construction. A basic example of a proprietary specification would state:

“Air Handlers shall be “Turbo Max” as manufactured by Chiller Corp.”

There are two problems with a proprietary specification (other than potentially being illegal): (a) they limit competition, and (b) invite steered contract awards. They limit competition because it limits the type of material that can be used on the project. In the example above, there could be equivalent air handlers available at a better price but the contractor could not use that lower priced product in its bid. Thus, the taxpayers end up paying more for tile. Also, contractors may not be able to secure a certain brand name product because of exclusive distribution agreements. Again, using the example above, contractor A’s competitor may have the exclusive distribution agreement with Chiller Corp. Read the court decision
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Reprinted courtesy of Wally Zimolong, Zimolong LLC
Mr. Zimolong may be contacted at wally@zimolonglaw.com

Insurer Motion to Intervene in Underlying Case Denied

August 10, 2021 — Tred R. Eyerly - Insurance Law Hawaii
The Colorado Supreme Court determined that the insurer defending under a reservation of rights could not intervene in the underlying case after the insured assigned its rights to any bad faith claim against the insurer. Auto-Owners Ins. Co. v. Bolt Factory Lofts Owners Ass'n, Inc., 2021 Colo. LEXIS 365 (Colo. May 24, 2021). Bolt Factory initiated a construction defects lawsuit against various contractors. Several defendants filed third-party complaints against subcontractors, including Sierra Glass Company. Auto-Owners agreed to defend its insured, Sierra Glass, under a reservation of rights. Auto-Owners declined to settle with Bolt Factory for $1.9 million, within policy limits. Sierra Glass then retains independent counsel and entered into a settlement with Bolt Factory. The settlement allowed Sierra Glass to assign its bad faith claims to Bolt Factory in exchange for the right to pursue the insurer for payment of the excess judgment rather than Sierra Glass. Instead of entering into a stipulated judgment, Bolt Factory and Sierra Glass proceeded to an abbreviated trial. 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

Owner’s Slander of Title Claim Against Contractor Recording Four Separate Mechanics Liens Fails Under the Anti-SLAPP Statute

February 01, 2021 — Garret Murai - California Construction Law Blog
Most mechanics lien actions follow a pretty standard process:

A mechanics lien claimant, either a contractor subcontractor, material supplier, or laborer, performs work but is not paid;
Mechanics lien claimant records a mechanics lien on the property in which work was performed; and
Within 90 days thereafter files suit to foreclose on the mechanics lien.

Sometimes, either before or after a mechanics lien claimant files suit, the owner will record a mechanics lien release bond, in which case mechanics lien claimant files suit against the release bond. But what if a mechanics lien claimant records a mechanics lien, the owner records a mechanics lien release bond, and the mechanics lien claimant records three different but identical mechanics liens thereafter? Is this even legal? 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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