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DIRECTORY AND CAPABILITIES

Florida Appeals Court Rules in Favor of Homeowners Unaware of Construction Defects and Lack of Permits

December 09, 2011 — CDJ STAFF

The Florida Court of Appeals has ruled that a homeowner is not liable for defects in unpermitted alterations, reversing a lower court’s decision in Jensen v. Bailey. The Jensens sold their house to the Baileys. During the sale, the Jensens filled out a property disclosure statement, checking “no” to a question about “any improvement or additions to the property, whether by your or by others that have been constructed in violation of building codes or without necessary permits.”

After moving in, the Baileys discovered several problems with the home. One involved a defective sewer connection leading to repeated backups. The Baileys also found problems with remodeling the Jensens had done in the kitchen, master bath, and bedroom. The remodeling work was not done with required permits nor was it up to code.

The court noted that an earlier case, Johnson v. Davis, established four criteria: “the seller of a home must have knowledge of a defect in the property; the defect must materially affect the value of the property; the defect must not be readily observable and must be unknown to the buyer; and the buyer must establish that the seller failed to disclose the defect to the buyer.” The court found that the first of these criteria was crucial to determining the case.

In the Johnson ruling, the then Chief Justice dissented, fearing that the courts “would ultimately construe Johnson’s requirement of actual knowledge to permit a finding of liability based on constructive knowledge,” quoting Justice Boyd, “a rule of constructive knowledge will develop based on the reasoning that if the seller did not know of the defect, he should have known about it before attempting to sell the property.” The Appeals Court concluded that the lower court hit this point in ruling on Jensen v. Bailey.

Citing other Florida cases, the court noted that the Johnson rule does require “proof of the seller’s actual knowledge of the defect.” The court cited a case in which it was concluded that the seller “should have known” that there was circumstantial evidence was that the seller did know about the defects, as the seller had been involved in the construction of the home.

In the case of the Jensens, the lower court concluded that they did not know that the work was defective, nor did they know that they were obligated to obtain permits for it. The Appeals Court found this one fact sufficient to reverse the decision and remand the case to the lower court for a final judgment in favor of the Jensens.

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New Jersey Law regarding Prior Expert’s Testimony

April 15, 2014 — Beverley BevenFlorez-CDJ STAFF
Mary Pat Gallagher writing for the New Jersey Law Journal reported that “[l]awyers who track down an opposing expert's testimony from prior cases must disclose that fact during discovery but need not say whether they plan to use it in cross-examining the expert at trial, a New Jersey appeals court says.” In Dalton v. Crawley, the Appellate Division held that “[d]ecisions about cross-examination ‘involve the attorney's mental processes, so they are inherently work product.’” The issue began when “one of the defense lawyers, Michael McGann, figured out from the deposition questions Mahoney directed at one of his experts that he had transcripts of testimony from earlier cases,” according to the New Jersey Law Journal. “Hit with a notice to produce the transcripts, [Plaintiff attorney Brian] Mahoney refused, saying they were ‘attorney work product and we will not be telling you what we have developed regarding this expert.’" The New Jersey Law Journal declared that the “ruling means both sides will have to indicate what transcripts they have gathered for use—giving the name of each expert as well as the name and docket number of the prior cases where those experts testified. “ Read the court decision
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Lease-Leaseback Fight Continues

June 01, 2020 — Garret Murai - California Construction Law Blog
It’s like the rematch between Rocky Balboa and Apollo Creed. In the right corner we have the California Taxpayers Action Network. In the left corner, Taber Construction, Inc. The title in contention: Construction of California’s Lease-Leaseback Program and, specifically, whether a construction firm can provide both pre-construction services as well as perform construction or, whether doing so, would be an impermissible conflict of interest under the Lease-Leaseback Law. In their first appellate court match, California Taxpayers Action Network argued that a lease-leaseback arrangement between Taber Construction and the Mount Diablo Unified School District, whereby the District agreed to lease the site to Taber Construction one dollar (which is permissible) and to pay Taber a “guaranteed project cost” of $14,743,395 comprised of “tenant improvement payments” totaling $13,269,057 prior to the District taking delivery of the project (which was the issue in dispute) and six “lease payment amount[s]” of $345,723 plus interest paid in 30-day intervals, violated the Lease-Leaseback Law because the bulk of the payments by the District to Taber Construction occurred during construction rather than during the lease-term which could only “truly” occur after the District took delivery of the project. The 1st District Court of Appeal sided with Taber Construction, and in doing so created an appellate court split with the 5th District Court of Appeal’s decision in Davis v. Fresno Unified School District, 237 Cal.App.4th 261 (2015), which held that contractor who received all payments prior to turnover of the project to the district violated the Lease-Leaseback Law. 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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Transportation Officials Make the Best of a Bumpy 2020

January 18, 2021 — Jim Parsons & Aileen Cho - Engineering News-Record
The year 2020 provided a bumpy budgetary ride for all modes of transportation, and some industry insiders don’t expect airport and transit ridership to return to pre-pandemic levels for years. Agencies are taking lessons learned, coupled with hopes for the new Biden administration, to carry on as best they can. Reprinted courtesy of Jim Parsons, Engineering News-Record and Aileen Cho, Engineering News-Record Ms. Cho may be contacted at choa@enr.com Read the full story... Read the court decision
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Battle of Experts Cannot Be Decided on Summary Judgment

June 13, 2018 — Tred R. Eyerly - Insurance Law Hawaii
When two competing experts disagreed on the cause of the loss, the trial court erred in granting summary judgment to the insurer. Garcia v. Firs Community Ins. Co., Fla. App. LEXIS 4237 (Fla. Ct. App. March 28, 2018). Garcia, the homeowner, discovered water damage in his home, allegedly due to a roof leak. Garcia notified his insurer, First Community Insurance Company. A forensic engineer, Ivette Acosta, was retained by First Community to inspect the property. After the inspection, coverage was denied. The homeowner's policy covered direct loss to property only if the loss was a physical loss. Loss caused by ""rain snow, sleet, sand or dust to the interior of a building was excluded unless a covered peril first damaged the building causing an opening in a roof or wall and the rain, snow, sleet, sand or dust enters through this opening." Loss caused by wear and tear, marring, or deterioration was also excluded. 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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Almost Half of Homes in New York and D.C. Are Now Losing Value

September 03, 2015 — Prashant Gopal – Bloomberg
Almost half of single-family houses in the New York and Washington metropolitan areas are losing value, a sign that buyers' tolerance for high prices in many large U.S. cities may be reaching a limit. The values of 45 percent of houses in both the Washington and New York areas slumped by at least 2 percent in June from a year earlier, according to a new index created by Allan Weiss, co-founder of the Case-Shiller home price indexes. In June 2014, only 15 percent of Washington residences dropped in value, while 20 percent fell in New York. Because the index is of only single-family homes, it doesn't include Manhattan. More properties also were in decline in Los Angeles, Chicago, Phoenix and Miami. Read the court decision
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Reprinted courtesy of Prashant Gopal, Bloomberg

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Colorado’s Need for Condos May Spark Construction Defect Law Reform

January 29, 2014 — Beverley BevenFlorez-CDJ STAFF
On January 6th, Ed Sealover of the Denver Business Journal reported that Denver Mayor Michael Hancock has asked Colorado legislators “to pass a reform law that will make it easier to build condos without fear of getting sued.” Hancock is one of several mayors “to advocate for a construction defects reform proposal that was killed by Democrats in a committee last year.” The problem, Sealover notes, is that only “2 percent of new housing in the state is multifamily units made for ownership—far lower than the 20 to 25 percent of such housing stock in other states represented by condos.” There is some dissent as to whether reforming construction defect laws is the solution to the housing problem: “Taking away rights of homeowners to get shoddy construction fixed in what is likely the most expensive purchase in their life is not the way to fix the lack of affordable housing,” Lynea Hansen, spokeswoman for a group of construction defect homeowners told Sealover. Furthermore, on January 7th, Sealover reported that Democrats “expressed skepticism” about a need to reform the laws, saying “they need more data on what is causing owner-occupied multifamily housing to be such a small part of the new housing market.” Moreover, Senate President-elect Morgan Carroll stated that she “wants to look into issues like why it is so hard to get insurance for building condominiums or examine why some areas of Colorado are seeing condo development and others aren’t.” Read the full story, January 6th article... Read the full story, January 7th article... Read the court decision
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Eminent Domain Bomb Threats Made on $775M Alabama Highway Project

July 03, 2022 — Derek Lacey - Engineering News-Record
Multiple bomb threats have been made against Alabama transportation officials, law enforcement and others in reaction to eminent domain plans for a major highway expansion project. Reprinted courtesy of Derek Lacey, Engineering News-Record Mr. Lacey may be contacted at laceyd@enr.com Read the full story... Read the court decision
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