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CONSTRUCTION DEFECT NEWS

Following Pennsylvania Trend, Federal Court Finds No Coverage For Construction Defect

Thursday, December 8, 2016 — Tred R. Eyerly – Insurance Law Hawaii

Bound by Pennsylvania law, the federal district court found there was no coverage for defects in the installation of a roof. State Farm Fire & Cas. Co. v. Kim's Asia Constr., 2016 U.S. Dist. LEXIS 138915 (E.D. Pa. Oct. 5, 2016).

Kim's Asia Construction contracted to remove and dispose of Powerline Imports, Inc.'s roof, and then install a new roof. After completion of the project, Powerline sued, alleging that Kim's Asia's negligent construction of the roof caused the roof to leak, even in minor rain storms. Kim's Asia made additional repairs, but the leaks continued. Powerline had to hire a new contractor to remove and dispose of the roof and install another roof. Powerline then sued Kim's Asia.

Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii

Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Designers Face Fatal Pedestrian Bridge Collapse Fallout

Thursday, December 8, 2016 — Scott Judy – Engineering News-Record

The use of “severely notched” end connections in the design of timber bridge girders that failed, sending a pair of partly completed pedestrian bridges crashing to the ground—and killing one worker—has come back to haunt the bridge engineer, architect of record and material supplier. The design detail had provoked concerns that were not fully addressed before the November 2014 accident at Wake Technical Community College in Raleigh, N.C., during an expansion project that involved several buildings and the bridges.

Reprinted courtesy of Scott Judy, Engineering News-Record

Mr. Judy may be contacted at judys@enr.com

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The Biggest Change to the Mechanics Lien Law Since 1963

Thursday, December 8, 2016 — Wally Zimolong – Supplemental Conditions

The New Year will bring with it the biggest change to Pennsylvania’s Mechanics Lien Law since the current law was passed in 1963. These changes will impact owner, contractors, and subcontractors equally. However, the biggest benefits will probably be for real estate developers and other project owners.

On December 31, 2016, Pennsylvania will go live with a website known as the State Construction Notices Directory. On that date, owners will have the option of making projects costing $1,500,000 or more “searchable projects.” An owner makes a project a searchable project by filing with the Notices Directory a “Notice of Commencement” before works begins. The Notice of Commencement must include the name, address, and email address of the contractor, full name and location of the searchable project, the county where the project is located, a legal description of the searchable property, and the name address, and email address of the searchable project owner. Importantly, the owner must also post a copy of this Notice of Commencement at the project site.

Reprinted courtesy of Wally Zimolong, Zimolong LLC

Mr. Zimolong may be contacted at wally@zimolonglaw.com

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The Home Office Is Dying

December 8, 2016 — Patrick Clark – Bloomberg

Zac Atkinson keeps a desk in the corner of the living room of his one-bedroom apartment in Studio City, Calif. Not that he uses it much: The work-from-home television writer migrates from couch to kitchen table and back again as he churns out scenes for animated children’s programs. “The folks from the generation before me tend to have more of an office,” says Atkinson, 32. “Most people I know end up sitting on the sofa, and half the time the TV is on when they’re working.”

Mr. Clark can be followed on Twitter @pat_clark

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Home Insurance, but With a Philanthropic Twist

December 8, 2016 — Rob Walker – Bloomberg

Aviv Gadot has lived in three different apartments in New York City but never purchased renters insurance. “I don’t trust the companies,” the software developer says. “I know they’ll do everything in their power to keep my money.” His attitude changed recently after he heard about a startup called Lemonade that began offering homeowners and renters insurance in New York state in September.

Along with an easy-to-use app, the carrier promotes a distinct business model. Lemonade keeps a flat 20 percent of your premium; an additional portion, as much as 40 percent, goes toward reinsurance (in case a catastrophe results in claims that outstrip premiums); the rest is set aside to cover claims. The twist: Whatever’s left over at yearend goes to charities picked by the customers.

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Toll Brothers Finds Chinese Partner for Latest NYC Condo Project

December 8, 2016 — Oshrat Carmiel – Bloomberg

Toll Brothers Inc., the biggest U.S. luxury-home builder, is bringing in a Chinese partner for its latest Manhattan condo development.

Toll is forming a joint venture with an affiliate of Gemdale Corp., one of China’s largest residential developers, to build 133 luxury condominiums across two towers at 121 E. 22nd St., the companies said in a statement Thursday. The project, one block north of Gramercy Park, has obtained a $237 million construction loan from a syndicate of five banks including Bank of New York Mellon, Capital One and China Merchants Bank New York.

Mr. Carmiel can be followed on Twitter @OshratCarmiel

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NBI’s Troubleshooting Construction Project Legal Issues Seminar

December 8, 2016 — Beverley BevenFlorez-CDJ STAFF

The National Business Institute presents a one-day seminar that focuses on how to handle construction project legal issues with confidence: “Seemingly small construction project issues can have large legal repercussions if not handled properly. It takes a skilled practitioner to navigate these matters in a way that maintains relationships and keeps projects on track. This comprehensive guide to troubleshooting construction project issues provides the information you need to find solutions for problems before they escalate into expensive legal battles. Help construction industry clients mitigate the chances for lawsuits and preserve professional reputations - register today!”

December 15, 2016
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UPDATE: Texas Federal Court Permanently Enjoins U.S. Department of Labor “Persuader Rule” Requiring Law Firms and Other Consultants to Disclose Work Performed for Employers on Union Organization Efforts

Thursday, December 8, 2016 — Aaron C. Schlesinger & Gregory R. Begg – Peckar & Abramson, P.C.

As an update to our prior alert, on November 16, 2016, a federal judge in Texas issued a permanent injunction blocking the U.S. Department of Labor’s (“DOL”) “persuader rule” – a preliminary injunction had been granted this past June.

In rendering the permanent injunction, the court adopted the reasoning of its prior June 27, 2016 decision that granted a nationwide preliminary injunction on the rule. In the earlier decision, the court held that a temporary injunction was appropriate because the parties challenging the rule were likely to succeed on the merits of their claim […].
Reprinted courtesy of Aaron C. Schlesinger, Peckar & Abramson, P.C. and Gregory R. Begg, Peckar & Abramson, P.C.
Mr. Schlesinger may be contacted at aschlesinger@pecklaw.com
Mr. Begg may be contacted at gbegg@pecklaw.com


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Insurance Tips for Contractors

Thursday, December 8, 2016 — Patrick McNamara - Porter Law Group

Many contractors contentedly accept the insurance policies presented to them by their insurance carriers. However, it is a much better practice to be an active participant in choosing the most appropriate coverage for your business and the specific jobs that you are performing. Use the following tips to be sure your company has the best and most comprehensive coverage.

  1. Never purchase a Commercial General Liability (“CGL”) policy with a “sunset” provision limiting coverage under Products & Completed Operations liability (P&CO) to a 2, 3 or 4-year term. Why? Because the California statute of limitations for construction defect claims is generally 10 years.
  2. Never consider a “Claims-made” or “Modified Occurrence” coverage form which also have a built-in limitation as to the length or term of P&CO coverage. Example: If you purchase a claims-made policy and decide to “switch” your insurance to the preferred “occurrence” coverage form, unless a special provision is made prior to the new purchase, the claims-made coverage would become worthless after the sixty (60) day claims-reporting period.
Reprinted courtesy of Patrick McNamara, Porter Law Group

Mr. McNamara may be contacted at pmcnamara@porterlaw.com

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Benefits to Insureds Under Property Insurance Policy – Concurrent Cause Doctrine

Thursday, December 8, 2016 — David Adelstein – Florida Construction Legal Updates

The Florida Supreme Court in Sebo v. American Home Assurance Co., Inc., 41 Fla. L. Weekly S582a (Fla. 2016) gave really good news to claimants seeking recovery under a first-party all-risk property insurance policy. The Court held that the concurrent cause doctrine and not the efficient proximate cause doctrine was the proper theory of recovery to apply when multiple perils—an excluded peril and a covered peril-combined to create a property loss.

Reprinted courtesy of David Adelstein, Katz, Barron, Squitero, Faust, Friedberg, English & Allen, P.A.

Mr. Adelstein may be contacted at dma@katzbarron.com

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CONSTRUCTION DEFECT NEWS

Forcible Entry and Detainer Actions: Courts May Not Consider Tenant’s Hardship

Thursday, December 8, 2016 — Erica Stutman – Snell & Wilmer Real Estate Litigation Blog

If you own property and a tenant wrongfully refuses to vacate the premises (for example when the lease expires or after proper written notice of termination), you may have a quick and easy remedy to have the tenant removed. Arizona’s forcible entry and detainer (FED) statute allows a person to bring a speedy, summary action to obtain an order that the person must leave the property immediately. See A.R.S. § 12-1171 – 1183. To allow for quick resolution, the only question a court may consider in a FED action is who has the right of possession of the property. A.R.S. § 12-1177(A) (“On the trial of an action of forcible entry or forcible detainer, the only issue shall be the right of actual possession and the merits of title shall not be inquired into.”). Counterclaims and cross-claims are not permitted in a FED action, and must be addressed in a separate civil action between the parties. If factual questions bear on the right of possession, they will also need to be resolved in a regular civil action.

Reprinted courtesy of Erica Stutman, Snell & Wilmer

Ms. Stutman may be contacted at estutman@swlaw.com

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LA Metro To Pay Kiewit $297.8M Settlement on Freeway Job

Thursday, December 8, 2016 — Greg Aragon – Engineering News-Record

The Los Angeles County Metropolitan Transportation Authority (LA Metro) has reached an agreement with Kiewit Corp. and will pay the contractor $297.8 million for project change orders on the Interstate 405-Sepulveda Pass Widening Project, in Los Angeles.

Reprinted courtesy of Greg Aragon, Engineering News-Record

ENR may be contacted at ENR.com@bnpmedia.com

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Residential Mortgage Lenders and Servicers Beware of Changes to Rule 3002.1

Thursday, December 8, 2016 — James C. Vandermark & Amy E. Vulio – White and Williams LLP

This December, residential mortgage lenders and servicers will be required to comply with new requirements for providing notices of payment changes (PCNs) and post-petition fees, expenses, and charges (PPFNs) to mortgage borrowers in Chapter 13 bankruptcies. While the new Federal Bankruptcy Rule 3002.1 will provide much needed clarity, it will also significantly increase the number of PCNs and PPFNs that lenders will need to file.

Reprinted courtesy of James C. Vandermark, White and Williams LLP and Amy E. Vulio, White and Williams LLP
Mr. Vandermark may be contacted at vandermarkj@whiteandwilliams.com
Ms. Vulpio may be contacted at vulpioa@whiteandwilliams.com


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CONSTRUCTION DEFECT NEWS

Float-In of MassDOT Span Sails, But Delay Dispute Lingers

Thursday, December 8, 2016 — Johanna Knapschaefer – Engineering News-Record

The Massachusetts Dept. of Transportation and a contracting team are in discussions regarding fabrication issues that caused a two-year delay in the completion of a key crossing between Quincy and Weymouth. The full completion of the $244-million Fore River Bridge replacement, originally slated for Jan. 5, 2017, is now projected for February 2019.

Reprinted courtesy of Johanna Knapschaefer, Engineering News-Record

ENR may be contacted at enr.com@bnpmedia.com

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Deductibles Limited to Number of Suits Filed Against Insured, Not Number of Actual Plaintiffs

Thursday, December 8, 2016 — Tred R. Eyerly – Insurance Law Hawaii

The court limited the number of deductibles to the counterclaims filed against the insured, not the more than 600 plaintiffs who were parties to the three underlying lawsuits. Probuilders Spec. Ins. Co. v. Yarbrough Plastering, 2016 U.S. Dist. LEXIS 134959 (E.D. Calif. Sept. 29, 2016).

Yarbrough entered into contracts with Lenox Homes to provide stucco and drywall services in the homes Lenox would build. Each contract required Yarbrough to indemnify Lenox for any claims resulting from property damage arising out of the performance of the contract.

Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii

Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Philadelphia Proposed Best Value Procurement Bill

Thursday, December 8, 2016 — Wally Zimolong – Supplemental Conditions

An opinion piece in today’s Philadelphia Inquirer concerning proposed legislation that would change the way the City of Philadelphia awards public construction projects is causing quite a stir. The article concerns legislation that would allow the City to award public construction contracts based on a “best value” approach rather than the current requirement that the contract be awarded to the lowest responsible and responsive bidder. The author worries that by removing the current objective criteria and replacing it with subjective ones, contracts can be steered to politically favored contractors. The author cites the recent no-bid contract awarded to a law firm run by the friend of Mayor Jim Kenney as an example of the chaos would ensue if this bill was passed.

Considering that the Bill’s sponsor, Bobby Hennon, is under FBI investigation, and some of the Mayor’s biggest supporters are as well, the author has ever right to be concerned. However, article comes up short in explaining what the Bill says and what best value procurement, if adopted, would mean for public construction work in Philadelphia.

First, the Bill that Councilman Hennon is proposing is actually a Bill that would make the best value procurement question a ballot question next November. In other words, the Bill, if passed, would but to a City wide vote the question of whether the City should change it procurement practices to permit the best value approach to be used in addition to the low bid approach that is current used.

Reprinted courtesy of Wally Zimolong, Zimolong LLC

Mr. Zimolong may be contacted at wally@zimolonglaw.com

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We Knew Concrete Could Absorb Carbon—New Study Tells How Much

Thursday, December 8, 2016 — Thomas F. Armistead – Engineering News-Record

Concrete’s large carbon footprint—that is, the amount of carbon dioxide emitted during the cement manufacturing process—is estimated to be 5% of industrial CO2 emissions, a source of concern in the battle against human-caused climate change. But last month, an international research team reported that substantial quantities of CO2 are reabsorbed, or sequestered, by cement-based products over their life cycle.

Reprinted courtesy of Thomas F. Armistead, Engineering News-Record

ENR may be contacted at enr.com@bnpmedia.com

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