Construction Defect Articles

Court Fines Building Company For Safety Failings

December 20, 2013
MELISSA ZAYA-CDJ STAFF

December 18, 2013 Westminster Magistrate Court fines Platinum Property Maintenance Ltd “for safety failings after a worker suffered life-changing injuries when he fell through a fragile garage roof at a site in Bexley,” Health and Safety Executive reports. The 39 year old injured man also “suffered brain injuries and was left partially deaf following the fall at a garage compound.” The married father of four “also fractured his shoulder and lost his peripheral vision as a result of the incident. While being treated in hospital, he contracted MRSA,” and may not be able to return to work due to his injuries and the nature of his profession.

The worker and his colleague were on the roof top removing moss and debris when the sheeting under them gave way causing the man to drop 3 metres before hitting the concrete ground. His colleague was not injured. “The Health and Safety Executive (HSE) investigated and found that no safety equipment, such as harnesses, scaffolding or boards, had been provided by the firm to prevent a fall. In addition, a risk assessment had not been carried out, no documented system of work was in place for roof repairs and there was a lack of adequate supervision.” The Court fined the company “£8,000 and ordered to pay £6,000 in costs after pleading guilty to breaching Section 3(1) of the Health and Safety at Work etc Act 1974.”

HSE inspector Peter Collingwood told IMSM Ltd London, “Work at height is inherently fraught with risk, and falls remain the single biggest cause of deaths and serious injury in the construction industry. It is therefore essential that effective management arrangements are in place to ensure risks are managed and workers are protected. Fragile roof covers provide little or no protection, and should be viewed with the same level of danger as an open void.”

http://local.imsm.com/london/news/london-building-firm-fined-for-worker-...


Contractor and School District Settle Contract Dispute

December 11, 2013
CDJ STAFF

A dispute between a Michigan construction company and an Ohio school district over unpaid work and delays has come to an end. The Ohio Court of Claims approved a $979,000 settlement from the school district; just over half of the $1.7 million Synergy Group claimed the Reynoldsburg school system owed it. The school district claimed that Synergy’s delays on the project caused it to have additional expenses both with subcontractors and legal fees.


Man Arrested for Attempting to Steel Copper from Apple Site

December 4, 2013
CDJ STAFF

Apple is currently demolishing buildings once occupied by Hewlett-Packard to make way for their Apple 2 campus. Security guards noticed a break-in in late November and called the police. After a police dog cornered the man, police found copper piping and wires that had been ripped from the walls of the old building. He was treated for a dog bite, then released on $11,000 bail.

The Apple 2 campus is a major a major construction project in Cupertino. The project is expected to be complete in 2016 and will have about 3.7 million square feet, space for about 12,000 employees.


Quarles & Brady LLP Announce Phoenix Litigation Dispute Resolution Group Chair

November 27, 2013
CDJ STAFF

Edward Salanga, a partner at Quarles & Brady with a practice that includes representing lenders and contractors in property and construction-related disputes, including construction defect claims, has been named the Litigation & Dispute Resolution Group Chair in the firm’s Phoenix office.


Home Repair Scams on the Rise in North Carolina

November 27, 2013
CDJ STAFF

Police in Kinston, North Carolina have warned residents that a group of men are contacting residents and telling them that they need expensive roof repairs. The men do not seem to be contractors. One resident, when contacted by the group, checked her own roof by going up a ladder. Seeing no damage, she called the police.

Police say this is the season for home repair scams. They caution homeowners to not give money up front for repairs, and always check to make certain that contractors are licensed and bonded.


Phoenix Construction Defect Case Settles for $13.6 Million

November 8, 2012
CDJ STAFF

Phoenix Business Journal reports that court has affirmed the $13.6 million settlement in the Sun City Grand construction defect case. The settlement was the result of arbitration. Del Webb Corp, the home builder, plans on appealing the court ruling, noting that the payout in attorney and expert fees is almost as much as the homeowners are getting. Initially, the homeowners claimed $50 million in damages and were offered $2 million.


Construction Defects - Defense Verdict

November 8, 2012
FOR IMMEDIATE RELEASE

Earlier this month a Multnomah County (Portland) Oregon jury awarded Smith Freed & Eberhard's contractor client a defense verdict after a 3 week construction defect trial.

This was Oregon's first condominium conversion case to go to jury verdict.The project was a 10 story building originally constructed in 1965, but converted to condominiums within 10 years of the lawsuit. Claims involving defects in condominium conversions have been the latest trend of lawsuits in the Portland metropolitan area.

The plaintiff was the Washington Park Homeowners Association which had sued the developers, mechanical contractor, roofer, window manufacturer and Smith Freed & Eberhard's client, the contractor who painted the building exterior and installed replacement windows.

One defendant got out on summary judgment, but all the other defendants settled with plaintiff before trial. Smith Freed & Eberhard's clients defense at trial was lack of causation. According to trial attorneys Jack Levy and Kathrin Dragich who interviewed the jurors after the verdict, the jury agreed with the lack of causation argument. The building had damage, which trial attorneys Jack Levy and Kathrin Dragich argued could be repaired on a limited basis.

One of the newsworthy aspect of this verdict is that the jury did not buy the plaintiff's expert's opinion relating to plaintiffs scope of repairs, nor did they believe that the construction repair bids were reasonable. Plaintiff expert's scope included a couple of approaches, both involving the removal and replacement of all siding and windows. Estimates ranged from $3.4 to $4.6 million, all of which was targeted at the Smith Freed & Eberhard client.

The jurors appeared to clearly see this approach as overreaching and as a betterment to the project. Smith Freed & Eberhard's theme was that normal people, dealing with issues in their own lives, make targeted repairs to defined problems. Normal people don't tear down the house when a few windows leak.


U.S. Lawmakers Seek to Ban Tainted Chinese Drywall

November 8, 2012
FOR IMMEDIATE RELEASE

U.S. Senators. Bill Nelson, (D.-Fl), and Mary Landrieu, (D.-LA) have filed legislation for a recall and immediate ban on tainted building products from China, as more and more people around the country are reporting problems in their homes built with imported drywall.

The legislation presses the Consumer Product Safety Commission ( CPSC ) for a recall on Chinese-made drywall, based in part on findings by a Florida homebuilder and state officials who have confirmed the presence of sulfide gases in homes built with the drywall.

Congressman Robert Wexler, (D.-Fl), has filed similar legislation in the House. In addition, Wexler has urged Florida Governor Charlie Crist to declare a state of emergency in Florida over the product. This would allow homeowners to apply for federal loans to help repair their homes.

Nelson and Landrieu's legislation also asks the CPSC to work with federal testing labs and the Environmental Protection Agency to determine the level of hazard posed by certain chemicals and as yet unidentified organic compounds in the drywall.

In addition, the legislation calls on the commission to issue an interim ban on imports until it can create federal drywall safety standards so consumers are protected in the future.

Among other things, the drywall is linked to seeping sulfide gases that can corrode electrical wiring and components of air-conditioning and other household appliances.

The two lawmakers said they're hoping to jump-start a process for helping affected homeowners with the costs of repairs or replacement, which under their legislation would be the responsibility of the manufacturers.

The potential scope of the problem is big. Officials believe between 60,000 and 100,000 homes nationwide may contain tainted drywall. Nelson represents Florida, where an estimated 36,000 homes are believed to contain Chinese-made drywall. Landrieu represents Louisiana, where tons of the drywall was used in post-Hurricane Katrina construction. Besides Florida and Louisiana, problems also have been seen and reported in the press in Virginia, Alabama, Mississippi and California.

Nelson noted that during a recent three-to five-year period drywall from China arrived at ports around the country, including 60 million pounds in New Orleans and 27 million pounds in Mississippi - two areas hard hit by Hurricane Katrina.

"I believe you're going to see this is widespread," said Nelson, a member of the Senate Commerce Committee that oversees the CPSC. "Anytime you have mounting evidence of potentially toxic goods you have an obligation to act quickly to protect consumers."

On Feb. 13, Nelson wrote the CPSC and requested a federal investigation into the imported drywall. The CPSC launched an investigation two weeks later. Last week, a team of federal investigators was in southwest Florida inspecting the electrical systems of suspect homes.

A number of homeowners have filed lawsuits, and developers are suing the manufacturers of the drywall. Homeowner lawsuits contend the drywall has caused damage to the home, that the drywall itself must be replaced and, in some cases, that residents have suffered adverse health effects such as asthma as a result of exposure.

In the past, there has been at least one case involving widespread replacement of siding in numerous homes around the country. The siding, a concoction of wood scraps and resins, was installed on about 800,000 homes around the country from 1985 to 1995. It warped prematurely, rotted in wet weather and sprouted mushrooms and other fungus. The first complaints arose out of the use of the wood panels on roofs of houses in Florida.

About 67,000 homeowners lodged complaints and eventually the manufacturer paid 37,781 homeowners an average of $4,367 or a total of $165 million.


Nevada Legislators Hear Arguments on Chapter 40 and Statute of Repose

November 8, 2012
FOR IMMEDIATE RELEASE

Following many years of debate over Nevada’s NRS Chapter 40, a bill passed in the middle of the 1990s as a process to resolve construction defect related disputes before litigation commenced between homeowners and builders of residential construction, the fight to change this law again has surfaced.

Many parties who are involved in construction defect claims in Nevada claim that Chapter 40 carries with it to many entitlements, making it to costly to build houses in Nevada, some say Chapter 40 is fine how it is.

But no matter whose side is being heard, one thing remains clear and that is a fierce dispute over the way the future of Nevada’s Chapter 40 will resolves homeowners’ claims of construction defects will be a hot issue before the Nevada legislature.

This past Wednesday a full hearing was held before a legislative committee which pit builders and subcontractors against attorneys for homeowners.

Builders and subcontractors say the bill, drafted with guidance from a special subcommittee led by state Sen. Terry Care, D-Las Vegas, is welcome relief. They say the current system is flooded with alleged bogus claims and exorbitant legal fees and often impedes home repairs. If passed, some say the legislation would tilt the system significantly toward builders and subcontractors, and plaintiff attorneys say it goes too far, imposing severe curbs on the rights of homeowners.

On the other hand, builders claim they are obligated to pay the homeowners’ costs of bringing lawsuits, provided homeowners agree to reasonable settlements. Builders and subcontractors say built-in attorney and expert fees create perverse incentives to bring Chapter 40 actions against them.

Subcontractors also claim that they are often innocent bystanders in construction defect claims and litigation in Nevada. For instance, window installers claim they are brought into lawsuits which are related to leaky roofs or defective drywall. Roofers and drywallers claim they are brought into cases with leaky windows. Subcontractors claim that they are only brought into suits by builders who wish to spread the cost, expense and exposure of the defective construction allegations amongst all parties who participated in the building of the home. Subcontractors’ claim their own insurance companies often advise them to settle, as it remains cheaper to settle rather than allow litigation costs to skyrocket.

The proposed legislation, Senate Bill 349,

http://www.leg.state.nv.us/75th2009/Reports/history.cfm?ID=967 would more narrowly define a construction defect. To qualify as defective, a home would have to present “unreasonable risk of injury to a person or property.” Alternately, it would have to meet all of the following criteria: violate building codes, cause damage to the property and be built in a manner not “good and workmanlike” according to industry standards. Currently, just one of those criteria, including violating a building code, needs to exist to mark a home as defective and qualify it for the Chapter 40 process. The legislation would also eliminate a provision in the law that allows plaintiffs to collect “reasonable attorney’s fees.”

Homeowner lawyers claim the bill would leave homeowners, thousands of whom bought substandard houses during the building boom in Nevada, defenseless against builders, their insurance companies and builders lawyers. Homeowner counsel allege that current law necessarily requires nothing more than code violation to qualify as a construction defect.

The committee also heard legislation that would shorten the time a homeowner has to bring civil action against a builder. Senate Bill 337

http://www.leg.state.nv.us/75th2009/Reports/history.cfm?ID=930 is a revision to the Statutes of Repose and reduces the time action may be commenced from 10 years to 6 years.

The legislative battle over construction defects is expected to continue until the session’s scheduled end two months from now.


Nevada Legislators Hear Arguments on Chapter 40 and Statute of Repose

November 7, 2012
FOR IMMEDIATE RELEASE

Senate Bill 337 (Statutes of Repose) has passed out of the Nevada State Senate. The vote was held April 15th, there were 20 yeas, 0 nays, and 1 Senator not voting. The bill was immediately referred to the Nevada State Assembly, where it was read for the first time today and referred to the Committee on Judiciary. The bill's history and content can be found at http://www.leg.state.nv.us/75th2009/Reports/history.cfm?ID=930

Senate Bill 349 (NRS Chapter 40) has also passed out of the Nevada State Senate. The vote was held today, there were 19 yeas, 1 nay, and 1 Senator not voting. The bill has been referred to the Nevada State Assembly. The bill's history and content can be found at http://www.leg.state.nv.us/75th2009/Reports/history.cfm?ID=967


New York commencement of duty to defend

March 25, 2011
CDCOVERAGE.COM

In American Home Assurance Co. v. BFC Construction Corp.,. No. 4323 (N.Y. App. Div. Feb. 22, 2011), the named insured tendered its defense of the underlying lawsuit to its insurer. An additional insured was also named as a defendant in the lawsuit.


New York commencement of duty to defend

March 25, 2011
CDCoverage.com

In American Home Assurance Co. v. BFC Construction Corp.,. No. 4323 (N.Y. App. Div. Feb. 22, 2011), the named insured tendered its defense of the underlying lawsuit to its insurer. An additional insured was also named as a defendant in the lawsuit. Read the full story.... Reprinted courtesy of CDCoverage.com


Howrey Construction Litigation Team Joins Pillsbury

March 2, 2011
CDJ STAFF

Insurance News Net and a variety of legal publications reported today that a construction litigation team of six partners, two counsel and seven associates will be joining Pillsbury in its Los Angeles, San Francisco, Washington, DC and New York offices. The group comprising 15 individuals have reportedly left the Howrey firm, and are joining the construction practice group at Pillsbury Winthrop Shaw Pittman LLP. Pillsbury Firm Chair Jim Rishwain, commented that “We are enthusiastic to have this team of market-leading professionals join Pillsbury, as these attorneys are remarkable for their breadth of litigation and arbitration experience combined with an unsurpassed focus on construction and infrastructure. Under John Heisse's leadership, as former co-head of Howrey's Construction Litigation group, the team received the 2010 Award for Excellence in Construction by Chambers USA,” According to press releases and the Pillsbury website, the team comprises a marquee group of litigators with an emphasis on resolving disputes for general construction and engineering, real estate and infrastructure projects and securing insurance coverage for those matters. The partners joining Pillsbury are John R. Heisse (San Francisco), David T. Dekker (DC), Robert B. Thum (Los Angeles), Jeffrey Gans (DC), Melissa Lesmes (DC), and Michael McNamara (DC). Heisse will reportedly serve as a leader of Pillsbury s Firmwide Construction Litigation team. In addition, the team will also include two counsel in Los Angeles, five associates in DC, one associate in San Francisco and one associate in New York. Other Howrey partners have joined Pillsbury in the recent past, specifically San Francisco IP litigation partner Duane Mathiowetz joined the firm on February 12, 2011.


Follow Up on Colorado Senate Bill 11-068: Unwarranted Changes to the Colorado Consumer Protection Act

March 2, 2011
Higgins, Hopkins, McLain & Roswell, LLC

In a prior Colorado Construction Litigation blog entry, we presented concerns with Senate Bill 11-068, which seeks to eliminate the significant public impact component of claims under the Colorado Consumer Protection Act (the CCPA ). On February 22, 2011, the Senate passed the bill in a 19 to 15 vote. As the bill made its way through the Senate, it was amended to remove the provisions that would have granted the Attorney General the unilateral power to add to the laundry list of acts that constitute deceptive trade practices. While the original version of the bill would have created a rebuttable presumption that a significant public impact occurred where a plaintiff offers evidence of a deceptive trade practice, recent revisions completely do away with the element of a significant public impact in a CCPA cause of action. The revised SB11-68 reads in part: 6-1-113.5. Private cause of action - elements legislative declaration. (1) TO PREVAIL IN A CLAIM BROUGHT UNDER SECTION 6-1-113, A PLAINTIFF SHALL ESTABLISH THAT:(a) THE DEFENDANT ENGAGED IN AN UNFAIR OR DECEPTIVE TRADE PRACTICE; Read Full Story...


LA Times Reports Construction Defects and Waste in Los Angeles Community College District $5.7 Billion Construction Plan

March 1, 2011
Gale Holland

In a series of articles scheduled for publication this week, the LA Times reports on a number of construction defect, planning, and project management issues. According to the article, “Oversight and quality control problems have plagued the district's $5.7-billion, voter-approved bond program to rebuild its nine campuses.”The authors of the piece reportedly interviewed more than 200 people, visited construction sites at all nine colleges and examined thousands of documents obtained through the California Public Records Act. “Inspectors, architects and project managers began finding serious construction defects early on and grew increasingly frustrated as deadlines came and went and the complex ultimately opened with many of the problems uncorrected.”Read Full Story


NTSB Hearings Underway on San Bruno Pipeline Explosion, Questions About Construction, and Welding Defects Arise

February 27, 2011
The Sacramento Bee

The Sacramento Bee reported that hearings are underway in the matter of the September 9, 2010 San Bruno Pipeline explosion. The explosion destroyed 38 homes and resulted in eight fatalities. According to the Bee, the NTSB is near to reaching its conclusions relevant to the cause of the explosion. A ruptured segment of the pipeline was reportedly found to have 150 welding defects. Questions have arisen as to why the inspection process failed to identify the defects, and as well what are the risks that may arise from similar pipelines in the area and nationally. “I could not believe that their inspection during construction was so bad in San Bruno,” said Robert Eiber, a Columbus, Ohio, pipeline consultant. Read More...


Florida’s Pending Community Association Legislation

February 25, 2011
CDJ STAFF

A recent blog posting from Gerstin & Associates outlines some pending legislation, which has the potential of impacting on Florida’s numerous community associations.Despite that the 2011 legislative session doesn’t begin for another week or so, a number of bills have been filed that if passed promise to alter the complexion of community association management in Florida. The extent to which the legislation will impact on construction defect litigation in the state is unclear, though the contemplated Design Professionals Limited Liability Bill might limit damages from errors on the part of design professionals (architects, engineers) to the actual cost of the architects work, as opposed to the cost of remediation attendant to the errors. This bill was vetoed in 2010 by Governor Christ, but has been resubmitted for the upcoming legislative session.Read Original Story


New York District Attorney Discusses Construction Defect Issues

February 25, 2011
CDJ STAFF

“New York used to be known as a well-built city, but the last construction boom had so many problems, it’s really like being in Florida,” assistant New York State Attorney General Marissa Piesman said last night at a forum for frustrated co-op and condo owners.Piesman is reportedly very familiar with construction defect issues confronting owners and builders concerned with city’s construction boom of the recent past. According to an article written by Teri Karush Rogers, and published in Brick Underground NY (www.brickunderground.com) Piesman discussed the increasing difficulties in addressing complaints. “It used to be that a phone call from the Attorney General’s office would be sufficient but in the last two years since the economy tanked, it’s been hard to get sponsors to be responsive,” she noted.In light of a mounting number of construction defect complaints the office of the Attorney General reportedly favors mediation over litigation.“We’re more likely to get involved when there’s a systemic problem across a whole building rather than a problem affecting one individual,“ said Piesman.  The rise in the city’s construction defect claims includes established developers as well as smaller players drawn to the city’s recent real estate boom.In a recent New York Times article real estate attorney Steven D. Sladkus said, “During the real estate boom, everyone had to be in the development business. It was like playing Lotto you had to be in it to win it. I had a case, for example, where a small building in Williamsburg, Brooklyn, was put up and people paid top dollar for not-so-fantastic apartments. The developer was a baker.” When asked if the complaints mainly involved inexperienced developers, he also noted, that “We’re dealing with some larger developers, too.”


David M. Louie Appointed Hawaii Attorney General

February 21, 2011
PR Web

Honolulu, Hawaii (Vocus/PRWEB) February 21, 2011 Previously a name partner at Roeca Louie & Hiraoka, Mr. Louie is a trial lawyer and has been in practice for the past 33 years. His areas of practice include personal injury defense, construction defect litigation and commercial litigation. While at Roeca Louie & Hiraoka, Mr. Louie was selected for inclusion in the 2011 Best Lawyers in America and was named a Hawaii Super Lawyer from 2008 to the present. Mr. Louie attended Occidental College (A.B. 1973 cum laude) and Boalt Hall School of Law (University of California 1977). “I couldn t be happier that Mr. Louie s accepted this critical position of State Attorney General,” said Governor Abercrombie. “He is well versed in many areas of law and will be a tireless advocate for the interests of the people of Hawaii. He is the kind of person we need on our team as we address the challenges facing our communities.” Read Full Story


Builders Push against Construction Defect Suits

February 17, 2011
Gabriel Dillard

Local homebuilders, real estate agents and others are mounting a full-court press against out-of-area attorneys who solicit local homeowners to participate in construction-defect lawsuits.A group gathered before the Fresno City Council Thursday to detail the impact such lawsuits have had on industries including construction, manufacturing and real estate sales. They also asked the council to support legislation that would require attorneys who solicit such lawsuits to disclose possible drawbacks to their clients.Granville Homes has been the target of such lawsuits, which are lodged against homebuilders by buyers alleging their homes were built defectively. Granville President Darius Assemi told the Fresno City Council that attorneys who solicit these types of lawsuits often do so without giving the builder a chance to remedy the situation.“You wake up one morning, and there it is a lawsuit on your doorstep,” Assemi said.He added the result is that homebuilders are often hesitant to build for the entry-level housing market.Pat Redell, owner of Fresno window and patio door manufacturer Merzon Industries, said such lawsuits have contributed to him closing shop. In his 30-plus years in business, he told the council he has been named in more than 300 of these types of cases, which has taken its toll. He said he employed up to 200 people in the late ’80s. Now he employs zero and is looking to sell his equipment.He likened the lawsuits to &ldqu;a disease spawned in the Southern California area that can be directly tied to just a handful of law firms.”Read the full story


Insurance Law: Morris Agreement in Construction Defect Class Action

February 7, 2011

Leflet v. Redwood Fire and Casualty Insurance Company, 600 Ariz. Adv. Rep. 6 (App. Div I, January 20, 2011) (J. Swan)IMPERMISSIBLE FOR INSURED AND INSURER TO ENTER MORRIS AGREEMENT THAT ELIMINATES PRIMARY INSURER’S OBLIGATION TO PAY POLICY LIMITS AND INSTEAD PASSES LIABILITY TO PAY TO EXCESS CARRIERHomeowner, insureds brought class action for construction defects. All relevant insurers including the insurer of the subcontractors issued reservations of right. The subcontractor’s insurer was obligated under its policy to also insure the general contractor. Ultimately the homeowners entered into a settlement agreement with the contractor and its primary insurer which included a stipulated judgment of $8.475 million. The agreement further attempted to absolve the primary insurer of any obligation to pay more than $375,000 and instead attempted to pass all responsibility to pay subcontractors and their insurers. Finally, the contractor and its insurer assigned all their rights against the subcontractors and their insurers to the class action plaintiff homeowners. Notably the subcontractors and their insurers had no notice of the agreement until it was finalized and approved by the court. The subcontractors ultimately settled under their exposure in the agreement and their carrier intervened during the reasonableness hearing of this Morris agreement. The trial court then ruled that the failure to give the sub’s insurer notice of the agreement constituted a breach of the cooperation clause and voided the agreement. The insurer was awarded attorneys’ fees and costs.The Arizona Court of Appeals affirmed. “Unlike the insured in Morris, Hancock did not act simply to protect itself from an insurer’s refusal to extend unconditional coverage. Instead, it acted as an agent of an insurer that sought to limit its own liability. As parties to the agreement, the Direct Insurers’ interests were aligned with — not opposed to — those of their insured.” Further, the primary carrier shared none of the risks that the insured had and which form the grounds for a Morris agreement; the primary carrier does not have the risk of being personally exposed to an excess judgment or risk receiving nothing if the cooperation clause is deemed breached. “Because Morris agreements are fraught with risk of abuse, a settlement that mimics Morris in form but does not find support in the legal and economic realities that gave rise to that decision is both unenforceable and offensive to the policy’s cooperation clause.”Read the full story...


U.S. Lawmakers Seek to Ban Tainted Chinese Drywall

February 2, 2011
Immediate Release

U.S. Senators. Bill Nelson, (D.-Fl), and Mary Landrieu, (D.-LA) have filed legislation for a recall and immediate ban on tainted building products from China, as more and more people around the country are reporting problems in their homes built with imported drywall.The legislation presses the Consumer Product Safety Commission ( CPSC ) for a recall on Chinese-made drywall, based in part on findings by a Florida homebuilder and state officials who have confirmed the presence of sulfide gases in homes built with the drywall.Congressman Robert Wexler, (D.-Fl), has filed similar legislation in the House. In addition, Wexler has urged Florida Governor Charlie Crist to declare a state of emergency in Florida over the product. This would allow homeowners to apply for federal loans to help repair their homes.Nelson and Landrieu’s legislation also asks the CPSC to work with federal testing labs and the Environmental Protection Agency to determine the level of hazard posed by certain chemicals and as yet unidentified organic compounds in the drywall.In addition, the legislation calls on the commission to issue an interim ban on imports until it can create federal drywall safety standards so consumers are protected in the future.Among other things, the drywall is linked to seeping sulfide gases that can corrode electrical wiring and components of air-conditioning and other household appliances.The two lawmakers said they’re hoping to jump-start a process for helping affected homeowners with the costs of repairs or replacement, which under their legislation would be the responsibility of the manufacturers.The potential scope of the problem is big. Officials believe between 60,000 and 100,000 homes nationwide may contain tainted drywall. Nelson represents Florida, where an estimated 36,000 homes are believed to contain Chinese-made drywall. Landrieu represents Louisiana, where tons of the drywall was used in post-Hurricane Katrina construction. Besides Florida and Louisiana, problems also have been seen and reported in the press in Virginia, Alabama, Mississippi and California.Nelson noted that during a recent three-to five-year period drywall from China arrived at ports around the country, including 60 million pounds in New Orleans and 27 million pounds in Mississippi — two areas hard hit by Hurricane Katrina.“I believe you’re going to see this is widespread," said Nelson, a member of the Senate Commerce Committee that oversees the CPSC. "Anytime you have mounting evidence of potentially toxic goods you have an obligation to act quickly to protect consumers.”On Feb. 13, Nelson wrote the CPSC and requested a federal investigation into the imported drywall. The CPSC launched an investigation two weeks later. Last week, a team of federal investigators was in southwest Florida inspecting the electrical systems of suspect homes.A number of homeowners have filed lawsuits, and developers are suing the manufacturers of the drywall. Homeowner lawsuits contend the drywall has caused damage to the home, that the drywall itself must be replaced and, in some cases, that residents have suffered adverse health effects such as asthma as a result of exposure.In the past, there has been at least one case involving widespread replacement of siding in numerous homes around the country. The siding, a concoction of wood scraps and resins, was installed on about 800,000 homes around the country from 1985 to 1995. It warped prematurely, rotted in wet weather and sprouted mushrooms and other fungus. The first complaints arose out of the use of the wood panels on roofs of houses in Florida.About 67,000 homeowners lodged complaints and eventually the manufacturer paid 37,781 homeowners an average of $4,367 or a total of $165 million.


Dolphin Towers residents face harsh reality

February 2, 2011
Kevin McQuaid

Repairs to Dolphin Towers may cost up to $10 million, and any move home is still far off.SARASOTA - Repairing cracked and corroded concrete in Dolphin Tower will cost $5 million to $10 million, an overdue engineer’s report is expected to conclude.Completion could take years because the work would not occur until after a potential lawsuit between the 117-unit tower and Great American Insurance, the building’s property carrier, is concluded.If that timetable holds, the tower’s residents -- many of whom are elderly -- will have to wait until 2013 or beyond to return to the 15-story building at 101 S. Gulfstream Ave.“People there have been told to make other plans for 2011, at the least,” said Alan Tannenbaum, a Sarasota attorney representing the building’s homeowner’s association.At a recent meeting, residents also were told demolishing Dolphin Tower has been considered, but at this juncture, it continues to make economic sense to try fixing the 37-year-old building.“We’re confident that the building still can be repaired,” Tannenbaum said. “It will be more expensive and extensive and take longer than originally anticipated, but we still think it can be repaired.”Shortly after the building was evacuated in late June, it was estimated that repairs would take three months and cost roughly $1 million.Read Full Story...


NJ Passes on the Integrated Product Doctrine in Construction Defect Cases

January 31, 2011
William L Ryan, Archer & Greiner, P.C

The New Jersey Supreme Court recently provided additional guidanceon the economic-loss doctrine in the context of a construction defect case. In Dean v. Barrett Homes, Inc., et al, 204 N.J. 286 (2010), the Court reversed the Appellate Division and trial court, ruling that the plaintiff homeowners were not precluded from pursuing claims against the manufacturer of their home’s exterior finish by virtue of the New Jersey Products Liability Act, N.J.S.A. 2A:58C-1 to 11 (the Act).The ruling is quite narrow, however, as the Court framed the issue before it as, ”whether, and in what circumstances . . . remote purchasers should be permitted to pursue a tort remedy against [a] manufacturer,“ for an allegedly defective product. In reaching its decision, the Court was called upon to consider whether or not it would adopt ”the integrated product doctrine“ as a corollary to the economic-loss rule. Ultimately, the Court concluded that while the integrated product doctrine did not apply to the facts of Barrett Homes, the economic-loss rule nevertheless limited the plaintiffs’ recovery to damages related solely to the structure of the home, exclusive of the home’s exterior, i.e., Exterior Insulation and Finish System (EIFS).The economic-loss rule bars tort remedies and strict liability when the only claim is for the damage to the product itself. The rule evolved as part of the common law, largely as an effort to establish the boundary line between contract and tort remedies.In recent years, the federal courts, including the Third Circuit, have expanded the economic-loss rule through the adoption of the “integrated product doctrine.”The courts have used this theory to extend the economic-loss rule to precludetort-based recovery when a defective product is incorporated into another product and causes damage.The plaintiffs in Barrett Homes purchased their home in 2002 from its original owners. The house was built in 1995 by Barrett Homes, Inc., who utilized EIFS that was designed and manufactured by Sto Corporation (Sto). Prior to purchasingthe property, the plaintiffs hired a professional to conduct a home inspection.The inspection report identified concerns regarding the EIFS and recommended that the plaintiffs retain an expert or contact the manufacturer before proceeding with the purchase of the house. The plaintiffs, however, did not read the report or make the inquiries suggested. As a result, the plaintiffs’ insurer would not transfer their existing homeowner’s policy to the new property because the insurer would not cover a stucco exterior. Without any further investigation of the EIFS, the plaintiffs obtained an insurance policy with another carrier and proceeded to purchase the property.The plaintiffs noticed problems with the EIFS approximately one year after moving into the home, and eventually learned that if moisture penetrates through the EIFS, it has no means to escape. They hired an industrial hygienist who inspected the home and discovered toxic mold attributed to leaks in the EIFS. The plaintiffs never claimed any personal injuries from the mold, but eventually removed and replaced all the EIFS.Read the full story... Reprinted courtesy William L. Ryan, Archer & Greiner, P.C., from the New Jersey Law Journal. Mr. Ryan can be contacted at wryan@archerlaw.com



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Construction Defect News Channel - The Latest News and Video From The Construction Defect Journal

Construction defect and claims video channel.  For access to full construction defect channel content visit the construction defect channel homepage at... ConstructionDefectChannel
Construction Issues with Hartford’s New Stadium

WTNH News 8 reports on the problems of the Dunkin’ Donuts construction project.

Tour of the Downtown Louisville Sky Rise Construction

WLKY News Louisville shows the multi-million dollar renovation of the 800 Building.

Apple Campus 2 Construction Update

A drone video tour of the Apple Campus 2.

“World’s Fastest” Data Center Construction Project

CyrusOne delivers 30 megawatts and 220,000 square feet in 180 days.

Building the World’s Longest Slide in LA

ENR Video presents a video on how the 45-foot long glass slide was attached to the 69th and 70th floors of the U.S. Bank Tower.

What is Digital Construction?

A 3-minute video by The B1M that explores and explains some of the many forms of digital construction.

Construction Defect Journal Archives - Recent CD News for Construction Claims Professionals

 

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