CONSTRUCTION DEFECT JOURNAL

"News and Information for Construction Defect and Claims Professionals"

CONSTRUCTION DEFECT JOURNAL - ISSUE 242749 - SUNDAY, MARCH 29, 2026

Meeting over contract

Each party claimed the contract was unambiguous when construed in context.

Contract Interpretation – Determining What the Contract Requires

March 24, 2026
David Adelstein - Florida Construction Legal Updates

A good ole dispute on contract interpretation in government contracting. Contract interpretation disputes happen all the time in every jurisdiction under the sun. Think about that. Now, what’s the best way to avoid a contract interpretation dispute? Naturally, invest in the contract language and fully understand the scope of work. Make all of this clear. But, of course, this isn’t foolproof meaning you could still be doing this and you could still find yourself in a contract interpretation dispute. Although, if you are doing this, and being proactive, the contract interpretation disputes should be minimal and more streamlined.

In Liberty Technical Services, LLC v. Department of Veterans Affairs, CBCA 8385, 2026 WL 407656 (CBCA 2026), the dispute centered on whether the government owed the contractor for certain, necessary equipment (largely controllers, but also tanks and pumps) not specified in the contract. The government countered that this should be a non-issue because the contractor always acknowledged it was responsible for furnishing the unspecified, necessary equipment, and the contractor did actually provide the equipment without direction from the government. Each party claimed the contract was unambiguous when construed in context.

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

Reprinted courtesy of David Adelstein, Kirwin Norris

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CDJ NEWS THIS WEEK

Plumbing pipe leak

The resulting leak lasted for nearly six days and released enough water to saturate and ruin all the subflooring and flooring in the insureds’ home.

Ninth Circuit Affirms District Court’s Finding of No Coverage for Interior Leak

March 24, 2026 — Tred R. Eyerly - Insurance Law Hawaii

Applying California law, the Ninth Circuit affirmed the district court’s finding that water damage caused by a leaking pipe over time was not covered under the insured’s homeowners’ policy. Mojica v. State Farm General Ins. Co., 2025 U.S. App. LEXIS 32405 (9th Cir. Dec. 11, 2025).

A small hole, slightly larger than a pen tip in size, developed in a pressurized hot water pipe. The resulting leak lasted for nearly six days and released enough water to saturate and ruin all the subflooring and flooring in the insureds’ home.

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

Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert

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Couple and dog moving into house

This article examines how owner occupancy prior to substantial completion can complicate project closeout and highlights key contract provisions that can help mitigate these risks.

Moving in Before Substantial Completion? The Risks of Early Owner Occupancy

March 24, 2026 — Sydney Koby - ConsensusDocs

Introduction
On many construction projects, particularly large projects facing schedule pressure, owners may begin occupying or using portions of the project before the work reaches substantial completion. This is often due to operational needs, phased turnover, or market demands that drive owners to take possession of all or part of a project while construction activities are ongoing. While early occupancy may seem practical, it can blur the lines of responsibility between owner and contractor and can create significant legal and practical complications.

These disputes are especially common on large, complex projects where punch list work, system commissioning, and closeout activities overlap with owner use. Without clear documentation and carefully drafted contract provisions, early occupancy can undermine an owner’s ability to enforce completion requirements while simultaneously exposing the contractor to claims of delay, inefficiency, or interference.

Ms. Koby may be contacted at skoby@joneswalker.com

Reprinted courtesy of Sydney Koby, Jones Walker

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Aerial view of Atlanta, Georgia

The bill aims to curb misuse of the lien process and provide additional remedies to those challenging a frivolous lien filing.

Georgia HB 676: A Bill Property Owners and Contractors Should Watch

March 24, 2026 — Robert Lafayette - The Construction Seyt

Property owners, contractors, and others dealing with mechanics and materialmen’s liens in Georgia should keep an eye on HB 676, which is currently making its way through the Georgia General Assembly. The bill aims to curb misuse of the lien process and provide additional remedies to those challenging a frivolous lien filing.

What HB 676 Would Do
HB 676 would add a new Code section (O.C.G.A. § 44-14-366.6) to the mechanics and materialmen’s lien statutes. If a lien is filed “without substantial justification or that is not made in good faith or that is made with malice or a wrongful purpose,” this new Code section would impose a fine of $1,500 per lien on the lien claimant, in addition to any attorney’s fees or court costs incurred by the party challenging the lien.

Mr. Lafayette may be contacted at rlafayette@seyfarth.com

Reprinted courtesy of Robert Lafayette, Seyfarth Shaw LLP

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California capitol building top

Both owners and contractors engaged in private works construction should ensure their teams are aware of this new law and be prepared to comply with its procedures.

California Enacts Change Order Fair Payment Act

March 24, 2026 — Michael J. Baker - Snell & Wilmer

For private works construction contracts entered on or after January 1, 2026, recent legislation establishes a claims and dispute resolution process for change orders. The law is codified at Civil Code § 8850. A synopsis of the pertinent provisions includes the following:

  1. Submitting a Claim. Contractors or subcontractors must submit a detailed, documented claim when requesting additional time or payment.
  2. Owner’s Response Time. The owner must meet and confer within thirty (30) days after receiving the claim. Within ten (10) days of meeting, the owner must provide a written statement identifying which portions of the claim are undisputed and which are disputed. An owner’s failure to respond is treated as disputing the entire claim.

Mr. Baker may be contacted at mjbaker@swlaw.com

Reprinted courtesy of Michael J. Baker, Snell & Wilmer

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Gas lines in trench

USIC failed to mark a certain gas line, which was later struck by a boring company, leading to an explosion that injured three people.

The Seventh Circuit Rejects Navigators Insurance Company’s Attempt to Escape Additional Insured Coverage For a Gas Explosion

March 24, 2026 — Kyle A. Rudolph & Anna M. Perry - Saxe Doernberger & Vita, P.C.

In a recent Seventh Circuit decision, Atlanta Gas Light Company v. Navigators Insurance Company, the court addressed a theme that policyholders are often confronted with by insurers[1] – insurers disputing additional insured coverage where the named insured is not named in the underlying action. The court aptly rejected this position since it was undisputed that the bodily injuries alleged in the underlying lawsuits were due to a gas explosion that was “caused, in whole or in part, by” the named insured’s acts or omissions.

I. Background
The additional insureds, Atlanta Gas Light Company and Southern Company Gas (collectively, “AGL”), retained the named insured, United States Infrastructure Corporation (“USIC”), to locate and mark gas lines that AGL owned in Georgia. USIC failed to mark a certain gas line, which was later struck by a boring company, leading to an explosion that injured three people.

Reprinted courtesy of Kyle A. Rudolph, Saxe Doernberger & Vita, P.C. and Anna M. Perry, Saxe Doernberger & Vita, P.C.

Mr. Rudolph may be contacted at KRudolph@sdvlaw.com
Ms. Perry may be contacted at APerry@sdvlaw.com

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News Coffee Cup

In Pillsbury's latest roundup, lodging demand for World Cup brings growth, commercial property management firms use of AI becomes firmer, construction industry shows slow start to the year, and more.

Real Estate & Construction News Roundup (3/11/25) – An AI Inflection Point for Hotels, Investor Pivot in Build-to-Rent and Looming Legislation for Single-Family Investors

March 24, 2026 — Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog

In our latest roundup, lodging demand for World Cup brings growth, commercial property management firms use of AI becomes firmer, construction industry shows slow start to the year, and more!

Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team

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Silver trophy

This annual guide recognizes more than 270 of the region's leading attorneys.

Traub Lieberman Attorneys Recognized in Hudson Valley Magazine’s 2026 Top Lawyers List

March 24, 2026 — Copernicus T. Gaza, Jonathan R. Harwood, Lisa M. Rolle, Lisa L. Shrewsberry, Christopher Russo & Hillary J. Raimondi - Traub Lieberman

Traub Lieberman is pleased to announce that six Partners from the White Plains, NY office have been included in the 2026 edition of the Hudson Valley Magazine’s Top Lawyers in the Hudson Valley list. This annual guide recognizes more than 270 of the region's leading attorneys.

Insurance:

  • Copernicus Gaza
  • Jonathan Harwood
  • Lisa Rolle
  • Lisa Shrewsberry

Reprinted courtesy of Copernicus T. Gaza, Traub Lieberman, Jonathan R. Harwood, Traub Lieberman, Lisa M. Rolle, Traub Lieberman, Lisa L. Shrewsberry, Traub Lieberman, Christopher Russo, Traub Lieberman and Hillary J. Raimondi, Traub Lieberman

Mr. Gaza may be contacted at cgaza@tlsslaw.com
Mr. Harwood may be contacted at jharwood@tlsslaw.com
Ms. Rolle may be contacted at lrolle@tlsslaw.com
Ms. Shrewsberry may be contacted at lshrewsberry@tlsslaw.com
Mr. Russo may be contacted at crusso@tlsslaw.com
Ms. Raimondi may be contacted at hraimondi@tlsslaw.com

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House being transported by crane

As modular construction continues to reshape the industrial landscape, contractors and owners alike must be mindful of the legal implications associated with its use.

Modular Construction’s Big Boom: New Risks Outpacing Standard Contracts in Industrial Projects

March 24, 2026 — Chad Theriot & Jack Mayo - Construction Executive

Modular construction is revolutionizing the construction industry, tackling labor shortages, sustainability goals and supply-chain challenges, with the global market for modular and prefabricated construction projected to reach over $200 billion by 2030. While residential builders have embraced modular’s speed and affordability, the greatest risks—and opportunities—are emerging in the industrial sector, where project scale and complexity demand new legal strategies.

In 2023, Chad Theriot explored industrial and infrastructure applications of modular construction, addressing risks like offsite fabrication and integration complexities in his article, “The Rise of Modular Construction—Impacts for Consideration.” Since that time, modular construction has continued to experience significant advancements and has been increasingly adopted by contractors across a broad spectrum of industrial and commercial projects. As modular construction continues to reshape the industrial landscape, contractors and owners alike must be mindful of the legal implications associated with its use, specifically as it relates to liability and risk allocation, regulatory compliance, quality control and upstream factors such as transportation and intellectual property concerns.

Reprinted courtesy of Chad Theriot and Jack Mayo, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.

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Illustration of intersection with cars and scooter

The plaintiffs argued that the landscape vegetation was too tall and violated the sight lines of the two drivers, and that the height of the shrubbery violated the owner’s landscaping contract and a local sight line ordinance.

Tampa Team Obtains Highly Favorable Verdict for Property Owner Client in Lawsuit over Traffic Accident

March 24, 2026 — Lewis Brisbois Newsroom

Tampa Managing Partner John Rine and Partner Nick Dareneau obtained a very favorable verdict for their property owner client in a Sarasota County trial in a lawsuit arising from a traffic accident. At the end of closing arguments, plaintiff’s counsel requested appropriately $18 million from the jury. The jury returned a net verdict of just over a thousand dollars.

The plaintiff was on a scooter and was involved in an accident with an SUV in a parking lot intersection. Our firm represented the property owner. The plaintiffs argued that the landscape vegetation was too tall and violated the sight lines of the two drivers, and that the height of the shrubbery violated the owner’s landscaping contract and a local sight line ordinance. They also argued that the intersection lacked a stop sign in contrast to the other six parking lot entrances, which had stop signs.

Reprinted courtesy of Lewis Brisbois

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Construction worker

The National Association of Home Builders opposes a specific provision in a section of the legislation that would curtail Wall Street’s footprint in the housing market.

Builders Oppose Senate Housing Bill Over Investor Ban Provision

March 24, 2026 — Katy O'Donnell - Bloomberg

A powerful group representing the nation’s home builders is coming out against the most significant housing legislation in more than a decade over a provision negotiated by the White House that would restrict institutional investors from purchasing single-family homes.

The builders’ objection could imperil the bill’s chances of becoming law, even as leaders of both parties are desperate to show they are doing something to alleviate voters’ cost-of-living concerns. The Senate voted 90-8 to clear a procedural hurdle for the bill on Wednesday, with a vote on final passage expected early next week.

The inclusion of the investor ban in a broader housing bill was key to getting the White House on board, Senate Banking Committee Chairman Tim Scott, a Republican from South Carolina, told reporters Tuesday.

Reprinted courtesy of Katy O'Donnell, Bloomberg

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People working on CAD

One of the main challenges is the large number of tools used throughout the AECO ecosystem.

The Single Source of Truth in Construction Projects: Reality or Myth?

March 24, 2026 — Aarni Heiskanen - AEC Business

The idea of a single source of truth has been a fundamental part of the digital vision in the AEC industry for many years. From centralized CAD storage to BIM collaboration platforms and, more recently, Common Data Environments, the goal stays the same. Project teams want a reliable place where everyone can access the latest information.

The phrase “single source of truth” comes from database and information management practices in the IT world, where the goal was to maintain one authoritative record of data and eliminate data redundancy. As the AEC industry began adopting digital tools, the same idea was applied to project information and workflows.

Despite decades of technological progress, the question remains whether “one ring that rules them all” can actually be implemented in real construction projects.

Mr. Heiskanen may be contacted at aec-business@aepartners.fi

Reprinted courtesy of Aarni Heiskanen, AEC Business

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Sagrada Familia Cathedral Barcelona Spain

"No straight lines or sharp corners exist in nature. Therefore, buildings should have no straight lines or sharp curves." - Antoni Gaudí, Sagrada Familia Architect

Spain’s Sagrada Familia: Contemporary Construction Methods Speed Iconic Basilica to Completion

March 24, 2026 — Pam McFarland - Engineering News-Record

In 2014, the entity behind construction of one of the world’s most iconic churches—the wildly imaginative Sagrada Familia basilica in Barcelona, Spain—contacted global consultant Arup with a challenge: Could the firm help the project team update designs developed more than a century earlier, to ensure that a critical project component was built to be structurally sound?

Ms. McFarland may be contacted at mcfarlandp@enr.com

Reprinted courtesy of Pam McFarland, Engineering News-Record

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Consulting Design and Architecture Expert Witness

Forensic Architect CA, AZ, NV, CO, TX, UT, FL, NM, OK - NCARB - National Council of Architectural Registration Boards

California Architectural Registration Board Supplemental Examination Commissioner

(800) 482-1822

www.berthowe.com

Percentage arrow falling

30-Year Mortgage Rate Falls Below 6% For First Time Since 2022

March 24, 2026 — Prashant Gopal - Bloomberg

For the first time since 2022, the average 30-year mortgage rate in the US has slipped below 6%, a milestone that could breathe life into the coming spring home-selling season.

The average for 30-year, fixed loans was 5.98%, down from 6.01% last week, data from Freddie Mac showed Thursday. By comparison, it was 6.76% a year ago. The last time it was below 6% was in September 2022.

A rate with a five at the front will ease affordability slightly and may get some buyers off the fence. The property market has been in a holding pattern since 2022 when rates shot up, pricing out many would-be buyers and dissuading homeowners from selling because most were holding onto much lower rates.

Reprinted courtesy of Prashant Gopal, Bloomberg

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Person using calculator

Repricing Risk: How Inflation and Tariffs Are Reshaping Construction Insurance

March 24, 2026 — Tyler Ahrenold - Construction Executive

For contractors, higher costs show up as tighter margins and delayed starts. For underwriters, they show up as a new exposure curve that’s harder to predict and more expensive to insure. What once was a straightforward pricing exercise based on historical loss data and replacement cost has become a constant recalibration of volatility, supply-chain uncertainty and claim severity.

The work itself hasn’t changed much—contractors and subcontractors are still building—but every part of the process now costs more. In 2025, construction input costs climbed another 4.4% for nonresidential projects, while tariffs on imported materials could added an additional 9% to overall project budgets. For insurers, that means a claim can cost 20-30% more to settle in 2026 (plus any tariff effects), and policy pricing must anticipate the total escalation.

Reprinted courtesy of Tyler Ahrenold, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.

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Seminar

ABA’s Forum on Construction Law 2026 Annual Conference

March 24, 2026 — Beverley BevenFlorez – CDJ Staff

The ABA Forum on Construction Law Annual Conference celebrates its 50th anniversary this year. The program will focus on the evolution of construction law with topics Evolution Is Real: Lessons Learned from the Past 50 Years of Construction Law; Learning by Doing: A Survey of the Most Significant Construction Projects of the Last; 50 Years and What They Taught Us; and Getting from There to Here: How Our Understanding of Right and Wrong Has Evolved over the last 50 Years. The event’s “[p]lenaries will be complemented by Forum Retrospectives, featuring past Forum Chairs from across the decades who will share insights into the Forum’s founding, growth, and enduring success, offering both historical context and inspiration for the future.”

May 6th-9th, 2026
Hilton Chicago
720 South Michigan Avenue
Chicago, IL 60605

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Mortgage rates decreasing

US Mortgage Rates Fall to Lowest Level in More Than Three Years

March 16, 2026 — Prashant Gopal - Bloomberg

US mortgage rates fell to the lowest level since September 2022 as affordability slowly improves.

The average for 30-year, fixed loans was 6.01%, down from 6.09% last week, data from Freddie Mac showed Thursday. By comparison, the rate was 6.85% a year ago.

The US housing market, undercut by high rates for years, seems poised for some improvement as incomes grow and borrowing costs ease. The median US home price, which has grown by less than 2% on an annual basis for 10 months, rose just 1.1% in January, according to brokerage Redfin. That’s a stark contrast to the double-digit appreciation during the post-pandemic buying frenzy.

Reprinted courtesy of Prashant Gopal, Bloomberg

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130 People Displaced Due To Structural Issues at South Bay Condo Complex

Over 100 people were displaced due to structural issues at a condominium complex in Santa Clara, the city said on Sunday. Marianne Favro of NBC Bay Area News reported.

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Gov. Green, Officials Provide Updates on Severe Flooding Across Oahu | Full Press Conference

State, city, and emergency leaders provide updates on emergency response efforts, including 233 rescues amid flooding and landslides across Oahu, reported Hawaii News Now.

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