CONSTRUCTION DEFECT JOURNAL

"News and Information for Construction Defect and Claims Professionals"

CONSTRUCTION DEFECT JOURNAL - ISSUE 242749 - SATURDAY, JULY 19, 2025

Scales of Justice Gavel Law Book

This case illustrates how ongoing maintenance obligations, even years after project completion, may keep the door open to liability long after you thought it was shut.

Colorado Appeals Court Clarifies “Control” Exception to Statute of Repose

July 15, 2025
David McLain - Colorado Construction Litigation Blog

In a recent Colorado Court of Appeals decision, Kritzer v. Qwest Corporation, the Colorado Court of Appeals reaffirmed the protections offered by the statute of repose under Colorado’s Construction Defect Action Reform Act (“CDARA”)---but also reminded practitioners that those protections are not absolute.

For construction professionals, subcontractors, and public utilities, the case illustrates how ongoing maintenance obligations, even years after project completion, may keep the door open to liability long after you thought it was shut.

The Background: A Sidewalk, a Bicycle Crash, and a Six-Year Gap
In 2010, Qwest Corporation and its subcontractors installed underground fiber optic cables near Cherry Hills Village Elementary School. To access the cables, they removed and replaced a section of sidewalk. That work wrapped up in February 2010.

Mr. McLain may be contacted at mclain@hhmrlaw.com

Reprinted courtesy of David McLain, Higgins, Hopkins, McLain & Roswell

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CDJ NEWS THIS WEEK



Construction worker drywall

The documents specified that two layers of drywall, which would increase the wall's fire resistance, were to be installed on the kitchen side of the wall.

Colorado Supreme Court Finds Economic Loss Rule Applies to Allegations of Willful and Wanton Conduct

July 15, 2025 — Tred R. Eyerly - Insurance Law Hawaii

The Colorado Supreme Court determined that no exception to the economic loss rule existed for allegations of willful and wanton conduct. Mid-Century Ins. Co. v. HIVE Construction, Inc., 2025 Colo. LEXIS 273 (Colo. April 21, 2025).

HIVE Construction, Inc. served as the general contractor for the construction of Masterpiece Kitchen, a restaurant. HIVE warranted, among other things, that "the Work will conform to the requirements of the Contract Documents." The architectural plans and design for the restaurant called for the construction of a wall separating the kitchen and dining area. The documents specified that two layers of drywall, which would increase the wall's fire resistance, were to be installed on the kitchen side of the wall. HIVE, however, installed one layer of drywall and one layer of plywood on the kitchen side. HIVE did to submit a change order asking permission to deviate from the plans and design in that way.

Installing the plywood on the kitchen side of the wall placed combustible material much closer to a heat source (the broiler in the kitchen) than the plans and design had prescribed. A fire eventually started within the wall, causing damage to the restaurant, forcing the restaurant to close.

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

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

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Cash money flowing through pipe

Cactus Water Services, LLC v. COG Operating, LLC resolves a high-stakes dispute over the ownership of produced water--a vexing byproduct of oil and gas production that is increasingly being viewed as a resource rather than waste--and its constituents.

From Waste to Wealth: Texas Supreme Court Ruling in Cactus Water Defines Produced Water Ownership, Sets Stage for Clarity on Critical Mineral Markets in Texas

July 15, 2025 — Ashleigh Myers, Robert A. James & Jillian Marullo - Gravel2Gavel Construction & Real Estate Law Blog

On June 27, 2025, the Texas Supreme Court issued its long-awaited decision in Cactus Water Services, LLC v. COG Operating, LLC, No. 23-0676, resolving a high-stakes dispute over the ownership of produced water--a vexing byproduct of oil and gas production that is increasingly being viewed as a resource rather than waste--and its constituents. The Court held that, unless expressly reserved, a deed or lease conveying oil and gas rights also conveys produced water as part of the mineral estate. The decision not only reinforces the ownership of produced water under Texas oil and gas law, but also offers insight into how emerging practices such as direct lithium extraction (DLE) from produced water might be treated under existing legal frameworks.

Background
The crux of this case is whether produced water belongs to the surface or mineral estate. Under Texas law, groundwater is owned by the surface owner, irrespective of the minerals contained in the groundwater. Coyote Lake Ranch, LLC v. City of Lubbock, 496 S.W.3d 53 (Tex. 2016); Robinson v. Robbins Petrol. Corp., 501 S.W.2d 865 (Tex. 1973). However, certain minerals, including lithium, are part of the mineral estate.

COG Operating, an oil and gas operator in the Permian Basin and mineral lessee, brought a declaratory judgment action against Cactus Water Services, a company that had acquired purported rights to produced water through a produced water lease granted by the surface owners, including the right to sell all water “produced from oil and gas wells and formations [on the covered properties].” COG, which had operated the lease and managed the transportation and disposal of produced water for years prior to the Cactus’s lease, argued that it owned the produced water as part of its mineral leasehold rights.

Reprinted courtesy of Ashleigh Myers, Pillsbury, Robert A. James, Pillsbury and Jillian Marullo, Pillsbury

Ms. Myers may be contacted at ashleigh.myers@pillsburylaw.com
Mr. James may be contacted at rob.james@pillsburylaw.com
Ms. Marullo may be contacted at jillian.marullo@pillsburylaw.com

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Handshake symbolizing agreement

The authors, both full-time neutrals, share some success strategies to help civil litigation practitioners, particularly in construction law.

Mediation Success – Strategies for Avoiding Prolonged Litigation and Getting To “Settled”

July 15, 2025 — Gene M. Witkin & Matthew W. Argue - The Dispute Resolver

By this article, the authors, both full-time neutrals, share some success strategies to help civil litigation practitioners, particularly in construction law. We address helpful tips to avoid common mediation pitfalls which can occur before mediation or during mediation. We will address break-out sessions, joint caucuses, and mediator’s proposals – so that you can make the most of the mediation process.

  1. RESOLUTION STARTS PRE-MEDIATION
  • Pre Mediation Preparation and Call

Good mediators frequently begin mediation many days if not months before the mediation event. The mediator will convene a pre-mediation planning call (often via Zoom) with all counsel to discuss a mediation plan for the case. The mediator explores with counsel the key issues that need to be addressed prior to mediation. Often the mediator will help the parties focus on key issues in dispute and avoid spending time on minor issues that can be resolved more easily during mediation. These key issues include insurance coverage and limits, making sure all decision makers attend mediation, exchange of documents and expert reports, as well as key documents that support or rebut the claims.

  • Non-Confidential Mediation Briefs

Mediation briefs that provide a thoughtful, complete, and honest assessment of the case set the stage for success - especially if they are non-confidential and exchanged with the other side. The mediation brief is a persuasive argument that can help focus the mediators and other party on the key areas in dispute. Ideally, mediation briefs are exchanged with sufficient time in advance of mediation so the mediator can react and if necessary, follow up with all parties regarding supplemental information to exchange prior to mediation. The goal is ensuring all parties are ready for mediation and any critical information is exchanged in advance of mediation.

Reprinted courtesy of Gene M. Witkin, AMCC and Matthew W. Argue, AMCC

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Hand writing on notepad

If you are a general contractor (or the contractor responsible for hiring subcontractors), please make sure to procure a worker’s compensation and employer’s liability insurance policy.

Quick Note: Procure Worker’s Compensation in the Name of Your Company If You Are a General Contractor

July 15, 2025 — David Adelstein - Florida Construction Legal Updates

If you are a general contractor (or the contractor responsible for hiring subcontractors), please make sure to procure a worker’s compensation and employer’s liability insurance policy. Also, don’t think you are “fully covered” if you have worker’s compensation through a professional employer’s organization, otherwise known as a PEO. If you go with a PEO, or are statutorily exempt from worker’s compensation, then you need to make sure ALL of the subcontractors you hire have worker’s compensation and employer’s liability insurance. No exception. Ever. The risk is much greater than any reward.

In construction under Florida law, the general contractor is deemed the “statutory employer” for purposes of worker’s compensation. This means that if a subcontractor does not have worker’s compensation, then the general contractor’s worker’s compensation policy is required to cover injuries. So, if a person under a subcontractor gets hurt, and the subcontractor does not have worker’s compensation insurance, then the general contractor is deemed the statutory employer for purposes of worker’s compensation.

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

Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.

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Surety bond guarantee agreement

The dispute involved the work of a subcontractor principal on an exterior wall enclosure project in Long Island City, New York.

The Problem with Bunting with Two Strikes

July 15, 2025 — Daniel Lund III - Lexology

A Pennsylvania federal court ruled decisively on a summary judgment in favor of a surety on its indemnity claims concerning a settled bond claim for which the surety paid $4.2 million. The dispute involved the work of a subcontractor principal on an exterior wall enclosure project in Long Island City, New York, valued at $5,695,312.

The general contractor’s notice of default cited the subcontractor for failing to prosecute work diligently and to fulfill subcontract obligations, including timely submission of shop drawings and calculations for curtain wall systems. In connection therewith, the general contractor sought damages which approached the bond’s penal sum.

The surety, which initially denied the general contractor’s bond claim in reliance on the subcontractor’s assertions of wrongful termination, engaged in its own extensive investigations concerning the claim, hiring a construction consultant for the purpose. A pivotal moment in the investigation arose during a May 2021 meeting, where the general contractor presented evidence (according to the court, in a PowerPoint presentation) that the subcontractor had not issued a purchase order or sub-subcontract for the project’s curtain wall, contradicting the subcontractor’s prior claims of progress. This revelation shifted the surety’s assessment of risk and liability, leading to the settlement with the general contractor. The surety then pursued indemnity against the subcontractor.

Mr. Lund may be contacted at daniel.lund@phelps.com

Reprinted courtesy of Daniel Lund III, Phelps

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General Construction Investigation - Licensed General Building Contractor CA, AZ, UT, FL

Certified Professional Estimator (ASPE) American Society of Professional Estimators

Extensive testimony experience attendant to numerous commercial and residential construction defect and claims related expert witness designations

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Lawyers are selected through a process that takes into consideration peer recognition and professional achievement.

Congratulations 2025 DE, MA, MD, NJ, NY, and PA Super Lawyers and Rising Stars

July 15, 2025 — White and Williams LLP

White and Williams congratulates the thirteen attorneys nominated as Super Lawyers and ten attorneys named Rising Stars across our Delaware, Massachusetts, Maryland, New Jersey, New York and Pennsylvania offices. Lawyers are selected through a process that takes into consideration peer recognition and professional achievement. The lawyers named to this year’s list represent a multitude of practices throughout the firm.

Super Lawyers 2025

Attorney Super Lawyers Denoted Practice Area (s)
Kevin C. Cottone Medical Malpractice
Robert G. Devine Personal Injury, Employment Litigation, Products Liability
R. Victoria Fuller Employment & Labor, Insurance Coverage, Schools & Education
David D. Gilliss Surety, Construction Litigation, Administrative Law
Dirk C. Haarhoff Insurance Coverage
Eric B. Hermanson Insurance Coverage, Civil Litigation
Eric G. Korphage Surety, Construction Litigation, Business Litigation
Bridget La Rosa Estate Planning & Probate
John G. Loughnane Bankruptcy: Business, Alternative Dispute Resolution, Business/Corporate, Creditor Debtor Rights: Business, Technology Transactions
Randy J. Maniloff Insurance Coverage
Wesley R. Payne Insurance Coverage, Personal Injury, Civil Litigation
Heidi J. Sorvino Bankruptcy
Andrew F. Susko Civil Litigation, Medical Malpractice, Business Litigation

Reprinted courtesy of White and Williams LLP

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Big ocean wave

Cities on every coast are facing hard, expensive decisions because of the seemingly more mundane effects of a warming planet.

Big Waves and High Tides Can Be Just as Insidious as Hurricanes

July 15, 2025 — Mark Gongloff - Bloomberg

A couple of days before Christmas last year, battered by heavy waves, the end of the half-mile-long Santa Cruz Municipal Wharf unexpectedly tumbled into Monterey Bay.

A tourist magnet claiming to be the longest fully wooden structure of its kind in the Western hemisphere, the wharf was open for business when the collapse happened, forcing visitors and workers to evacuate. Two engineers and a project manager at the wharf’s terminus fell in the water but escaped serious injury. Some heavy construction equipment and a large public restroom weren’t so lucky.

The collapse, triggered by waves that may have been up to 30 feet high, came just a year after another winter storm had damaged the same section of pier (a storm that came one year after another winter storm hit Monterey Bay). The construction equipment and workers were there to help with repairs. For much of the past decade, Santa Cruz had planned wharf upgrades that included a “landmark” building on the section that fell in the drink. Now even the idea of simply restoring the missing part of the wharf, a $14 million project, is up for debate.

Reprinted courtesy of Mark Gongloff, Bloomberg

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Group of business people shadows with cape

Wilke Fleury is extremely proud that several of its incredible attorneys have been selected as 2025 Northern California Super Lawyers or Rising Stars!

Congratulations to Wilke Fleury’s 2025 Super Lawyers and Rising Stars!

July 15, 2025 — Wilke Fleury LLP

Wilke Fleury is extremely proud that several of its incredible attorneys have been selected as 2025 Northern California Super Lawyers or Rising Stars! Super Lawyers rates attorneys in each state using a patented selection process and publishes a yearly magazine issue that produces award-winning features on selected attorneys. Congratulations to this talented group:

2025 Super Lawyers:

  • Adriana C. Cervantes
  • Daniel L. Egan
  • Daniel J. Foster
  • David A. Frenznick
  • George A. Guthrie
  • Neal C. Lutterman
  • Stephen K. Marmaduke
  • Suzanne M. Nicholson
  • Matthew W. Powell
  • Trevor L. Stapleton
  • Steven J. Williamson

    • Reprinted courtesy of Wilke Fleury LLP

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    Illustration of panelists at conference

    Partners at some of CE’s 2025 Top 50 Construction Law Firms offer perspectives on the state of contract disputes, recent victories worth celebrating and implications of the Trump administration’s changes to the legal landscape.

    Unprecedented Times: An Interview Panel With 2025 Top Construction Law Firms

    July 15, 2025 — David McMillin - Construction Executive

    In a typical year, construction law doesn’t change all that much—but so far, 2025 has been anything but a typical year. Before the Trump administration reached its first-100-days mark, attorneys were already combing through the language of nearly 130 executive orders. While executive orders are nothing new—President Biden signed more than 160, and President Trump signed more than 200 in his first term—many of the recent actions are fundamentally changing the way that construction firms operate.

    How should you manage an uptick in uncertainty? Which cases are moving through the courts that could impact your jobsites? And what can you do to increase your odds of avoiding mediation, arbitration or litigation? There are no easy answers to any of these questions, but following the lead of some of the industry’s brightest legal minds—all of whom practice among CE’s most recent edition of the Top 50 Construction Law Firms—can put you on a course for success.

    TARIFF TALK
    When the Trump Administration unveiled plans to impose a sweeping new set of tariffs in the spring, the vast majority of construction firms felt a figurative crack in their foundations: In April, around 80% of ABC contractors reported that suppliers had notified them of price increases, and nearly 20% of them had projects paused or interrupted. As leaders continue to worry about what those price increases might do to their business models, they’re spending more time talking to their attorneys.

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

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    Homeowners worried looking at receipt laptop

    Are you being overcharged by your contractor?

    How To Deal With Contractors Overcharging You – Bad Contractor Series Part 4

    July 15, 2025 — Jon Grishpul - GreatBuildz

    If you haven’t already, start with part 1 of our Bad Contractors series: How To Spot a Bad Contractor.

    Most people will end up renovating a home at least a few times in their lives and sometimes that experience can turn into a renovation nightmare. If you are unfortunate enough to find yourself working with a bad contractor, you could easily end up in a stressful contractor dispute.

    Sadly, this is not an uncommon occurrence. Over 50% of homeowners report having a negative experience with their remodel or complaining of a bad contractor. Many homeowners say that the main reason for their dissatisfaction is that the contractor was overcharging them and asking for more money above the budget.

    How To Avoid Being Ripped Off By a Contractor
    If you haven’t hired a contractor yet, there are several things you should do in order to prevent contractors from overcharging you. The most important thing you should do is find a quality, reputable, and trustworthy contractor. Generally, good contractors bid on the job fairly at the outset and make an effort to have as few extra charges as possible because they want to keep their clients happy. They put too much value on their reputation and make it a priority to make sure the client is happy. They want you to be satisfied so that you will recommend them to their friends in the future.

    Reprinted courtesy of Jon Grishpul, GreatBuildz

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    Construction Contract Signing

    Russell Vought, director of the White House Office of Management and Budget, laid out the position in a June 12 memo in response to agencies issuing “overly broad” Federal Acquisition Regulation deviations related to PLAs.

    Trump Administration Directs Agencies to Use PLAs for Large Projects, With Exceptions

    July 15, 2025 — James Leggate - Engineering News-Record

    Federal agencies planning to sign large construction contracts should use project labor agreements with unions as required when practical, the White House said in a new memo that widens a loophole allowing federal agencies to not use PLAs.

    Mr. Leggate may be contacted at leggatej@enr.com

    Reprinted courtesy of James Leggate, Engineering News-Record

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    OSHA on clipboard

    The U.S. Department of Labor has expanded access for employers in doubt about whether they are in compliance with the law through the “opinion letter program.”

    Ask (OSHA) and You Shall Receive? DOL Expands Opinion Letter Program for OSHA and Other DOL Agencies

    July 15, 2025 — Kip J. Adams - Lewis Brisbois Newsroom

    Boston, Mass. (June 16, 2025) - A common refrain from many U.S. employers following receipt of an Occupational Safety and Health Administration (OSHA) citation is that if they had known that they were in violation, they would have acted quickly to correct it. Well, now the U.S. Department of Labor (DOL) has expanded access for employers in doubt about whether they are in compliance with the law through the “opinion letter program.”

    The DOL has made the opinion letter program available across five of its agencies to expand compliance assistance. They are:

    • The Wage and Hour Division
    • OSHA
    • The Employee Benefits Security Administration
    • The Veterans’ Employment and Training Service
    • The Mine Safety and Health Administration

    Employers now can request opinion letters addressing their specific question. As outlined on the DOL’s website, an effective request shall include:

    • an accurate and complete description of the facts, such as job duties, work schedules or pay structure;
    • confirmation that the request is not related to an existing matter that requires the interpretation of federal law (i.e., not related to an open investigation, citation, etc.);
    • details that allow review and response but do not include sensitive personal or confidential business information; and
    • a phone number in case the DOL needs to follow up.

    Mr. Adams may be contacted at Kip.Adams@lewisbrisbois.com

    Reprinted courtesy of Kip J. Adams, Lewis Brisbois

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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

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    Hand holding house with percentage chart upward arrows

    US New-Home Sales Jump to Highest Since 2022 as Prices Fall

    July 15, 2025 — Michael Sasso - Bloomberg

    US new-home sales rose unexpectedly in April to the highest level since February 2022, likely helped by builder incentives aimed at alleviating affordability challenges.

    Purchases of new single-family homes increased nearly 11% last month to a 743,000 annual rate, boosted in particular by the South and Midwest, according to government data released Friday. The figure exceeded most estimates in a Bloomberg survey of economists.

    Reprinted courtesy of Michael Sasso, Bloomberg

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    Construction workers hands together team gesture

    Nonresidential Construction Adds 11,300 Jobs in May

    July 15, 2025 — ABC - Construction Executive

    WASHINGTON, June 6—The construction industry added 4,000 jobs on net in May, according to an Associated Builders and Contractors analysis of data released by the U.S. Bureau of Labor Statistics. On a year-over-year basis, industry employment has increased by 126,000 jobs, an increase of 1.5%.

    Nonresidential construction employment increased by 11,300 positions, with growth in all three subcategories. Nonresidential specialty trade added the most jobs, increasing by 4,500 positions, while heavy and civil engineering and nonresidential building added 3,700 and 3,100 jobs, respectively.

    The construction unemployment rate decreased to 3.5% in May. Unemployment across all industries remained unchanged at 4.2%.

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

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    Power lines at sunset

    How Insurers Lead the Way for Power Generation and Electrical Distribution Projects

    July 15, 2025 — Chris Fancher - Construction Executive

    As the world continues to experience a rapid surge in electricity demand, driven by transformative industries and technologies, the need for robust power generation and distribution infrastructure has never been more critical. The rise of data centers, artificial intelligence, electric vehicles and battery energy storage systems has put significant pressure on the power grid, requiring new and innovative solutions to meet this growing demand.

    To support this monumental shift, the construction of new power generation facilities, electrical distribution networks and renewable energy projects is essential. This is where insurers can step in as a trusted partner in ensuring—and insuring—the successful completion of power-related projects.

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

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    AI Robot hand touching human hand creating spark

    AI in AEC 2026

    July 15, 2025 — Aarni Heiskanen - AEC Business

    The world’s first conference series focused on artificial intelligence in the built environment returns in March 2026!

    AI in AEC 2026 brings together AI experts, industry professionals, researchers, and thought leaders to explore the future of artificial intelligence in architecture, engineering, and construction. Whether you’re developing AI solutions or seeking to implement them in practice, this is the premier platform to connect, share, and shape what’s next.

    In 2025, the event welcomed over 320 participants from 32 countries, receiving outstanding feedback, with average ratings above 4 out of 5 for several consecutive years.

    March 18th-19th, 2026
    Helsinki, Finland & Virtual

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

    Reprinted courtesy of Aarni Heiskanen, AEC Business

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    Heavy Rain Returns to Texas Just 10 Days After Historic Flooding

    New questions are being raised about what more could have been done to warn those in the flood zone. NBC’s Morgan Chesky reports for TODAY.

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    Historic Grand Canyon Lodge Destroyed as Massive Wildfires Burn

    A historic lodge on the Grand Canyon's North Rim has been destroyed by a fast-moving wildfire, the park said Sunday. It comes as two massive wildfires burn out of control near the North Rim. NBC News’ Steve Patterson has the latest.

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