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Insurance Companies Dropping Homeowners with Solar Panels in Florida
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Eleanor Moses fell on a walkway outside a condo rented by Pascale Roger-McKeever.
California Court of Appeal Holds a Tenant Owes No Duty to Protect a Social Guest From a Defective Sidewalk Leading to a Condominium Unit
Monday, May 22, 2023
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Garrett A. Smee & Lawrence S. Zucker II - Haight Brown & Bonesteel LLP
On May 5, 2023, the California First District Court of Appeal, Division One, issued an opinion in Moses v. Roger-McKeever (A164405), holding that a condominium tenant owes no duty to a social guest using a walkway that leads to the unit.
Eleanor Moses fell on a walkway outside a condo rented by Pascale Roger-McKeever. Moses would not have used the walkway but for Roger-McKeever’s invite to a small gathering for members of a political activist group. Upon entering the condo for the event that night, Moses brought to Roger-McKeever’s attention the poor lighting in the entryway. Roger-McKeever apologized, and stated that her landlord had delayed repairing the porch light. The accident supposedly happened on a short walkway that had three steps leading away from a street sidewalk. Supposedly, Moses tripped on the second step while leaving the social gathering because of the poor lighting.
Reprinted courtesy of Garrett A. Smee, Haight Brown & Bonesteel and Lawrence S. Zucker II, Haight Brown & Bonesteel
Mr. Smee may be contacted at gsmee@hbblaw.com
Mr. Zucker may be contacted at lzucker@hbblaw.com
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The court determined there was no coverage for an adverse arbitration decision suffered by the insured in a construction defect case.
Insurer Has No Obligation to Cover Arbitration Award in Construction Defect Case
Monday, May 22, 2023
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Tred R. Eyerly - Insurance Law Hawaii
The court determined there was no coverage for an adverse arbitration decision suffered by the insured in a construction defect case. Am. Fire and Cas. Co. v. Unforgettable Coatings, Inc., 2023 U.S. Dist. LEXIS 64846 (D. Nev. April 13, 2023).
Unforgettable contracted with Muirfield Village Homeowner's Association for painting and related services. Following completion of the project, Muirfield alleged that Unforgettable's work was defective and filed suit. The parties agreed to arbitration. The arbitrator found that Unforgettable breached the contract and its implied warranty. Damages were awarded to Muirfield.
American Fire and Casualty Company (AFCC) was Unforgettable's insurer and defended Unforgettable at the arbitration. AFCC sued for a declaration that it had no obligation to indemnify Unforgettable for the damages awarded. Unforgettable and Murifiled counterclaimed, alleging that AFCC breached the policy by not covering the award, as well as a variety of extracontractual claims related to the investigation process. AFCC moved for judgment on the pleadings. The motion was granted with leave to amend.
Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com
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It is not an issue of trusting the person you are working with, but rather, a lack of trust in how handshake deals may play out in court should a dispute ever arise.
Handshake Deals Gone Wrong
Monday, May 22, 2023
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Jessica Allain - ConsensusDocs
The construction industry has it fair share of “handshake deals”, oral agreements relying on the integrity of the people involved. But when it comes to protecting and enforcing legal rights, it is always a better idea to properly paper the deal and get it in writing. Otherwise, contractors relying on verbal promises may find themselves without any legal remedy should the deal go south. After all, it is not just a matter of trust, but also a way to document that everybody agrees on what the terms of the deal actually are.
For example, a recent case out of New York highlights the dangers of unwritten promises. In Castle Restoration, LLC v. Castle Restoration & Construction, Inc., No. 16349-15 (N.Y. App. Div. 2/9/22), 2022 NY Slip Op 50082(U), 2022 WL 402882, 2022 N.Y. Misc. LEXIS 485, Castle Inc. and Castle LLC entered into a deal for an asset sale to transfer equipment and a client list from Castle Inc. to Castle LLC. While that initial asset sale was properly papered with sale documents and a promissory note, the parties entered into a subsequent handshake/oral agreement where Castle LLC agreed to provide Castle Inc. with labor and materials on construction projects, and those goods and services would offset the payment obligation under the promissory note. But the problem was that the contract for the asset sale had a provision that the agreement could not be changed by oral agreement; rather, any changes had to be made in writing.
Reprinted courtesy of Jessica Allain, Jones Walker LLP (ConsensusDocs)
Ms. Allain may be contacted at jallain@joneswalker.com
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Falling Short: Construction Must Prioritize Worker Safety
May 22, 2023 — Mark McGhiey - Construction Executive
A building boom across the United States, particularly in nonresidential projects, has many construction firms and contractors concerned about the availability of workers. To keep up with demand, some contractors have resorted to lowering their hiring standards. But in one of the most perilous professions in America, these actions could have serious implications for the safety of workers.
Bureau of Labor Statistics data shows construction and extraction occupations had the second most occupational deaths in 2021—the most recent data available—at a rate of 12.3 fatalities for every 100,000 workers. Falls continue to be a leading cause of construction deaths and injuries on jobsites, with more than 300 fall-related deaths each year and thousands of serious injuries. Despite increased awareness and stringent regulations, these incidents continue to disrupt workers’ lives and livelihoods, as well as businesses’ abilities to operate.
Reprinted courtesy of Mark McGhiey, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
Wrap-up Exclusion Applies Even if Insured Not Enrolled in Wrap-Up Program
May 22, 2023 — Tred R. Eyerly - Insurance Law Hawaii
The Supreme Court of New York, Appellate Division, found that the lower court properly determined that the wrap-exclusion applied to the insured even though it was not enrolled in the Wrap-up Insurance Program for the project. Skanska USA Building Inc. v. Harleysville Ins. Co., 2023 N.Y. App. Div. LEXIS 1893 (N.Y. App. Div. April 11, 2023).
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Tiger Woods-Backed Project to Build Homes in Florida Horse Town
May 22, 2023 — Jennifer Epstein - Bloomberg
An international developer backed by Tiger Woods and Justin Timberlake has joined an effort to build a sprawling residential community with stores and a revamped golf course in Wellington, a South Florida equestrian town near Palm Beach.
Plans call for single-family homes, condos, a hotel and a golf club on a site spanning 600 acres (243 hectares). A commercial center will include stores, restaurants and offices. Work is scheduled to begin next month with updates to the existing Cypress Golf Course, and the developers expect other club facilities to take shape over the next few years.
What Contractors Need to Prioritize in Their Subcontract Negotiations
May 22, 2023 — Beverley BevenFlorez – CDJ Staff
This live webinar presented by ConsensusDocs “will provide fundamental principles for appropriate flow-down provisions and the most important provisions that general contractors and subcontractors alike should focus their attention upon.” Attendees “will gain a deeper understanding of critical issues like pay-if-paid and pay-when-paid, as well as minimizing conflicts between contract documents and scope gaps.” The seminar includes the following learning objectives: “Understand the differences between pay-if-paid vs. pay-when-paid and how to draft precisely on this critical issue, “Understand how notice requirements should be flowed down for claims and other issues,” “Learn how conflicts between the prime and subcontracts matter and the implications of contractual precedence,” and “Gain tactical pointers for termination for convenience.”
June 14th, 2023
Virtual Event
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Attorney William L. Doerler describes the changes to the Montana Code.
Montana Significantly Revises Its Product Liability Laws
Monday, May 22, 2023
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William L. Doerler - The Subrogation Strategist
On May 4, 2023, Montana changed its product liability laws when the Governor signed SB 216, which was effective upon passage and applies to claims that accrue on or after May 4, 2023. Among the changes is the adoption of a sealed container defense and the application of comparative negligence principles in strict liability actions. Montana also adopted a defense based on certain actions not being brought within 10 years. In addition, Montana adopted a rebuttable presumption with respect to a product’s defective condition. A jury must be informed about this rebuttable presumption with respect to certain warnings claims, premarket licensing procedures or claims involving drugs and/or medical devices. The changes to the Montana Code are further described below.
- In situations where there are multiple defendants, a defendant in a strict liability or breach of warranty action may now assert, as a defense, that the damages of the claimant were caused in full or in part by a person with whom the claimant has settled or released from liability. See MCA § 27-1-703(6)(a) (as revised). Comparative negligence or fault defenses are also available in actions against sellers, even where there are not multiple defendants. See MCA § 27-1-719(4)(e) (discussing a seller’s defenses in situations other than multiple defendant situations) (as revised).
Reprinted courtesy of William L. Doerler, White and Williams LLP
Mr. Doerler may be contacted at doerlerw@whiteandwilliams.com
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Attorney Daniel Lund III analyzes Fidelity & Deposit Co. v. Blanton.
Construction Litigation Roundup: “It’s None of Your Business.”
Monday, May 22, 2023
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Daniel Lund III - Lexology
“It’s none of your business.”
So said a construction surety resisting discovery of its underwriting file in the context of the surety’s affirmative $2 million indemnity claim (on a $25M bond), and a Missouri federal court agreed.
In response to the surety’s indemnity suit, the defaulted principal contractor and additional corporate indemnitors offered up defenses of “lack of consideration and the doctrine of unclean hands, laches, waiver and/or estoppel, among others.” The indemnitors also issued written discovery to the surety seeking to obtain the surety’s underwriting file – which would reveal the underpinnings of the surety’s decision to issue the bond to the contractor – asserting “that the underwriting and due diligence documents are relevant to the[] lack of consideration defense. [Indemnitors] claim that ‘[t]his defense is based on Defendants' belief that Plaintiff did not conduct any reasonable inquiry into any Defendants' ability to pay or financial resources and therefore Plaintiff did not rely on the financial condition of each Defendant in determining whether to issue the bonds.’"
Reprinted courtesy of Daniel Lund III, Phelps
Mr. Lund may be contacted at daniel.lund@phelps.com
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The 4th Circuit recently had some interesting things to say about the definition of labor.
Maybe Supervising Qualifies as Labor After All
Monday, May 22, 2023
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Christopher G. Hill - Construction Law Musings
Remember back in 2021 when I “mused” about Dickson v. Fidelity and Deposit Company of Maryland et al.? Remember how the Eastern District of Virginia held that mere supervision does not qualify as “labor” under the federal Miller Act? Well, the 4th Circuit recently weighed in on the appeal of that case and had some interesting things to say about the definition of labor.
As a quick reminder, Plaintiff worked as a project manager on a project to repair and upgrade certain stairs at the Pentagon. Plaintiff subcontracted with prime contractor Forney Enterprises Inc. on this project. On Dec. 20, 2018, the prime contract was terminated. Plaintiff filed the Miller Act suit on Feb. 5, 2020. Dickson alleged that Fidelity and Deposit Company of Maryland, or F&D, must pay him, pursuant to the Miller Act, the amount he is owed for the labor he performed on the project. Now before the district court were cross-motions for summary judgment. In evaluating Plaintiff’s claims, the district court examined the defendant’s claims that (1) Dickson’s work did not qualify as “Labor” under the Miller Act, and (2) that the suit was not timely filed. The Eastern District of Virginia court agreed with both arguments.
Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com
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Attorney Marissa L. Down's top ten take-aways from the 2023 annual meeting in Vancouver.
TOP TAKE-AWAY SERIES: The 2023 Annual Meeting in Vancouver
Monday, May 22, 2023
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Marissa L. Downs - The Dispute Resolver
Program coordinators Katie Kohm and Peter Marino put together an amazing annual meeting last week in Vancouver. While its impossible to retread all of the ground we covered in discussing the "future of construction law," here are my top 10 take-aways:
10. Public-private partnerships may finally be taking off in the United States. P3s were slow to be pursued within the United States. According to panelists Peter Hahn, John Heuer, Sean Morley, and Lee Weintraub, this was chiefly because of the reticence of public bodies to deviate from the standard vendor model. Looking at the recent trends, it seems as though the United States--the "sleeping giant of public-private partnerships"--may finally be waking up. In 2022, a total of 29 public-private partnership projects were signed or reached financial close within the United States, representing an increase of 16% from the prior year. Thirty-eight states also now have some form of P3 enabling legislation. While we still lag behind our Canadian cousins, the future of P3s in this country is looking a little brighter.
9. The value proposition for the architecture profession is broken. Architects Lakisha Ann Woods (the CEO of AIA) and Phillip Bernstein (Associate Dean & Professor Adjunct Yale University) shared their thoughts with moderator Kelly Bundy on the challenges facing the architecture profession. The biggest issue they noted was the need to recruit qualified (and diverse) candidates into the profession. Unfortunately, this is difficult to do given the long career track (on average, it becomes 13.1 years to become a licensed architect) and the low salaries paid compared to other professions. Phillip shared that the high average starting salary for architecture grads from Yale (one of the leading programs in the country) is just $76,000. If we want to recruit the best and most innovative candidates into the field, the value proposition needs to change.
Reprinted courtesy of Marissa L. Downs, Laurie & Brennan, LLP
Ms. Downs may be contacted at mdowns@lauriebrennan.com
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Pillsbury's Construction & Real Estate Law Team discuss recent industry news.
Real Estate & Construction News Roundup (05/10/23) – Wobbling Real Estate, Booming (and Busting) Construction, and Eye-Watering Insurance Premiums
Monday, May 22, 2023
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Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
In our latest roundup, the commercial real estate sector continues to wobble, construction booms and busts, flood insurance premiums reach eye-watering levels, and more.
- In its latest Financial Stability report, the Federal Reserve acknowledges that the shaky commercial real estate sector could potentially harm the U.S. financial system. (Courtenay Brown, Axios)
- New data from the California Department of Finance shows that even though the state’s population significantly decreased during the COVID-19 pandemic, home building soared, reaching levels not seen since 2008. (Terry Castleman, Los Angeles Times)
- Already weakened by rising interest rates, inflation and debt, Sweden’s real estate sector took another hit as SBB’s shares continued to slump. (Reuters)
Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team
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Large construction projects carry greater risk. Professionals at The Hartford share how you can bid on the right sized projects to help protect your business.
Construction Bidding for Success
Monday, May 22, 2023
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The Hartford Staff - The Hartford Insights
When construction companies develop a history of successful projects, they often consider bidding on larger projects. However, larger projects can carry greater risks.
If your company has successfully completed numerous $10 million projects and is considering a bid on a $100 million project, there are several factors to consider before submitting a proposal. That is because bidding on the wrong project could potentially put you out of business.
“When a contractor bids a larger project, there is a greater financial risk,” says Tim Holicky, a senior executive underwriter at The Hartford. There are more subcontractors to manage and additional materials to purchase, which all leads to greater financial risk.
Reprinted courtesy of The Hartford Staff, The Hartford Insights
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Home Prices See Largest Dip in a Decade
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Neither the Plaintiff nor the Property Owner produced sufficient evidence to demonstrate the existence of an issue of fact precluding dismissal.
Traub Lieberman Attorneys Lisa Rolle and Christopher Acosta Win Motion to Dismiss in Bronx County Trip and Fall
Monday, May 22, 2023
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Lisa M. Rolle & Christopher D. Acosta - Traub Lieberman
Traub Lieberman Partner Lisa Rolle and Associate Christopher Acosta won a motion to dismiss in a trip and fall accident complaint and cross-claim brought before the New York Supreme Court, Bronx County. The underlying accident allegedly occurred on the sidewalk abutting the subject premises, which is owned by the Property Owner and was leased to a Pest Control Company. The Property Owner brought a cross-claim against the Pest Control Company as a result of the initial complaint.
Reprinted courtesy of Lisa M. Rolle, Traub Lieberman and Christopher D. Acosta, Traub Lieberman
Ms. Rolle may be contacted at lrolle@tlsslaw.com
Mr. Acosta may be contacted at cacosta@tlsslaw.com
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A better building solution exists, but it must be implemented, especially in areas at the highest risk for damage and loss, to be effective.
Evolving Climate Patterns and Extreme Weather Demand New Building Methods
Monday, May 22, 2023
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Annette Rubin - Construction Executive
Compared to the rest of the world, most buildings in the United States are relatively young. But most residential and commercial properties could use a makeover. Buildings constructed over twenty, fifty and one hundred years ago are, unsurprisingly, not as energy-efficient or as safe as new builds following modern methods—especially when considering the effects of climate change and more frequent extreme weather events on the integrity of that infrastructure.
According to the National Association of Home Builders, over 90% of new homes built in the United States today are wood-framed. These homes are incapable of withstanding a tornado or hurricane, yet they are still being built directly in the path of storms. Even buildings constructed in some of the most earthquake-prone areas of the U.S. may contain design flaws that make them susceptible to damage because they are built using a non-ductile concrete method, which experts say has an inadequate configuration of steel reinforcing bars—making the building vulnerable when shaken. While this building method was banned for new construction, it is not yet required to retrofit older construction to improve safety and structural integrity.
Reprinted courtesy of Annette Rubin, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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The project committee for ASHRAE Standard 241P will accept comments through May 26.
ASHRAE Seeks Comments by May 26 on Draft of Pathogen Mitigation Standard
Monday, May 22, 2023
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James Leggate - Engineering News-Record
ASHRAE, the professional group focused on research and standards development for heating, ventilation, air conditioning and air conditioning systems, is seeking comments on the first draft of a standard for pathogen mitigation, it announced May 15. ASHRAE will accept comments on the public review draft, via osr.ashrae.org, through May 26.
Reprinted courtesy of James Leggate, Engineering News-Record
Mr. Leggate may be contacted at leggatej@enr.com
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Modular construction and a tight budget didn’t prevent San Francisco architects from giving this affordable housing project an exuberant look, inside and out.
Inspired by Filipino Design, an Apartment Building Looks Homeward
Monday, May 22, 2023
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Sarah Holder - Bloomberg
Austerity and efficiency aren’t the first words that come to mind when you see the angled sawtooth bays of Tahanan Supportive Housing, or catch a glimpse of a rainbow through its lobby. But the dramatic exterior and joyful interior of this San Francisco building are both products of their constraints.
When David Baker Architects was approached to design the six-story development, the goal was aggressive: Produce 145 units of permanent supportive housing at under $400,000 a unit, and have the operation up and running in less than three years. The firm accepted the challenge, and by 2022, Tanahan was fully leased to residents, all of whom are San Franciscans who have struggled with chronic homelessness.
In a city where affordable units typically cost $600,000 to $700,000 each to construct, keeping in budget and meeting the deadline meant turning to the modular building company Factory OS. It also meant keeping variation at a minimum. The studios are identical, like Lego blocks; instead of being mirrored across a hallway, they’re just rotated 180 degrees. But nothing else about the building feels utilitarian.
Reprinted courtesy of Sarah Holder, Bloomberg
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