Illustration of judge and testimony

Ghukasian offers a cautionary tale.

California Appellate Court Rules That Mistakenly Grading the Wrong Land Is Not an Accident

Monday, June 27, 2022 — Jared De Jong & Scott S. Thomas - Payne & Fears

In a decision that further muddies the already murky waters of “occurrence” jurisprudence, the California Court of Appeal has ruled that a general liability policy does not cover a homeowner who mistakenly grades the wrong piece of land because the act of grading land is not “accidental.”

In Ghukasian v. Aegis Security Insurance Company, ___ Cal. App. 5th ___, 2022 WL 1421511 (2022), a homeowner instructed her contractor to clear and level a piece of land that the homeowner believed was part of her property. Unfortunately, the land was owned by a neighbor, who sued the homeowner and the contractor for trespass and negligence. The homeowner tendered to her insurer, Aegis. The homeowner’s policy contained a standard insuring agreement creating coverage for property damage caused by an “occurrence,” defined by the policy as an “accident, including continuous or repeated exposure to substantially the same general harmful conditions.” The insurer denied coverage, arguing that intentionally grading land is not an accident. Coverage litigation ensued.

Reprinted courtesy of Jared De Jong, Payne & Fears and Scott S. Thomas, Payne & Fears
Mr. De Jong may be contacted at jdj@paynefears.com
Mr. Thomas may be contacted at sst@paynefears.com

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Business men and women looking up

The expert is a critical component to most cases alleging negligence against design professionals in Massachusetts.

The Importance of Engaging Design Professional Experts Early, with a Focus on Massachusetts Law

Monday, June 27, 2022 — Jay Gregory - Gordon & Rees Construction Law Blog

In any Massachusetts case alleging negligence against a design professional, an expert witness on the topic of liability is a critical, early consideration. Given the expense of expert witnesses, counsel representing design professionals are wise to evaluate (1) the need for an expert, (2) the timing of the engagement of an expert, and (3) the scope of the expert’s services.

To begin, not every allegation of negligence against a design professional necessitates an expert opinion. “The test for determining whether a particular a particular matter is a proper one for expert testimony is whether the testimony will assist the jury in understanding issues of fact beyond their common experience.” Herbert A. Sullivan, Inc. v. Utica Mutual Insurance Co., 439 Mass. 387, 402 (2003) (addressing duties of an insurer). For instance, in its ruling in Parent v. Stone & Webster Engineering Corp., the Massachusetts Supreme Court noted no expert would be necessary to prove professional negligence where an electrician was injured by a mislabeled distribution box carrying 2,300 volts. 408 Mass. 108 (1990). It is reasonable to expect lay jurors to comprehend the duty of an electrician to properly label a distribution box carrying potentially fatal quantities of voltage. To the extent liability is readily recognizable to the average juror (i.e. “within the ken of the average juror”), significant cost savings are achievable by forgoing the use of an expert witness. That, however, is the exception.

Reprinted courtesy of Jay S. Gregory, Gordon Rees Scully Mansukhani

Mr. Gregory may be contacted at jgregory@grsm.com

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The end printed on paper in typewriter

The importance of having a well written pass-through provision in a subcontract or separate stand-alone liquidating agreement in place with a subcontractor cannot be overstated.

A Brief Discussion – Liquidating Agreements

Monday, June 27, 2022 — Gerard J. Onorata - Peckar & Abramson, P.C.

During a construction project, it is not uncommon for disputes to arise between a general contractor and a subcontractor. Frequently, these disputes involve claims for extra work and delay damages that can be attributed to the owner of the project due to deficient design or unforeseen conditions. When these occasions arise, the parties can often resolve these claims without the need for litigation or arbitration by entering into a “liquidating agreement.”

What is a Liquidating Agreement?
Because there is no direct contractual relationship between a subcontractor and an owner, there does not exist a legal basis for a subcontractor to assert a breach of contract claim against a project owner. In legal parlance, this is known as “lack of contractual privity.” A liquidating agreement bridges this contractual gap and allows a subcontractor to pass its claim against the owner through the general contractor. Essentially, with a liquidating agreement, the general contractor acts as a conduit for passing through the subcontractor’s claim.

Reprinted courtesy of Gerard J. Onorata, Peckar & Abramson, P.C.

Mr. Onorata may be contacted at gonorata@pecklaw.com

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The Top 100 Project Delivery Firms Balance Increased Risks

June 27, 2022 — Emell D. Adolphus & Jonathan Keller - Engineering News-Record

With projects facing rising material costs, crunched schedules and labor shortages, project delivery firms say owners are finding themselves at a fork in the road when it comes to design-bid-build versus alternative delivery models. Risks are inherent to any project, but more owners are turning to alternative delivery to reap the rewards of early collaboration.

Reprinted courtesy of Emell D. Adolphus, ENR and Jonathan Keller, ENR
Mr. Adolphus may be contacted at adolphuse@enr.com
Mr. Keller may be contacted at kellerj@enr.com

Motion in Limine Ruling Allows Evidence of Bad Faith Claims Handling, but Not of Bad Faith Conduct

June 27, 2022 — Tred R. Eyerly - Insurance Law Hawaii

Under Florida law, the court granted the insurer's motion in limine to exclude evidence of bad faith until a breach of the policy was established, but denied the motion insofar as it sought to exclude evidence of bad faith claims handling. Monterey at Malibu Bay Condo. Ass'n v. Empire Indem. Ins. Co., 2022 U.S. Dist. LEIXS 68013 (S.D. Fla. April 13, 2022).

The Condominium Association filed suit for declaratory relief after its property was damaged by Hurricane Irma. The insurer, Empire Indemnity Insurance Company, made a partial payment, but the AOAO alleged Empire breached the contract by failing to fully indemnify the AOAO. Before trial, Empire moved to preclude the AOAO from introducing evidence and testimony alleging bad faith conduct. It also sought to exclude references to its "bad faith" or "good faith" conduct because such references could confuse the jury and unduly prejudice Empire.

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

Sales of New US Homes Jumped in May, Marking First Gain This Year

June 27, 2022 — Reade Pickert - Bloomberg

Sales of new US homes jumped in May, reflecting gains in the West and South and interrupting a months-long skid as the residential real estate market adjusts to rising borrowing costs and still-elevated prices.

Purchases of new single-family homes increased 10.7% to an annualized 696,000 pace, the first gain this year, government data showed Friday. The figure followed an upwardly revised 629,000 in April. The median forecast in a Bloomberg survey of economists called for a 590,000 rate.

6th Annual Insurance in the Construction Industry Seminar

June 27, 2022 — Beverley BevenFlorez – CDJ Staff

This two-day seminar, offered both in person or through a live webinar, will cover “ethical considerations in a complicated defense, recent case law and legislative updates, coverage issues with respect to CGL, Builder’s Risk, OCIP and Subguard Policies, use of bonds, and Additional Insured endorsements.” The event is relevant for attorneys, contractors, and insurance professionals servicing the construction industry.

August 25th-26th, 2022
Virtual & In Person Event
Hampton Inn & Suites - Brickell Downtown
50 SW 12th Street
Miami FL, 33130

Featured Experts For More Visit Us At:

Builders Standard of Care Expert Witness and Consulting General Contractor area area area

Builders Standard of Care Expert Witness and Consulting General Contractor area area area

Consulting Civil Engineer and General Contracting Expert Witness Arrange No Charge Initial Consultation Concerning Your Matter. area area

Ash beyond bridge

The cost of damage alone over the past several years soars into the hundreds of billions.

Hunton Insurance Group Advises Policyholders on Issues That Arise With Wildfire Claims and Coverage – A Seven-Part Wildfire Insurance Coverage Series

Monday, June 27, 2022 — Scott P. DeVries & Yosef Itkin - Hunton Insurance Recovery Blog

Wildfires destroy millions of acres a year in the United States, spewing smoke across much of the nation. The cost of damage alone over the past several years soars into the hundreds of billions. As wildfires continue to spread, particularly as we enter wildfire season, policyholders’ claims will rise and with that, so too will wildfire insurance coverage issues. Many believe that when a fire damages their property and/or interrupts their business operations, a claim gets submitted and is automatically paid; sadly, this is often not the case.

In a seven-part series delving into issues relating to wildfire insurance coverage, the Hunton insurance group provides a comprehensive understanding of the types of policies that may be available, legal and factual issues that may arise, and steps policyholders can take – both in advance and during the claims process – to maximize recovery. The following issues will be addressed:

  • Part One: Types of Wildfire-Related Losses and the Policies That May Provide Coverage
  • Part Two: Coverage for Smoke-Related Damages
  • Part Three: Standard Form Policy Exclusions
  • Part Four: Coverage for Supply Chain Related Losses
  • Part Five: Valuation of Loss, Sublimits, and Amount of Potential Recovery
  • Part Six: Ensuring Availability of Insurance and State Regulations
  • Part Seven: How to Successfully Prepare, Submit and Negotiate the Claim

Reprinted courtesy of Scott P. DeVries, Hunton Andrews Kurth and Yosef Itkin, Hunton Andrews Kurth
Mr. DeVries may be contacted at sdevries@HuntonAK.com
Mr. Itkin may be contacted at yitkin@HuntonAK.com

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Texas flag with map

In Galveston Bay and along the Gulf Coast, the Army Corps of Engineers has proposed the largest project in its history.

Texas Plans a Texas-Sized Response to Rising Seas

Monday, June 27, 2022 — Francis Wilkinson - Bloomberg

In coastal Texas and many other places, walled cities are making a comeback. It’s quite a turnabout, as the efficacy of defensive walls had declined precipitously since the age of the long bow. Barbarians still menace, of course. But the rekindled enthusiasm for defensive walls is a response to a different kind of threat.

San Francisco is contemplating a huge tidal wall across its bay to fend off sea rise and the attendant dousing of some of the world’s most expensive real estate. Miami is weighing the damage a sea wall would do to tourist vistas against the damage a rising sea might do absent a wall. New Orleans, after $14 billion in levee construction, is an armored metropolis. Norfolk, Virginia, another low-lying city exposed to a surging sea, is spending a few hundred million federal dollars on a downtown sea wall. New York City, which has flooded in two devastating storms so far this century, is building a $1.45 billion series of walls, floodgates and underground drainage, a modest down payment on the city’s defense against rising tides and storm surge.

Reprinted courtesy of Francis Wilkinson, Bloomberg
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Tools on wooden desk

As always, the legal answer is “it depends."

Substitute Materials — What Are Your Duties? What Are Your Risks? (Law Note)

Monday, June 27, 2022 — Melissa Dewey Brumback - Construction Law in North Carolina

In managing a project as the design professional, you are called upon to wear many hats. One of those hats is that of material specifier and, at times, substitute material approver. What are your duties in looking at substitute materials?

As always, the legal answer is “it depends”. In part, it will depend on your role on the project and what, specifically, the contract says. However, at its most basic, you can be sued for accepting an out of spec substitute material. This is so even if you believed the spec met requirements based on information that the contractor gave you. So, tread carefully in this area.

Do not assume any information that the contractor presents to you– take the time to research for yourself, call the manufacturer, and otherwise ensure that the product will work.

Reprinted courtesy of Melissa Dewey Brumback, Ragsdale Liggett

Ms. Brumback may be contacted at mbrumback@rl-law.com

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Businessman using laptop outside

The financial and reputational damage caused by these attacks cannot be underestimated.

Five Actions Construction and Energy Risk Managers Can Take to Avoid the Catastrophic Consequences of a Cyber Attack

Monday, June 27, 2022 — Eve-Lynn Gisonni - Saxe Doernberger & Vita

With the ever-increasing usage of technology in the construction and energy industries, risks to business operations have also increased. Property developers and construction contractors rely on electronic data and communications more than ever to streamline projects, ensure efficient and timely supply chain delivery, and facilitate immediate communications between parties. However, with this dependence upon technology comes the heightened risk of cyber criminals frustrating construction operations and driving up costs.

Similarly, as the energy sector has grown more dependent upon online networks for deliverables, vulnerabilities have become more pronounced in trades dependent upon electrical grids. When an entire electricity network must be taken offline in defense of a cyber-attack, this impacts countless industries such as hospitals and health care operations, manufacturers and suppliers, and local and interstate traffic systems.

Reprinted courtesy of Eve-Lynn Gisonni, Saxe Doernberger & Vita

Mr. Gisonni may be contacted at EGisonni@sdvlaw.com

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3d characters in race with one crossing red finish line

The attorneys on the list were honored on May 12 at LABJ’s inaugural Top 100 Lawyers Awards at the ASU California Center.

Craig Holden Named Top 100 Lawyer by Los Angeles Business Journal

Monday, June 27, 2022 — Craig Holden - Lewis Brisbois

Los Angeles, Calif. (May 17, 2022) - Los Angeles Partner Craig Holden has been named to the Los Angeles Business Journal’s (LABJ) “Top 100 Lawyers” list, which recognizes the most impactful attorneys in the Los Angeles region for their ongoing efforts as outstanding legal professionals. The attorneys on the list were honored on May 12 at LABJ’s inaugural Top 100 Lawyers Awards at the ASU California Center.

In the publication’s special section, LABJ Publisher Josh Schimmels noted that the attorneys on the Top 100 Lawyers list “have demonstrated exceptional legal skill and achievements across the full spectrum of responsibility, exemplary leadership and contributions to the Los Angeles community at large.” He also observed, “Considering the fact that the Los Angeles region has long been known for its status as a hub for legal [through] leaders and record-setting attorneys, being a standout in that field is particularly impressive.”

Likewise, in discussing his inclusion on the list, Mr. Holden remarked, “I am honored to be included on this list with so many exceptional attorneys from the LA legal community.”

Reprinted courtesy of Craig Holden, Lewis Brisbois

Mr. Holden may be contacted at Craig.Holden@lewisbrisbois.com

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Tax under magnifying glass

Suspending the gas tax would result in the loss of billions in revenue from the HTF without resulting in any relief at the pump for consumers.

ASCE Statement on Calls to Suspend the Federal Gas Tax

Monday, June 27, 2022 — Tom Smith, Executive Director, American Society of Civil Engineers (ASCE)

WASHINGTON, D.C. – ASCE strongly opposes the recent announcement from the Biden Administration to suspend the current 18.4 cents-per-gallon federal gasoline tax for three months. Even at the same modest figure of 18 cents per gallon for over 25 years since 1993, the motor fuel tax has represented a reliable federal revenue source for communities to fix and modernize their network of roads, bridges, and transit systems.

Suspending the gas tax would result in the loss of billions in revenue from the Highway Trust Fund (HTF), significantly diminishing much of the progress made in the Bipartisan Infrastructure Law at a time when Americans expect improvements to the nation's roads, bridges, and transit systems. Replacing this lost revenue with funds from other sources is not a viable long-term solution and sets a damaging precedent. Encouraging states to follow suit will compound this bad idea and further exacerbate our nation's infrastructure funding challenges. Our transportation system, including roadways, bridge spans, and transit networks, can't rely on novel, unpredictable funding.

Further, there is little guarantee that motorists will see any real relief at the pump. Gas holidays aren't price controls; the manager at the gas station still gets to set their price. Oil producers have benefited significantly in the past from previous state-level gas tax holidays. There is no mechanism to ensure that these "savings" are passed on to consumers, but there is a virtual guarantee of disrupting transportation dollars and the HTF. While it sounds like an enticing solution when pocketbooks are strained, Congress knows that a variety of factors, including plain supply and demand, affect the prices that people see at fuel stations.

Now is the time to build on the momentum of the Bipartisan Infrastructure Law which, for the first time in decades, takes significant steps to revitalize our nation's aging infrastructure, improve public safety, strengthen our economy, and deliver well-paying jobs.

Edina Teen Starts Construction Company I KMSP FOX 9

Congratulations on sheet of paper

Hunton Andrews Kurth LLP’s insurance practice has received a U.S. News & World Report Tier 1 ranking.

Hunton Insurance Practice Receives Top (Tier 1) National Ranking by US News & World Report

Monday, June 27, 2022 — Hunton Insurance Recovery Blog

Hunton Andrews Kurth LLP’s insurance practice has received U.S. News & World Report’s highest national ranking (Tier 1) in its ranking of Best Law Firms for Insurance Law. Law firms are ranked in tiers from 1 (highest) to 3 (lowest) based on quantitative data that speaks to general demographic and background information on the practice group, attorneys, and other data that speaks to the strengths of a law firm’s practice as well as qualitative client feedback about:

  • the practice group’s expertise,
  • responsiveness,
  • understanding of a business and its needs,
  • cost-effectiveness,
  • civility, and
  • whether the client would refer another client to the firm.
Reprinted courtesy of Hunton Andrews Kurth LLP
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Businessman throws money in air

ACS has successfully obtained awards through post-trial motion practice for an additional $13.6 million in favor of the general contractor.

UPDATE: ACS Obtains Additional $13.6 Million for General Contractor Client After $19.2 Million Jury Trial Victory

Monday, June 27, 2022 — Kristina Southwell - Ahlers Cressman & Sleight PLLC

In March 2022, ACS obtained a $19.2 million jury verdict in favor of its general contractor client after a lengthy trial against the project owner. Since that time, ACS has successfully obtained awards through post-trial motion practice for an additional $13.6 million in favor of the general contractor. These awards increased to total judgment to more than $32 million.

When moving to enter judgment on the jury verdict, ACS successfully argued for and obtained more than $5 million in prejudgment interest on the jury verdict to compensate the general contractor for having to go years without payment for work performed. ACS also successfully obtained a decree of foreclosure on its construction lien and incorporated language in the judgment requiring the owner to pay an additional $1.9 million in Washington State sales tax on the jury award. Finally, under the authority of the Washington construction lien statute (RCW 60.04.181), ACS sought to recover the attorneys’ fees, costs, and expenses incurred by the general contractor client during the course of litigation. ACS succeeded in obtaining an award for more than $6.6 million for various expenses and costs including ACS’s attorney fees, all the costs of hiring expert witnesses, costs and expenses related to subcontractors’ presentation of pass-through claims against the owner, and other litigation costs and expenses.

Reprinted courtesy of Kristina Southwell, Ahlers Cressman & Sleight PLLC

Ms. Southwell may be contacted at wendy.wheatmccoy@acslawyers.com

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Electrical wires through fog

The differences between the state’s power system in 2008 and now reveal how difficult it is to anticipate the future of energy.

Predicting the Future of Texas’s Grid Is a Texas-Sized Challenge

Monday, June 27, 2022 — Nathaniel Bullard - Bloomberg

A little more than a year after a paralyzing winter freeze, the Texas power market just experienced the stress of extreme heat. Last week, power prices in Houston briefly jumped above $5,000 per megawatt-hour as high temperatures coincided with a number of generators being offline for maintenance.

Yet a few days earlier, power prices in west Texas had been negative $883 dollars per megawatt-hour, because at the time wind generation was abundant and demand was low.

“Dynamic” is one way to describe the price swings within the Electric Reliability Council of Texas (Ercot), the grid that provides the majority of the state’s power. “Jarring” or “terrifying” might be other words for it, particularly for those buying power in the spot market.

Reprinted courtesy of Nathaniel Bullard, Bloomberg
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Legislation word on paper in typewriter

Similar bill awaits Senate floor action.

House Passes $25B Water Resources Development Bill

Monday, June 27, 2022 — Tom Ichniowski - Engineering News-Record

A key federal infrastructure bill advanced with approval in the House of a measure providing $25.3 billion to help finance 22 Army Corps of Engineers storm and flood protection, ecological restoration, harbor dredging and other projects around the country.

Reprinted courtesy of Tom Ichniowski, Engineering News-Record

Mr. Ichniowski may be contacted at ichniowskit@enr.com

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Builders Standard of Care Expert Witness and Consulting General Contractor area area area

Builders Standard of Care Expert Witness and Consulting General Contractor area area area

Builders Standard of Care Expert Witness and Consulting General Contractor area area area