CONSTRUCTION DEFECT JOURNAL

"News and Information for Construction Defect and Claims Professionals"

CONSTRUCTION DEFECT JOURNAL - ISSUE 242749 - TUESDAY, AUGUST 26, 2025

Dispute occurring during meeting conference table

A federal judge ruled that before the case can be decided, a three-party arbitration must run its course over how many $1-million deductibles the design and construction team owe per claim to project liability insurer Lexington Insurance Co.

STV and Tutor Perini/Parsons Arbitrate Unusual Dispute Over Seven $1M Deductibles

August 25, 2025
Richard Korman - Engineering News-Record

The $2.1-billion Terminal A replacement project at Newark-Liberty International Airport, open since 2023 in in New Jersey, has turned into a multi-million-dollar legal headache for key companies on the project - the Tutor Perini/Parsons joint venture contractor and its main design subcontractor, STV Engineering.

Mr. Korman may be contacted at kormanr@enr.com

Reprinted courtesy of Richard Korman, Engineering News-Record

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CDJ NEWS THIS WEEK



Lawyer talking to jury

Do not neglect the proper measure of damages in construction defect cases

Proving and Defending Against Construction Defect Damages

August 25, 2025 — David Adelstein - Florida Construction Legal Updates

Recent decisions in Florida (see here) have harshly come out against owners in construction defect cases that fail to properly measure their damages as of the date of the breach. The result has been a big “L” for owners in these cases based on an appeal even though the owners won at the trial level.

In a recent case, an owner presented construction defect damages from an expert and prevailed at trial. However, the damages were NOT measured as of the date of the breach, but years after. The appellate court reversed and remanded in favor of the contractor, meaning the owner lost the case.

If you are involved in a construction defect case, make sure the below is instilled in your thought process and analysis because you NEED to know how to prove construction defect damages and defend against construction defect damages:

“Damages for a breach of contract should be measured as of the date of the breach. Fluctuations in value after the breach do not affect the nonbreaching party’s recovery.” Damages are not supported by competent, substantial evidence when damages are assessed for a time other than that of the time of breach.

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

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

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Person at crossroads

The case addresses the legal duty of care owed by construction professionals - specifically geotechnical consultants - to property owners with whom they are not contractual privity.

At the Border of Contract and Torts in Construction Disputes

August 25, 2025 — Garret Murai - California Construction Law Blog

"The declining significance of privity has found its way to construction law."

So begins the 4th District Court of Appeal’s decision in Lynch v. Peter & Associates, Engineers, Geologists, Surveyors, Inc., 104 Cal.App.5th 1181 (2024). The case addresses the legal duty of care owed by construction professionals - specifically geotechnical consultants - to property owners with whom they are not contractual privity. The case reaffirms the Biakanja factors and signals the growing willingness of courts to impose liability beyond contract boundaries, especially in residential construction.

Factual Background
In April 2018, general contractor Grover Construction (Grover) hired geotechnical firm Peter & Associates, Engineers, Geologists, Surveyors, Inc. (“Peter”) to perform a limited inspection of a footing trench for a proposed addition to a single-family home in San Clemente, California owned by Gregory and Cheryl Lynch. The Peter firm’s scope was narrow and its fee modest - just $360.

Mr. Murai may be contacted at gmurai@nomosllp.com

Reprinted courtesy of Garret Murai, Nomos LLP

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Supply chain ship dock port jet

This article explores how global events can affect supply chains, why documentation is typically critical to connecting cost impacts to those events, and practical steps contractors can take to mitigate risks.

Global Events and the Construction Supply Chain: Preparing for the Unexpected

August 25, 2025 — Sydney Koby - ConsensusDocs

In today’s global economy, the construction industry is increasingly vulnerable to the ripple effects of worldwide events. From the COVID-19 pandemic and the war in Ukraine to tariff impacts and the recent escalation of tensions with Iran, contractors are facing more frequent and unpredictable disruptions. This article explores how global events can affect supply chains, why documentation is typically critical to connecting cost impacts to those events, and practical steps contractors can take to mitigate risks. This article does not cover every one of these items in extreme detail (each could be a standalone topic), but it provides an overview of each with general issues to keep in mind during project execution.

The Impact of Global Events on the Supply Chain
Over the past several years, events like COVID-19 shutdowns and the war in Ukraine have disrupted the flow of materials and labor, leading to widespread challenges in meeting construction schedules and controlling costs. More recently, tensions with Iran raised new concerns over oil production and access to global shipping routes. This could lead to spikes in fuel costs, price hikes in petroleum-based products, and shipment delays. While the potential for various global disruptions is not necessarily new, their unpredictability continues to make project planning and budgeting a challenge across the construction industry.

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

Reprinted courtesy of Sydney Koby, Jones Walker

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Denied

The court denied the insurer's motion to strike the insureds' expert witnesses, and denied the insurer's motion to dismiss all claims raised under the state's unfair claims settlement act.

Motion to Strike Insureds' Experts Denied, Unfair Claim Settlement Claims Survive Summary Judgment

August 25, 2025 — Tred R. Eyerly - Insurance Law Hawaii

The court denied the insurer's motion to strike the insureds' expert witnesses, and denied the insurer's motion to dismiss all claims raised under the state's unfair claims settlement act. Gerstman v. Crestbrook Ins. Co., 2025 U.S. Dist. LEXIS 108705 (N.D. Tex. June 9, 2025).

The insureds' property suffered damage when, during a hail and wind storm, a tree branch fell onto the property. The insureds made a claim with their insurer, Crestbrook Insurance Company. Crestbrook inspected the property and estimated damages totalling $6,061.68. Because the sum was less than the $25,000 deductible, Crestbrook did not make a payment.

The insureds hired a public adjuster who estimated repair costs totalling $137,545.19, including a full replacement of the roof. Crestbrook then reinspected and increased the damage estimate to $10,093.45, which was still below the deductible.

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

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

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News on cell phone

Pillsbury's roundup features adaptive reuse in the hospitality industry, falling home prices in major markets, loan maturity in real estate, and more.

Real Estate & Construction News Roundup (7/23/25) – Builders Look for Startups, AI Transforms Real Estate and Interest Rates Stall Construction Momentum

August 25, 2025 — Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog

Our latest roundup features adaptive reuse in the hospitality industry, falling home prices in major markets, loan maturity in real estate, and more!

  • Builders are ramping up their own venture funding arms, and they’re looking for startups that are commercial-ready, rather than starting out. (Matthew Thibault, Construction Dive)
  • Adaptive reuse is not exclusive to the hotel industry, but more hospitality brands and builders are seeking it out for its cost-savings, sustainability and design appeal. (Jenna Graber, Hotel Dive)
  • Nearly one-third of the largest 100 markets are now showing annual price declines of at least a full percentage point from recent highs, and the trend suggests more markets will do the same. (Diana Olick, CNBC)

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

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White and Williams LLP is pleased to congratulate our attorneys recognized in the Best Lawyers in America 2026 rankings.

Best Lawyers® Recognizes 40 White and Williams Lawyers

August 25, 2025 — White and Williams LLP

White and Williams LLP is pleased to congratulate our attorneys recognized in the Best Lawyers in America 2026 rankings.

Best Lawyers has recognized three attorneys as "Lawyer of the Year” including: Robert G. Devine, in the area of Litigation - Insurance, who focuses his practice in the areas of catastrophic loss matters, construction litigation, employment law, commercial litigation, professional liability, products liability, premises liability, transportation law and dram shop liability in New Jersey, New York and Pennsylvania; Randy J. Maniloff, in the area of Insurance Law, who focuses his practice on the representation of insurers in coverage disputes over primary and excess obligations; and Patricia B. Santelle, in the area of Insurance Law & Litigation – Insurance, who focuses her practice on the representation of insurance company clients in matters involving asbestos, environmental, toxic tort and long-tail claims.

Thirty-three White and Williams lawyers have been recognized as Best Lawyers in America 2026. Inclusion in Best Lawyers is based entirely on peer-review. The methodology is designed to capture, as accurately as possible, the consensus opinion of leading lawyers about the professional abilities of their colleagues within the same geographical area and legal practice area. Best Lawyers employs a sophisticated, conscientious, rational, and transparent survey process designed to elicit meaningful and substantive evaluations of quality legal services.

In addition, seven lawyers were recognized as Best Lawyers: Ones to Watch® in America. This recognition is given to attorneys who are earlier in their careers for outstanding professional excellence in private practice in the United States.

Reprinted courtesy of White and Williams LLP

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Personal injury law on scrabble tiles

The action involved a plaintiff who alleged she was caused to trip and fall at a condominium complex due to negligent maintenance of the complex’s sidewalk area.

“We Are Here for One Reason”: Newark Trial Team Achieves Another Favorable Settlement for Client After Jury Selection

August 25, 2025 — Lewis Brisbois Newsroom

Newark, N.J. (August 8, 2025) - The Newark trial team of Partners Afsha Noran and Colin Hackett were asked to drop in and try a personal injury matter with a multiple seven-figure demand, thirteen days before trial, for a longstanding firm client. Following jury selection - the Newark trial team’s sixth of 2025 - the matter settled for 38% of the plaintiff’s demand prior to the team’s appearance in the matter.

The action involved a plaintiff who alleged she was caused to trip and fall at a condominium complex due to negligent maintenance of the complex’s sidewalk area. EMS responded to the accident scene, and she was transported to the hospital where she spent five days followed by a seven-day stint at an in-house rehabilitation facility. As a result of the fall, the plaintiff claimed multiple cervical herniations requiring a two-level fusion surgery, traumatic brain injury resulting in TBI and cognitive impairment, dental and jaw damage including fourteen smashed teeth and TMJ, as well as left and right wrist ligament injuries.

Between the parties, twelve fact witnesses and seven experts were identified to testify at trial. The Lewis Brisbois trial team was tasked by the client with determining the defense themes for both liability and damages and the presentation of same at trial. To do so, they worked through the 4th of July holiday weekend to analyze the large volume of discovery and formulate a trial strategy.

Reprinted courtesy of Lewis Brisbois

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Hand adding fifth gold star

BWB&O is honored to share news of inclusion in Best Lawyers in America and Ones to Watch in America. Partner Keith Bremer also earned Lawyer of the Year for his work in Personal Injury and Construction Litigation.

Meet BWB&O’s 2026 Best Lawyers in America!

August 25, 2025 — Dolores Montoya - Bremer Whyte Brown & O'Meara LLP

BWB&O is honored to share that Partners John O’Meara, Vik Nagpal, Nicole Whyte, Keith Bremer, Daniel Crespo, Sheila Stiles, Patrick Au, Nicole Schmidt, and Peter Brown have been selected by their peers for inclusion in the 32nd edition of Best Lawyers in America.

Partners Devin Brunson, Ava Vahdat, Devin Gifford, Melissa Ingleby, Kyle Riddles, Nicholas Rodriguez, JohnPaul Salem, Christopher Filer, and Associates Kristoffer Wathne, Melissa Youngpeter, Angelo Perillo, Caitlin Salata, Kendra Arnold, Sammy Daboussi, Kendall Youngman, Ryan Leibel, Sasha Jamshidi, and Christina Matian are selected as Best Lawyers: Ones to Watch and will be included in the sixth edition of Best Lawyers: Ones to Watch in America.

Each person is being recognized for their expertise in the areas of Family Law, Construction, Transportation Law, Commercial, Personal Injury, Business, and Real Estate Litigation.

Reprinted courtesy of Bremer Whyte Brown & O'Meara LLP

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Hazards

Each year, OSHA’s top 10 most frequently cited standards shine a spotlight on the most persistent safety issues across all industries. The finalized list from 2024 should catch the eye of every construction professional.

Hazards Ahead: OSHA's Top 10 Citations of 2024

August 25, 2025 — Taylor Thorn - Construction Executive

The latest data from the Occupational Safety and Health Administration highlights systemic safety challenges that continue to put workers at risk and create business liabilities. But beyond those citations lie opportunities: to prevent injuries, reinforce a culture of safety and protect the bottom line.

Several of OSHA’s top 10 violations in 2024 apply directly to construction professionals. Fall protection in particular has held the number one spot for 14 consecutive years, with more than 7,000 citations issued in 2024. More than 6,500 of those citations came from the construction industry. In a field where falls are the leading cause of fatalities, this trend is deeply concerning.

Other top citations are similarly rooted in routine jobsite activities, such as incorrect ladder usage, incomplete or outdated hazard communication programs, and missing eye protection. These issues reflect a broader challenge: Safety protocols might be written down, but they aren’t always enforced, understood or adapted to the realities of fast-paced construction work.

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

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Best in gold with Good in background

Congratulations to the 13 Payne & Fears attorneys included in the 2026 Edition of The Best Lawyers In America and Best Lawyers: Ones to Watch.

Thirteen Payne & Fears Attorneys Honored by Best Lawyers

August 25, 2025 — Payne & Fears LLP

Congratulations to the 13 Payne & Fears attorneys included in the 2026 Edition of The Best Lawyers In America® and Best Lawyers: Ones to Watch®. Attorneys have been recognized in the following practice areas:

The Best Lawyers in America® (2026 Edition)
Irvine, CA

  • Jeffrey K. Brown
    • Employment Law – Management
    • Labor Law – Management
    • Litigation – Labor and Employment
  • Daniel F. Fears
    • Employment Law – Management
    • Labor Law – Management
    • Litigation – Labor and Employment
  • Daniel M. Livingston
    • Commercial Litigation
    • Litigation – Real Estate

Reprinted courtesy of Payne & Fears LLP

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Statue of liberty manhattan in background

The article, published in the Summer 2025 issue of Cornerstone Magazine, is the first of a series examining the contractual dynamics important to prime contractor risk management.

Not Everything Flows Downhill (At Least Not In New York): The Importance of Understanding How New York Courts Interpret Subcontract Incorporation by Reference and Flow-Down Provisions

August 25, 2025 — Mark A. Snyder & Kara M. Smiley - Peckar & Abramson, P.C.

Mark Snyder, a partner in P&A’s New York office, and associate Kara Smiley, have written “Not Everything Flows Downhill (At Least Not In New York): The Importance of Understanding How New York Courts Interpret Subcontract Incorporation by Reference and Flow-Down Provisions,” an article for Associated General Contractors of America (AGC) NYS. The article, published in the Summer 2025 issue of Cornerstone Magazine, is the first of a series examining the contractual dynamics important to prime contractor risk management. Prime contractors need to carefully align their contracts with both the owner and subcontractors to avoid legal and financial risks in a construction project. Flow-down provisions and specific incorporation by-reference provisions – and how the courts of New York interpret and enforce them, is critical to effective contractual risk management. The full article can be read here starting on page 39.

Reprinted courtesy of Mark A. Snyder, Peckar & Abramson, P.C. and Kara M. Smiley, Peckar & Abramson, P.C.

Mr. Snyder may be contacted at msnyder@pecklaw.com
Ms. Smiley may be contacted at krivas@pecklaw.com

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Construction worker on computer

In the future, estimators will likely supervise, verify, and fine-tune AI-generated results, focusing on higher-order decisions rather than manual measurement.

Construction Estimation: From Manual Takeoff to the AI Future

August 25, 2025 — Aarni Heiskanen - AEC Business

Quantity takeoff (QTO) is the foundation of construction cost estimation, another critical task. For decades, professionals have sought to streamline QTO through technology, aiming for greater speed, consistency, and accuracy.

Yet despite advances in digital tools, the profession is still in flux. A 2023 global study by RICS and Glodon found that only 39% of surveyed organizations use QTO and estimating software integrated with BIM or Common Data Environments. Another 31% rely on standalone tools, and 30% still don’t use specialized software at all.

As someone who’s witnessed the evolution of QTO technologies since the 1980s, from digitizing tablets to today’s AI-powered platforms, I find this gap telling. Now that machine learning and large language models are entering the mix, the big question is: Will AI finally automate the estimation process or just become another tool in the estimator’s kit?

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

Reprinted courtesy of Aarni Heiskanen, AEC Business

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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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Homeowners moving

Hello Spartanburg! The Affordability Migration Finds New Homes

August 25, 2025 — Conor Sen - Bloomberg

Spartanburg, not Atlanta. San Antonio, not Austin. A challenging housing market is pulling builders away from metros they’ve long favored to smaller cities, where it’s easier to construct the kinds of homes Americans can afford.

The shift raises questions about the future of big Southern metros that have historically made affordability central to their pitch to migrants from high-cost parts of the country. Many house hunters now find themselves priced out in these destinations by a combination of expensive homes and mortgage rates near 7%. Moreover, cautious buyers are driving resale inventory higher in traditional construction hot spots, depressing prices enough that the economics of building there have become more difficult.

Reprinted courtesy of Conor Sen, Bloomberg

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Construction workers in training or class

How Safety Training Can Improve Employee Engagement and Retention

August 25, 2025 — Rebecca Williams - Construction Executive

Employee engagement has become a focal point in the workplace over the last several years. Assessing the level of worker motivation and passion for their tasks can assist companies in improving their retention strategies. It’s widely recognized that employee engagement is a critical element in achieving operational success, especially in industries such as construction. Unfortunately, According to Gallup, employee engagement is declining across the globe.

A decline in workforce engagement can lead to higher attrition, lower productivity and a less safe workplace. When employees feel less engaged with their role, employer or colleagues, their adherence to safety protocols may become compromised. One effective method to bolster engagement on your construction site is through comprehensive and thoughtful safety training initiatives. Safety training not only helps workers feel valued, but also ensure their wellbeing and safety, fostering a culture of trust and commitment within the workplace.

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

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Scale of justice gavel law books

Appraisal Award That Exceeds Insureds' Proof of Loss Upheld

August 25, 2025 — Tred R. Eyerly - Insurance Law Hawaii

The insurer's challenge to an appraisal award that was more than the insureds' proof of loss was rejected by the court. Larson, et al. v. Auto-Owners Ins. Co., Iowa Dist. Ct. No. LACV053659 (Iowa Dist. Ct. June 4, 2025).

The insureds' home was damaged by hail. The insureds and Auto-Owners disagreed over the loss amount, primarily related to replacement of undamaged siding and the requirement of reasonably uniform appearance. The insureds invoked the policy's appraisal provision.

The umpire determined the final appraisal award was $208,194.47. The award was $80,000 higher than the insureds' proof of loss.

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

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

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Seminar

Join BWB&O Partner John Toohey and His Panel at the CLM Construction Conference in Downtown San Diego, September 17-19th!

August 25, 2025 — Dolores Montoya - Bremer Whyte Brown & O'Meara LLP

Bremer Whyte Brown & O’Meara, LLP is thrilled to share that Partner John Toohey and his panel are speaking during the CLM Construction Conference in Downtown San Diego on Friday, September 19th, from 9:45 to 10:45 AM.

Grab your complimentary breakfast and join Matthew Pavelchak of Walter Moore, Roni Most of Kahana Feld, James “Jim” Teater of United Fire Group, and John Toohey of BWB&O as they discuss “Making Waves: Navigating the Surge of Defective Pool Claims in Texas.”

Attending the CLM Construction Conference? If YES – YOU’RE INVITED!

BWB&O is a proud Show Daily Sponsor for the conference and a co-sponsor of the 3rd Annual ONE Party FOR ALL Construction Community Event on Thursday, September 18, 2025, from 8 to 11 PM. Every registered attendee is welcome to this all-inclusive networking party at Altitude Sky Lounge, offering unparalleled views of the San Diego skyline and bay, along with networking fun.

September 17th-19th, 2025
Marriott Marquis San Diego Marina
333 West Harbor Drive
San Diego

Reprinted courtesy of Bremer Whyte Brown & O'Meara LLP

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Beach Houses on the Outer Banks Condemned in Aftermath of Hurricane Erin

WAVY's Andy Fox reports live on Hurricane Erin OBX impacts.

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Pickett Fire in Napa County Grows to Nearly 4,000 Acres

The Pickett Fire near Calistoga in Napa County expanded to 3,993 acres Friday night as firefighting efforts continued with night-flying helicopters and containment held at 7%, Cal Fire said.

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