CONSTRUCTION DEFECT JOURNAL

"News and Information for Construction Defect and Claims Professionals"

CONSTRUCTION DEFECT JOURNAL - ISSUE 242749 - THURSDAY, MARCH 12, 2026

Contract hologram checklist on laptop

Phelps lawyers Daniel Lund and Larry Borda examined contractual provisions that most often expose construction professionals to unexpected financial and legal risk.

Protect Your Projects By Identifying and Controlling Hidden Contract Risks

March 10, 2026
Larry Borda & Daniel Lund III - JD Supra

In a recent webinar entitled “Spreading the Risk and Avoiding Killer Contract Clauses,” Phelps lawyers Daniel Lund and Larry Borda examined contractual provisions that most often expose construction professionals to unexpected financial and legal risk. While construction contracts may appear routine, each contract serves as the primary mechanism for managing, allocating, and mitigating risk among parties involved in complex projects—often valued in the hundreds of millions or billions of dollars. When parties fail to fully understand the terms they sign, costly and avoidable consequences frequently follow.

Contracts as Risk-Transfer Instruments
Construction contracts are the primary method for transferring risk. While contracts authorize work and define scope, they also allocate responsibility for the risks inherent in construction projects. Some may imagine a world where a one-page agreement and a set of plans would suffice. In reality, modern construction requires detailed agreements—particularly provisions designed to anticipate problems, distribute burdens and reduce disputes.

Reprinted courtesy of Larry Borda, Phelps and Daniel Lund III, Phelps

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

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CDJ NEWS THIS WEEK

Judge with gavel

Together, the Palisades and Eaton fires that both started on Jan. 7, 2025, killed more than 30 people, charred almost 40,000 acres and destroyed more than 16,000 structures.

LA Fire Victims Can Pursue City Utility Claims, Judge Rules

March 10, 2026 — Jef Feeley & Maxwell Adler - Bloomberg

The water and power utility that serves the city of Los Angeles must face hundreds of lawsuits faulting its response to the massive 2025 wildfire that leveled one of the city’s premier seaside neighborhoods and caused tens of billions of dollars in damage.

In a significant victory for fire victims, Los Angeles Superior Court Judge Samantha Jessner concluded in a written ruling Thursday that a unique California law allows property and business owners to pursue claims that the Los Angeles Department of Water and Power failed to supply enough water to fight the blaze that consumed the Pacific Palisades area.

Over strong objections from lawyers for the nation’s largest public utility, Jessner finalized a tentative ruling she issued last week concluding victims have a legal basis to move forward with allegations a city reservoir drained for repairs left fire hydrants with inadequate water pressure and helped the wind-whipped blaze get out of control.

Reprinted courtesy of Jef Feeley, Bloomberg and Maxwell Adler, Bloomberg

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Construction workers

This alert outlines the key statutory changes and explains the operational, scheduling, insurance, and risk‑management implications for the New York construction industry.

Amended Again?! Critical Changes to RPAPL § 881: What New York Contractors and Construction Managers Need to Know

March 10, 2026 — Mark A. Snyder & David Polazzi - Peckar & Abramson, P.C.

Recent amendments to New York’s RPAPL § 881 will significantly change how project teams obtain and maintain access to adjoining properties for construction-related work. The 2025 amendment signed into law by Governor Hochul, and the newly enacted 2026 revisions, will directly impact general contractors (GCs) and construction managers (CMs), as well as their trade contractors who regularly confront neighbor‑access, support‑of‑excavation, and protection‑of‑adjoining‑property challenges. Although we do not advise that GCs and CMs get involved in the “weeds” of license agreements or the prosecution of an action to obtain access pursuant to an RPAPL § 881 action, which are typically owner responsibilities, GCs and CMs should understand the change in law, as there may be circumstances where they are responsible for securing access.

This alert outlines the key statutory changes and explains the operational, scheduling, insurance, and risk‑management implications for the New York construction industry.

Reprinted courtesy of Mark A. Snyder, Peckar & Abramson, P.C. and David Polazzi, Peckar & Abramson, P.C.

Mr. Snyder may be contacted at msnyder@pecklaw.com
Mr. Polazzi may be contacted at dpolazzi@pecklaw.com

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Soil running through hands

Attorneys Curt Martin and Lee Banta discuss differing site conditions, and how those risks can – and should be – apportioned.

“He Chose…Poorly: How Bad DSC Clauses Lead to Project Doom in the Last Crusade of Construction Risk”

March 10, 2026 — Curt Martin & Lee Banta - ConsensusDocs

“We do not follow maps to buried treasure, and X never, ever marks the spot.” That’s the advice that Indiana Jones offered in the Last Crusade film. But what’s beneath the surface isn’t just important to adventure archaeologists. It has real-world application to our industry, where success depends on the stability of materials below the surface.

The study of geology and soils has ancient roots. Egyptians relied on soil stability for the pyramids; Rome built a continent-wide roadway system utilizing subgrade preparation techniques; Medieval builders implemented a rudimentary foundation pier system; Henri Gautier studied what is now called the “angle of repose” for French retaining walls in the early 18th Century.

Through the 19th Century, contractors bore the risk of the stability of their work, and the attendant peril of unforeseen site conditions. But in the early 20th Century, design trades continued to develop increased understanding of soil and underground conditions. In the 1920’s US federal contracts began employing “differing site conditions” clauses, which provided for cost/time adjustments if subsurface conditions differed from expectations. Industry forms followed the federal policy, and these clauses became almost universally accepted.

Reprinted courtesy of Curt Martin, Peckar & Abramson, P.C. and Lee Banta, Peckar & Abramson, P.C.

Mr. Martin may be contacted at cmartin@pecklaw.com
Mr. Banta may be contacted at lbanta@pecklaw.com

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Notepad with pen coffee laptop

Whatever you do, don’t put yourself in a position where you are spoiling evidence.

Quick Note: Don’t Spoil Evidence!!!!

March 10, 2026 — David Adelstein - Florida Construction Legal Updates

The phrase “spoliation of evidence” is a phrase that gets used, sometimes properly and sometimes improperly. The reason is that if evidence is legitimately spoiled, the opposing party wants an adverse inference jury instruction. There are two potential adverse inference jury instructions dealing with spoliation of evidence, neither of which are good, and one of which you definitely don’t want. A recent case discusses these jury instructions (check here) in a slip and fall personal injury case. The bottom line is that you need to preserve evidence relevant to a claim. Don’t lose it. Don’t intentionally destroy it. Don’t pretend it does not exist. Don’t do all the things that hinder the preservation and ultimate production of the relevant evidence. An adverse inference jury instruction (or an adverse inference implication in a non-jury trial) could be much, much worse. The facts are what the facts are. The best thing you can do is confront the facts. Confront the bad facts just like the good facts. The nature of any dispute is that there will be both good and bad facts. Bad facts can hopefully be explained recognizing there will be bad facts on the other side too. Sometimes, the bad facts warrant major strategic considerations and shifting the focus of how a dispute will be handled and presented. Whatever you do, don’t put yourself in a position where you are spoiling evidence. Once you get an adverse inference instruction, that’s it, as it’s very tough to overcome.

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

Reprinted courtesy of David Adelstein, Kirwin Norris

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Construction worker injured

The appellate court affirmed the trial court’s grant of summary judgment to the contractor’s insurer finding that the sumcontractor’s insurer had a duty to defend the contractor.

Contractor Entitled to Defense Under Subcontractor’s Policy

March 10, 2026 — Tred R. Eyerly - Insurance Law Hawaii

The appellate court affirmed the trial court’s grant of summary judgment to the contractor’s insurer finding that the sumcontractor’s insurer had a duty to defend the contractor. Navigators Specialty Ins. Co. v. TBR Construction, LLC, et al., 2025 Ill. App. Unpub. LEXIS 2177 (Ill. Ct. App. Dec. 3, 2025).

Greenscape Homes, LLC was the general contractor for a residential development. Greenscape hired TBR Construction, LLC as a carpentry-framing subcontractor pursuant to a “Trade Contractor Agreement.” The Trade Agreement required TBR to name Greenscape as an additional insured. TBR was insured by Utica. Greenscape was insured by Navigators.

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

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

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Testifying Construction and Building Industry Standard of Care Expert Witness

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

(800) 482-1822

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Tariff blocks

Although recent litigation has centered on the scope of presidential tariff authority rather than construction‑specific disputes, these decisions carry important implications for how parties structure risk in their contracts.

Managing Tariff Volatility in Cross‑Border U.S. Construction Projects: Practical Contract‑Drafting and Procurement Strategies

March 10, 2026 — Sara Beiro Farabow & Michael Wagner - The Construction Seyt

Volatile U.S. tariff announcements continue to affect international supply chains for U.S. construction projects. Although recent litigation has centered on the scope of presidential tariff authority rather than construction‑specific disputes, these decisions carry important implications for how parties structure risk in their contracts. In May 2025, the U.S. Court of International Trade (CIT) struck down certain “Liberation Day” tariffs as exceeding presidential authority under IEEPA. A federal district court in Washington, D.C. likewise issued a preliminary injunction suspending related tariffs—though it later stayed its own order pending appeal. And the Supreme Court has agreed to review cases addressing the legal limits of IEEPA‑based tariffs.

While none of these developments arises from construction disputes, the themes they highlight—timing, statutory authority, and documentation—mirror the issues encountered when tariff conditions disrupt international procurement. The following strategies reflect practical steps U.S. project owners, contractors, and foreign suppliers can take to mitigate risk, drawing on drafting approaches now widely used across major construction forms, including—but not limited to—modified AIA agreements.

Reprinted courtesy of Sara Beiro Farabow, Seyfarth Shaw LLP and Michael Wagner, Seyfarth Shaw LLP

Ms. Farabow may be contacted at sfarabow@seyfarth.com
Mr. Wagner may be contacted at mewagner@seyfarth.com

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Gold star surrounding desk in office

This award validates the intentional choices HHMR has made to invest in culture, to build clarity of direction through EOS, and to listen deeply to each other.

HHMR Honored as a 2026 Denver Business Journal Best Places to Work Recipient

March 10, 2026 — David McLain - Colorado Construction Litigation Blog

We are pleased to share that Higgins, Hopkins, McLain & Roswell has been named a 2026 Denver Business Journal Best Places to Work honoree, a recognition grounded entirely in direct feedback from our own team members.

The Denver Business Journal Best Places to Work program, in partnership with Quantum Workplace, ranks organizations based on anonymous employee engagement survey results that measure culture, leadership, communication, trust, team dynamics, and satisfaction. This year’s list includes 65 companies across the Denver metropolitan area, judged by the people who know these workplaces best: their employees.

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

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

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Worker at desk with stacks of paperwork

Because the U.S. Supreme Court did not identify the proper mechanism for obtaining refunds, companies affected by the IEEPA tariffs should not assume that refund rights will be implemented automatically or uniformly.

Supreme Court Strikes Down IEEPA Tariffs: The Refund Process Will Be Messy

March 10, 2026 — Brett W. Johnson, Derek Flint, T. Troy Galan & Thomas Williams - Snell & Wilmer

On February 20, 2026, the U.S. Supreme Court held in Learning Resources, Inc. v. Trump, and the consolidated case Trump v. V.O.S. Selections, Inc., that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs unilaterally.1 The decision invalidates both the “reciprocal” tariffs and the drug-trafficking tariffs imposed under IEEPA.

For importers, the immediate question is whether, how, and when refunds can actually be obtained. On that issue, the U.S. Supreme Court provided no roadmap. To the contrary, the dissent warned that the United States “may be required to refund billions of dollars,” that the process is likely to be a “mess,” and that the majority opinion “says nothing today about whether, and if so how, the Government should go about returning the billions of dollars that it has collected from importers.”

Reprinted courtesy of Brett W. Johnson, Snell & Wilmer, Derek Flint, Snell & Wilmer, T. Troy Galan, Snell & Wilmer and Thomas Williams, Snell & Wilmer

Mr. Johnson may be contacted at bwjohnson@swlaw.com
Mr. Flint may be contacted at dflint@swlaw.com
Mr. Galan may be contacted at tgalan@swlaw.com
Mr. Williams may be contacted at twilliams@swlaw.com>

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Builder standing in front of highway bridges

Road builders-led group win a legal victory in Cook County, Ill., argued transportation funds were not spent directly for infrastructure needs in 2023 as required by law.

Court Rules Cook County Misspent $243M in Transportation Funds

March 10, 2026 — Annemarie Mannion - Engineering News-Record

A Cook County Illinois Circuit Court judge has ruled that the county violated the state constitution by using $243 million in transportation tax revenue during fiscal 2023 for non-transportation purposes, handing a legal win to a statewide coalition of construction trade groups.

Ms. Mannion may be contacted at manniona@enr.com

Reprinted courtesy of Annemarie Mannion, Engineering News-Record

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Illustration of business men and women superheroes

This honor reflects their dedication to their clients, depth of experience, and the high standard of service they bring to every matter.

Five Payne & Fears Attorneys Named 2026 Southern California Super Lawyers

March 10, 2026 — Payne & Fears LLP

Five Payne & Fears attorneys have been named to the 2026 Southern California Super Lawyers list in recognition of their work across a range of practice areas. This honor reflects their dedication to their clients, depth of experience, and the high standard of service they bring to every matter.

Reprinted courtesy of Payne & Fears LLP

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Hand spins valve

While industry attention has largely centered on electricity procurement and grid impacts, the availability and legal entitlement to a firm water supply has become equally material to siting, permitting and community acceptance.

Structuring Water Resilience for Data Center Development: Water Rights, Reuse Incentives, and Emerging Disclosure Risk

March 10, 2026 — Ashleigh Myers, Jillian Marullo & Jason Drogin Atwood - Gravel2Gavel Construction & Real Estate Law Blog

As AI-driven data center development accelerates, developers, communities and regulators are increasingly focused on water demand—both the volume required and the sources from which that water will be drawn. While industry attention has largely centered on electricity procurement and grid impacts, the availability and legal entitlement to a firm water supply has become equally material to siting, permitting and community acceptance. Particularly as surface and groundwater supplies become increasingly constrained and new projects are sited in regions experiencing tighter hydrologic conditions or growth-related supply constraints, project teams are increasingly integrating water supply analysis into early-stage development to address issues that can materially affect schedule, financing and long-term operations.

Reprinted courtesy of Ashleigh Myers, Pillsbury, Jillian Marullo, Pillsbury and Jason Drogin Atwood, Pillsbury

Ms. Myers may be contacted at ashleigh.myers@pillsburylaw.com
Ms. Marullo may be contacted at jillian.marullo@pillsburylaw.com
Mr. Atwood may be contacted at jason.atwood@pillsburylaw.com

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Illustration of businesswoman holding trophy

These finalists exemplify the talent, leadership, and collaborative spirit that define GRSM’s commitment to advancing women in law.

GRSM Attorneys Named Finalists in 2026 Women, Influence & Power in Law Awards

March 10, 2026 — Gordon Rees Scully Mansukhani

Gordon Rees Scully Mansukhani attorneys have been shortlisted as finalists for Corporate Counsel’s 2026 Women, Influence & Power in Law (WIPL) Awards, which honor women leaders who have demonstrated a commitment to advancing the empowerment of women in the legal profession.

In the Law Firm Internal Collaborative Leadership category, Stephanie Jones was recognized for her exceptional ability to foster collaboration, mentor talent, and align colleagues across GRSM. Jones has consistently demonstrated leadership rooted in trust, inclusion, and shared purpose, qualities that have strengthened the firm during a period of extraordinary growth. Her impact on the firm’s culture and success will continue as she steps into her role as Chief Operating Partner in June 2026, where she will further build on her leadership in fostering teamwork, mentorship, and alignment across the firm’s national platform.

Reprinted courtesy of Gordon Rees Scully Mansukhani

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Consulting Design and Architecture Expert Witness

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

California Architectural Registration Board Supplemental Examination Commissioner

(800) 482-1822

www.berthowe.com

Skyscrapers Miami

Miami Waldorf Developer Pitches Second 1,000-Foot Skyscraper

March 10, 2026 — Anna J Kaiser - Bloomberg

The real estate developer building a 1,049 foot-tall Waldorf Astoria-branded condo tower in Miami is now proposing a second supertall skyscraper down the block.

Property Markets Group, the Miami-based firm which also co-developed the super-slender building at 111 W. 57th St. on Manhattan’s Billionaires’ Row, plans to break ground on the 985-foot tower in downtown next year and will partner with Delano, a hotel brand that includes a historic art deco hotel in Miami Beach and locations in Paris and Dubai.

Reprinted courtesy of Anna J Kaiser, Bloomberg

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Construction workers

Construction Job Openings Rebound by 90,000 in November 2025

March 10, 2026 — ABC - Construction Executive

WASHINGTON, Jan. 7—The construction industry had 292,000 job openings on the last day of November, according to an Associated Builders and Contractors analysis of data from the U.S. Bureau of Labor Statistics’ Job Openings and Labor Turnover Survey. JOLTS defines a job opening as any unfilled position for which an employer is actively recruiting. Industry job openings increased by 90,000 during the month and are up by 15,000 from the same time last year.

“Construction job openings rose meaningfully in November and were up on a year-over-year basis for the first time since July,” said ABC Chief Economist Anirban Basu. “At the same time, the industrywide pace of layoffs plunged to the lowest level of 2025, matching the second-lowest rate ever recorded.

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

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Handshake agreement

Breach of Fiduciary Duty and Negligent Misrepresentation Claims Against Insurance Broker

March 10, 2026 — David Adelstein - Florida Construction Legal Updates

Can an insurance broker be liable for breach of fiduciary duty and negligent misrepresentation? Stated differently, can an insurance broker be liable for these claims even if the insurance broker has been found not to be liable for the negligent failure to procure insurance? Well, a recent appellate decision out of Florida’s 5th District Court of Appeals, confirms yes, with such claims being BROADER CLAIMS with BROADER DAMAGES than the negligent failure to procure coverage.

In Brown & Brown of Florida, Inc. v. Houligan’s Pub & Club, Inc., 51 Fla.L.Weekly D49b (Fla. 5th DCA 2026), this is exactly what transpired when a jury found an insurance broker not liable for negligent failure to procure insurance, but liable for breach of fiduciary duty and negligent misrepresentation. On appeal, the broker did not appeal its liability for these counts, rather, it appealed the measure of damages for these counts.

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

Reprinted courtesy of David Adelstein, Kirwin Norris

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Seminar

32nd West Coast Casualty Construction Defect Seminar

March 10, 2026 — Beverley BevenFlorez – CDJ Staff

The West Coast Casualty Construction Defect Seminar returns to the Disneyland Resort this May. The event brings together approximately 1200-1400 professionals “from the legal, insurance, builder, contractor, subcontractor and numerous other communities” per year. The seminar covers topics such as prosecution, defense, insurance coverage, science and technology regarding the construction defect industry. The event also provides numerous networking opportunities. Early bird registration is available until April 24th at 5pm, and registration closes on May 8th at 5pm.

May 14th-15th, 2026
Disneyland Hotel
1150 W Magic Way
Anaheim, CA 92802

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Tornado Threat Upgraded In Illinois And Indiana To Rare Level 4 Risk As Midwest Faces Severe Storms

The threat for tornadoes this evening has increased during a round of severe storms in the Midwest.

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Solar Light Causes House Fire

Homeowner describes terrifying night, losing entire home in 20 minutes after investigators say the only possible cause traced back to solar powered lights, WSMV 4 Nashville reported.

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