CONSTRUCTION DEFECT JOURNAL

"News and Information for Construction Defect and Claims Professionals"

CONSTRUCTION DEFECT JOURNAL - ISSUE 242749 - THURSDAY, DECEMBER 25, 2025

North Carolina collapsed house next to other houses

Nearly 3 million US homes in places like Charleston, South Carolina; Miami; and New York are at risk of being flooded permanently because of sea-level rise at some point in roughly the next century, according to a recent Richmond Federal Reserve research note.

Outer Banks Homes Collapsing Is Just a Taste of What’s to Come

December 22, 2025
Mark Gongloff - Bloomberg

On Sept. 20, 2024, a four-bedroom, three-bathroom beach house in Buxton, North Carolina, in the heart of the Outer Banks, sold for $580,000. On Oct. 28 this year, the house, known as Mermaid’s Rest, collapsed into the ocean. It was one of five homes swallowed that day by high waves churned up by an offshore storm.

Few things demonstrate how climate change is already upending lives and fortunes quite like watching somebody’s stately vacation home topple into the drink. But Outer Banks houses like Mermaid’s Rest (a striking example first dug up by the New York Times but just one of many such cases), are mere showroom models for the havoc that rising seas are already threatening.

First, let’s get one caveat out of the way: Barrier islands like the Outer Banks are always changing shape, regardless of the climate. Homes built on the shores of such islands have always been at risk of eventually sliding off the edge like a quarter in one of those coin-pusher arcade games.

Reprinted courtesy of Mark Gongloff, Bloomberg

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CDJ NEWS THIS WEEK



Person ripping contract in half

Because SEG failed to pay the very first payment application on time, it was then barred from enforcing the other parts of the contract and enforcing its rights from their forward.

Don’t Breach Your Contract, but If You Do, Don’t Breach First

December 22, 2025 — Christopher G. Hill - Construction Law Musings

Well, it’s been a while since my last post here at Musings due to travel, work, Thanksgiving, etc. so I thought I’d let a recent case remind us all that while breaching a construction contract is bad, doing it first is even worse. This is the so called “doctrine of first breach” that basically states that if both parties are in breach (or even just one), then the first to breach is the one that will bear the costs of breach. The doctrine also states that the one first to breach first can’t enforce any of its rights going forward.

The plaintiff in SEG Props. LLC v. NTC Mazzuca Constr.,Inc., the Virginia Court of Appeals considered a first breach scenario that was pretty extreme. The basic facts are as follows:

SEG hired Mazzuca to build a private shooting range and hired a property manager (Jones, Lang, LaSalle, Inc. (“JLL”)) as its project representative. Per the contract, if Mazzuca provided a payment application on or before the 25th of the month, payment was due by the 25th of the following month. In no event was payment to be made more than 30 days from receipt of the payment application by the owner’s representative. Even where there was a dispute, the undisputed amounts were to be paid. Mazzuca and JLL used a so called “pencil” method for payment applications that involved JLL reviewing the payment applications for errors and then a final payment application with the corrections being sent to the Architect. Needless to say there were change orders and disputes, but after the smoke cleared, it was obvious that from the first payment application, SEG had failed to make timely payment (for the whole saga, please read the case as it is too long for this post). Later, SEG terminated Mazzuca for cause upon one day’s notice that SEG would be supplementing Mazzuca’s workforce.

Mr. Hill may be contacted at chrisghill@constructionlawva.com

Reprinted courtesy of The Law Office of Christopher G. Hill

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Cracked glass door

The underlying plaintiff, Mustafaa Dais alleged that he was injured when a glass door collapsed onto him as he exited BJ’s Restaurant.

Additional Insured’s Claim for a Defense Is Dismissed

December 22, 2025 — Tred R. Eyerly - Insurance Law Hawaii

The court dismissed the additional insured’s complaint seeking a defense against a personal injury case. Piece Mgmt., Inc. v. Atlantic Casualty Ins. Co., 2025 U.S. Dist. LEXIS 205589 (S.D. N. Y. Oct. 18, 2025).

The underlying plaintiff, Mustafaa Dais alleged that he was injured when a glass door collapsed onto him as he exited BJ’s Restaurant. Dais sued BJ’s seeking damages for his injuries. He later amended his complaint to add Piece Management, Inc. the property’s management company, and Narway, Inc., the company hired to install the glass door.

Under the subcontract between Piece and Narwy, Narway was required to maintain a general liability policy and to add Piece as an additional insured. Narway obtained the required policy from Atlantic Casualty Insurance Company.

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

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

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Someone tripping and falling over a cord

The Kahana Feld team argued that the accident did not occur on the defendants’ premises, but instead on a nearby MTA subway platform, as identified by eyewitness accounts and plaintiff’s medical records.

Kahana Feld Secures Voluntary Discontinuance With Prejudice in High-Exposure Trip-and-Fall Case

December 22, 2025 — Kahana Feld

Kahana Feld partners Rachael Marvin and Dominic Donato recently achieved a significant victory in Kings County obtaining a voluntary discontinuance with prejudice of a high-exposure trip-and-fall lawsuit just before oral argument on defendants’ motion for summary judgment.

Plaintiff claimed they were injured after tripping on an allegedly worn and cracked exterior stair at the clients’ property. However, through careful investigation and strategic motion practice, our team argued that the accident did not occur on the defendants’ premises, but instead on a nearby MTA subway platform, as identified by eyewitness accounts and plaintiff’s medical records. Additionally, our defense medical expert opined that the plaintiff’s severe leg injuries were inconsistent with the claimed fall location—supporting our position that the alleged incident could not have happened as described.

Reprinted courtesy of Kahana Feld

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Construction meeting over plans laptop

While technical contractual arguments do carry weight, this does not mean they are slam dunks if the evidence supports a waiver or modification argument based on the parties’ course of conduct.

Course of Conduct Can Serve as Waiver or Modification of Parties’ Contract

December 22, 2025 — David Adelstein - Florida Construction Legal Updates

When you enter into a contract, the language in the contract means something. And if you don’t follow what the contract says, it will be used against you. It can be used to support the argument that you breached the contract. Or it can be used to demonstrate your lack of compliance with the contract does not entitle you to the recourse you are seeking. However, this does not mean under certain circumstances the language of the contract cannot be waived or modified by the parties’ course of conduct.

In a recent dispute, an owner and contractor sued each other under a cost-plus contract. The contractor recorded a construction lien and moved to foreclose its construction lien. The owner claimed it was over-charged and claimed the contractor breached the contract. The contractor also claimed it was not timely paid with improperly withheld payment applications. The trial court granted summary judgment in favor of the contractor, which was affirmed on appeal based on the parties’ course of dealing:

The trial court concluded that, although the parties’ cost-plus contract required that all change orders be approved in writing, the summary judgment record established that this provision was routinely waived by the parties’ course of dealing: [owner] would orally request changes to the project; [contractor] would perform those changes; and [owner] would pay the invoices for those changes.

Moscato Corp. v. Mutchnik Construction Group, Inc., 411 So.3d 570 (Fla. 3d DCA 2025)

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

Reprinted courtesy of David Adelstein, Kirwin Norris

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Wet slippery floor

The plaintiff unknowingly stepped into the area of dripped melted ice and fell.

Fort Lauderdale Associate Secures Summary Judgment in Rare Premises Liability Win

December 22, 2025 — Lewis Brisbois Newsroom

Fort Lauderdale, Fla. (October 29, 2025) - Fort Lauderdale Associate Kyle Hollander recently secured a summary judgment victory for his client, Winn-Dixie, in a contested premises liability case.

This was a hotly disputed liability case of water on the floor near an ice cooler with surveillance footage of a customer constantly bringing bags of ice to and from the cooler to the register. The plaintiff unknowingly stepped into the area of dripped melted ice and fell. Kyle successfully argued based on the plaintiff’s own deposition testimony and the surveillance footage that Winn-Dixie didn’t have the requisite actual notice. Additionally, Kyle argued that the brief duration the condition remained on the floor was legally insufficient to establish constructive notice under Florida law. The Court agreed, finding that the evidence would not survive a directed verdict and granting summary judgment in favor of the defense.

Reprinted courtesy of Lewis Brisbois

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Businessperson in middle of maze

White and Williams LLP attorneys summarize recent cases in the insurance industry.

Top Developments 2025 - Issue 4

December 22, 2025 — John S. Anooshian, Paul A. Briganti, Elizabeth L. Ferguson, Alexandra M. George & Haley S. Newman - The Complex Insurance Coverage Reporter

“ARISING OUT OF”

Rowe v. State Mut. Ins. Co., 2025 Me. LEXIS 89 (Me., Sept. 23, 2025)

Maine Supreme Court, in the premises liability context, holds that an exclusion in a mobile homeowners policy for injury or damage "arising out of a premises . . . that is not an insured location'” precluded coverage for underlying negligent failure-to-warn claims. The court looked to authority from a workers compensation case, where it stated that “the term ‘arising out of' employment means that there must be some causal connection between the conditions under which the employee worked and the injury, or that the injury, in some proximate way, had its origin, its source, or its cause in the employment. . . . [T]he employment need not be the sole or predominant causal factor for the injury and . . . the causative circumstance need not have been foreseen or expected.” In this case, it found there to be “an immediate relationship between the injury and a condition of the uninsured premises” (specifically, a gap created by the owner-insured at the entrance to a mobile home), and rejected the claimant’s argument that the injury instead arose from the insureds’ negligent conduct in failing to warn. Separately, the court held that the property did not qualify as an “insured location,” reasoning it was not listed in the declarations and there was no evidence the insureds had resided there or acquired it for use as a residence.

Reprinted courtesy of John S. Anooshian, White and Williams LLP, Paul A. Briganti, White and Williams LLP, Elizabeth L. Ferguson, White and Williams LLP, Alexandra M. George, White and Williams LLP and Haley S. Newman, White and Williams LLP

Mr. Anooshian may be contacted at anooshianj@whiteandwilliams.com
Mr. Briganti may be contacted at brigantip@whiteandwilliams.com
Ms. Ferguson may be contacted at fergusone@whiteandwilliams.com
Ms. Newman may be contacted at newmanh@whiteandwilliams.com

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Hand adding fifth star onto blocks

These rankings reflect the firm’s sustained commitment to excellence in the construction-industry area and its litigation disciplines.

HHMR Recognized in 2026 Best Law Firms® Rankings for Construction Litigation and Construction Law

December 22, 2025 — David McLain - Colorado Construction Litigation Blog

We are pleased to announce that HHMR has once again been honored in the 2026 edition of the Best Law Firms® rankings. This year our firm received two regional tier designations in Colorado:

  • Tier 2 in Colorado for Construction Law
  • Tier 3 in Colorado for Litigation – Construction

These rankings reflect the firm’s sustained commitment to excellence in the construction-industry area and its litigation disciplines. The Best Law Firms program, which is published by Best Lawyers and relies on peer review and other independent factors, serves as an important benchmark for legal quality and client service.

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

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

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Fire testing

Fire protection systems are only as good as their testing reveals. Make sure your buildings and jobsites are equipped appropriately.

Fire Protection You Can Trust Starts With the Right Testing

December 22, 2025 — Fernanda Gregati - Construction Executive

Steel’s strength and flexibility enable bold architectural design, fast project delivery and enduring structures. Despite its many advantages, steel has one critical vulnerability: It fails in fire of certain temperatures.

According to the American Institute of Steel Construction, steel can lose roughly half its load-bearing strength at 1,100°F (593°C). The organization also reports that in real-world building fires, fueled by everyday office contents such as wood, paper and furniture, temperatures can exceed this threshold in minutes. That’s why many building codes mandate passive fire protection systems on exposed structural steel. Among the most effective prove thin-film intumescent coatings that expand under heat to form a charred insulating layer. These coatings delay heat transfer, allowing steel to maintain its integrity long enough to allow more time for evacuation and emergency response.

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

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Green Earth sitting on law book next to Gavel

This court challenge to the bills was filed in January 2024 by several major trade groups and business organizations, led by the U.S. and California Chambers of Commerce.

Ninth Circuit Issues Injunction Halting SB 261 Climate Disclosure Laws

December 22, 2025 — Michael S. McDonough & Karen Eskander - Gravel2Gavel Construction & Real Estate Law Blog

On November 18, 2025, the U.S. Court of Appeals for the Ninth Circuit issued an injunction temporarily halting the implementation of California’s SB 261, the Climate-Related Financial Risk Act, just weeks before the law’s first mandated disclosures on January 1, 2026. The court declined to stay California’s companion climate emissions disclosure bill, the Climate Corporate Data Accountability Act (SB 253), due to that bill’s less immediately pressing compliance deadline of August 2026.

Background on California Climate Disclosure Laws
As we have discussed in previous posts, California enacted two comprehensive climate disclosure laws in 2023. The Climate Corporate Data Accountability Act (SB 253) and the Climate-Related Financial Risk Act (SB 261) impose greenhouse gas emissions and climate-related financial risk reporting requirements that apply to thousands of public and private companies formed under U.S. law and “doing business in California.” The California Air Resources Board (CARB) has released a preliminary list of companies it believes may be subject to the state’s new climate disclosure regime.

Reprinted courtesy of Michael S. McDonough, Pillsbury and Karen Eskander, Pillsbury

Mr. McDonough may be contacted at michael.mcdonough@pillsburylaw.com
Ms. Eskander may be contacted at karen.eskander@pillsburylaw.com

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Person filling out a form

This is the Second article in a series of four articles discussing how to properly fill out the four California construction releases described in California Civil Code 8132 – 8138.

How to Properly Fill Out and Use the Unconditional Waiver and Release on Progress Payment Form Used in California Construction

December 22, 2025 — William L. Porter - Porter Law Group

This is the Second article in a series of four articles discussing how to properly fill out the four California construction releases described in California Civil Code 8132 – 8138.

Let me start by noting that in addition to practicing construction law for more than 35 years, I chaired the committee of California construction attorneys who revised those sections of the California Civil Code dealing with this release form and many other construction forms as part of Senate Bill 189 in 2010. I also wrote the first version of this release form and made it free to the public well before the new law took effect in 2012. With this background, let me note a few things about the Unconditional Waiver and Release on Progress Payment form to help you avoid mistakes that might prevent you from achieving the intended effect of the form or releasing claim rights to a greater extent than you intend.

Mr. Porter may be contacted at bporter@porterlaw.com

Reprinted courtesy of William L. Porter, Porter Law Group

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Team with hands arms together

The list highlights outstanding law fi­rms in the L.A. area that are consciously working towards creating diverse, positive, and supportive environments to help drive the success of their attorneys.

Snell & Wilmer Named Among the “Most Admired Law Firms to Work For” by Los Angeles Business Journal

December 22, 2025 — Snell & Wilmer

LOS ANGELES – Snell & Wilmer is proud to announce that its Los Angeles office has again been named to the Los Angeles Business Journal’s 2025 “Most Admired Law Firms to Work For.” The list highlights outstanding law fi­rms in the L.A. area that are consciously working towards creating diverse, positive, and supportive environments to help drive the success of their attorneys. Firms appearing on the list were judged on company culture, employee benefit and support programs, as well as diversity and women’s initiatives.

“We are honored to be recognized once more as one of the ‘Most Admired Law Firms to Work For’ by the Los Angeles Business Journal”, said Joshua Schneiderman, managing partner of the firm’s Los Angeles office. “Our focus remains on building a workplace where people feel supported, encouraged to grow, and connected to their colleagues, clients, and communities. We are committed to investing in programs, relationships, and opportunities that create long lasting career fulfillment.”

Reprinted courtesy of Snell & Wilmer

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Aerial View Earth Half City Half Green

The U.S. Energy Dept. has withdrawn its federal definition of zero-emissions buildings and ended related technical assistance that many states and owners used as a benchmark.

US Energy Dept. Withdraws Federal ‘Zero-Emissions Building’ Definition

December 22, 2025 — Bryan Gottlieb - Engineering News-Record

The U.S. Dept. of Energy has withdrawn the Biden-era federal definition of a “zero-emissions building,” marking another step in the Trump administration’s rollback of climate-focused initiatives and creating uncertainty for states, cities and owners that had informally used the guidance in project planning.

Mr. Gottlieb may be contacted at gottliebb@enr.com

Reprinted courtesy of Bryan Gottlieb, Engineering News-Record

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House next to stacks of coins with percentage symbol

Homebuilders Bet on 1% Mortgage Rates to Wake Up US Buyers

December 22, 2025 — Prashant Gopal - Bloomberg

With the average mortgage rate near 6%, US homebuyers are looking at the most affordable monthly payments in a year. But San Antonio real estate agent Tavyn Weyman knows how to get them lower — much lower.

The trick is simple: buy new.

In markets across the US, homebuilders sitting on unsold inventory are subsidizing mortgage rates so heavily they sometimes match the record lows last seen during the Covid-19 pandemic. That’s in addition to perks like free appliances, finished basements and zero closing costs.

Reprinted courtesy of Prashant Gopal, Bloomberg

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Construction Technology

How Field Technology Is Transforming Construction Jobsites

December 22, 2025 — ABC - Construction Executive

WASHINGTON, Oct. 6—Associated Builders and Contractors released its fifth annual construction technology report, the ABC Field Tech Report, which highlights the tools and innovations shaping project sites, showcasing the possibilities and opportunities when technology transforms construction in the field.

“ABC’s fifth annual construction technology report turns the spotlight to the jobsite, where field technology is driving the next stage of progress,” said Matt Abeles, ABC vice president of construction technology and innovation. “The swift advancement of this particular technology represents a new era for our industry. These leading solutions and companies display a focus on empowering the people who build our infrastructure with field tech like drones, robotics, laser scanning and jobsite security. Field technology is redefining how contractors plan, monitor and execute their work while protecting their people and adding value to communities.”

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

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Property Insurance

Forfeited LLC Has No Claim Against Broker Allowing Policy to Lapse

December 22, 2025 — Tred R. Eyerly - Insurance Law Hawaii

The trial court’s dismissal of the LLC’s claim against its broker was affirmed because the LLC failed to file its tax return and its status as an LLC was forfeited. 1201 W. Cross Street, LLC v. Gray Ins. Group, Inc., 2025 Md. App. LEXIS 858 (Md. Ct. App. Oct. 8, 2025).

1201 W. Cross Street, LLC (Cross Street) employed Gray Insurance Group to broker insurance for the LLC’s property. Cross Street and Gray continued their business relationship for years with Gray notifying Cross Street when it was time to renew its property insurance.

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

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

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Laguna Niguel Aerial View Coastline

ABA’s Forum on Construction Law 2026 Midwinter Conference

December 22, 2025 — Beverley BevenFlorez – CDJ Staff

The American Bar Association (ABA) presents their midwinter conference, “Changing Landscapes: New and Effective ADR Strategies.” This event “launches the Forum’s 50th Anniversary Celebration, marking five decades of building the best construction lawyers.” In addition to its programming, attendees will have networking opportunities such as the “Meet the Neutrals” Speed Networking Event in support of the Ray Corollary Initiative.

February 4th-7th, 2026
The Ritz-Carlton, Laguna Niguel
1 Ritz Carlton Dr
Dana Point, CA 92629

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California Supreme Court Upholds Public Access to Rio Del Mar Beach Walkway

California Supreme Court upholds public access to Rio Del Mar Beach walkway, KSBW Action News 8 reported.

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CA Homeowner Stuck With $50K Bill After Neighbor's Tree Falls on Her House

A tree falls on your property, except... it's not your tree. It's technically on your neighbor's property. Yet, as a Castro Valley woman found out, she was stuck with the headache and the bill.

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