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FBI Opens Criminal Investigation into Baltimore Bridge Collapse, AP Source Says
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A 230-ton land-based crane will offload the wreckage for inspection and processing, and eventual transport to a disposal site that has yet to be identified.
Wreckage Removal Underway at Site of Collapsed Key Bridge in Baltimore, But Weather Slows Progress
Monday, April 15, 2024
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Jim Parsons - Engineering News-Record
Note: The text of this article was updated 4/3/24 to reflect new information.
Weather and water conditions are hampering the piece-by-piece process of cutting and removing wreckage from the collapsed Francis Scott Key Bridge in Baltimore, while officials consider potentially utilizing progressive design-build for a replacement bridge. Officials remain uncertain as to how long the meticulous effort to clear the key shipping channel will take.
Reprinted courtesy of Jim Parsons, Engineering News-Record
ENR may be contacted at enr@enr.com
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Courts are split on the enforceability of provisions that seek to assess liquidated damages beyond substantial completions.
Enforceability of Contract Provisions Extending Liquidated Damages Beyond Substantial Completion
Monday, April 15, 2024
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Stu Richeson - The Dispute Resolver
This post takes a look at the enforceability of contract provisions providing for liquidated delay damages after substantial completion. Typically, the assessment of liquidated delay damages ends at substantial completion of a project. However, various standard form contracts, including some of the ConsensusDocs and EJCDC contracts, contain elections allowing for the parties to agree on the use of liquidated damages for failing to achieve substantial completion, final completion, or project milestones. The standard language in the AIA A201 leaves it up to the parties to define the circumstances under which liquidated damages will be awarded.
Courts are split on the enforceability of provisions that seek to assess liquidated damages beyond substantial completions. Courts in some jurisdictions will not impose liquidated damages after the date of substantial completion on the ground that liquidated damages would otherwise become a penalty if assessed after the owner has put the project to its intended use. Perini Corp. v. Greate Bay Hotel & Casino, Inc., 129 N.J. 479, 610 A.2d 364 (1992). When the terms are clear, other jurisdictions will enforce contract terms providing for liquidated damages until final completion, even if the owner has taken beneficial use of the facility. Carrothers Const. Co. v. City of S. Hutchinson, 288 Kan. 743, 207 P.3d 231 (2009).
Reprinted courtesy of Stu Richeson, Phelps
Mr. Richeson may be contacted at stuart.richeson@phelps.com
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Attorney Tred R. Eyerly analyzes Exec. 1801 LLC v. Eagle W. Ins. Co.
Court Grants Insurer's Motion for Summary Judgment After Insured Fails to Provide Evidence of Systemic Collapse
Monday, April 15, 2024
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Tred R. Eyerly - Insurance Law Hawaii
With the insurer conceding that there was evidence of potential collapse at portions of eight specific building locations, the court granted the insurer's motion for partial summary judgment in determining no additional buildings suffered from collapse. Exec. 1801 LLC v. Eagle W. Ins. Co., 2024 U.S. Dist. LEZXIS 5923 (D. Or. Jan. 11, 2024).
Executive 1801 owned a group of six buildings with eighty-six residential units. The court previously granted partial summary judgment on Executive 1801's rain damage claim, leaving only claims regarding collapse. Eagle insured "the property for direct physical los or damage to Covered Property . . . caused by or resulting from any Covered Cause of loss." The policy further provided, "We will pay for direct physical loss or damage to Covered Property, caused by collapse of a building or any part of a building insured under this policy, if the collapse is caused by . . . hidden decay."
Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com
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US DOT Awards $830M for Resilience-Related Infrastructure Upgrades
April 15, 2024 — Tom Ichniowski - Engineering News-Record
Continuing the rollout of Infrastructure Investment and Jobs Act funds, the U.S. Dept. of Transportation has awarded $829.6 million to 80 road, bridge, transit and other projects to improve their ability to withstand floods, rising seas and other harmful effects of climate change. The winning projects are located in 37 states, the District of Columbia and the Virgin Islands.
Avoiding Rescission of Insurance Coverage: An Insured’s Worst Nightmare
April 15, 2024 — Geoffrey B. Fehling, Cary D. Steklof & S. Alice Weeks - Hunton Insurance Recovery Blog
No policyholder wants to hear the word “rescission” in the context of an insurance claim. The reality, however, is that when policyholders complete applications for insurance, they are typically focused on obtaining the best policy terms for the best rate. Nuances about question wording, the breadth of the applicant’s representations or how a court may analyze the insurer’s questions or the policyholder’s answers usually take a back seat to the central importance of placing and renewing coverage at a realistic price. But once a claim is made, insurers look back at applications to assess the accuracy and completeness of all information received during the underwriting process, especially in signed applications. If the insurer discovers a misrepresentation, it can be used to rescind the policy, leaving the insured with no coverage.
Reprinted courtesy of Geoffrey B. Fehling, Hunton Andrews Kurth, Cary D. Steklof, Hunton Andrews Kurth and S. Alice Weeks, Hunton Andrews Kurth
Mr. Fehling may be contacted at gfehling@HuntonAK.com
Mr. Steklof may be contacted at csteklof@HuntonAK.com
Ms. Weeks may be contacted at aweeks@HuntonAK.com
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US New-Home Sales Rise After Downward Revisions to Past Months
April 15, 2024 — Michael Sasso - Bloomberg
Sales of new homes in the US edged higher in January as builders and buyers capitalized on lower mortgage rates at the start of the year.
Purchases of new single-family homes increased 1.5% to a 661,000 annual pace after the prior three months were revised lower, government data showed Monday. The median forecast in a Bloomberg survey of economists called for a rate of 684,000.
Contaminated Properties in Oregon Seminar
April 15, 2024 — Beverley BevenFlorez – CDJ Staff
This one-day event “will include presentations by attorneys, consultants, and other representatives of the regulated community regarding environmental issues that have impeded property redevelopment.” The seminar “will provide a detailed overview of the regional issues faced by developers, including regulatory changes and broad liabilities that future owners of these properties may face.” Faculty will provide “legislative and policy updates and review the latest issues pertaining to environmental justice, vapor intrusion, and Superfund site reuse” and “will discuss funding resources, insurance considerations, and technical assistance for addressing contaminated properties and offer a look into recent projects, both small and large.”
June 20th, 2024
In Person & Virtual Event
Location TBD
Portland, OR
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By not allowing the carrier the right to file suit against third-party tortfeasors until the insured provides its carrier with an assignment of all its rights, Missouri’s approach has opened the door for challenges to subrogation rights.
Missouri Protects Subrogation Rights
Monday, April 15, 2024
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Lian Skaf - The Subrogation Strategist
The point at which an insurance carrier possesses the equitable right of subrogation is an issue on which the states have differed. Some allow carriers to pursue rights of subrogation immediately upon payment and some have taken stricter approaches. Missouri falls into the latter group. By not allowing the carrier the right to file suit against third-party tortfeasors until the insured provides its carrier with an assignment of all its rights, Missouri’s approach has opened the door for challenges to subrogation rights.
In Megown v. Auto Club Fam. Ins. Co., 2024 Mo. App. LEXIS 82, the plaintiff-insureds Michael and Jane Megown (the Megowns) suffered a house fire on February 8, 2016. Their insurance carrier, Auto Club Family Insurance Company (Auto Club) reimbursed the Megowns for their property damage in the amount of $722,433.56. Subsequently, the Megowns sued Auto Club for breach of contract and later amended their complaint to add claims against Tyberius Enterprises, LLC d/b/a Crag Electric (Craig Electric), the third-party tortfeasor, for direct negligence, alleging both property damage and personal injuries. Auto Club intervened in the Megowns’ claim against Craig Electric to protect its interest as subrogee for its property damage payment to the Megowns. Craig Electric settled prior to trial, paying $1,000,000.00 to both the Megowns and Auto Club, to be allocated at a later date. After a bench trial that apportioned the settlement with $722,433.56 paid to Auto Club and $277,566.44 paid to Megowns – and a jury trial awarding no further damages – the Megowns appealed.
Reprinted courtesy of Lian Skaf, White and Williams LLP
Mr. Skaf may be contacted at skafl@whiteandwilliams.com
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This case serves as a reminder to carefully review the bid terms and know when the public entity does not bear the cost of construction, public bidding procedure requirements may not apply.
Competitive Bidding Statute: When it Applies and When it Does Not
Monday, April 15, 2024
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Mason Fletcher - Ahlers Cressman & Sleight PLLC
The University of Washington (UW), a public university, aimed to secure a real estate developer for a new building on its campus. The proposal involved an 80-year ground lease (the “Lease”), and developers submitted bids. The selected developer would demolish an existing building, construct a new one, own it during the Lease at its own cost, and UW would lease back a portion, with ownership reverting to UW at the Lease’s end. Alexandria Real Equities, Inc. (ARE) was a finalist but ultimately was not selected, and the Lease was awarded to Wexford Science and Technology, LLC (Wexford). As a result, ARE filed suit against UW asserting three claims: 1) UW lacked authority to execute the Lease, 2) UW didn’t follow required competitive bidding procedures, and 3) UW’s developer selection process was arbitrary and capricious. None of these claims were successful and ARE appealed.
Division II of the Washington Court of Appeals affirmed in Alexandria Real Estate Equities Inc. v. Univ. of Wash., __ Wn. App. __, 539 P.3d 54 (2023), a published decision. The Court concluded, based on the facts in that case, that because construction was not publicly funded, UW did not have to follow competitive bidding requirements that were laid out in a statute relevant to state universities. Still, the Court applied the “bright-line cutoff point” that prohibits disappointed bidders from challenging an award once a contract has been executed. See Dick Enterprises, Inc. v. Metro. King County, 83 Wn. App. 566, 572, 922 P.2d 184 (1996).
Reprinted courtesy of Mason Fletcher, Ahlers Cressman & Sleight PLLC
Mr. Fletcher may be contacted at mason.fletcher@acslawyers.com
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To pursue a claim under a federal contract, contractors must abide by the CDA’s statutory requirements.
The (Jurisdictional) Rebranding of The CDA’s Sum Certain Requirement
Monday, April 15, 2024
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Jordan A. Hutcheson and Stephanie Rolfsness - Watt Tieder
The Contract Disputes Act (the “CDA”), 41 U.S.C.A. §§ 7101 et seq., which has provided the statutory framework for resolution of most contract disputes between the federal government and its contractors since 1978, has recently been the subject of changes in judicial interpretation, despite no corresponding statutory changes. The CDA’s implementing provisions in the Federal Acquisition Regulations (FAR), require that contractors submit a claim to the government in the form of written demand to a contracting officer requesting a final decision and seeking the payment of money in a sum certain prior to pursuing resolution via board or court. However, with respect to the sum certain requirement, the United States Court of Appeals for the Federal Circuit issued an opinion in late 2023 determining that this requirement “should not be given the jurisdictional brand” as it has categorically received in the past. Rather, the court concluded that the sum certain requirement is merely an element of a claim for relief under the CDA that a contractor must satisfy to recover. This rebranding does not debase the sum certain requirement, but it does indicate a renewed focus on what constitutes “jurisdictional” in government contracts litigation.
Reprinted courtesy of Jordan A. Hutcheson, Watt Tieder and Stephanie Rolfsness, Watt Tieder
Ms. Hutcheson may be contacted at jhutcheson@watttieder.com
Ms. Rolfsness may be contacted at srolfsness@watttieder.com
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To minimize liability, here are some general best practices to follow when locking out a defaulting tenant.
Best Practices: Commercial Lockouts in Arizona
Monday, April 15, 2024
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Patrick Tighe - Snell & Wilmer Real Estate Litigation Blog
If a tenant defaults under a commercial lease, Arizona law permits the landlord to re-take possession of the premises by locking out the defaulting tenant. However, if the landlord’s lockout is wrongful, the landlord may be liable for the damages the tenant sustains because of the wrongful lockout. To minimize such liability, here are some general best practices to follow when locking out a defaulting tenant:
- Do Not Breach the Peace. It is vital when performing a lockout to not breach the peace. What constitutes a “breach of the peace” depends on the particular circumstances at hand. For example, if a tenant arrives during the lockout and becomes angry or threatens violence, the landlord should stop performing the lockout and return at a later time. As a general rule of thumb, it is best to perform lockouts in the early morning hours or in the late evening hours when the landlord is less likely to encounter the tenant.
- Provide A Notice of Default. Many commercial leases require the landlord to provide a notice of default before the landlord can lock out a defaulting tenant. Check, double check, and triple check that the landlord followed the lease’s notice of default provisions correctly, including that the landlord sent the notices to all required parties in accordance with the time requirements set forth in the lease.
Reprinted courtesy of Patrick Tighe, Snell & Wilmer
Mr. Tighe may be contacted at ptighe@swlaw.com
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Kahana Feld’s Co-Founding Partner, Jason Feld was honored by the Claims & Litigation Management Alliance (CLM) with the Inaugural Volunteer of the Year award.
Jason Feld Awarded Volunteer of the Year by Claims & Litigation Management Alliance
Monday, April 15, 2024
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Linda Carter - Kahana Feld
On April 3, 2024, Kahana Feld’s Co-Founding Partner, Jason Feld was honored by the Claims & Litigation Management Alliance (CLM) with the Inaugural Volunteer of the Year award.
The CEO of CLM, Ronna Ruppelt stated, “The new CLM Volunteer of the Year award honors dedicated members who passionately serve the CLM community. Jason’s service spans over a decade as both the President and Director of Events for the Orange County Chapter. Under his guidance, this chapter has flourished – not only educating and connecting the CLM community but rallying members to give back to the local community through service events in the process. Jason is also a frequent writer, speaker, and contributor for CLM events, and we are proud to honor him as our inaugural CLM Volunteer of the Year.”
Mr. Feld is a renowned nationwide construction claims leader who actively speaks at industry events. He serves as panel counsel for many prominent insurance carriers and provides personal counsel for multiple national and regional builders, developers, and contractors. With his vast experience and expertise, Mr. Feld is a trusted authority in the field and is highly regarded for his legal representation.
Reprinted courtesy of Linda Carter, Kahana Feld
Ms. Carter may be contacted at lcarter@kahanafeld.com
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Pillsbury's Construction & Real Estate Law Team summarizes recent industry news.
Real Estate & Construction News Roundup (3/20/24) – Construction Backlog Falls, National Association of Realtors Settle Litigation, and Commercial Real Estate Market’s Effect on City Cuts
Monday, April 15, 2024
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Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
In our latest roundup, bad loans outweigh loss reserves at top six U.S. banks, the FCC announces a proposed rule aimed at “bulk billing,” office-to-multifamily conversion projects grow in major metro cities, and more!
- The National Association of Realtors has agreed to settle litigation that accused them of artificially inflating real estate commissions – a major decision that could reshape the housing market for buyers, sellers and agents. (Rachel Siegel, The Washington Post)
- An NYU professor considers the positives and negatives of cities cutting services or raising other kinds of taxes to offset the continued faltering of the commercial real estate market. (Alan Rappeport, The New York Times)
- Construction backlog fell in February for every size of contractor except for those with under $30 million in annual revenue, while, over the past year, the largest contractors – those with greater than $50 million in revenue – have experienced the greatest decline in backlog. (Sebastian Obando, Construction Dive).
Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team
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House Freedom Caucus Pushes Back on Baltimore Bridge Funding
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Although issues are present on any construction project, they are exponentially more impactful on stadium projects due to their sheer enormity and the significance of completing by “opening day.”
Balancing Risk and Reward: The Complexities of Stadium Construction Projects
Monday, April 15, 2024
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Gregory A. Eichorn - Peckar & Abramson, P.C.
From grand designs to opening day, stadium construction projects present a captivating blend of high-profile opportunities and significant challenges and risks. Navigating this complex landscape is not easy, but when managed properly, the potential rewards, both in terms of reputation and finances, can make it a gamble worth taking. While each stadium project is different, some of the more common risks include:
- Securing adequate labor, materials and equipment based on the size of the project;
- Logistical concerns regarding the concurrent performance of multiple trade scopes on a single site;
- Protection of work in place from weather due to the large footprint of the stadium project;
- Cash flow issues caused by protracted change order processing, conflicting and/or onerous payment requirements from project financing entities, and reimbursement of considerable monthly general condition costs; and
- Meeting the schedule requirements for the project.
Reprinted courtesy of Gregory A. Eichorn, Peckar & Abramson, P.C.
Mr. Eichorn may be contacted at geichorn@pecklaw.com
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Leveraging the threat of a non-suit when Plaintiffs rested, BWB&O secured resolution of Plaintiffs’ complaint for a fraction of what had previously been sought.
Congratulations to San Diego Partner Alex Giannetto and Senior Associate Michael Ibach on Settling a Case 3 Weeks Into a 5-Week Trial!
Monday, April 15, 2024
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Dolores Montoya - Bremer Whyte Brown & O'Meara LLP
Partner Alex Giannetto and Senior Associate Michael Ibach of BWB&O’s San Diego office started a trial in San Diego set to last at least five weeks. Plaintiffs alleged causes of action of negligence, trespass and nuisance against BWB&O’s client, arguing the owner/property manager did not properly handle alleged overwatering of the front yard, allegedly resulting in a landslide impacting 8 homes on a City slope in Carlsbad. Cross-Complainant City alleged independent negligence to fix the slope it owned and controlled as well as various indemnity-based causes of action against BWB&O’s client. Plaintiffs claimed over $24 million in damages, while Cross-Complainant placed sole blame for the incident on BWB&O’s client around $6 million.
Heading into trial, it was made clear that neither Plaintiffs nor Cross-Complainant would accept anything less than 7-figures to settle BWB&O’s client out of the case. In the first week of trial, BWB&O was able to leverage motions in limine, opening statements, and cross-examinations to secure a dismissal of three of the four causes of action alleged by Plaintiff that were associated with pain & suffering. In the second week of trial, BWB&O secured a dismissal of Cross-Complainant’s negligence cause of action paving the way for a settlement with Plaintiffs. Leveraging the threat of a non-suit when Plaintiffs rested, BWB&O secured resolution of Plaintiffs’ complaint for a fraction of what had previously been sought. Finally, BWB&O was able to secure a dismissal of the remaining indemnity-based causes of action in the cross-complaint and fully extract the client from the matter.
Reprinted courtesy of Dolores Montoya, Bremer Whyte Brown & O'Meara LLP
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For homebuyers, location, location, location must now include the risk of natural disasters stoked by global warming.
The Three L’s of Real Estate Have New, Urgent Meaning
Monday, April 15, 2024
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Mark Gongloff - Bloomberg
What will it take to make Americans stop rushing headlong into climate peril? Cheaper housing in safer places, for one thing. But maybe big red flags on property listings will help, too.
Redfin Corp., the digital real estate company, last week added air-quality data to its listings as part of its “climate risks” feature, which aims to warn homebuyers of the chances their dream home could succumb to a global-warming nightmare. Using data from the climate research firm First Street Foundation, Redfin estimates a property’s current and predicted risk levels for flooding, wildfires, extreme heat, high winds — and now days when the Environmental Protection Agency’s Air Quality Index tops 100, a category known as “unhealthy for sensitive groups.”
Reprinted courtesy of Mark Gongloff, Bloomberg
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The roof has nearly 400 glulam beams—more than 250 of them 80 ft long—paired with 40,000 lattice pieces atop 34 Y-shaped columns.
Wood Wizardry in Oregon: Innovation Raises the Roof for PDX Terminal
Monday, April 15, 2024
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Aileen Cho - Engineering News-Record
Drones, self-propelled modular transporters and a curtain wall that really does hang off the roof like a curtain are all notable technologies that made installing an 18-million-lb timber roof possible at Portland International Airport. Of equal weight is the emphasis on full-scale sourcing of the timber and representing the Pacific Northwest’s residents, history and geography.
Reprinted courtesy of Aileen Cho, Engineering News-Record
Ms. Cho may be contacted at choa@enr.com
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