CONSTRUCTION DEFECT JOURNAL

"News and Information for Construction Defect and Claims Professionals"

CONSTRUCTION DEFECT JOURNAL - ISSUE 242749 - TUESDAY, JANUARY 13, 2026

Woman weighing choices

Whether settlement is always the best choice depends on several factors to be discussed here.

To Settle or Not Settle: Factors to Weigh and Practical Considerations

January 13, 2026
Gerard J. Onorata - ConsensusDocs

Deciding to settle a construction dispute is often wrought with difficulty, requiring the decision maker to evaluate a number of factors. Nevertheless, there are no hard and fast rules that apply when advising a party whether or not they should settle a dispute. Yet the vast majority of construction disputes do settle before going to trial or arbitration. In fact, recent statistics show that approximately 95% of all civil cases, including construction disputes, settle before trial[1]. However, whether settlement is always the best choice depends on several factors to be discussed here.

Merits of Your Case
First and foremost are the merits of your claims and defenses against any claims that are asserted against you. Construction disputes are inherently fact sensitive, and the merits of a case are driven by the facts of the dispute. Simple breach of contract actions for balances of unpaid funds for the work and materials that have been provided and installed on a project make weighing the merits of the affirmative claim relatively simple. However, these types of “collection cases” stand in stark contrast to complex construction delay claims for equitable adjustment where there exist competing and numerous causes of the delays. In addition, there are complicated legal principles applicable to whether there is entitlement to compensation for the delay or simply an extension of time. Construction defect claims where technical engineering issues are involved also present a heightened level of complexity that may make such cases difficult to prove on the merits.

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

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

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CDJ NEWS THIS WEEK



Welcome to North Dakota Sign

Minnesota and North Dakota-based firms are building the center on the site between Fargo and Harwood, N.D.

Construction of $3B Data Center in North Dakota Spurs Annexation Battle

January 13, 2026 — Annemarie Mannion - Engineering News-Record

Construction of a $3-billion data center on a 320-acre site in southeastern North Dakota has sparked an annexation dispute between the small city where it is being built and its much larger neighbor, Fargo.

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

Reprinted courtesy of Annemarie Mannion, Engineering News-Record

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Hail raining on roof

The School’s expert opined that the indentations to the metal roof surfaces weakened the metal and made it more susceptible to further damage, particularly from wind and snow.

Exclusion Bars Coverage For Cosmetic Hail Damage to Roof

January 13, 2026 — Tred R. Eyerly - Insurance Law Hawaii

The federal district court granted the insurer’s motion for summary judgment, finding there was no coverage for hail damage due to an exclusion for cosmetic hail damage. Cannon Falls Area Schools v Hanover Am. Ins. Co., 2025 U.S. Dist. LEXIS 206792 (D. Minn. Oct. 21, 2025).

On April 22, 2022, a hailstorm and high winds damaged the insured School’s buildings. The School’s buildings had metal roofs. The parties agreed that the hailstorm caused indentations to the roofs, but did not puncture the metal on the roofs. Since the storm, the roofs had not leaked.

The School submitted a claim for property damage to its insurer, Hanover. A portion of the claim for damage to the HVAC equipment was paid. The remainder of the claim was denied based on the policy’s Cosmetic Damage Exclusion which excluded coverage for cosmetic damage to roof surfacing caused by wind or hail.

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

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

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Lady Law statue on desk with law book

The Plaintiff framed his claim as a “premises defect,” but the hazards he identified are not legally recognized as unreasonably dangerous conditions under governing Texas Supreme Court precedent.

Successful KF Defense Results in Dismissal with Prejudice

January 13, 2026 — Elliott Wright & William "Pat" Durland - Kahana Feld

Kahana Feld Partner Elliott Wright and Senior Counsel William “Pat” Durland secured a major victory for their client with a complete dismissal of all claims by establishing that the Plaintiff failed to satisfy the Texas Tort Claims Act’s jurisdictional prerequisites through our Plea to the Jurisdiction.

Our Plea to the Jurisdiction demonstrated that governmental immunity applies unless a Plaintiff can prove a clear and unambiguous statutory waiver, and that the Plaintiff bears the burden of pleading and proving such a waiver. In this case, we showed that the Plaintiff provided no timely statutory notice as required by §101.101 of the TTCA and the City Charter’s six-month notice requirement, making jurisdiction impossible to invoke. Without proper notice—formal or actual—the court has no power to hear the case, and the defect cannot be cured by amendment. 

Reprinted courtesy of Elliott Wright, Kahana Feld and William "Pat" Durland, Kahana Feld

Mr. Wright may be contacted at ewright@kahanafeld.com
Mr. Durland may be contacted at wdurland@kahanafeld.com

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Handshake split into two

There is an important distinction between a binding contract an an “agreement to agree.”

An “Agreement to Agree” Is Not a Binding Contract

January 13, 2026 — David Adelstein - Florida Construction Legal Updates

A driving issue in a recent dispute was whether a binding contract existed simply through the selection of a proposal in response to a solicitation. Or, was there nothing more than an “agreement to agree,” which does not create a binding contract. There is an important distinction between a binding contract an an “agreement to agree.”

A Community Redevelopment Agency (CRA) issued a Request for Proposals otherwise referred to as an RFP. The RFP specifically stated that the CRA and proposer will be contractually bound only if and when a written contract is executed between the parties. A proposer was notified that it was selected as the winning proposer however a written contract was never executed because the proposer was subsequently disqualified. The proposer filed a lawsuit claiming it was wrongfully disqualified and prevailed. The trial court found it was entitled to attorney’s fees pursuant to a contract that had been formed when the proposer’s proposal was originally accepted.

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

Reprinted courtesy of David Adelstein, Kirwin Norris

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Construction worker in trench

The Court held that surveillance footage conclusively showed the minor did not fall into an “open trench” as alleged.

BWB&O’s LA Team Secures a Defense Victory for General Contractor Client in Riverside Superior Court!

January 13, 2026 — Dolores Montoya - Bremer Whyte Brown & O'Meara LLP

Congratulations to Woodland Hills Partner Daniel Crespo and Associate Lauren Landau for securing a defense victory on behalf of one of our general contractor clients!

The Riverside Superior Court granted summary judgment in favor of our client, finding the plaintiff’s core allegation was flatly contradicted by video evidence. The Court held that surveillance footage conclusively showed the minor did not fall into an “open trench” as alleged, but instead fell after voluntarily jumping over a temporary construction fence stabilizer.

Reprinted courtesy of Dolores Montoya, Bremer Whyte Brown & O'Meara LLP

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Pen lying on contract

As always, be careful when drafting your construction contracts because every word may be parsed by a judge.

Reminder: You Can’t Make Others Indemnify You for Your Own Actions

January 13, 2026 — Christopher G. Hill - Construction Law Musings

I have spoken about Virginia Code 11-4.1 and the prohibition on forcing others to indemnify for the actions of the indemnitees on a few occasions here at Construction Law Musings (See Uniwest Posts). The Western District of Virginia gave its take on indemnification clauses and why they need to be carefully drafted in a December 2024 case, Sauer Construction, LLC v. MC3 Solutions, LLC et al.

In Sauer, the Court looked at, among other things, an indemnification provision between MC3, a subcontractor to Sauer, and MC3s sub-subcontractor, Bonitz Flooring Group. This was the relatively typical construction dispute where a general contractor sues a subcontractor and then that subcontractor sues its supplier and sub-subcontractors for indemnity pursuant to its contract. When faced with the indemnification claim, Bonitz argued that the indemnification provision violated the Va. Code 11-4.1 because it required Bonitz to indemnify MC3 for MC3’s actions. The provision follows the break.

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

Reprinted courtesy of The Law Office of Christopher G. Hill

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Highway intersection blurred color lines depicting cars

In the United States, there is over $500 billion worth of civil megaprojects in the pipeline, with an average of four megaprojects per month in 2024 and a total monthly value of $9.2 billion.

Civil Megaprojects: The Evolving Use of Dispute Prevention and Collaborative Delivery Methods in Public Contracting

January 13, 2026 — Lisa D. Love - The Dispute Resolver

Civil megaprojects are large, complex ventures in civil engineering and construction that typically cost over $1 billion to construct. These projects generally have significant and long-lasting impacts on the economy, environment and society, and involve multiple public and private stakeholders. Typical civil megaprojects include infrastructure projects, such as highways, bridges, tunnels, airports, dams, power plants and public buildings, which require extensive planning, design, coordination and construction over an extended period of time.

In the United States, there is over $500 billion worth of civil megaprojects in the pipeline, with an average of four megaprojects per month in 2024 and a total monthly value of $9.2 billion.[i] Here are some recent examples of civil megaprojects:

The Hudson Tunnel Project (a portion of the Gateway Program), under construction in the states of New York and New Jersey, involves the construction of two new tunnels and the renovation of aging rail tunnels used by Amtrak and New Jersey Transit that were damaged by Superstorm Sandy along the Northeast Corridor. This has been deemed one of the most important infrastructure projects in the country. It is projected to be completed in 2027 at a cost of over $16 billion.[ii]

Reprinted courtesy of Lisa D. Love, JAMS

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Stripes showing different climates weather patterns

SB 253 and SB 261 impose greenhouse gas emissions and climate-related financial risk reporting requirements applying to thousands of public and private companies.

CARB Issues Proposed Climate Disclosure Regulations

January 13, 2026 — Michael S. McDonough, Ashleigh Myers & Karen Eskander - Gravel2Gavel Construction & Real Estate Law Blog

On December 9, 2025, the California Air Resources Board (CARB) issued proposed regulations and a staff report for California’s comprehensive climate disclosure laws, the Climate Corporate Data Accountability Act (SB 253) and the Climate-Related Financial Risk Act (SB 261). These proposed regulations come less than a month after the Ninth Circuit issued an injunction temporarily halting enforcement of SB 261, at least until a January 9, 2026, hearing on the plaintiffs’ requested longer-term injunction through the remainder of the First Amendment challenge to the laws. The draft regulations would adopt some, but not all, of the provisions proposed by CARB in its public workshops on the laws to date, and notably would scale back applicability to those companies above a threshold level of sales in the state. The proposed regulations also define key terms, establish the program fee structures, explain fee enforcement and set initial reporting timelines. The written comment period begins on December 26, 2025, and ends on February 9, 2026. CARB will hold a public hearing on the proposed regulations on February 26, 2026 at 9 a.m. PST.

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

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

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Wooden gavel on desk

The lawsuit was brought by four Chinese nationals living in Florida on temporary visas or with a pending asylum application and a real estate firm in Florida that claims to do significant business on behalf of Chinese purchasers.

Eleventh Circuit Permits Florida Restrictions on Property Ownership by Certain Foreign Nationals to Go Forward

January 13, 2026 — Minyao Wang - Lewis Brisbois Newsroom

New York, N.Y. (December 4, 2025) - On November 4, 2025, the U.S. Court of Appeals for the Eleventh Circuit issued a long-anticipated decision in Shen v. Simpson, upholding the constitutionality of a Florida law, SB 264, which restricts ownership of or investment in Florida real estate by individuals “domiciled” in the People’s Republic of China and to a lesser extent, other countries of concern (which are identified in the statute as Russia, North Korea, Iran, Cuba, Venezuela and Syria) who are not American citizens or green card holders. The restriction encompasses residential, commercial and agricultural real estate. Oral argument in the case was held on April 19, 2024, and it took the court almost one year and seven months to issue its opinion, an unusually long turn-around time.

This Update follows previous Lewis Brisbois alerts on Florida’s law and legal challenges to it.

Mr. Wang may be contacted at Minyao.Wang@lewisbrisbois.com

Reprinted courtesy of Minyao Wang, Lewis Brisbois

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Trophy

With more than 25 years of experience, Frank serves as the managing partner of Snell & Wilmer’s Orange County office and co-chairs the firm’s Real Estate Practice Group.

Snell & Wilmer Partner Jonathan Frank Named Winner of 2025 Connect CRE’s Lawyers in Real Estate Award

January 13, 2026 — Snell & Wilmer

ORANGE COUNTY — Snell & Wilmer is pleased to announce that Orange County Partner Jonathan Frank has received the 2025 Connect CRE’s Lawyers in Real Estate Award, a distinction honoring attorneys who demonstrate excellence in commercial real estate law while making meaningful contributions to the industry and their communities. The award recognizes legal leaders whose expertise, vision, and dedication set them apart, reflecting a career marked by both professional achievement and civic impact.

Reprinted courtesy of Snell & Wilmer

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Illustration businesswoman with superhero shadow

Lisa L. Shrewsberry has been named to the Top 25: 2025 Westchester County Super Lawyers Top List.

Traub Lieberman Partner and Firm Co-Chair Lisa L. Shrewsberry Named Top 25: 2025 Westchester County Super Lawyers®

January 13, 2026 — Traub Lieberman

Traub Lieberman is pleased to announce that Partner and Firm Co-Chair Lisa L. Shrewsberry has been named to the Top 25: 2025 Westchester County Super Lawyers Top List. This is the eighth year that Lisa has been on the Top 25 list for Westchester County Super Lawyers. Lisa has also been selected to the New York – Metro Super Lawyers list since 2008.

Reprinted courtesy of Traub Lieberman

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Downtown Los Angeles Skyline at Sunset

As rebuilding begins in Pacific Palisades and Altadena, builders are showcasing resilient architecture and construction techniques aimed at outwitting future disaster.

New LA Home Designs, Reimagined By Fire

January 13, 2026 — Patrick Sisson - Bloomberg

One year after wildfires tore through neighborhoods in Los Angeles County, killing at least 31 people and destroying more than 10,000 buildings, architects and developers are rethinking what home looks like in LA, and how resilient residential architecture evolves.

Recovery from the costly disaster is a long way away. So far, hundreds of new homes have been submitted for permitting, but it’s a process shaping out to be an uneven one, based on damage, insurance and wealth. Affected homeowners are grappling with the details of fire-resilient construction and landscaping techniques, along with some more fundamental questions about what their communities should look like.

Reprinted courtesy of Patrick Sisson, Bloomberg

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Aerial view of home development in Florida

Miami’s Housing Supply Shortage Hits Affordability, Codina Says

January 13, 2026 — Anna J Kaiser & John Gittelsohn - Bloomberg

South Florida faces a growing affordability problem as housing demand outstrips supply, according to Ana-Marie Codina, whose family firm develops master-planned communities in the region.

“We definitely need more supply,” Codina said in an interview at a Bloomberg New Voices event in Miami on Friday. “There’s very little differential between what rents we’re getting versus some of our competitors who have older product or less amenitized product. And that’s a function of supply.”

Reprinted courtesy of Anna J Kaiser, Bloomberg and John Gittelsohn, Bloomberg

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Trends Markets

ENR 2025 Fourth Quarterly Cost Report

January 13, 2026 — Engineering News-Record

Data center construction continues to rise, accounting for a large amount of work in the past year.

Reprinted courtesy of Engineering News-Record

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Red denied stamp on paperwork

Writ Petition Denied, Effectively Confirming That Covid-19 May Cause Covered Physical Damage Under Some Insurance Policies

January 13, 2026 — Andrew S. Koelz, Michael S. Levine & S. Alice Weeks - Hunton Insurance Recovery Blog

On November 4, 2025, the Supreme Court of Nevada denied a petition for a writ of mandamus filed by insurers seeking to challenge denial of their partial summary judgment motion on the issue of whether Covid-19 may cause “direct physical loss, damage or destruction” of property under an all-risk insurance policy that includes affirmative coverage for loss caused by infectious disease.

Reprinted courtesy of Andrew S. Koelz, Hunton Andrews Kurth LLP, Michael S. Levine, Hunton Andrews Kurth LLP and S. Alice Weeks, Hunton Andrews Kurth LLP

Mr. Koelz may be contacted at akoelz@hunton.com
Mr. Levine may be contacted at mlevine@hunton.com
Ms. Weeks may be contacted at aweeks@hunton.com

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Seminar

DRI 2026 Construction Law Seminar

January 13, 2026 — Beverley BevenFlorez – CDJ Staff

Participants of DRI’s Construction Law Seminar will learn about renewable energy projects, construction defect projects that have also been impacted by natural disasters, developing, defending, and presenting delay claims and much more. The event includes numerous networking opportunities including dine-arounds and small-group discussions.

March 25th-27th, 2026
Renaissance Nashville Hotel
611 Commerce St
Nashville, TN 37203

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Home Insurance Rates to Rise for Over 1 Million Californian Homeowners

One in eight California homeowners could see their insurance rates spike. Kris Sanchez, NBC Bay Area reports.

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Investigation Into Fire at Denver Apartment Building Construction Site Could Take Months

The investigation into the cause of a five-alarm fire at a Denver apartment building construction site is expected to take weeks or months, 9News reported.

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