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Hurricane Milton Leaves Death and Destruction in its Wake in Florida
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A homeowners’ association sued the developer/builder for alleged construction defects in the common area and exteriors of homes that the association maintained for the homeowners in the community.
Arizona Court Affirms Homeowners’ Association’s Right to Sue Over Construction Defects
Tuesday, October 15, 2024
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Melissa Kenney - White and Williams LLP
In Gallery Community Association v. K. Hovnanian at Gallery LLC, No. 1 CA-CV 23-0375, 2024 Ariz. App. Unpub. LEXIS 696 (Ct. App.), the Court of Appeals of Arizona (Court of Appeals) discussed whether a homeowners’ association can file an action for breach of the implied warranty of workmanship and habitability arising from construction defects. At issue was whether the implied warranty extended to the areas within the community that the association maintained, including the common areas. The Court of Appeals held that homeowners’ associations can sue builder-vendors for breach of the implied warranty arising from construction defects.
In this case, a homeowners’ association, responsible for managing and maintaining a community of townhomes, sued the developer/builder for alleged construction defects in the common area and exteriors of homes that the association maintained for the homeowners in the community. The alleged defects included the pool cabana and staircase walls in the common areas and the exterior walls, roofs, and staircases on the separately owned townhomes in the community. The builder filed a motion for summary judgment, arguing that the implied warranty extended to dwelling actions initiated by homeowners – not homeowners’ associations – and that the alleged construction defects at issue were not related to a dwelling. The trial court granted the motion. The Court of Appeals vacated the trial court’s grant of summary judgment and remanded for further proceedings. In reaching its decision, the Court of Appeals determined that both common law and statutory law authorized the homeowners’ association’s breach of implied warranty claim.
Reprinted courtesy of Melissa Kenney, White and Williams
Ms. Kenney may be contacted at kenneyme@whiteandwilliams.com
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The Supreme Judicial Court of Massachusetts determined that rainwater collecting on the insureds' rooftop and causing interior damage was not "flood" as defined in the policy and subject to sublimits.
Rainwater Collecting on Rooftop is not Subject to Policy's Flood Sublimits
Tuesday, October 15, 2024
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Tred R. Eyerly - Insurance Law Hawaii
Responding to a certified question from the First Circuit, the Supreme Judicial Court of Massachusetts determined that rainwater collecting on the insureds' rooftop and causing interior damage was not "flood" as defined in the policy and subject to sublimits. Zurich Am. Ins. Co. v. Medical Properties Trust, Inc., 2024 Mass. LEXIS ___ (Mass. July 23, 2024).
A severe thunderstorm caused heavy rain and strong winds which damaged a hospital. The hospital was owned by Medical Properties Trust, Inc. (MPT) and leased to Steward Health Care System LLC (Steward). Ground water accumulated and flooded the basement. Rainwater also accumulated on the hospital's parapet roofs and on the second-story courtyard, and eventually seeped through the parapet roofs and courtyard to the hospital's upper floors, causing damage to the building and property within.
Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com
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An Owner or upstream contractor often requests that the performing contractor begin the work in advance of receiving a signed change order.
Toolbox Talk Series Recap - Undocumented Change Work
Tuesday, October 15, 2024
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Douglas J. Mackin - The Dispute Resolver
In the August 29, 2024 edition of Division 1's Toolbox Talk Series, Don Rea presented on the causes of undocumented change order work and what actions parties to a construction project can take to protect themselves, which compliments and reinforces some of the key points from the May 30, 2024 Toolbox Talk on maximizing profits while experiencing changes during project performance.
Article 7 of AIA A201 General Conditions covers (i) change orders, (ii) constructive change directives, and (iii) “minor changes.” Work that falls outside the scope of the construction contract will often fit into one of these three categories. Rea’s presentation focused on the fact that, regardless of which category applies, proper documentation of the change work is vital.
Reprinted courtesy of Douglas J. Mackin, Cozen O’Connor
Mr. Mackin may be contacted at dmackin@cozen.com
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How Safety Culture Can Cause a Ripple Effect From Construction Company to Broader Community
October 15, 2024 — Eder Garcia - Construction Executive
At its essence, a safety culture becomes ingrained in an organization's ethos, shaping its values, practices and daily operations. It reflects a collective dedication to prioritizing the health, safety and wellbeing of every individual associated with the company.
A robust safety culture offers numerous advantages to an organization. Firstly, it significantly reduces workplace accidents and injuries, leading to lower healthcare and insurance costs. This not only safeguards employees' wellbeing but also enhances operational efficiency and productivity. When employees feel secure, they tend to be more engaged and motivated, fostering higher morale and job satisfaction.
Reprinted courtesy of Eder Garcia, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
Florida Claims Administration Statute and Difference Between Policy Defense and Coverage Defense
October 15, 2024 — David Adelstein - Florida Construction Legal Updates
A recent insurance coverage dispute involving an automobile liability insurance policy contains a worthy discussion, particularly on the difference between a policy defense and a coverage defense. In this case, the carrier did not provide a defense to the defendant and the plaintiff and defendant entered into a Coblentz agreement. The plaintiff, as assignee of the insured, filed a lawsuit against the automobile liability policy for coverage. Summary judgment was granted in favor of the insurer finding there was no coverage under the terms of the policy. This was affirmed.
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LGI Homes Recognized as one of the World's Most Trustworthy Companies for the Second Consecutive Year by Newsweek
October 15, 2024 — LGI Homes, Inc.
THE WOODLANDS, Texas, Sept. 24, 2024 (GLOBE NEWSWIRE) -- LGI Homes, Inc. (NASDAQ: LGIH) today announced that it has been named on Newsweek's list of the World's Most Trustworthy Companies 2024. This marks the second consecutive year the Company has earned this prestigious distinction.
This prestigious award is presented in collaboration with Statista, the world-leading statistics portal and industry ranking provider. The World's Most Trustworthy Companies 2024 were identified in an independent survey based on a vast sample of more than 70,000 participants in 23 industries spanning 20 countries. All stock-listed companies headquartered in one of the target countries with a revenue of over 500 million USD were considered in the study. The participants rated companies in terms of three touchpoints of trust: Investor Trust, Customer Trust, and Employee Trust.
38th Annual Construction Super Conference
October 15, 2024 — Beverley BevenFlorez – CDJ Staff
The Construction Super Conference held in Las Vegas is “for mid- to senior-level professionals who work in the legal and commercial construction markets.” The event will consist of educational sessions and panel discussions that will “address timely issues within the legal, business, and economic realms of today’s construction industry.”
December 9th-11th, 2024
The Cosmopolitan of Las Vegas
3708 Las Vegas Blvd S
Las Vegas, NV 89109
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Here, the subcontractor had the insurance and related certificate properly filed when the sub started its work, but the insurer canceled the insurance for nonpayment of premiums during the course of the work.
“Since You Asked. . .”
Tuesday, October 15, 2024
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Daniel Lund III - Lexology
… you must now pay.
So said a California appellate court, affirming the trial court’s decision against a subcontractor suing for unpaid subcontract sums. Instead of being awarded those unpaid amounts, the subcontractor lost the case and was tagged with a $1.55 million attorney’s fees award and $270,000 costs award in favor of the defendants.
What went wrong?
California law requires a licensed contractor to maintain at all times proper workers’ compensation insurance coverage. The failure to maintain the coverage and have the certificate of coverage on file with the California Contractors State License Board results in “automatic and immediate suspension” of the contractor license. Retroactive reinstatement of the license may occur only if the contractor provides proof of the insurance within 90 days of the effective date of the insurance certificate – unless the contractor can show that failure to have the certificate on file was “due to circumstances beyond the control of the licensee.”
Reprinted courtesy of Daniel Lund III, Phelps
Mr. Lund may be contacted at daniel.lund@phelps.com
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At the heart of these rulings is the argument that FCA relators - who decide whom to sue, which legal theories to pursue, and how to proceed - exercise significant executive authority.
Surprising Dismissal of False Claims Act Case Based on Appointments Clause - What Does It Mean?
Tuesday, October 15, 2024
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Steven H. Lee - Lewis Brisbois Newsroom
Atlanta, Ga. (October 1, 2024) - In a surprising turn of events, the U.S. District Court for the Middle District of Florida recently dismissed a False Claims Act (FCA) lawsuit brought by relator Clarissa Zafirov against Florida Medical Associates, LLC, and other defendants. U.S. District Judge Kathryn Kimball Mizelle ruled that the FCA’s qui tam provisions, which allow private individuals to bring lawsuits on behalf of the government, violate the Constitution’s Appointments Clause.
This decision follows another unexpected ruling by U.S. District Judge Aileen Cannon in the Southern District of Florida, where the court similarly dismissed an indictment against former President Donald Trump based on the same constitutional clause.
At the heart of these rulings is the argument that FCA relators - who decide whom to sue, which legal theories to pursue, and how to proceed - exercise significant executive authority. Because they are not appointed by the President, a department head, or a court, the judges concluded that these relators hold their positions unconstitutionally. As a result, Judge Mizelle dismissed the case entirely.
Reprinted courtesy of Steven H. Lee, Lewis Brisbois
Mr. Lee may be contacted at Steven.Lee@lewisbrisbois.com
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The Act aims to counter the rising cost of housing in the commonwealth by implementing new policies and providing funding for the construction of affordable housing.
Massachusetts Affordable Homes Act Provides New Opportunities for Owners, Developers, and Contractors
Tuesday, October 15, 2024
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Larry Grijalva - Construction Law Zone
On August 6, 2024, Massachusetts Governor Maura Healey signed the Affordable Homes Act (the Act) into law. The Act aims to counter the rising cost of housing in the commonwealth by implementing new policies and providing funding for the construction of affordable housing. New policies include:
- A requirement that municipalities permit the construction of accessory dwelling units (ADUs) on the same parcel as a primary dwelling.
- A requirement that municipalities permit the construction of single-family residences on previously unbuildable lots held in common ownership with an adjacent residential lot.
- The creation of a commercial property conversion program to support the conversion of commercial space into housing or mixed-use developments.
Reprinted courtesy of Larry Grijalva, Robinson & Cole LLP
Mr. Grijalva may be contacted at lgrijalva@rc.com
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Below is a list of resources and donation links to help support those affected by the recent hurricanes in the Gulf.
ABC Announces Disaster Relief Efforts and Resources Following Hurricane Milton
Tuesday, October 15, 2024
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ABC - Construction Executive
HURRICANE RELIEF
Florida, Georgia, South Carolina, North Carolina, Virginia and Tennessee were hit with Hurricane Helene, and now Florida is facing additional damage from Hurricane Milton, which is expected to make landfall on Wednesday, Oct. 9. Damages from Helene have already been catastrophic, and our hearts and prayers go out to all currently affected and those who may be in the path of Milton. Florida Gov. DeSantis has declared a state of emergency for 51 counties ahead of this impending storm.
Donate to the ABC Cares Foundation via the online portal.
The ABC Florida East Coast chapter and the ABC Cares Foundation Inc. are committed to assisting communities impacted by Hurricanes Helene and Milton. 100% of donations made to the ABC Cares Foundation—an IRS 501(c)(3)—for this purpose will be restricted, directly supporting regional needs, and are 100% tax deductible.
Donate to the American Red Cross through ABC’s donation portal.
Your Red Cross disaster relief gift will help people whose lives have been upended by wildfires, storms, floods and countless other crises. This custom website tracks donations by the ABC community and can be dedicated to a friend or loved one.
Donate
Reprinted courtesy of ABC, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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The result of this doctrine is that the one hiring the independent contractor must not only provide that specific precautions be taken to avoid peculiar risk of injury, but must also act to ensure that these precautions are actually implemented by the independent contractor.
Owners and Contractors are Liable for Injuries Caused by their Independent Contractors under the “Peculiar Risk Doctrine”
Tuesday, October 15, 2024
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William L. Porter - Porter Law Group
Many contractors and owners believe that if they hire an independent contractor to perform work and that independent contractor causes injury to others during the performance of that work, then it is the independent contractor alone who will be liable for those injuries. In most circumstances, this is correct. The owner or the contractor will not be held liable for injuries caused by his or her independent contractor. However, this is not always the case.
Under the “Peculiar Risk Doctrine” and California cases interpreting the doctrine, a contractor or owner who hires an independent contractor to do work which is considered to be “inherently dangerous work” can be still be held directly liable for damages when that independent contractor causes injury to others by negligently performing the work.
Such liability can generally be imposed on the one hiring the independent contractor under either of two branches of the peculiar risk doctrine. First, where a person hires an independent contractor to do inherently dangerous work, but fails to provide in the contract or in some other manner that special precautions must be taken to avert the peculiar risk of injury related to that work, then the one hiring the independent contractor can be held liable for injuries to others caused by the independent contractor’s negligence. (Restatement Second of Torts Section 413). For example, in Mackey v. Campbell Construction Co. 101 Cal. App. 3d 774, 162 Cal. Rptr. 64 (1980), Western Electric Company, the owner of the project, was found liable for the personal injuries of a subcontractor’s employee because Western’s representatives were on the job at all times, had doubts about the safety of scaffolding being used on the project, yet failed to require use of precautions that could have been taken to avoid injury.
Reprinted courtesy of William L. Porter, Porter Law Group
Mr. Porter may be contacted at bporter@porterlaw.com
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Civil engineers are dedicated to protecting the public with projects that can lessen the impacts of these storms, and we are eager to help communities rebuild as quickly as possible following events like Milton and Helene.
ASCE Statement on Hurricane Milton and Environmental Threats
Tuesday, October 15, 2024
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Feniosky Peña-Mora, P.E., President - American Society of Civil Engineers
WASHINGTON, DC. – On the heels of the tragic damage caused by Hurricane Helene throughout the Southeast, Floridians were struck by another major hurricane, Milton, less than two weeks later. Our hearts go out to those impacted again by this storm through property damage, lack of water access, power outages, or worse, loss of life, all before getting a chance to recover from Helene. Civil engineers are dedicated to protecting the public with projects that can lessen the impacts of these storms, and we are eager to help communities rebuild as quickly as possible following events like Milton and Helene.
Although we do not yet know the full scope of destruction caused by Hurricane Milton, severe weather, including compound flooding events, are increasing regularly and pose a great risk to our safety and economic vitality. While so many eyes are fixated on hurricanes impacting the Southeast, wildfires are burning across several western states, including the Elk Fire in Wyoming, the largest wildfire the Bighorn National Forest has experienced in more than a century, now spanning over 75,000 acres as the region is experiencing unusually hot and dry weather and strong winds that are helping this fire to spread rapidly. The climate impacts we are accustomed to – wildfires in the West and hurricanes in the Southeast – are getting stronger, and now environmental challenges are occurring in areas we wouldn't suspect, such as Hurricane Helene striking mountain communities in Western North Carolina that have been labeled as "climate safe-havens," and Texas dealing with annual winter storms.
ASCE is a leader in codes and standards development and has created an easy-to-understand toolkit for legislators and the public to learn the benefits of these up-to-date standards and determine when and how to adopt them, making our built environment more resilient to natural catastrophes. ASCE's flagship standard, ASCE/SEI 7-22, recently underwent the most significant update to its flooding chapter to ensure structures following this standard are prepared for 500-year flood events.
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Power Outages and Flooding Persist in Florida After Hurricane Milton
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The California Mechanics Liens and Related Construction Remedies 2024 update was recently was just released.
2024 Update to CEB’s Mechanics Liens Now Available
Tuesday, October 15, 2024
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Garret Murai - California Construction Law Blog
For a number of years we have had the honor to serve as update authors for several publications of California’s Continuing Education of the Bar (CEB).
I didn’t realize it until now but the CEB, a program of the University of California, was started more than 75 years ago following WWII to provide veterans who were attorneys with practical guidance on changes to the law as they returned to their practices following the war. Pretty cool!
Reprinted courtesy of Garret Murai, Nomos LLP
Mr. Murai may be contacted at gmurai@nomosllp.com
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The tensions between AI and data centers, and the green power sources needed not only for those purposes but for responses to climate change and the economy more generally, are not going away.
Big Data Meets Big Green: Data Centers and Carbon Removal Compete for Zero-Emission Energy
Tuesday, October 15, 2024
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Robert A. James, Sidney L. Fowler & Ashleigh Myers - Gravel2Gavel Construction & Real Estate Law Blog
Artificial intelligence, data centers, carbon removal and zero-emission power may sound like a winning line (plus the Free Space) on a 2024 Buzzword Bingo card. But the concepts have come into dramatic real-world tension as private and public actors seek to accommodate the digital and environmental imperatives for green energy.
After years of fairly stable demand, punctuated by declines during the pandemic and economic slumps, electricity demand is projected to double by 2050. A principal cause is the rapid expansion in the power needed to energize and cool servers amid explosive growth in the number and size of data centers, crypto miners, and other point sources of computation. Data centers were 3% of U.S. demand and are projected to be up to 9% or more by 2030; AI will drive a 160% surge in data center demand by 2030. A commentator notes, “We haven’t seen [growth like] this in a generation.”
Reprinted courtesy of Robert A. James, Pillsbury, Sidney L. Fowler, Pillsbury and Ashleigh Myers, Pillsbury
Mr. James may be contacted at rob.james@pillsburylaw.com
Mr. Fowler may be contacted at sidney.fowler@pillsburylaw.com
Ms. Myers may be contacted at ashleigh.myers@pillsburylaw.com
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Tower 28 residents allege owner set initial rents improperly.
NYC Landlord Accused of Skirting Law With Rent-Free Months Offer
Tuesday, October 15, 2024
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Natalie Wong - Bloomberg
The opening of Tower 28, one of the tallest residential towers in New York City outside Manhattan, brought rent-stabilized units to Long Island City roughly seven years ago, adding affordable listings to a neighborhood where soaring prices were increasingly squeezing out many renters.
Now, three tenants at the 58-story building have filed a class-action lawsuit alleging the landlord sought to evade New York City rent regulations in order to raise prices even higher over time.
The lawsuit against the limited liability company tied to 42-12 28th St. in Queens claims that the property owner recorded initial rents with the New York State Division of Housing and Community Renewal that were higher than what the first tenant was actually charged and paid. In doing so, any future rent increases were based off a higher figure, according to the lawsuit.
Reprinted courtesy of Natalie Wong, Bloomberg
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When built, the GMT’s 65-m-tall, 60-m-wide, 4,800-metric-ton enclosure structure will be one of the largest mechanized buildings in the world.
A Place to Study Eternity: Building the Giant Magellan Telescope
Tuesday, October 15, 2024
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Jeff Rubenstone - Engineering News-Record
Situated on a remote mountaintop in the Atacama Desert in Chile, the Giant Magellan Telescope will one day allow astronomers to peer further into the universe with a greater degree of clarity than ever before. But siting a highly sensitive instrument with seven massive, 8.4-meter-dia mirrors on a windy peak in one of the world’s most seismically active regions takes careful engineering, especially since the 12-story upper section of the 22-story telescope enclosure will have to rotate 360° with an extreme degree of precision, multiple times a night.
Reprinted courtesy of Jeff Rubenstone, Engineering News-Record
Mr. Rubenstone may be contacted at rubenstonej@enr.com
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