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    Construction Expert Witness Builders Information
    Elgin, Minnesota

    Minnesota Builders Right To Repair Current Law Summary:

    Current Law Summary: Statutory warranties for one-year, two-year and ten-year periods limits types of construction defects actionable under warranty law; This statute (Chapter 327A) limits liability and excludes normal wear and tear, normal shrinkage caused by drying of the dwelling, loss due to insufficient ventilation, loss or damage from negligence, improper maintenance, or alteration to dwelling, loss or damage from failure to maintain or failure to mitigate


    Construction Expert Witness Contractors Licensing
    Guidelines Elgin Minnesota

    Residential contractors need to be licensed. If you work in two or more trades, certain trades will require a license. Call the state for details.


    Construction Expert Witness Contractors Building Industry
    Association Directory
    Rochester Area Builders Inc
    Local # 2465
    108 Elton Hills Lane NW
    Rochester, MN 55901
    http://www.rochesterareabuilders.com

    South Central Builders Association
    Local # 2412
    575 Havana Rd
    Owatonna, MN 55060


    Minnesota River Builders Association
    Local # 2487
    443 Belgrade Avenue
    North Mankato, MN 56003
    http://www.mnrba.com

    Crow River Builders Association Affil w/National Associated Home Builders
    Local # 2424
    PO Box 656
    Hutchinson, MN 55350
    http://www.crbahome.org

    Builders Association of Minnesota
    Local # 2400
    525 Park St Ste 150
    Saint Paul, MN 55103
    http://www.bamn.org

    Builders Association of the Twin Cities
    Local # 2433
    2960 Centre Pointe Drive
    Roseville, MN 55113
    http://www.batconline.org

    West Central Builders Assoc
    Local # 2432
    PO Box 447
    New London, MN 56273
    http://www.westcentralbuilders.com


    Construction Expert Witness News and Information
    For Elgin Minnesota

    2011 Worst Year Ever for Home Sales

    “Other Insurance” and Indemnity Provisions Determine Which Insurer Must Cover

    One Colorado Court Allows Negligence Claim by General Contractor Against Subcontractor

    Going Green for Lower Permit Fees

    Nevada Construction Defect Lawyers Dead in Possible Suicides

    Kentucky Court Upholds Arbitration Award, Denies Appeal

    United States District Court Confirms That Insurers Can Be Held Liable Under The CCPA.

    Amerisure Case to be Heard by Texas Supreme Court

    Exclusions Bar Coverage for Damage Caused by Chinese Drywall

    A Performance-Based Energy Code in Seattle: Will It Save Existing Buildings?

    Policyholder Fails to Build Adequate Record to Support Bad Faith Claim

    Florida: No Implied Warranties for Neighborhood Improvements

    Record-Setting Construction in Fargo

    Oregon agreement to procure insurance, anti-indemnity statute, and self-insured retention

    Equipment Costs? It’s a Steal!

    Florida trigger

    Arbitrator May Use Own Discretion in Consolidating Construction Defect Cases

    Gilroy Homeowners Sue over Leaky Homes

    Geometrically Defined Drainage Cavities in EIFS as a Guard Against Defects

    Virginia Chinese Drywall “property damage” caused by an “occurrence” and number of “occurrences”

    Ceiling Collapse Attributed to Construction Defect

    Washington Court Limits Lien Rights of Construction Managers

    Pennsylvania Court Extends Construction Defect Protections to Subsequent Buyers

    Town Files Construction Lawsuit over Dust

    Houses Can Still Make Cents: Illinois’ Implied Warranty of Habitability

    Kansas Man Caught for Construction Scam in Virginia

    Mandatory Arbitration Provision Upheld in Construction Defect Case

    The Complete and Accepted Work Doctrine and Construction Defects

    South Carolina Legislature Defines "Occurrence" To Include Property Damage Arising From Faulty Workmanship

    Retaining Wall Contractor Not Responsible for Building Damage

    General Contractor/Developer May Not Rely on the Homeowner Protection Act to Avoid a Waiver of Consequential Damages in an AIA Contract

    Contractor’s Coverage For Additional Insured Established by Unilateral Contract

    Coverage Rejected Under Owned Property and Alienated Property Exclusions

    Water Is the Enemy

    Insurance for Defective Construction Now in Third Edition

    California Assembly Bill Proposes an End to Ten Year Statute of Repose

    No Third-Quarter Gain for Construction

    Construction Law: Unexpected, Fascinating, Bizarre

    Environment Decision May Expand Construction Defect Claims

    Late Filing Contractor Barred from Involving Subcontractors in Construction Defect Claim

    Counterpoint: Washington Supreme Court to Rule on Resulting Losses in Insurance Disputes

    Court Requires Adherence to “Good Faith and Fair Dealing” in Construction Defect Coverage

    Limitations of Liability in Subcontractors’ Contracts May Not Be Enforceable in Colorado to Limit Claims by Construction Professionals.

    Boston’s Tunnel Project Plagued by Water

    Michigan Supreme Court Concludes No Statute of Repose on Breach of Contract

    Australian Developer Denies Building Problems Due to Construction Defects

    Construction Defects in Home a Breach of Contract

    Pictorial Construction Terminology Dictionary — A Quick and Helpful Reference

    Delaware “occurrence” and exclusions j(5) and j(6)

    Insurance Policy Provides No Coverage For Slab Collapse in Vision One

    Claims Under Colorado Defect Action Reform Act Count as Suits

    Contractors with Ties to Trustees Reaped Benefits from LA Community College Modernization Program

    Denver Court Rules that Condo Owners Must Follow Arbitration Agreement

    Granting Stay, Federal Court Reviews Construction Defect Coverage in Hawaii

    Was Jury Right in Negligent Construction Case?

    Product Exclusion: The Big Reason Behind The Delay of LEED 2012

    California Supreme Court to Examine Arbitration Provisions in Several Upcoming Cases

    Save a Legal Fee: Prevent Costly Lawsuits With Claim Limitation Clauses

    Application of Efficient Proximate Cause Doctrine Supports Coverage

    Homeowners Sue Over Sinkholes, Use Cash for Other Things

    South Carolina Contractors Regain General Liability Coverage

    Mortar Insufficient to Insure Summary Judgment in Construction Defect Case

    Florida trigger

    $5 Million Construction Defect Lawsuit over Oregon Townhomes

    Ohio Casualty’s and Beazer’s Motions were Granted in Part, and Denied in Part

    Construction Defect Case Not Over, Despite Summary Judgment

    Brown Paint Doesn’t Cover Up Construction Defects

    Manhattan Developer Breaks Ground on $520 Million Project

    In Re Golba: The Knaubs v. Golba and Rollison, Debtors

    In Colorado, Repair Vendors Can Bring First-Party Bad Faith Actions For Amounts Owed From an Insurer

    Former New York Governor to Head Construction Monitoring Firm

    Insurer Has Duty to Defend in Water Intrusion Case

    Time to Repair Nevada’s Construction Defect Laws?

    Home Repair Firms Sued for Fraud

    Mississippi exclusions j(5) and j(6) “that particular part”

    Celebrities Lose Case in Construction Defect Arbitration

    Policing Those Subcontractors: It Might Take Extra Effort To Be An Additional Insured

    Cleveland Condo Board Says Construction Defects Caused Leaks

    New Buildings in California Soon Must Be Greener

    Construction Defect Claim Did Not Harm Homeowner, Court Rules

    Fifth Circuit Reverses Insurers’ Summary Judgment Award Based on "Your Work" Exclusion

    Steps to Defending against Construction Defect Lawsuits

    Consulting Firm Indicted and Charged with Falsifying Concrete Reports

    Supreme Court of Oregon Affirms Decision in Abraham v. T. Henry Construction, et al.

    Water Drainage Case Lacks Standing

    Homeowner may pursue negligence claim for construction defect, Oregon Supreme Court holds

    Court Will Not Compel Judge to Dismiss Construction Defect Case

    State Farm Too Quick To Deny Coverage, Court Rules

    In Oregon Construction Defect Claims, “Contract Is (Still) King”

    Alaska Supreme Court Dismisses Claims of Uncooperative Pro Se Litigant in Defect Case
    Corporate Profile

    ELGIN MINNESOTA CONSTRUCTION EXPERT WITNESS
    DIRECTORY AND CAPABILITIES

    Leveraging from more than 5500 construction defect and claims related expert witness designations, the Elgin, Minnesota Construction Expert Witness Group provides a wide range of trial support and consulting services to Elgin's most acknowledged construction practice groups, CGL carriers, builders, owners, and public agencies. Drawing from a diverse pool of construction and design professionals, BHA is able to simultaneously analyze complex claims from the perspective of design, engineering, cost, or standard of care.

    Elgin Minnesota general contracting structural engineering expert witnessesElgin Minnesota general contracting eifs expert witnessElgin Minnesota general contracting building code expert witnessElgin Minnesota general contracting expert witness roofingElgin Minnesota general contracting construction claims expert witnessElgin Minnesota general contracting fenestration expert witnessElgin Minnesota general contracting contractor expert witnessElgin Minnesota general contracting construction project management expert witnessElgin Minnesota general contracting testifying construction expert witness
    Construction Expert Witness News & Info
    Elgin, Minnesota

    Texas contractual liability exclusion

    May 18, 2011 — May 18, 2011 - CDCoverage.com

    In Ewing Construction Co., Inc. v. Amerisure Ins. Co., No. C-10-256 (S.D. Tex. April 28, 2011), insured Ewing was the general contractor for an athletic facility constructed for a school district. The school district sued Ewing alleging defective construction of the project. The underlying complaint included contract and negligence causes of action, and sought damages for the repair of the damages and loss of the use of the project. The complaint did not allege damage to any property other than the project itself. Ewing tendered its defense to its CGL insurer Amerisure. Amerisure denied a defense and Ewing filed suit against Amerisure. The federal district trial court entered summary judgment for Amerisure. Applying Texas law, the court held that all of the damages fell within the “contractual liability” exclusion precluding any duty to defend or indemnify.

    Read the full story…

    Reprinted courtesy of CDCoverage.com


    Congress Addresses Homebuilding Credit Crunch

    May 20, 2011 — CDJ Staff

    The National Association of Home Builders (NAHB) reports that Representatives Gary Miller (CA), Brad Miller (NC) and twenty-nine cosponsors have put forth a bill with bipartisan support to “address the severe credit crunch for acquisition, development, and construction (AD&C) financing.” They report in addition to more than 1.4 million construction workers who have been “idled since 2006,” the housing slump has cost 3 million jobs and $145 million in wages.

    NAHB reports that they worked closely with lawmakers on the bill. The association had members meet with legislators both in D.C. and in their home districts. They state that HR 1755 would help homebuilders “find the credit they need to move forward with new or existing projects.”

    The bill would allow lenders to use the value upon completion when assessing loan collateral and ban the use of foreclosed or distressed sale properties in assessing values of projects. The would bill would also lessen restrictions by banking regulators, which the lead sponsors said “have hindered federal and state chartered banks and thrifts’ ability to make and maintain loans to qualified small home builders that have viable projects.”

    The NAHB is urging members of Congress to cosponsor the bill and is urging the Senate to introduce a companion bill.

    Read the full story…

    Read HR 1755


    Florida Property Bill Passes Economic Affairs Committee with Amendments

    April 14, 2011 — April 14, 2011 Beverley BevenFlorez - Construction Defect Journal

    The Florida Property Bill (HBB 803) was passed by the Economic Affairs Committee by a vote of 11-7, according to Property Casualty 360, after adopting nine new amendments. The additions to the bill included limiting notice of claims to a set number of years, extending the statute of limitation on property claims from five years to six years, among others.

    HB 803 and SB 408, the Senate companion bill, focus primarily on residential property insurance. They make changes to the Florida Hurricane Catastrophe Fund, while also promoting increased notification of policy changes to policyholders. Sections of the bills provide minor fixes such as renaming Citizens Property Insurance Corporation to Taxpayer-Funded Property Insurance Corporation. However, other sections of the bills contain more significant policy changes such as sinkhole coverage and hurricane claims.

    The bills’ intent, according to the SunSentinel.com, is to reduce fraudulent claims and to bring new insurers into the insurance market. However, SunSentinel.com also reports that the bills may drastically increase property insurance premiums.

    Read the full Property Casualty 360 article...

    Read the full Sun Sentinel article...


    OSHA Extends Delay of Residential Construction Fall Protection Requirements

    September 13, 2012 — CDJ Staff

    OSHA has announced a fourth delay in full implementation of requiring fall protection in residential construction. The requirements, which would obligate those in residential construction to use the same degree of fall protection as is used in commercial construction, were originally set to go into effect in September 2011. As part of the phasing in of the new requirements, penalties were reduced, originally until March 2012. This has now been extended until December 15, 2012.

    Read the full story…


    South Carolina Legislature Redefining Occurrences to Include Construction Defects in CGL Policies

    April 1, 2011 — April 1, 2011 Beverley BevenFlorez - Construction Defect Journal

    The question of what circumstances must be in place for construction defects to be covered in a general commercial liability (CGL) policies is being raised by the courts and the legislature in South Carolina. The Insurance Journal reports that the American Insurance Association as well as the Property and Casualty Insurers Association of America are speaking out on the issue.

    The problem seems to be centered on what defines an “occurrence.” CGL policies were not meant to cover faulty workmanship, according to the filing by the South Carolina Supreme Court. In January of this year, the South Carolina Supreme Court reversed the ruling in Crossmann Communities v Harleysville Mutual declaring that “Respondents cannot show the damage here was the result of an occurrence. Rather, the damage was a direct result and the natural and expected consequence of faulty workmanship; faulty workmanship did not cause an occurrence resulting in damage.” They focused their attention on the word “accident,” stating that there is a fortuity element that is not diminished.

    The South Carolina legislature reacted by producing a bill that would add new language directly negating the ruling by the Supreme Court. The South Carolina bill S-431 would change the definition of an occurrence in regards to construction defects as follows: “For a liability insurance policy issued to a construction professional, an ‘occurrence’ means, at a minimum: (1) an accident; or (2) continuous or repeated exposure to substantially the same general harmful condition or substance. No additional requirement of a fortuitous event is needed to constitute an ‘occurrence.’”

    S-431 is currently residing in the House Committee on Labor, Commerce and Industry.

    Read the full story...


    Hilton Grand Vacations Defect Trial Delayed

    October 23, 2012 — CDJ Staff

    A settlement agreement between Conti Electric and Westgate Resorts has lead to a delay in starting the trial over construction defect claims and billing disputes over Hilton Grand Vacations a time share tower in Las Vegas. According to the Las Vegas Review-Journal, the dispute includes claims of $23.3 million owed to the general contractor against which the developer has placed $30 million in construction defect claims.

    Read the full story…


    Florida trigger

    May 18, 2011 — May 18, 2011 - CDCoverage.com

    In Johnson-Graham-Malone, Inc. v. Austwood Enterprises, Inc., No. 16-2009-CA-005750-XXXX-MA (Fla. 4th Cir. Ct. Duval County, April 29, 2011), insured JGM was the general contractor for an apartment project completed in 1998. In 2007, the project owner sued JGM seeking damages for defective construction resulting in moisture penetration property damage. JGM tendered its defense to Amerisure. Amerisure denied a defense. JGM defended and settled the underlying suit and then filed suit against Amerisure seeking recovery of defense and settlement costs. The trial court granted JGM’s motion for partial summary judgment. The court first addressed Amerisure’s duty to defend. Applying Florida law, the court held that, although the underlying complaint alleged that the property damage was not discovered until after expiration of the Amerisure policies

    Read the full story…

    Reprinted courtesy of CDCoverage.com


    Know the Minnesota Statute of Limitations for Construction Defect Claims

    July 10, 2012 — CDJ Staff

    Writing on the Benson Kerrane Storz Nelson web site, Alex Nelson gives an overview of the Minnesota laws covering statutes of limitation and repose. He notes that frequently when his firm declines to take a construction defect case its’ over a missed statute of limitation. He describes the time periods as both “short” and “ambigious.” The briefest limit is that a homeowner “has only 6 months within which to give written notice of the defect to the builder once the defect has manifested itself.” Any legal action must commence within two years of the same point.

    The Minnesota statutes also have a six-year limitation, which starts for a single home at transfer of title to the first purchaser or when the purchaser takes possession, whichever happens first. For a condo, it is the last of “completion of the common element,” first unit sale or “Termination of Declarant control.” Fraud or misrepresentation also has a six-year limit, while negligence claims are limited to within the first two years “after the manifestation of the defect.”

    The statues of repose also provide limits to filing construction defect lawsuits. Mr. Nelson points out that the longest are for negligence, fraud, and “major construction defects,” all of which have a ten-year limit. On the other hand, claims against general workmanship and materials must be made in the first year.

    Read the full story…


    Yellow Brass Fittings Play a Crucial Role in Baker v Castle & Cooke Homes

    May 10, 2012 — CDJ Staff

    Baker v Castle & Cooke Homes Hawaii, et al. is a “class action filed by homeowners who allege that their homes have a construction defect. They allege that their plumbing systems include brass fittings susceptible to corrosion and likely to cause leaks. They bring this action against the developer of their homes and the manufacturers of the brass fittings.”

    Zurn, the manufacturer of the allegedly defective brass fittings, sought a dismissal, or if that could not be achieved, then “a more definite statement, of five of the six claims.” Zurn moved for summary judgment on the sixth claim, or alternately sought “summary judgment on one of the five claims it” sought to dismiss.” The court granted in part the motion, and denied the motion for summary judgment.

    The developer, Castle & Cooke, sought dismissal of the First Amended Complaint stating “that Plaintiffs have not complied with Hawaii’s Contractor Repair Act, chapter 672E of Hawaii Revised Statutes, which requires, among other things, a plaintiff to give a contractor the results of any testing done before filing an action against that contractor.” The court couldn’t determine “certain facts essential to ruling” on Castle & Cooke’s motion, and therefore denied the motion, but ordered Plaintiffs to submit requested material by the stated deadline.

    The Baker v Castle & Cooke case began with the Plaintiffs claim that the use of yellow brass fittings can lead to construction defects. They allege that “yellow brass is particularly susceptible to dezincification, a corrosion process in which zinc leaches into potable water that comes into contact with the brass. According to Plaintiffs, as the brass corrodes, it becomes porous and mechanically weak. Plaintiffs further allege that the PEX systems in the putative class members’ homes have begun to, or are about to, leak water into the walls, ceilings, and floors of their homes. Plaintiffs allege that the leakage will cause water damage and mold growth, exposing the occupants to toxins.”

    In response to the plaintiffs’ claims, Zurn argued “because their yellow brass fittings have not failed to date, Plaintiffs fail to allege, and have no evidence showing, that they have suffered any actual injury.” Plaintiffs replied, “even if the fittings have not failed as of today, failure in the future is inevitable.”

    However, the court stated, “whether Plaintiffs have suffered any injury, or whether Plaintiffs are attempting to proceed based solely on future injury, implicates Plaintiffs’ standing to bring this action, as well as whether this case is ripe for adjudication.” The court has requested the parties to submit “supplemental briefing on whether this case should be dismissed pursuant to Rule 12(b)(1). In supplemental briefs, Zurn argues that dismissal is appropriate because Plaintiffs lack standing, and Castle & Cooke argues that dismissal is appropriate because Plaintiffs’ claims are not ripe.”

    The court continues to discuss the problem of standing: “To establish standing, a plaintiff must demonstrate three things. First, the plaintiff must suffer an "injury-in-fact," which means that there must be a concrete and particularized "invasion of a legally protected interest" and the invasion is actual or imminent. Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992). Second, the injury must be fairly traceable to the challenged action. Third, a favorable decision must be likely to redress the injury. Id. It is the first element (injury-in-fact) that is in issue here.”

    The court found that the plaintiffs do have standing: “Even if the court could not rely on the allegations that the pipes will soon leak, the court would conclude that, for standing purposes, Plaintiffs have a sufficient injury-in-fact in the form of their alleged economic loss.” In a hearing, Plaintiffs argued that their homes had decreased in value.

    The court also denied Castle & Cooke’s motion to dismiss based on a lack of ripeness, stating “the same reasons Plaintiffs satisfy the injury-in-fact requirement for standing purposes, they satisfy the constitutional ripeness requirement.”

    Plaintiffs asserted six counts against Zurn. Zurn, in response, made a motion to dismiss counts VIII, IX, X, XII, and XIII. The court granted Zurn’s motion for Counts VIII, IX, and X only: “Counts VIII (product liability), IX (negligence), and X (strict liability) sound in tort. Zurn argues that, because Plaintiffs allege no injury other than to the PEX systems and the yellow brass fittings themselves, the economic loss rule bars their tort claims. The court agrees.”

    The court disagreed with Zurn’s motion regarding Count XII: “Count XII asserts that Zurn has breached the implied warranty of merchantability. Zurn argues that Count XII is barred by the applicable statute of limitations and that Plaintiffs do not sufficiently allege an injury. The court disagrees.”

    Zurn’s motion regarding Count XIII was also denied: “Count XIII asserts that Zurn violated section 480-2 of Hawaii Revised Statutes.” Furthermore, “Plaintiffs allege that Zurn ‘engaged in unfair and deceptive acts or practices when [it] designed, manufactured and sold Yellow Brass Fittings.’ Zurn argues that Plaintiffs fail to state a claim under section 480-2(a) because their claims are barred by the statute of limitations and they do not adequately allege reliance or a cognizable injury. The court disagrees.”

    The court denied the motion for summary judgment with respect to Counts XI and XII.

    Castle & Cooke sought to dismiss “Plaintiffs’ claims against it under section 672E-2 of Hawaii Revised Statutes, which provides for dismissal when claimants fail to comply with chapter 672E.” There was some discussion regarding the test results. Apparently, the plaintiffs had failed to provide a written notice of claim at least 90 days before filing the action. However, it is unclear if the Plaintiffs have since complied with the requirements of the chapter. “The court has received no supplemental information from either party about whether any test results from another case have been turned over or whether those materials are subject to a confidentiality agreement. The record at this point does not establish noncompliance with the requirement in chapter 672E to provide such information. The court therefore denies the motion to dismiss.”

    In summary, “Zurn’s motion to dismiss is granted as to Count VIII, Count IX, and Count X. Zurn’s motion to dismiss is denied with respect to Plaintiffs’ other claims. Zurn’s request for a more definite statement and its summary judgment motion are denied. Plaintiffs are given leave to file an amended Complaint no later than May 21, 2012.” Furthermore, “the court denies Castle & Cooke’s motion, but directs Plaintiffs to file, within two weeks, either a certificate of compliance with section 672E-3(c), or an explanation as to why they have not complied. Castle & Cooke may submit a response within two weeks of Plaintiffs’ submission. Each party’s submission is limited to 1000 words.”

    Read the court’s decision…


    Hovnanian Sees Second-Quarter Profit, Points to Recovery

    June 19, 2012 — CDJ Staff

    Hovnanian Enterprises has shown a profit in the second quarter, which the company attributes to recovery in the homebuilding industry. Apart from a sales promotion in 2007, the company sold more homes per community in April than it has in any other month since 2006. Ara K. Hovnanian said that “the sales improvements we have experienced are fairly wide-based in terms of geography, price points and buyer profiles.”

    The quarter’s profit was $1.8 million. In the year prior, Hovnanian faced losses of $72.7 million. The Wall Street Journal’s Marketwatch reported that Hovnanian’s stock price recently went up 19%.

    Read the full story…


    Florida Construction Defect Case Settled for $3 Million

    June 19, 2012 — CDJ Staff

    The Runaway Beach Club Condominium Association of Kissimmee, Florida has settled its construction defect claims against the parties involved in the construction and development of the buildings. The association claimed that defective roofs and improperly installed windows had lead to leaks and associated damages. A trial date had been set, but parties involved were able to reach this settlement instead.

    Read the full story…


    Dust Infiltration Due to Construction Defect Excluded from Policy

    September 9, 2011 — CDJ Staff

    A summary judgment was affirmed in the case of Brown v. Farmers Group, by the California Court of Appeals. The Browns bought a new home in Oakley, California. At the time, they signed disclosure statement “acknowledging that the area around their home experienced gusty winds and would be in development for years to come, which might result in dust and airborne mold.”

    The Browns found an unusual amount of dust in their home, which became worse when they ran their heating and air conditioning system. Shelia Brown was later diagnosed with chronic valley fever, which was attributed to airborne mold. The Browns contacted Farmers which investigated the house. Although the adjustor from Farmers said the Browns would be covered, Farmers denied the claim.

    After the Browns moved out of the house, an inspector found that the HVAC line in the attic was disconnected, sending dust into the home. The Browns brought action against Mid-Century Insurance, which managed the policy, and Farmers. The identified the HVAC defect, window problems, and valley fever as causes, suing for breach of contact, breach of implied covenant of good faith and fair dealing, and the intentional infliction of emotional distress.

    The court rejected all these claims. The policy with Farmers excluded losses due to defective construction. This ruled out the faulty HVAC system and any problems there might have been from the windows. The policy also specifically excluded losses from contamination, fungi, pathogens, and noxious substances. The court further found that the adjustor’s opinion was irrelevant to the question of what the policy actually covered. Finally, the court found no evidence of intentional infliction of emotional stress.

    On review, the appeals court upheld the trial court’s conclusions and affirmed the summary judgment.

    Read the court’s decision…


    Mark Van Wonterghem To Serve as Senior Forensic Consultant in the Sacramento Offices of Bert L. Howe & Associates, Inc.

    March 1, 2012 — CDJ Staff

    Sacramento, CA — Bert L. Howe and Associates, Inc., is pleased to announce that Mark Van Wonterghem - General Contractor, has joined the firm as Senior Forensic Consultant. Mark will be responsible for leading the firm’s expansion in the newly formed Sacramento headquarters.

    His focus will continue to be working with construction practice groups and claims professionals in the Sacramento and Bay Area markets. He will utilize the resources of the Construction Experts Group at Bert L. Howe & Associates in furthering the litigation support needs attendant to the firm’s Northern California clientele.

    Mr. Van Wonterghem possesses extensive consulting and testimony experience. Through 32 years of experience in the construction industry he leverages extensive practical experience with multiple trades including concrete foundations, walls and flatwork, structural wood and steel framing, finish carpentry, drywall, lath & plaster/stucco, window & door installations, deck coating systems, metal and membrane flashings and above/below grade waterproofing. This trade experience encompasses both the commercial and residential construction sectors and has been vital in his ability to provide concise explanation of construction industry standards, as well as trade-specific standards of care.

    Mr. Van Wonterghem has broad experience with all types of building construction ranging from concrete and steel commercial construction to high-end custom residential construction.

    In connection with the Construction Experts Group at BHA, Mr. Van Wonterghem provides construction consulting and litigation support services to a wide variety of recognized construction claims professionals, owners, and publicly traded builders.

    The firm’s Sacramento offices are located at the Gateway Oaks III office complex, 2520 Venture Oaks Way, Suite 435, Sacramento, CA 95833. Mr. Van Wonterghem can be reached via e mail at mvanwonterghem@berthowe.com or at (800) 783-1822.


    Legislatures Shouldn’t Try to Do the Courts’ Job

    March 1, 2012 — CDJ Staff

    David Thamann, writing in Property Casualty 360, argues that current actions by legislatures on insurance coverage amount to “legislative interference or overreach.” He notes that under current Colorado law, “a court shall presume that the work of a construction professional that results in property damage — including damage to the work itself or other work — is an accident unless the property damage is intended and expected by the insured.” He argues that here legislators are stepping into the role of the courts. “Insureds and insurers are not always going to be pleased with a court ruling, but that is the system we have.”

    Read the full story…


    New Buildings in California Soon Must Be Greener

    June 19, 2012 — CDJ Staff

    The California Energy Commission has approved new energy efficiency standards for new homes and commercial buildings. The 2013 Building Energy Efficiency Standards are set to go into effect on January 1, 2014, and will require 30% more energy efficiency for non-residential construction and 25% more for homes. The standards do not affect hospitals, nursing homes, or prisons.

    Buildings covered under the standard will have to have roofs that ready for the installation of solar panels. Additionally, non-residential buildings will require high-performance windows, advanced lighting controls, and cool-roof technologies. Residential requirements include insulated hot-water pipes, whole house fans, and more efficient windows.

    The new standards are expected to add 3,500 new building industry jobs. One thing these construction workers won’t be building are power plants, since over the next thirty years, the standards are expected to save as much as six power plants.

    Read the full story…


    Seller Cannot Compel Arbitration for Its Role in Construction Defect Case<

    March 1, 2012 — CDJ Staff

    The buyer of a leaky home in Venice, California cannot be compelled to arbitration with the seller in a construction defect lawsuit, according to a decision in Lindemann v. Hume, which was heard in the California Court of Appeals. Lindemann was the trustee of the Schlei Trust which bought the home and then sued the seller and the builder for construction defects.

    The initial owner was the Hancock Park Trust, a real estate trust for Nicholas Cage. Richard Hume was the trustee. In 2002, Cage agreed to buy the home which was being built by the Lee Group. Cage transferred the agreement to the Hancock Park Trust. Hancock had Richard Nazarin, a general contractor, conduct a pre-closing walk through. They also engaged an inspector. Before escrow closed, the Lee Group agreed to provide a ten-year warranty “to remedy and repair any and all damage resulting from water infiltration, intrusion, or flooding due to the fact that the door on the second and third floors of the residence at the Property were not originally installed at least one-half inch (1/2”) to one inch (1”) above the adjacent outside patio tile/floor on each of the second and third floors.”

    Cage moved in and experienced water intrusion and flooding. The Lee Group was unable to fix the problems. Hume listed the home for sale. The Kamienowiczs went as far as escrow before backing out of the purchase over concerns about water, after the seller’s agent disclosed “a problem with the drainage system that is currently being addressed by the Lee Group.”

    The house was subsequently bought by the Schlei Trust. The purchase agreement included an arbitration clause which included an agreement that “any dispute or claim in Law or equity arising between them out of this Agreement or any resulting transaction, which is not settled through mediation, shall be decided by neutral, binding arbitration.” The warranty the Lee Group had given to Hancock was transferred to the Schlei trust and Mr. Schlei moved into the home in May 2003.

    Lindemann enquired as to whether the work done would prevent future flooding. Nazarin sent Schlei a letter that said that measures had been taken “to prevent that situation from recurring.” In February, 2004, there was flooding and water intrusion. Lindemann filed a lawsuit against the Lee Group and then added the Hancock Park defendants.

    The Hancock Park defendants invoked the arbitration clause, arguing that Lindemann’s claims “were only tangentially related to her construction defect causes of action against the Lee Group.” On June 9, 2010, the trial court rejected this claim, ruling that there was a possibility of conflicting rulings on common issues of law. “With respect to both the developer defendants and the seller defendants, the threshold issue is whether there was a problem with the construction of the property in the first instance. If there was no problem with the construction of the property, then there was nothing to fail to disclose.” Later in the ruling, the trial court noted that “the jury could find there was no construction defect on the property, while the arbitration finds there was a construction defect, the sellers knew about it, and the sellers failed to disclose it.” The appeals court noted that while Hancock Park had disclosed the drainage problems to the Kamienowiczs, no such disclosure was made to Sclei.

    The appeals court described Hancock Park’s argument that there is no risk of inconsistent rulings as “without merit.” The appeals court said that the issue “is not whether inconsistent rulings are inevitable but whether they are possible if arbitration is ordered.” Further, the court noted that “the Hancock Park defendants and the Lee Group have filed cross-complaints for indemnification against each other, further increasing the risk of inconsistent rulings.”

    The court found for Lindemann, awarding her costs.

    Read the court’s decision…


    Contractors with Ties to Trustees Reaped Benefits from LA Community College Modernization Program

    March 3, 2011 — Original reporting by Gale Holland, Michael Finnegan and Doug Smith, Los Angeles Times

    In the latest installment of the “Billions To Spend” series of investigative reports focused on construction defects, management, and cost issues relevant to LACC’s Community College Modernization Projects, the LA Times examines the costs associated with the various layers of construction management and benefits that accrued to contractors with ties to LACC trustees.

    The reporting by the Times is seemingly critical of the project’s utilization of “body shops” an industry term for companies that function as employers of record. The article segment published today cites a number of circumstances wherein their utilization appears to have escalated costs substantially.

    “To gauge the cost of the staffing system, The Times reviewed thousands of pages of financial records from April 2007, when URS began managing the program, to July 2010. Reporters identified two dozen contractors serving as conduits for pay and benefits for employees they did not supervise.

    At least 230 people were employed in this manner, at a total cost of about $40 million, the records show.

    Approximately $18 million of the total was paid to the employees, according to the Times analysis. The remaining $22 million went to profit and overhead for contractors, the records indicate.

    For employees on its own payroll, the district says that medical and other benefits increase compensation costs 40% above base salaries. So if the district had employed its construction staff directly, the total cost for the period studied would have been $25 million instead of $40 million, a savings of $15 million, The Times calculated.”

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    Construction Defects in Home a Breach of Contract

    September 9, 2011 — CDJ Staff

    The Supreme Court of North Dakota has ruled in Leno v. K & L Homes, affirming the verdict of the lower court. K & L Homes argued that district court had erred in several ways, including by refusing to instruct the jury on comparative fault, denying a request for inspection, and not allowing a defendant to testify on his observations during jury viewing.

    The Lenos purchased a home constructed by K & L Homes, after which they alleged they found cracks, unevenness, and shifting, which they attributed to improper construction. They claimed negligence on the part of K & L Homes. K & L Homes responded that the Lenos were responsible for damage to the home. The Lenos dropped their negligence claim, arguing breach of contract and implied warranties.

    Before the trial, after the discovery period had passed, K & L Homes requested to inspect the home. This was rejected by the court. Kelly Moldenhauer, the owner of K & L Homes sought to testify about his observations during the jury’s viewing of the house. The court denied this too. The jury found that K & L was in breach of contract and awarded damages to the Lenos.

    The North Dakota Supreme Court noted that K & L Homes gave “warranties that the home had been built according to local building codes and laws, and that the house was fit for its particular purpose as a residence.” The court found that a defective home breached this warranty. Further, the home violated an implied warranty of fitness.

    The district court had denied K & L’s request to inspect the home, as the discovery period had ended and it would not give the Lenos time to do further discovery of their own. At the time of the request, there was only twenty-two days before the trial. The Supreme Court ruled that this was not an abuse of discretion of the part of the district court.

    The Lenos had requested that Moldenhauer’s testimony not be permitted, as it would “have the same effect as if the court had granted K & L Homes’ pretrial request for inspection.” K & L Homes agreed to this in court, replying, “okay.”

    The decision affirms the judgment of the district court and the damages awarded to the Lenos by the jury.

    Read the court’s decision…