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    Nebraska Builders Right To Repair Current Law Summary:

    Current Law Summary: Actions alleging a breach of warranty and construction defect are governed by a four-year statute of limitations (which may be extended by two years if the cause of action is not or could not reasonably have been discovered within the four-year period) and a ten-year statute of repose for latent defects.


    Construction Expert Witness Contractors Licensing
    Guidelines Boelus Nebraska

    Businesses must register with the Secretary of State. No state license is required for general contracting, however, local licensure is needed in counties with populations over 100,000. Licensure is required for the electrical trade.


    Construction Expert Witness Contractors Building Industry
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    North Platte Chapter
    Local # 2854
    PO Box 146
    North Platte, NE 69103


    Metro Omaha Builders Assn
    Local # 2872
    4141 N 156th Street Ste 100
    Omaha, NE 68116
    http://www.moba.com

    Central Nebraska Home Builders Association
    Local # 2818
    131 North Grace
    Grand Island, NE 68803


    Nebraska State Home Builders Association
    Local # 2800
    PO Box 22375
    Lincoln, NE 68542
    http://www.nshba.org

    Columbus Home Builders Association
    Local # 2805
    3121 39th St
    Columbus, NE 68601


    West Central Nebraska Home Builders Association
    Local # 2897
    5817 Ave O Place
    Kearney, NE 68847


    Home Builders Association of Lincoln
    Local # 2836
    6100 S 58th St Ste C
    Lincoln, NE 68516
    http://www.hbal.org


    Construction Expert Witness News and Information
    For Boelus Nebraska

    Demand for Urban Living Leads to Austin Building Boom

    Insurance Firm Defends against $22 Million Claim

    Defective Drains Covered Despite Water Intrusion Exclusion

    Injured Construction Worker Settles for Five Hundred Thousand

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

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

    Courts Are Conflicted As To Whether "Good Faith" Settlement Determinations Can Be Reviewed Via Writ Petition Or Appeal

    Good and Bad News on Construction Employment

    Insurer Has Duty to Defend in Water Intrusion Case

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    Kansas Man Caught for Construction Scam in Virginia

    Construction Defect Case Not Over, Despite Summary Judgment

    The Flood Insurance Reform Act May be Extended to 2016

    Former Zurich Executive to Head Willis North America Construction Insurance Group

    Washington Court Limits Lien Rights of Construction Managers

    Housing Market on Way to Recovery

    Limiting Plaintiffs’ Claims to a Cause of Action for Violation of SB-800

    Another Colorado District Court Refuses to Apply HB 10-1394 Retroactively

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    Hospital Construction Firm Settles Defect Claim for $1.1 Million

    Colorado Senate Bill 12-181: 2012’s Version of a Prompt Pay Bill

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    California Lawyer Gives How-To on Pursuing a Construction Defect Claim

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    Damron Agreement Questioned in Colorado Casualty Insurance v Safety Control Company, et al.

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

    After $15 Million Settlement, Association Gets $7.7 Million From Additional Subcontractor

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    Federal District Court Continues to Find Construction Defects do Not Arise From An Occurrence

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    Insurance for Defective Construction Now in Third Edition

    Federal District Court Predicts Florida Will Adopt Injury In Fact Trigger

    Fourteen More Guilty Pleas in Las Vegas Construction Defect Scam

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    No Coverage for Property Damage That is Limited to Work Completed by Subcontractor

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    Court Rules on a Long List of Motions in Illinois National Insurance Co v Nordic PCL

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    Court Clarifies Sequence in California’s SB800

    Negligent Construction an Occurrence Says Ninth Circuit

    Construction Employment Rises in Half of the States

    Construction Defect Journal Seeks Article Submissions Regarding SB800 and Other Builders Right to Repair Laws

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    Insurance Firm Under No Duty to Defend in Hawaii Construction Defect Case

    Local Government Waives Construction Fees to Spur Jobs

    Arizona Contractor Designs Water-Repellant Cabinets

    Pictorial Construction Terminology Dictionary — A Quick and Helpful Reference

    Construction Defects Are Occurrences, Says Georgia Supreme Court

    Illinois Court Determines Insurer Must Defend Negligent Misrepresentation Claim

    Delays in Filing Lead to Dismissal in Moisture Intrusion Lawsuit

    Lien Law Unlikely To Change — Yet

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

    Connecticut Gets Medieval All Over Construction Defects

    Florida Property Bill Passes Economic Affairs Committee with Amendments

    Seven Tips to Manage Construction Defect Risk

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    SB800 Cases Approach the Courts

    Eighth Circuit Remands to Determine Applicability of Collapse Exclusion

    Faulty Workmanship may be an Occurrence in Indiana CGL Policies

    Fifth Circuit Asks Texas Supreme Court to Clarify Construction Defect Decision

    Insurer Able to Refuse Coverage for Failed Retaining Wall

    Nevada Budget Remains at Impasse over Construction Defect Law

    Exclusions Bar Coverage for Damage Caused by Chinese Drywall

    Cabinetmaker Exceeds Expectations as Conditions Improve

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    Window Manufacturer Weathers Recession by Diversifying

    District Court’s Ruling Affirmed in TCD v American Family Mutual Insurance Co.

    Georgia Law: “An Occurrence Can Arise Where Faulty Workmanship Causes Unforeseen or Unexpected Damage to Other Property”

    Insurer’s Discovery Requests Ruled to be Overbroad in Construction Defect Suit

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    Building Inspector Jailed for Taking Bribes
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    BOELUS NEBRASKA CONSTRUCTION EXPERT WITNESS
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    The Boelus, Nebraska Construction Expert Witness Group is comprised from a number of credentialed construction professionals possessing extensive trial support experience relevant to construction defect and claims matters. Leveraging from this considerable body of experience, BHA provides construction related trial support and expert services to the nation's most recognized construction litigation practitioners, Fortune 500 builders, commercial general liability carriers, owners, construction practice groups, and a variety of state and local government agencies.

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    Construction Expert Witness News & Info
    Boelus, Nebraska

    Does the New Jersey Right-To-Repair Law Omit Too Many Construction Defects?

    January 6, 2012 — CDJ Staff

    A post on the blog of Liberty Building Forensics Group find fault with the New Jersey Home Warranty and Builders’ Registration Act for not being stringent enough. The poster notes the coverage given under the bill. In the first year, builders are responsible to remedy faulty workmanship and materials and major structural defects. While other protections expire in the first or second year, there is a ten year coverage of major construction defects.

    The blogger finds fault with the exclusion New Jersey law places on these claims, arguing that “due to the stringent definition of ‘major construction defects,” the warranty affords no coverage unless the house is practically collapsing.” The bill excludes leaks, cracks, and mold, and further limits claims if the homeowner has failed to inform the builder or insurer of defects, failure to maintain the home, and alterations made by the homeowner.

    The intent of the New Jersey law is given as “requiring that newly constructed homes conform to certain construction and quality standards as well as to provide buyers of new homes with insurance-backed warranty protection in the event such standards are not met.” It’s argued in the piece that it instead serves to “strip homeowners of any meaningful means of recovery for discovered construction defects.”

    Read the full story…


    Gut Feeling Does Not Disqualify Expert Opinion

    July 6, 2011 — CDJ Staff

    The New Jersey Supreme Court issued a ruling in June on the case of Nevins v. Toll in which they reversed an earlier decision and remanded the case to a lower court for retrial. At issue in the case was the testimony of the plaintiff’s expert, J. Anthony Dowling. In depositions, Mr. Dowling said that his estimates for repair were based on a “gut feeling.” Dowling said he had “very little” experience in cost estimates for single-family homes. The defendants sought to bar Dowling’s testimony which was granted by the judge. Without an expert, Ms. Nevin’s case was dismissed.

    Describing Dowling’s report as “far from a model of how an expert’s opinion in a construction case should be presented,” the court noted that Dowling is not a professional expert witness. However, the court did note that Dowling is a professional cost estimator. Despite Mr. Dowling using his “gut feeling” to construct his estimate, the New Jersey Supreme Court felt that whether his estimate is convincing is “a question for the jury.”

    Read the court’s opinion…


    Condominium Communities Must Complete Construction Defect Repairs, Says FHA

    July 10, 2012 — CDJ Staff

    Laura K. Sanchez of HindmanSanchez writes that the FHA “will not approve or recertify” any condominium community “where there are any pending or incomplete repairs within the community which are a result of a construction defect claim, regardless of whether the litigation has been resolved and regardless of whether there are funds in the bank paid by the developer to pay for the repairs.” The FHA notes that failure to complete or fund repairs could “put FHA insured loans at risk.” Communities must disclose all maintenance and repair issues to the FHA. Sanchez notes that the FHA has stated that incomplete repairs could put FHA-insured loans at risk.

    Read the full story…


    Ohio Court of Appeals Affirms Judgment in Landis v. Fannin Builders

    April 20, 2011 — April 20, 2011 Beverley BevenFlorez - Construction Defect Journal

    The Ohio Court of Appeals affirmed the judgment in Landis v. William Fannin Builders. Landis contracted Fannin Builders to build their home. The case involved staining problems on the T1-11 siding chosen by the plaintiffs.

    After a year and a half of discussion on how to resolve the problem of uneven staining on the siding, Landis filed suit “against Fannin Builders, alleging claims for breach of contract, breach of the express limited warranty, and violation of the Ohio Consumer Sales Practices Act (“OCSPA”). Fannin Builders, in turn, filed a third-party complaint against 84 Lumber, alleging claims for breach of contract and indemnification. With the trial court’s leave, Fannin Builders also later amended its answer to add a counterclaim against appellees for breach of contract and unjust enrichment. In the counterclaim, Fannin Builders alleged that appellees still owed it $3,908.98 for the construction of appellees’ home.”

    “In its decision, the trial court found in appellees’ favor on their breach of contract claim and against appellees on their claims for breach of the express limited warranty and violation of the OCSPA. Additionally, the trial court found in Fannin Builders’ favor on its counterclaim for breach of contract and against Fannin Builders on its third-party claims for breach of contract and indemnity. The trial court determined that appellees’ damages amounted to $66,906.24, and after setting off the $3,908.98 that appellees owed Fannin Builders under the construction contract, the trial court awarded appellees $62,997.26. The trial court reduced its decision to judgment on May 18, 2010.”

    Fannin Builders appealed this judgment and assigned the following errors:

    [1.] The Trial Court Erred as a Matter of Law by Concluding that Appellant Breached its Contract with Appellees when it provided a Semi-Transparent Oil-Based Stain that Simply did not Meet their Approval.

    [a.] The Contract does not Contain a Satisfaction Clause.

    [b.] Even if the Court Implies a Satisfaction Clause, the Court Should Apply an Objective Standard.

    [2.] The Trial Court Erred as a Matter of Law by Failing to Consider Appellant’s Right to Cure.

    [3.] The Trial Court committed Reversible Error by not Assessing Damages Using “Diminished Value Standard,” and by Creating a Remedy that Constitutes Economic Waste.

    [4.] The Trial Court Erred as a Matter of Law by Concluding that Appellant is Barred from Seeking Indemnification When 84 [Lumber] Never Fulfilled its Obligations Pursuant to the Settlement Agreement Entered on August 2, 2005.

    In response to the first assigned error, the Court of Appeals stated: “Because the failure to provide siding of a uniform color, not appellees’ displeasure, breached the contract, we reject Fannin Builders’ contention that the trial court implied a satisfaction clause into the contract and found a breach of that clause. Accordingly, we overrule Fannin Builders’ first assignment of error.”

    The Court of Appeals overruled the second assignment of error and provided the following reasoning: “Although Fannin Builders depends upon a term of the limited warranty for its right to cure, the trial court concluded that no breach of the limited warranty occurred. Fannin Builders breached the duty of workmanlike conduct implicit in the construction contract, not the limited warranty requiring it to satisfy the BIA’s Quality Standards. Consequently, the limited warranty does not apply to this case, and thus, it does not prevent appellees’ recovery of damages.”

    The Appeals Court found “the trial court’s award of damages” was “both reasonable and supported by competent, credible evidence,” and therefore concluded “that the trial court did not err in setting appellees’ damages at $62,997.26.” The Fannin Builders third assignment of error was overruled.

    The fourth and final assignment of error was also overruled by the Court of Appeals. “While Fannin Builders correctly asserts that 84 Lumber never installed the replacement siding, it ignores the fact that it ordered 84 Lumber to remove the replacement siding from appellees’ property. Thus, Fannin Builders precluded 84 Lumber from completely performing under the August 2, 2005 letter agreement. […] Consequently, Fannin Builders cannot now claim that the letter agreement is unenforceable or that it is entitled to indemnification from 84 Lumber. Because Fannin Builders assumed all liability for the defective siding in the letter agreement, it is responsible for appellees’ damages.”

    James A. Zitesman, Columbus, Ohio Business Attorney, compared the case to Jones v. Centex (Ohio App. 2010), which had a different verdict:

    “The common thread is the implied warranty of good workmanship. In the Jones case, the Court found that the buyers had in fact waived all implied warranties, including the implied warranty of good workmanship. In the contract between Jones and Centex, the builder stated that it “…would not sell the property to Purchasers without this waiver.” Probably should have been a sign to the buyers.

    In the Landis case, the Court stated, “Contracts for the future construction of a residence include a duty, implied by law, that the builder must perform its work in a workmanlike manner.” The Court gave significant weight to the concept of the implied warranty of good workmanship. The builder relied upon the BIA Warranty which limits builders’ liability and exposure to legal issues. The trial court concluded there was no breach of the limited warranty, rather the builder “breached the duty of workmanlike conduct implicit in the construction contract, not the limited warranty requiring it to satisfy the BIAs Quality Standards.”

    The Supreme Court of Ohio has accepted the Jones v. Centex Homes case for review.

    Read the full story...


    Arbitrator May Use Own Discretion in Consolidating Construction Defect Cases

    September 1, 2011 — CJD Staff

    The Mississippi Court of Appeals has ruled in the case of Harry Baker Smith Architects II, PLLC v. Sea Breeze I, LLC. Sea Breeze contracted with Harry Baker Smith Architects II, PLLC (HBSA) to design a condominium complex, which would be built by Roy Anderson Corporation. All parties agreed to arbitration.

    Subsequently, Sea Breeze alleged defects and sought arbitration against the architectural firm and started a separate arbitration proceeding against the contractor. The special arbitrator appointed by the American Arbitrators Association determined that it would be proper to consolidate the two actions “since they arose from a common question of fact or law.” HBSA filed in chancery court seeking injunctive relief and a reversal of the decision. Sea Breeze and Roy Anderson filed a motion to compel the consolidated arbitration.

    The court noted that the special arbitrator “established that the contract between Sea Breeze and Roy Anderson expressly allowed for consolidation of the two cases.” Further, the arbitrator “concluded that HBSA expressly agreed to consolidation by written consent through its 2008 letter, through which it insisted upon Roy Anderson’s involvement ‘in any mediation and/or arbitration.’”

    The court concluded that the chancery court “did not have the power to fulfill HBSA’s request.” The court affirmed the chancery court’s judgment.

    Read the court’s decision…


    Contractor Liable for Soils Settlement in Construction Defect Suit

    February 10, 2012 — CDJ Staff

    The California Court of Appeals ruled on January 9 in Burrow v. JTL Dev. Corp., a construction defect case in which houses suffered damage due to improperly compacted soil, upholding the decision of the lower court.

    Turf Construction entered into a deal with JTL to develop a parcel they acquired. A third firm, Griffin Homes, withdrew from the agreement “when a geotechnical and soils engineering firm reported significant problems with soil stability on 14 of the lots.” Turf Construction then took over compacting and grading the lots. Turf “had never compacted or graded a residential tract before.” Robert Taylor, the owner of Turf, “testified he knew there was a significant problem with unstable soils.”

    After homes were built, the plaintiffs bought homes on the site. Shortly thereafter, the homes suffered damage from soil settlement “and the damage progressively worsened.” They separately filed complaints which the court consolidated.

    During trial, the plaintiff’s expert said that there had been an inch and a half in both homes and three to five inches in the backyard and pool areas. “He also testified that there would be four to eight inches of future settlement in the next fifteen to twenty years.” The expert for Turf and JTL “testified that soil consolidation was complete and there would be no further settlement.”

    Turf and JTL objected to projections made by the plaintiffs’ soil expert, William LaChappelle. Further, they called into question whether it was permissible for him to rely on work by a non-testifying expert, Mark Russell. The court upheld this noting that LaChappelle “said that they arrived at the opinion together, through a cycle of ‘back and forth’ and peer review, and that the opinion that the soil would settle four to eight inches in fifteen to twenty years was his own.”

    Turf and JTL contended that the court relied on speculative damage. The appeals court disagreed, stating that the lower court based its award “on evidence of reasonably certain damage.”

    Turf also that it was not strictly liable, since it did not own or sell the properties. The court wrote that they “disagree because Turf’s grading activities rendered it strictly liable as a manufacturer of the lots.” The court concluded that “Turf is strictly liable as a manufacturer of the lots.”

    Judge Coffee upheld the decision of the lower court with Judges Yegan and Perren concurring.

    Read the court’s decision…


    Follow Up on Continental Western v. Shay Construction

    March 28, 2012 — Brady Iandiorio, Colorado Construction Litigation

    Writing in Construction Law Colorado, Brady Iandiorio revisits the case Continental Western v. Shay Construction. He promises to continue to follow cases dealing with Colorado HB 10-1394.

    Recently the Court ruled on two Motions to Reconsider filed by Defendants Milender White and Shay Construction.

    Procedurally, the Motions to Reconsider were ruled on by the Honorable William J. Martinez, because the day after the motions were filed the action was reassigned to Judge Martinez. In the short analysis of the Motion to Reconsider, the court leaned on Judge Walker D. Miller’s ruling on the summary judgment and his analysis of the (j)(5) and (j)(6) exclusions.

    As a quick refresher regarding the grant of summary judgment, Judge Miller agreed with Continental Western’s argument that the asserted claims were excluded under the “damage to property” exclusion. The policy’s exclusions state: “(j) Damage to Property . . . (5) that particular part of real property on which you or any contractors or subcontractors working directly or indirectly on your behalf are performing operations, if the ‘property damage’ arises out of those operations; or (6) that particular part of any property that must be restored, repaired or replaced because ‘your work’ was incorrectly performed on it.” Judge Miller found that both exclusions (j)(5) and (6) applied to both Shay’s allegedly defective work.

    Read the full story…

    Reprinted courtesy of Brady Iandiorio of Higgins, Hopkins, McClain & Roswell, LLC. Mr. Iandiorio can be contacted at iandiorio@hhmrlaw.com.


    No Duty to Indemnify When Discovery Shows Faulty Workmanship Damages Insured’s Own Work

    November 7, 2012 — Tred Eyerly, Insurance Law Hawaii

    Our post last week addressed the duty to defend when alleged faulty workmanship caused loss to property adjacent to where the insured was working. See Pamerin Rentals II, LLC v. R.G. Hendricks & Sons Constr., Inc., 2012 Wis. App. LEXIS 698 (Wis. Ct. App. Sept. 5, 2012) [post here]. Today, we report on recent developments in the same case where the court determined, despite earlier finding the insurer owed a defense, it had no duty to indemnify. Pamperin Rentals II, LLC v. R.G. Hendricks & Sons Constr., Inc., 2012 Wisc. App. LEXIS 793 (Wis. Ct. App. Oct. 10, 2012).

    Hendricks contracted to “prepare the site and supply and install concrete, tamped concrete, and colored concrete” at several service stations. The owner sued Hendricks, alleging the concrete “was defective and/or the work performed was not done in a workman-like manner and resulted in damages, and will require replacement.”

    Pekin Insurance Company agreed to defend Hendricks subject to a reservation of rights.

    Read the full story…

    Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii. Mr. Eyerly can be contacted at te@hawaiilawyer.com


    Las Vegas Home Builder Still in Bankruptcy

    October 23, 2012 — CDJ Staff

    American West Development attempted to exit Chapter 11 bankruptcy on September 27, but their plan was turned down by U.S. Bankruptcy Court Judge Mike Nakagawa. According to the Las Vegas Review-Journal, Judge Nakagawa rejected the plan over a trust fund for construction defects. America West’s attorney said they were hoping to complete the process by the end of the year.

    Under approved portions of the plan, America West’s owner, Lawrence Canarelli, will retain control of the corporation, although he must contribute $10 million into the firm and an additional $1.5 million into the fund for construction defects. America West faces charges for construction defects reported in the broad range of “less than $20 million” to “as much as $80 million.”

    Read the full story…


    Is Construction Heading Off the Fiscal Cliff?

    December 20, 2012 — CDJ Staff

    After a period of growth, the construction industry lost 20,000 jobs in November, based on the federal jobs data. Damon Scott of New Mexico Business Weekly suggests that contractors may have laid off employees in anticipation of the “fiscal cliff.” Ken Simpson, the chief economist of the National Association of Home Builders said in a press release that “it is discouraging that construction employment is still struggling after three years of expansion in the overall economy.”

    Read the full story…


    Demand for Urban Living Leads to Austin Building Boom

    August 16, 2012 — CDJ Staff

    The New York Times reports that Austin is undergoing a building boom as a high-tech firms, including Facebook and Google, have moved into the downtown area. With them, comes a need for more apartment buildings and more retail space. Mike Kennedy, the president and chief executive of an Austin real estate firm, told the Times “the office space was here, the housing came, and retail is arriving last to the scene.” Currently, two large projects that will add about 500 apartment units is underway, including a 222-unit, 18-story building, and another that will contain 277 units. Apartment occupancy in Austin is at ninety-seven percent.

    Developers also have hotels and more office space planned. The area has about 6,000 hotel rooms with an additional 2,000 planned, but events in Austin can bring in more people than the city’s 30,000 hotel rooms can accommodate. Office space is eighty-eight percent occupied, and a lack of office space could cause firms to look elsewhere.

    Read the full story…


    Developer’s Fraudulent Statements Are His Responsibility Alone in Construction Defect Case

    February 10, 2012 — CDJ Staff

    The Texas Court of Appeals ruled on December 21 in the case of Helm v Kingston, a construction defect case. After purchasing what was described as “an extremely well-built” two-bedroom townhouse, Mr. Kingston made complaints of construction defects. Greenway Development did not repair the defects to Kingston’s satisfaction, and he filed notice of suit. In his suit, he claimed that GDI and its president, John Helm, had committed fraud and negligent misrepresentation. Kingston claimed that Helm “fraudulently induced Kingston to believe that the townhouse evidenced the highest quality of workmanship when in fact the quality of workmanship was atrocious.” Helms brought a counterclaim that Kingston’s suit was frivolous.

    About four years after Kingston purchased the townhome, the suit proceeded to trial. The trial court determined that Helm was not “liable in his individual capacity,” but this was reversed at appeal.

    A second trial was held ten years later on the question of whether Kingston’s unit was a townhome or an apartment. A jury found that Helm “engaged in a false, misleading or deceptive act or practice that Kingston relied on to his detriment.” Kingston was awarded $75,862.29 and an additional $95,000 in attorney fees by the jury. Helms made an unsuccessful appeal to the Appeals Court, after which Kingston was awarded an additional $10,000. Helms then made an unsuccessful appeal to the Texas Supreme Court, which lead to an additional $3,000 for Kingston. There was also a verdict of $48,770.09 in pre-judgment interest and “five percent post-judgment interest accruing from the date of the judgment until the time the judgment is paid. Helm appealed.

    In his appeal, Helm raised seven issues, which the court reorganized into five Kingston raised one issue on cross-appeal.

    Helms’ first claim was that Kingston “failed to satisfy the requirement of” Texas’s Residential Construction Liability Act and that by not filing under the RCLA, Kingston’s fraud and misrepresentation claims were preempted. Further Helms claimed that the RCLA limited Kingston’s damages. The court rejected this, as the RCLA deals with complaints made to a contractor and not only did Helm fail to “conclusively establish” his “status as a ‘contractor’ under the statutory definition,” Helm testified that he was “not a contactor” at the pre-trial hearing.

    Helms’s second claim was that Kingston’s later claim of a misconstructed firewall should be barred, claiming that Kingston “‘had knowledge of a defect in the firewall’ as early as 1997 but did not assert them until 2007.” The court rejected this because Kingston’s claim was that “Helm ‘fraudulently induced Kingston to believe that the townhouse evidenced the highest quality of workmanship when in fact the quality of the workmanship was atrocious.’”

    Helms also challenged whether his statements that the residence was of “good quality” constituted fraud and misrepresentation under Texas’s Deceptive Trade Practices-Consumer Protection Act. The court concluded that Helm was in a position to make knowledgeable statements and further that “residential housing units are not artistic works for which quality is inherently a matter of subjective judgment.” Helm also claimed that Kingston could have avoided certain repair expenses through the “exercise of reasonable care.” Helms argued that the repairs could have been made for $6,400. The court disagreed, as these claims were cited only to invoke the DTPA, and that later petitions established additional defects.

    Helms’s next claim was that he was not allowed to designate responsible third parties. The court rejected this because there GDI represented matters concerning the residence only through Helm’s statements. The court noted that “Helm is correct that?third parties may be liable for fraud if they ‘participated in the fraudulent transactions and reaped the benefits,’” but they note that “Helm never specifically alleged that GDI or CREIC participated in Helm’s alleged fraudulent transactions.

    The final issue in the decision was about court costs, and here the court denied claims on both sides. Helm argued that the award of legal fees were excessive, as they exceeded the actual damages. The court noted that they “may not substitute our judgment for that of the jury,” and also that “the ratio between the actual damages awarded and the attorney’s fees is not a factor that determines the reasonableness of the fees.” But the court also rejected Kingston’s claim for post-judgment interest on $10,312.30 that Helm had deposited in the trial court’s registry. The court noted that the monies were to be paid out upon final judgment, but the mandate did not include any reference to interest.

    Read the court’s decision…


    Celebrities Lose Case in Construction Defect Arbitration

    May 26, 2011 — CDJ Staff

    An arbitration panel has ruled that problems with the Idaho home of actors Tom Hanks and Rita Wilson were not due to construction defects but rather to “poor design and bad architectural advice.” The couple had settled with the architectural firm, Lake Flato of San Antonio, Texas for $900,000 and was subsequently seeking $3 million from Storey Construction of Ketchum, Idaho.

    Problems with the couple’s home “included leaking roofs, inadequate drainage, fireplaces that did not vent properly and an inadequate air-conditioning system. In 2003, sliding snow from the roof damaged kitchen windows and roof components.”

    The arbitration panel, according to the report in the Idaho Mountain Express and Guide, noted that “Hanks and Wilson were responsible for the full $167,623 cost of arbitration, but further denied a Storey Construction counterclaim that alleged Hanks and Wilson filed their claim out of malice.”

    Read the full story…


    Ensuing Losses From Faulty Workmanship Must be Covered

    May 10, 2012 — Tred Eyerly, Insurance Law Hawaii

    Coverage for damages resulting from faulty workmanship in the construction of an apartment complex was at issue in The Bartram, LLC v. Landmark Am. Ins. Co., 2012 U.S. Dist. LEXIS 44535 (N.D. Fla. March 30, 2012).

    The owner of the apartments, Bartram, had primary coverage and three layers of excess coverage. Each contract excluded loss from faulty workmanship. The policies provided, however, "if loss or damage by a Covered Cause of Loss results, we will pay for that resulting loss or damage."

    Bartram contended water intrusion occurred because of faulty workmanship, which caused damage to the buildings’ exterior and interior finishes, wood sheathing, framing, balcony systems, drywall ceilings and stucco walls. This damage was separate from the work needed to simply fix the faulty workmanship. Therefore, Bartram argued, the ensuing losses that resulted from the water intrusion was covered.

    The insurer argued the ensuing loss exception was not applicable if the ensuing loss was directly related to the original excluded loss.

    Read the full story…

    Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii. Mr. Eyerly can be contacted at te@hawaiilawyer.com


    Statute of Repose Dependant on When Subcontractors Finished

    July 10, 2012 — CDJ Staff

    Scott C. Sandberg of Snell and Wilmer writes a post on the JDSupra site about the Colorado Court of Appeals decision in Shaw Construction v. United Builder Services. Sanberg notes that when the general contractor was sued by an HOA, the contractor turned around and sued its subcontractors. The contractor made three claims. They claimed that “improvement” referred to the whole project, that “substantial completion” was reached when the architect certified completion, and that the statute of repose was tolled by the HOA’s service of a Construction Defect Action Reform Act notice.

    The subcontractors claimed that “improvement” only referred to their specific work, which reached “substantial completion” when they finished, despite work to be done by other later, and the HOA’s notice to the contractor did not affect the subcontractors. The Colorado court agreed with the subcontractors.

    Sandberg notes that some of the contractor’s were not addressed by the court, noting that “the court did not decide whether an improvement triggering the statute of repose can be determined on a trade-by-trade basis,” and that “the court did not decide whether substantial completion occurs when a certificate of occupancy is issued or when the architect certifies completion.”

    Read the full story…


    Pennsylvania Court Extends Construction Defect Protections to Subsequent Buyers

    December 20, 2012 — CDJ Staff

    The Pennsylvania courts have long held that there is an implied warranty of habitability for the initial purchaser of a home. Now, as some defects may not immediately show up, the court has extended that implied warranty to second and subsequent purchasers. As Marc D. Brookman, David I. Haas, and Christopher Bender of Duane Morris note, “this judicially created doctrine shifts the risk of a latent defect in the construction of a new home from the purchaser to the builder-vendor.”

    The Pennsylvania Supreme Court concluded that a contractual relationship is not needed for an implied warranty of habitability. The court’s concern was inequalities would result when a home was sold while other homes were protected by being within the statute of repose.

    Read the full story…


    Boston’s Tunnel Project Plagued by Water

    August 11, 2011 — CDJ Staff

    Boston’s Tip O’Neil Tunnel, part of the “Big Dig” project, is suffering from water leaks which has lead to millions of dollars of damage, according to an article in the Boston Globe. The report quotes Frank DePaola, the highway administrator, as likening the water leaks to “three garden hoses.” The project’s chief engineer notes that those “three garden hoses” add up to 17 million gallons a year.

    Further, the chief engineer reports notes that the leaks could compromise both safety and structural integrity. Problems have included a 110-pound light fixture that fell in February, ventilation ducts clogged with ice during the winter, and mold in utility rooms and ventilation buildings.

    Read the full story…


    Federal Judge Dismisses Insurance Coverage Lawsuit In Construction Defect Case

    December 9, 2011 — CDJ Staff

    A federal judge dismissed a coverage lawsuit brought by Mid Continent Casualty Company against its insured, Greater Midwest Builders Ltd.

    Plaintiff brought this declaratory judgment action in response to a suit filed in Johnson County District Court, seeking a judicial determination that it had no coverage obligation for claims asserted against its insured. This case was stayed until the state court action entered judgment against the insured. The prevailing parties then commenced a garnishment action against the plaintiff, and another insurance company, in state court in Missouri. The court was asked whether it should lift the stay and proceed with the case, or decline jurisdiction in favor of resolution in the Missouri state court.

    The court granted the motion to dismiss holding that proceeding with the case would lead to protracted, piecemeal litigation, while deferring to the Missouri state court would decide all the claims involved in the dispute.

    Read the court’s decision…