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    Construction Expert Witness Builders Information
    Tynan, Texas

    Texas Builders Right To Repair Current Law Summary:

    Current Law Summary: HB 730 amended the Texas Property Code by adding Title 16 and amending chapter 27. Overseen by the Texas Residential Construction Commission (TRCC) the code asserts that a contractor is not liable for any percentage of damages caused by failure to take reasonable action to mitigate damages or take reasonable action to maintain the residence. It also limits damages, requires written notification and response for right of repair and defines warranty periods. Additionally, SB 754 states“(5-10 Sec. 27.107) a contractor may assert as an affirmative defense to an allegation of a defect made in a complaint filed under this subchapter that the defect is the result of abuse, neglect, or unauthorized modifications or alterations of the home.”


    Construction Expert Witness Contractors Licensing
    Guidelines Tynan Texas

    No state license is required, however, general contractors must get permits at the local level. Separate boards license HVAC, and plumbing trades.


    Construction Expert Witness Contractors Building Industry
    Association Directory
    Laredo Builders Association
    Local # 4593
    201 W Hillside Suite 3
    Laredo, TX 78041
    http://www.laredobuilders.org

    Builders Association of Corpus Christi
    Local # 4521
    5325 Yorktown Blvd
    Corpus Christi, TX 78413
    http://www.bacctexas.org/

    Builders Association of Victoria
    Local # 4572
    5105 E Airline Rd
    Victoria, TX 77904
    http://www.vctbuilders.org

    Galveston Area Builders & Remodelers Association
    Local # 4533
    P O Box 1037
    Santa Fe, TX 77517
    http://www.galvestonbuilders.org/

    Builders Association of Greater San Antonio
    Local # 4560
    3625 Paesanos Parkwary
    San Antonio, TX 78231
    http://www.sabuilders.com

    Greater New Braunfels Home Builders Association
    Local # 4503
    625 W San Antonio St
    New Braunfels, TX 78130
    http://www.newbraunfelshomebuilders.com

    Greater Houston Builders Association
    Local # 4536
    9511 W Sam Houston Pkwy N
    Houston, TX 77064
    http://www.ghba.org


    Construction Expert Witness News and Information
    For Tynan Texas

    Florida trigger

    Construction Defects Are Occurrences, Says South Carolina High Court

    Water District Denied New Trial in Construction Defect Claim

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

    Nevada Supreme Court Reverses Decision against Grader in Drainage Case

    Eleventh Circuit Asks Georgia Supreme Court if Construction Defects Are Caused by an "Occurrence"

    Coverage Rejected Under Owned Property and Alienated Property Exclusions

    Residential Construction Down in San Diego

    LEED Certified Courthouse Square Negotiating With Insurers, Mulling Over Demolition

    Eighth Circuit Remands to Determine Applicability of Collapse Exclusion

    State Audit Questions College Construction Spending in LA

    Ohio Court Finds No Coverage for Construction Defect Claims

    Texas Law Bars Coverage under Homeowner’s Policy for Mold Damage

    Florida Chinese drywall, pollution exclusion, “your work” exclusion, and “sistership” exclusion.

    No Resulting Loss From Deck Collapsing Due to Rot

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

    California Posts Nation’s Largest Gain in Construction Jobs

    Nevada Assembly Sends Construction Defect Bill to Senate

    Important Information Regarding Colorado Mechanic’s Lien Rights.

    No Coverage for Negligent Misrepresentation without Allegations of “Bodily Injury” or “Property Damage”

    Builder Cannot Receive Setoff in Construction Defect Case

    Insurer Must Cover Construction Defects Claims under Actual Injury Rule

    Couple Sues Attorney over Construction Defect Case, Loses

    Ceiling Collapse Attributed to Construction Defect

    Good Signs for Housing Market in 2013

    Safe Harbors- not just for Sailors anymore (or, why advance planning can prevent claims of defective plans & specs) (law note)

    Bad Faith and a Partial Summary Judgment in Seattle Construction Defect Case

    Construction Defect Not an Occurrence in Ohio

    A Loud Boom, But No Serious Injuries in World Trade Center Accident

    Anti-Concurrent Causation Clause Bars Coverage for Landslide and Water Leak

    Texas Court of Appeals Conditionally Grant Petition for Writ of Mandamus to Anderson

    Tenth Circuit Finds Insurer Must Defend Unintentional Faulty Workmanship

    Florida County Suspends Impact Fees to Spur Development

    After Construction Defect Case, Repairs to Austin Building

    Sometimes It’s Okay to Destroy Evidence

    Foundation Arbitration Doesn’t Preclude Suing Over Cracks

    Court Grants Summary Judgment to Insurer in HVAC Defect Case

    Texas res judicata and co-insurer defense costs contribution

    Excess Carrier Successfully Appeals Primary Insurer’s Summary Judgment Award

    Faulty Workmanship may be an Occurrence in Indiana CGL Policies

    Construction Defects Are Occurrences, Says Georgia Supreme Court

    Minnesota Starts Wide-Ranging Registration of Contractors

    Hovnanian Sees Second-Quarter Profit, Points to Recovery

    Firm Sued For Construction Defects in Parking Garage

    Broker Not Liable for Failure to Reveal Insurer's Insolvency After Policy Issued

    David McLain to Speak at the CDLA 2012 Annual Conference

    Defect Claims as Occurrences? Check Your State Laws

    Safer Schools Rendered Unsafe Due to Construction Defects

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

    Cleveland Condo Board Says Construction Defects Caused Leaks

    Southern California Lost $8 Billion in Construction Wages

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

    California Construction Bill Dies in Committee

    Cogently Written Opinion Finds Coverage for Loss Caused By Defective Concrete

    Insurance Company Prevails in “Chinese Drywall” Case

    Construction Defect Litigation at San Diego’s Alicante Condominiums?

    Construction Defects: 2010 in Review

    Construction Job Opening Rise in October

    Construction on the Rise in Denver

    Home Sales Still Low, But Enough to Spur Homebuilders

    Construction Defects Not Occurrences under Ohio Law

    Construction Defect Notice in the Mailbox? Respond Appropriately

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

    Homeowners May Not Need to Pay Lien on Defective Log Cabin

    Conspirators Bilked Homeowners in Nevada Construction Defect Claims

    New Jersey Court Rules on Statue of Repose Case

    Construction Company Head Pleads Guilty to Insurance and Tax Fraud

    More Charges in Las Vegas HOA Scandal

    Park District Sues over Leaky Roof

    Construction Defect Claim Did Not Harm Homeowner, Court Rules

    No Coverage for Construction Defects Under Alabama Law

    Is Construction Heading Off the Fiscal Cliff?

    Court finds subcontractor responsible for defending claim

    Lockton Expands Construction and Design Team

    Construction Defect Lawsuits? There’s an App for That

    General Contractors Must Plan to Limit Liability for Subcontractor Injury

    Defective Grout May Cause Trouble for Bridges

    Housing Market on Way to Recovery

    Insurance Policy Provides No Coverage For Slab Collapse in Vision One

    Construction Demand Unsteady, Gains in Some Regions

    Builder Waits too Long to Dispute Contract in Construction Defect Claim

    Claims Under Colorado Defect Action Reform Act Count as Suits

    Unlicensed Contractors Nabbed in Sting Operation

    Damage During Roof Repairs Account for Three Occurrences

    Contract Not So Clear in South Carolina Construction Defect Case

    Construction Defects and Contractor-Owners

    Construction Bright Spot in Indianapolis

    Failure to Meet Code Case Remanded to Lower Court for Attorney Fees

    “Details Matter” is the Foundation in a Texas Construction Defect Suit

    Quarter Four a Good One for Luxury Homebuilder
    Corporate Profile

    TYNAN TEXAS CONSTRUCTION EXPERT WITNESS
    DIRECTORY AND CAPABILITIES

    The Tynan, Texas 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
    Tynan, Texas

    Defense for Additional Insured Not Barred By Sole Negligence Provision

    August 11, 2011 — Tred Eyerly, Insurance Law Hawaii

    A general contractor was entitled to a defense as an additional insured when the underlying complaint did not allege it was solely negligent. A-1 Roofing Co. v. Navigators Ins. Co., 2011 Ill. App. LEXIS 656 (Ill. Ct. App. June 24, 2011).

    A-1 was the general contractor for a roof resurfacing job at a high school. Jack Frost Iron Works Inc. (“Frost”) was one of A-1’s subcontractors. Frost had a CGL policy with Navigators Insurance Company under which A-1 was an additional insured.

    An employee of Frost’s subcontractor Midwest Sheet Metal Inc. was killed at the job site when a boom-lift he was operating flipped over. The boom-lift had been leased by another Frost subcontractor, Bakes Steel Erectors, Inc. (BSE). The deceased's estate filed suit against A-1, BSE and two other defendants.

    Read the full story…

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


    Construction Case Alert: Appellate Court Confirms Engineer’s Duty to Defend Developer Arises Upon Tender of Indemnity Claim

    January 27, 2010 — By Steven M. Cvitanovic, Haight Brown & Bonesteel, LLP, January 27, 2010

    In the recent case of UDC-Universal Development, L.P. v. CH2M Hill, 2010 Cal.App.LEXIS 47 (filed January 15, 2010), the Sixth District Court of Appeal provided a stunning illustration of the far-reaching effects of the California Supreme Court’s holding in Crawford v. Weather Shield Manufacturing Inc. (2008) 44 Cal.4th 541. In Crawford, the Court held the duty to defend under an indemnity agreement arose upon the mere tender of defense of a claim covered by the indemnity.

    In the UDC case, CH2M Hill provided engineering and environmental planning services to developer UDC on a project that ultimately wound up in a construction defect lawsuit by the homeowners association ( HOA ). UDC tendered its defense to CH2M Hill, the tender was rejected, and UDC filed a cross-complaint for negligence, breach of contract and indemnity against CH2M Hill and others. After the HOA’s construction defect claims were settled, UDC proceeded to trial against CH2M Hill. The jury found in favor of CH2M Hill on the claims for negligence and breach of contract. At the request of the parties prior to trial, the trial court ruled on the application of the indemnity agreement in light of Crawford and, in so doing, found that the defense obligation arose upon the tender and that CH2M Hill breached that duty despite the jury finding in favor of CH2M Hill.

    The Court of Appeal affirmed, noting that the defense obligation arose as soon as the defense was tendered and did not depend on the outcome of the litigation, and that the HOA’s general description of the defects along with an allegation that Doe engineers were negligent triggered the duty to defend.

    Although this case did not expand the crushing impact of Crawford’s holding, it is

    Read the full story...


    Insurer Has Duty to Defend in Water Intrusion Case

    July 10, 2012 — CDJ Staff

    The Seventh Circuit Court of Appeals has upheld a summary judgment against an insurance company in a construction defect suit. Lagestee-Mulder, Incorporated (LMI) was hired by Crown Centre to construct a multi-story office building in Franfort, Illinois. LMI hired Frontrunner Glass & Metal to supply and install windows and doors. Frontrunner purchased an insurance policy from Consolidated which named LMI as an additional insured. The project experienced water intrusion and other construction defects and Crown sued LMI. Consolidated denied coverage. LMI sued Consolidated and the US District Court granted a summary judgment against Consolidated.

    The appeals court reviewed the grounds for summary judgment and determined that under Illinois law, Consolidated had a duty to defend. The court cited an earlier opinion that “if the underlying compliant alleges facts within or potentially within policy coverage, an insurer is obligated to defend its insured even if the allegations are groundless, false, or fraudulent.”

    Read the court’s decision…


    Late Filing Contractor Barred from Involving Subcontractors in Construction Defect Claim

    March 1, 2012 — CDJ Staff

    The Colorado Court of Appeals looked at that state’s Construction Defect Action Reform Act in determining if a general contractor could add subcontractors as third-party defendants to a construction defect lawsuit. Shaw Construction, LLC was the general contraction of the Roslyn Court condominium complex, and was sued by the homeowners’ association in a construction defect case. United Builder Services was the drywall subcontractor on the project. MB Roofing had installed roofs, gutters, and downspouts. The certificate of occupancy for the last building was issued on March 10, 2004. The project architect certified completion of all known remaining architectural items in June, 2004.

    The HOA filed a claim against the developers of the property on January, 21, 2009. A week later, the HOA amended its complaint to add Shaw, the general contractor. Shaw did not file its answer and third-party complaint until March 29, 2010, sending its notice of claim under the CDARA on March 30.

    The subcontractors claimed that the six-year statute of limitations had ended twenty days prior. Shaw claimed that the statute of limitations ran until six years after the architect’s certification, or that the HOA’s suit had tolled all claims.

    The trial court granted summary judgment to the subcontractors, determining that “substantial completion occurs ‘when an improvement to real property achieves a degree of completion at which the owner can conveniently utilize the improvement of the purpose it was intended.’”

    The appeals court noted that “Shaw correctly points out that the CDARA does not define ‘substantial completion.’” The court argued that Shaw’s interpretation went against the history and intent of the measure. “Historically, a construction professional who received a complaint responded by ‘cross-nam[ing] or add[ing] everybody and anybody who had a part to play in the construction chain.’” The court concluded that the intent of the act was to prevent unnamed subcontractors from being tolled.

    The court further rejected Shaw’s reliance on the date of the architect’s certification as the time of “substantial completion,” instead agreeing with the trial court that “the architect’s letter on which Shaw relies certified total completion.”

    The appeals court upheld the trial court’s determination that the statute of limitation began to run no later than March 10, 2004 and that Shaw’s complaint of March 29, 2010 was therefore barred. The summary judgment was upheld.

    Read the court’s decision…


    Anti-Concurrent Causation Clause Bars Coverage for Landslide and Water Leak

    June 19, 2012 — Tred Eyerly, Insurance Law Hawaii

    The insured unsuccessfully attempted to get around the policy’s anti-concurrent causation clause by arguing a covered cause of loss was a contributing factor. See Stor/Gard, Inc. v. Strathmore Ins. Co., 2012 U.S. Dist. LEXIS 63217 (D. Mass. May 4, 2012).

    A building at the insured’s storage facility was damaged when heavy rain caused a mass of soil to slide down a slope, causing soil and a retaining wall to fall on the building. The accident caused a partial collapse of the building. The insurer hired two soil engineers, each of whom concluded that a landslide caused the accident. The reports also noted, however, that a leak from the property’s drainage system resulted in a very small percentage of water infiltrating the ground.

    The insurer denied coverage based upon an exclusion for landslides.

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

    Read the full story…


    Colorado “property damage” caused by an “occurrence” and exclusions j(5) and j(6) “that particular part”

    August 11, 2011 — CDCoverage.com

    In Continental Western Ins. Co. v. Shay Construction, Inc., No. 10-cv-02126 (D. Col. July 28. 2011), general contractor Milender White subcontracted with insured Shay for framing work.   Shay in turn subcontracted some of its work to others.  When Shay?s subcontractors filed suit against Shay and Milender White seeking payment for their work, Milender White cross-claimed against Shay for breach of contract alleging that,Milender White notified Shay during construction that some of Shay?s work was defective and that when Shay repaired its defective work, it damaged work performed by others.  Shay’s CGL insurer Continental Western filed suit against Milender White and Shay seeking a judicial declaration of no coverage.  The federal district trial court granted Continental Western?s motion for summary judgment.

    Read the full story…

    Reprinted courtesy of CDCoverage.com


    Homebuilders Go Green in Response to Homebuyer Demand

    May 10, 2012 — CDJ Staff

    McGrawHill Construction reports that 17 percent of new homes and remodels in 2011 were done with green building practices. Their report estimates that by 2016, this will rise to 29 to 38 percent of the market for home construction and remodeling.

    Consumers see the green buildings as more desirable, particularly where they are more energy efficient. Two thirds of builders noted their customers were interested in features that would lower the energy use of their homes. Consumers also feel that green building materials are more durable and see green homes as higher quality.

    Read the full story…


    Tampa Condo Owners Allege Defects

    October 23, 2012 — CDJ Staff

    Owners in the Bel Mare towers have filed a lawsuit alleging that the building have construction defects that could lead to problems during periods with high winds. The Tampa Bay Business Journal reports that the condo association has sued the developer, the general contractor, the architects, the structural engineers, and subcontractors.

    Read the full story…


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

    September 1, 2011 — Tred Eyerley, Insurance Law Hawaii

    A policy’s “other insurance” clause and a contractual indemnity provision were at the root for determining which of two insurers had to cover for injuries at a construction site. Valley Forge Ins. Co. v. Zurich Am. Ins. Co., 2011 U.S.Dist. LEXIS 76061 (N.D. Calif. July 14, 2011).

    Hathaway was the general contractor at a demolition and construction project. Hathaway was insured by Zurich. Reinhardt Roofing was the roofing subcontractor. Reinhardt was insured by Valley Forge under a policy which named Hathaway as an additional insured. The subcontract also required Reinhardt to indemnify Hathaway for acts or omissions arising from Reinhardt’s work unless Hathaway was solely negligent.

    Four of Reinhardt’s workers were injured when a canopy roof on which they were working collapsed. At the time of the accident, Hathaway’s on-site supervisor was inspecting a gap in the canopy roof, but did not order Reinhardt’s workers to stop working. 

    Read the full story…

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


    Arbitration Clause Found Ambiguous in Construction Defect Case

    October 28, 2011 — CDJ Staff

    The California Court of Appeals ruled on September 28 in the case of Burch v. Premier Homes. Ms. Burch bought a home after negotiating various addendums to the contract. The contract was a standard California Association of Realtors contract to which both the buyer and seller made additions. At issue in this case was paragraph 17 of the contract which included that “Buyer and Seller agree that any dispute or claim in Law or equity arising between them out of this Agreement or resulting transaction, which is not settled through mediation, shall be decided by neutral, binding arbitration.”

    The seller/defendant’s Addendum 2 “included provisions relating to the arbitration of disputes that may arise.” Ms. Burch’s realtor, Lisa Morrin, told Burch that “she had never seen a proposed contractual provision that would require a home buyer to agree to arbitrate with a builder over construction defects.” Ms. Burch told Morrin that she did not want to buy the property if she would have to give up her rights under California law.

    As part of Addendum 2, the buyer had to buy a warranty from the Home Buyers Warranty Corporation. The sale was held up for a while, as Ms. Burch waited for a copy of the warranty. When she received it, she took further exception to Addendum 2. Scott Warren of Premier Homes said he could not sell the property without Addendum 2. Ms. Burch told her realtor that despite the claims made by Mr. Warren that this was for her benefit, she felt it was more to the benefit of Premier Homes. Don Aberbrook of HBW agreed to the clause, contained in the final sentence of Addendum 2, being struck.

    Subsequent to buying the home, Burch submitted a claim concerning construction defects. HBW denied the claim and Burch began an action against the defendants. Premier filed a motion to compel arbitration which Burch opposed.

    The trial court ruled that the striking out of the arbitration clause at the end of Addendum 2 “created a conflict with respect to the parties’ intent as to the scope of arbitration.” The trial court found that “the parties’ intention was to preserve Burch’s right to make state law claims including her right to a jury trial for any non-warranty claims against the builder.”

    The appeals court in their ruling looked at the standard of review and concluded that the purchase agreement was ambiguous and that extrinsic evidence was required to resolve that ambiguity. As the contract contained contradictory provisions as to whether or not arbitration was required, it was necessary for the trial court to examine these claims. The appeals court found that the evidence supported the conclusions of the trial court.

    Finally, the appeals court found that “there was no valid agreement to arbitrate disputes.” The court noted that arbitration can only happen by mutual consent and “it is clear that Burch did not enter into an agreement to arbitrate any construction defect disputes she might have.”

    Read the court’s decision…


    Construction Upturn in Silicon Valley

    August 17, 2011 — CDJ Staff

    Work resumed after nearly three years on an office tower in Santa Clara, according to the San Jose Mercury News. Work had stalled on the building due to the economy, but now the developer is planning a second five-story building on the site. Other dormant projects in the area are also getting restarted. Santa Clara County saw the addition of 1,800 construction jobs in June.

    A spokesperson for the Operating Engineers Local 3 in Alameda told the paper, “two years ago we had five thousand folks on the out-of-work list. It’s now down to about 1,700.”

    Read the full story…


    2011 West Coast Casualty Construction Defect Seminar – Recap

    June 1, 2011 — CDJ Staff
    Event exhibitors and sponsors contribute to an informative and engaging environment
    Event exhibitors and sponsors contribute to an informative and engaging environment

    This year’s meeting was the best yet for the industry-leading construction defect and claims event.

    This year’s seminar concluded on May 13, 2011 with the Construction Defect Community Charitable Foundation Golf Tournament, held at Strawberry Farms Golf Course.

    The Disneyland Hotel in Anaheim, California was the place where more than 1,500 attendees convened for two days of professional development activities and seminars that included CLE workshops and panel discussions of special interest to legal and insurance professionals concerned with construction defect and claims litigation. Key events included “Challenges for Experts in Construction Defect Claims and Litigation,” “Keeping Up with Construction Defect Coverage,” and “Tips for Avoiding the ‘Perfect Storm’ in Handling of Wrap Claims.”

    Supporting the golf tournament at the 15th hole
    Supporting the golf tournament at the 15th hole

    This year’s Ollie award was given to George D. Calkins II, Esq. The West Coast Casualty Jerrold S. Oliver Award of Excellence was named in honor of the late Judge Jerrold S. Oliver, and recognizes an individual who is outstanding or has contributed to the betterment of the construction community.

    In addition to being the most comprehensive professional development seminar in the area of construction defects, this year’s seminar was equally valuable as a networking opportunity for members of the industry. People participated in professional development events during the day and then continued networking in the evening at numerous social events. The Lawn Party as well as the legendary Wood, Smith, Henning & Berman events were very well attended. Additional valuable networking events were hosted by a number of industry professionals at the House of Blues, and Tortilla Joe’s.

    As of this writing the 2011, West Coast Casualty's Construction Defect Seminar has applied for or has already received the following continuing education accreditation in the following areas;

    Read the full story…

    For more information about next year’s event, visit West Coast Casualty.


    Badly Constructed Masonry Walls Not an Occurrence in Arkansas Law

    May 10, 2012 — CDJ Staff

    The US District Court for Maryland has granted a summary judgment in the case Konover Construction Corp. v. ATC Associates to Massachusetts Bay Insurance Company and denied a request for dismissal from ACT. Konover (KBE) was contracted by Wal-Mart to build a Wal-Mart store and a Sam’s Club in Port Covington, Maryland. Superus, Inc. was hired by KBE to build the masonry walls. Superus purchased a policy from Massachusetts Bay Insurance which named KBE as an additional insured. Wal-Mart hired ATC Associates to independently test and inspect the concrete structural steel, and masonry.

    After the building was in use, a large crack appeared which was attributed a latent construction defect. Other cracks were discovered. Upon investigation, it was discovered that there were “voids or foam in the concrete block surrounding the reinforcing steel that should have been filled with grout,” and in some cases, “reinforcing steel was missing or not installed in accordance with the specifications.” KBE paid for the repair and remediation and Wal-Mart assigned all rights and interests against ATC to KBE.

    KBE filed suit against ATC. ATC called for dismissal on the grounds that Wal-Mart had no claims as the problems had been remediated. Wal-Mart then provided KBE with additional agreements to give them enforceable rights against ATC and Superus. KBE filed a fourteen claims against ATC, Superus, and Massachusetts Bay. In the current case, Massachusetts Bay sought summary judgment and ATC sought dismissal of all claims against it.

    Massachusetts Bay claims that they need not indemnify Superus, as “there is no evidence adequate to establish that Superus’ defective work caused any collateral and/or resulting damage that was not subject to an Impaired Property exclusion, and that, in any event, no damage occurred during the policy period.”

    As Wal-Mart is headquarted in Arkansas, certain contracts were under Arkansas law. Under the Arkansas courts, “defective workmanship, standing alone and resulting in damages only to the work product itself, is not an ‘occurrence.’” The court determined that collateral or resultant damage would be covered. The court found that “it is clear under Arkansas law, and the parties appear to agree, that Massachusetts Bay is not obligated to indemnify KBE for any repairs to the masonry walls themselves, including any cracks or gaps in the walls.” The court also found that “there is no evidence adequate to prove that any allegedly resultant property damage was caused by Superus’ faulty construction of the walls.” The court also noted that “if the building code violation and structural integrity problem were ‘property damage,’ insurance coverage would be barred by the Impaired Property Exclusion.” Based on these findings, the court concluded that Massachusetts Bay is entitled to summary judgment.

    While the court dismissed the case against Massachusetts Bay, the court declined ATC’s motion to dismiss. The court noted that ACT’s alleged negligence in conducting inspections “created only a risk of economic loss for KBE.” Although hired by Wal-Mart, ATC “transmitted its daily testing and inspection reports of the Wal-Mart and Sam’s Club projects directly to KBE.” The court found that “KBE has made a plausible claim.”

    ATC also claimed that KBE contributed to the negligence due to the negligence of its subcontractor. The court concluded that it was plausible that “ATC will not be able to carry its burden of proving KBE was contributorily negligent.” The court was less sanguine about KBE’s fraud claim, but though it “may not now appear likely to have merit, it is above the ‘plausibility’ line.”

    In conclusion, KBE may not continue its case against Massachusetts Bay. However, the judge allowed the other proceedings to continue.

    Read the court’s decision…


    Mandatory Arbitration Provision Upheld in Construction Defect Case

    May 18, 2011 — May 18, 2011 Beverley BevenFlorez - Construction Defect Journal

    The Superior Court of New Jersey reversed the decision in Frumer v. National Home Insurance Company (NHIC) and the Home Buyers Warranty Corporation (HBW), stating that the mandatory arbitration provision within the Frumer’s home warranty policy was binding.

    The Frumers alleged that the construction defects were discovered immediately after moving into their million dollar home. After failing to achieve any results from dealing with the builder, they turned to their home warranty. There was some dispute over claims, and a settlement offer was rejected by the Frumers. The Frumers elected to commence litigation rather than utilize the binding arbitration.

    The NHIC and the HBW filed a motion to compel arbitration, however, the motion judge denied the motion: “…the Warranty leaves open the option for [plaintiffs] to commence litigation, which [plaintiffs have] done in this case. The clause also states that ‘the filing of a claim against this limited Warranty shall constitute the election of remedy and shall bar the Homeowner from all other remedies.’ However, the provision does not state that the filing of a claim elects arbitration as the exclusive remedy, and any ambiguity in the language must be inferred against the drafter.”

    The NHIC and the HBW appealed the decision. The Superior Court reversed the decision: “Where, such as here, the homeowner files a claim against the warranty for workmanship/systems defects, the warranty clearly and unequivocally establishes binding arbitration as the exclusive remedy. There is, however, no election of remedies for a dispute involving a major structural defect claim. The warranty clearly and unequivocally establishes binding arbitration as the exclusive remedy.”

    Charles Curley of Halberstadt Curley in Conshohocken, Pa., the local counsel for National Home and Home Buyers, told the New Jersey Law Journal that “the ruling reaffirms New Jersey’s commitment to enforcing arbitration agreements and requiring people to go to mandatory arbitration when the contracts call for it.”

    “At this point, their hope is that the warranty company will do what it's supposed to do — repair covered defects,” Eric McCullough, the Frumer’s lawyer said to the New Jersey Law Journal.

    Read the full story…


    More Charges in Las Vegas HOA Construction Defect Scam

    May 10, 2012 — CDJ Staff

    VegasInc.com reports that U.S. District Judge James Mahan has unsealed fourteen more criminal cases in the ongoing Las Vegas HOA corruption probe. One of the fourteen is Lisa Kim, whose Platinum Community Services managed communities in which Nancy Quon and Leon Benzer were involved.

    Two attorneys were also named. Brian Jones had previously been named in civil litigation as working to rig HOA elections in favor of the straw buyers. Jeanne Winkler had done legal work for one of the communities and for the developer before her disbarment.

    Eight of the names released were of alleged straw buyers. These individuals are said to have bought fractional shares of homes so they could stand for election on the HOA boards. One of the individuals named, Arnold Meyers, had sued the Jasmine Homeowners Association, claiming that their HOA elections were tainted. Myers claimed that homeowners received postcards stating that he did not own his condo. His suit was dropped after two homeowners claimed that their names had been forged on Meyer’s affidavits.

    Read the full story…


    FHA Lists Bridges and Overpasses that May Have Defective Grout

    September 13, 2012 — CDJ Staff

    The Federal Highway Administration has released a list of bridges and overpasses that may be prone to corrosion problems due to grout that was in chlorides when it was supposed to be completely free of them. Currently, the FHA is working with state departments of transportation to determine if the defective grout was indeed used on additional bridges and overpasses. The initial FHA list of structures determined to have been built with the defective grout lists thirty-four sites, of which four are in Ohio, the largest number for any state.

    California contains only one such site, the intersection of the 55 and 405 freeways, one of the few items on the list not designated as a bridge.

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    Appeals Court Upholds Decision by Referee in Trial Court for Antagan v Shea Homes

    May 10, 2012 — CDJ Staff

    In the case Antangan v. Shea Homes Ltd. Partnership (Cal. App., 2012), Plaintiffs appealed “an order vacating a judgment and entering a modified judgment in their construction defect action against defendants Shea Homes, Inc. and Shea Homes Limited Partnership,” while the Defendant, Shea Homes Limited Partnership (Shea Homes) appealed “an order of the judicial referee denying its motion to strike and tax costs.”

    On the Antagon issue, the appeals court concluded that “the trial court did not err by vacating and modifying its judgment so that the cost of referee’s fees would be equally divided by the parties and consistent with a prior stipulation they filed in court.”

    On the Shea Homes issue, the appeals court concluded: “1) the judicial referee did not err by ruling that plaintiffs’ offers to compromise (§ 998) were validly served on Shea Homes’ counsel, 2) the offers substantially complied with statutory requirements, 3) the offers were not required to be apportioned, and 4) the referee’s award of $5,000 as costs for a person assisting plaintiffs’ counsel was not an abuse of discretion.” The appeals court affirmed the judgment.

    Here is a brief history of the trial case: “Plaintiffs Chito Antangan, Jimmy Alcova and other homeowners brought an action against defendants Shea Homes, Inc. and Shea Homes Limited Partnership for damages alleging that the properties they purchased from these ‘developer defendants’ were defective. Plaintiffs claimed numerous construction defects required them ‘to incur expenses’ for ‘restoration and repairs’ and the value of their homes had been diminished.”

    In response, Shea Homes filed a motion for an order to appoint a judicial referee. The motion was granted and it was ruled that “a referee would ‘try all issues’ and ‘report a statement of decision to this court.’”

    On May 10, 2010 the judicial referee (Thompson) “awarded plaintiffs damages and various costs, and ruled that ‘Shea Homes shall bear all of the Referee’s fees.’” The latter ruling would become a matter for contention later on.

    In July of 2010, the plaintiffs “sought, among other things, $54,409.90 for expert fees, and $14,812.50 for the services of Melissa Fox for ‘exhibit preparation & trial presentation.’ Shea Homes filed a motion to strike and/or tax costs claiming: 1) Fox was a paralegal, 2) plaintiffs were not entitled to attorney’s fees, and 3) the fees for Fox’s services were an indirect and improper method to obtain attorney’s fees. The referee disagreed and awarded $5,000 for Fox’s services. The referee also ruled that plaintiffs had properly served valid offers to compromise (§ 998) on Shea Homes’ counsel in 2009. He said those offers to defendants in the case at that time did not have to be apportioned.”

    “Antangan contends the trial court erred when it vacated and modified its original judgment, which ordered Shea Homes to pay all the referee’s fees. We disagree.”

    Antagon contended that the trial court erred when it vacated and modified its original judgment regarding Shea Homes paying the referee’s fees. The appeals court disagreed: “A trial court has inherent authority to vacate or correct a judgment that is void on its face, incorrect, or entered by mistake. (§ 473; Rochin v. Pat Johnson Manufacturing Co. (1998),67 Cal.App.4th 1228; Olivera

    Read the court’s decision…


    One Colorado Court Allows Negligence Claim by General Contractor Against Subcontractor

    December 20, 2012 — Heather Anderson , Higgins, Hopkins, McLain & Roswell

    Judge Paul King of the Douglas County District Court recently confirmed that subcontractors in residential construction owe an independent duty, separate and apart from any contractual duties, to act without negligence in the construction of a home in Colorado.  See Order, dated September 7, 2010, Sunoo v. Hickory Homes, Inc. et al., Case No. 2007CV1866; see alsoCosmopolitan Homes, Inc. v. Weller, 663 P.2d 1041 (Colo. 1983); A.C. Excavating v. Yacht Club II Homeowners Ass’n, Inc., 114 P.3d 862 (Colo. 2005).  He also verified that the holding in the B.R.W. Inc. v. Dufficy & Sons, Inc., 99 P.3d 66 (Colo. 2004)[1]  case does not prohibit general contractors, such as Hickory Homes, from enforcing a subcontractor’s independent duty to act without negligence in the construction of a home. 

    Read the full story…

    Reprinted courtesy of Heather Anderson, Higgins, Hopkins, McLain & Roswell, LLC. Ms. Anderson can be contacted at anderson@hhmrlaw.com