ANAHEIM CALIFORNIA BUILDING CONSULTANT
DIRECTORY AND CAPABILITIES

NLRB Finalizes Rule for Construction Industry Unions to Obtain Majority Support Representational Status

September 23, 2024 — Aaron C. Schlesinger - Peckar & Abramson, P.C.
On July 26, 2024, the National Labor Relations Board (“NLRB”) issued its Fair Choice – Employee Voice Final Rule (“Final Rule”), which takes effect September 30, 2024. The Final Rule eases the process for unions in the construction industry to convert their status as collective bargaining representative of bargaining unit employees from Section 8(f) to 9(a) of the National Labor Relations Act (“Act”) simply by placing certain recognitional acceptance language in their collective bargaining agreements. As a result, construction industry employers should review their collective bargaining agreements prior to signing to determine if such language exists. Section 9(a) Non-Construction Industry Employers In most industries, not including construction, union recognitional status as collective bargaining representative of the employer’s employees is governed by Section 9(a) of the Act. In order for a Union to obtain recognitional status under Section 9(a), the union must either: (1) file a petition with the NLRB showing support of 30% of the proposed bargaining unit via employee executed authorization cards and win an election of 51% of the employees in the proposed bargaining unit who actually vote; or (2) by reaching an agreement with the employer that the union possesses employee executed authorization cards from 51% of the proposed bargaining unit, which has been confirmed by a neutral arbitrator pursuant to a card count. Once such status is achieved, the union and employer are required to meet and bargain towards reaching a collective bargaining agreement covering the terms and conditions of employment of the union represented employees. A Section 9(a) union cannot have its recognitional status revoked absent the loss of majority support of the employees it represents. Read the full story...
Reprinted courtesy of Aaron C. Schlesinger, Peckar & Abramson, P.C.
Mr. Schlesinger may be contacted at aschlesinger@pecklaw.com

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Mitigating Mold Exposure in Manufacturing and Multifamily Buildings

July 31, 2024 — Laura Champagne - Construction Executive
As hurricanes season and summer storms approach, more apartment complexes, commercial and industrial properties, and public buildings are at risk of leaking and flooding. Water-saturated structures are prime breeding grounds for mold, but there are ways to prevent, detect and remove it before it becomes a serious and costly issue—for buildings and building residents alike. Being proactive limits an owner’s exposure to the liability of debilitating health effects and structural safety concerns. Mold requires three things to grow: water, food and humidity. Water will stealthily penetrate small porous surfaces of any building material, such as drywall, plaster, wood, concrete or even fabrics. These materials serve as a food source to quickly produce more fungus. Common sources of undetected water flow include foundation problems, poorly installed windows, roof malfunctions, gutter clogs, storm damage, leaky pipes, improper drainage, HVAC issues, faulty appliances, bathroom vent issues and wet building materials. Mold loves humidity and thrives in dark, warm environments, such as attics, basements, lofts, building corners and bathrooms. Reprinted courtesy of Laura Champagne, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the full story...

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Benefit of the Coblentz Agreement and Consent Judgment

August 26, 2024 — David Adelstein - Florida Construction Legal Updates
If you are not familiar with the concept of what is commonly known as a Coblentz agreement relative to an insurance coverage dispute, review these prior postings (here and here and here). This is a good-to-know agreement if you are a claimant and need to consider an avenue of collection if the insured’s carrier denies coverage out of the gate (meaning the carrier has denied both the duty to defend and the duty to indemnify). A recent Eleventh Circuit Court of Appeals opinion demonstrates the Coblentz agreement concept. In Barrs v. Auto-Owners Ins. Co., 2024 WL 3673089 (11th Cir. 2024), an owner asserted a construction defect claim against its contractor. The owner hired the contractor to deconstruct a building and the contractor hired a demolition subcontractor. The owner noticed work was not being performed and materials (e.g., lumber) were missing; the demolition subcontractor had stolen materials. The subcontractor was terminated, and the owner claimed the contractor’s negligence allowed the theft and delayed his project. The contractor’s commercial general liability (CGL) insurer notified the insured-contractor that coverage did not exist and refused to defend the contractor. The owner sued the contractor under various theories of liability. The owner and contractor entered into a settlement agreement (i.e., the Coblentz agreement) where the contractor “admitted liability in the amount of $557,500.00….A consent judgment was entered against [the contractor] that closely tracked the settlement agreement but did not indicate which portion of the damages award was attributed to which claims. The agreement also assigned [owner] and all of [the contractor’s] rights to claim coverage and to recover available funds under [the contractor’s CGL policy].” Read the full story...
Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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Damage Control: Major Rebuilds After Major Weather Events

October 21, 2024 — David McMillin - Construction Executive
More than two feet of rain drenching Fort Lauderdale in a day, baseball-sized hail chunks falling on Minneapolis and the deadliest wildfire in more than a century destroying more than 2,100 acres of Maui—2023 was a stark reminder that Mother Nature is a force to be reckoned with. In total, $28 billion dollars’ worth of extreme weather and climate-related disasters ripped across the U.S. last year—a new record, according to the National Oceanic and Atmospheric Administration. And there’s no relief in sight: 2024 is already the second-busiest tornado season on the books, and wildfires were burning in Oregon, California, Montana and Texas as this issue went to print. Part of dealing with disasters is preparing for their impact to infrastructure, and Roland Orgeron Jr.—who co-founded New Orleans-based Legacy Industries with business partner Blake Couch in 2016—has been helping clients do just that. “We do a lot of consulting to identify vulnerabilities, and we offer action plans for companies based on potential storm scenarios,” Orgeron Jr. says. Some of those clients include large oil and gas companies with operations along the Mississippi River that cannot afford to be shut down for any extended period. “Before Hurricane Ida hit, we pre-positioned equipment inside some facilities, and we had guys responding the day after the storm to clear the area and assess the damage,” Orgeron Jr. says. During the immediate response to Hurricane Ida in 2021, the company’s work involved more than keeping the business locations up and running; they needed to help a business’ employees find a place to live. “We have a home stabilization contract with one oil and gas company designed to make sure their employees can get back to work as comfortably and quickly as possible,” Orgeron Jr. says. Reprinted courtesy of David McMillin, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the full story...

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Additional Insured is Loss Payee after Hurricane Damage

October 01, 2024 — Tred R. Eyerly - Insurance Law Hawaii
Construing the policy language, the federal district court found that the policy's additional insured was the loss payee for damage caused by Hurricanes Laura and Delta. TCP Ryan St. LLC v. Weschester Surplus Lines Ins. Co., 2024 U.S. Dist. LEXIS 125529 (W.D. La. July 16, 2024). Hurricanes Laura and Delta caused damage to TCP Ryan Street, LLC's (TCP) property. Westchester had issued a policy to MRI Heritage Brand, Inc. (MRI). MRI, as lessee, was obligated pursuant to the lease terms to "purchase and maintain . . . a policy of fire, extended coverage, vandalism and malicious mischief (or 'all risk') insurance coverage on all real property situated at the Lease Premises." The lease also required MRI to obtain coverage under a policy naming only the landlord as the sole insured and provided that the proceeds would be payable to the landlord. The policy provided that no entity was covered unless Westchester had received identifying information for the entity during the application process or the entity was added by endorsement. Read the full story...
Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Toolbox Talk Series Recap - Undocumented Change Work

October 15, 2024 — Douglas J. Mackin - The Dispute Resolver
In the August 29, 2024 edition of Division 1's Toolbox Talk Series, Don Rea presented on the causes of undocumented change order work and what actions parties to a construction project can take to protect themselves, which compliments and reinforces some of the key points from the May 30, 2024 Toolbox Talk on maximizing profits while experiencing changes during project performance. Article 7 of AIA A201 General Conditions covers (i) change orders, (ii) constructive change directives, and (iii) “minor changes.” Work that falls outside the scope of the construction contract will often fit into one of these three categories. Rea’s presentation focused on the fact that, regardless of which category applies, proper documentation of the change work is vital. Read the full story...
Reprinted courtesy of Douglas J. Mackin, Cozen O’Connor
Mr. Mackin may be contacted at dmackin@cozen.com

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Construction Professionals Could Face More Liability Exposure Following California Appellate Ruling

December 17, 2024 — Jamison Rayfield & Brian Slome - Lewis Brisbois
San Diego/San Francisco, Calif. - The California Court of Appeal recently reversed a summary judgment ruling in favor of a geotechnical engineering firm that had conducted a brief inspection of a residential construction project's footing trench for $360. The case arose when homeowner Cheryl Lynch experienced significant property damage after her home's foundation failed and the structure began subsiding into a slope. Lynch sued Peter & Associates for professional negligence and nuisance, despite having no direct contractual relationship with the firm, which had been hired by her contractor to perform the geotechnical inspection. The court distinguished this case from Bily v. Arthur Young & Co. (1992) 3 Cal.4th 370, which had limited auditors' professional duty to third parties, noting that Bily dealt with purely economic damages, whereas Lynch involved physical property damage, making Bily's policy concerns about unlimited liability inapplicable. The court emphasized that construction professional negligence cases, particularly those involving residential property damage, warrant a different analysis than cases involving economic loss. Reprinted courtesy of Jamison Rayfield, Lewis Brisbois and Brian Slome, Lewis Brisbois Mr. Rayfield may be contacted at Jamison.Rayfield@lewisbrisbois.com Mr. Slome may be contacted at Brian.Slome@lewisbrisbois.com Read the full story...

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Construction Litigation Roundup: “Give a Little Extra …”

July 31, 2024 — Daniel Lund III - Lexology
Surplus lines insurers in Louisiana are considered by the state to be “an alternative type of property and casualty insurance coverage for consumers who cannot get coverage on the standard market … for specialty risk or high-risk situations….” As a quid pro quo for undertaking the exceptional risk, a surplus lines insurer argued to the United States Fifth Circuit Court of Appeals that an arbitration clause within its surplus line policy should be enforceable, notwithstanding a Louisiana statute applying to the insurance industry and prohibiting terms in insurance policies “delivered or issued for delivery” in Louisiana which have the effect of “[d]epriving the courts of this state of the jurisdiction or venue of action against the insurer.” La. R.S. 22:868. Historically in Louisiana, arbitration clauses have been understood to divest courts of jurisdiction, and, consequently, §22:868 has been held to memorialize an “anti-arbitration policy,” although the statute does not specifically mention arbitration. Read the full story...
Reprinted courtesy of Daniel Lund III, Phelps
Mr. Lund may be contacted at daniel.lund@phelps.com

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