ANAHEIM CALIFORNIA BUILDING CONSULTANT
DIRECTORY AND CAPABILITIES

Construction Litigation Roundup: “D’Oh!”

August 12, 2024 — Daniel Lund III - Lexology
The U.S. DOL found itself on June 24 on the wrong end of a preliminary injunction concerning recent changes to the Davis-Bacon Act. The lawsuit, initiated in Texas federal court by the Associated General Contractors of America and other concerned citizens, sought a preliminary injunction barring implementation and enforcement of “specified portions of § 5.2 and § 5.5(e) of the DOL’s ‘Updating the Davis-Bacon and Related Acts Regulations’” – the “Final Rule,” published August 23, 2023. After determining the appropriateness of the “standing” of the plaintiffs based upon the plaintiffs being “adversely affected” by the Final Rule, the federal court preliminarily enjoined enforcement of the Final Rule. In noting its disagreement with the Final Rule, the court stated:

“… the Final Rule amends the DBA [the Davis-Bacon Act] by imposing a stealth selfimplementing DBA requirement in the contract by an operation-of-law provision that contradicts the express statutory language of the Act [the court bristling at the idea that contracts might exclude with impunity the otherwise mandated DBA clauses]. Further, the Final Rule amends the Act to extend the DBA to apply to workers who are not mechanics and laborers, and to extend the scope of the work covered by DBA to include work is not performed ‘directly on the site of the work.’

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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No Prejudicial Error in Refusing to Give Jury Instruction on Predominant Cause

November 11, 2024 — Tred R. Eyerly - Insurance Law Hawaii
The California Court of Appeal affirmed the trial court's judgment after the jury determined there was no coverage for a leaking pipe. Mendoza v. Pacific Spec. Ins. Co., 2024 Cal. App. Unpub. EXIS 5477 (Cal. Ct. App. Aug. 20, 2024). The Mendoza's third amended complaint alleged their home was damaged "by overflow of water from the dwelling's plumbing system resulting from a broken pipe, which overflow undermined the structural integrity of the dwelling." The Mendozas insured their home under a policy issued by Pacific. The policy insured the property against "sudden and accidental direct physical loss" except where expressly excluded. The Mendozas submitted a claim Pacific paid approximately $1800 for the loss and closed the claim. The amount paid did not include payment for any structural damage to the home. The Mendozas alleged that Pacific's failure to conduct a full and fair investigation into the structural damage and its inadequate payment of benefits was a breach of the implied covenant of good faith and fair dealing. 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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GRSM Team Wins Summary Judgment in Million-Dollar HOA Dispute

December 17, 2024 — Robert A. Bragalone & B. Ryan Fellman - Gordon Rees Scully Mansukhani
Gordon Rees Scully Mansukhani Partner Bob Bragalone and Senior Counsel Ryan Fellman won a complete summary judgment on behalf of five board members who had been added to an HOA dispute by the defendant homeowners. The GRSM team resolved the matter within just 60 days of taking over the case, bringing an end to a legal battle that had lasted more than four years. The dispute began when the HOA, as plaintiff, filed suit against the homeowners in Denton County District Court. The HOA alleged that the homeowners had violated the HOA’s Covenants, Conditions, and Restrictions by constructing a non-conforming carport and sought a declaratory judgment to resolve the issue. In response, the homeowners filed a counterclaim and third-party petition, adding the individual HOA board members to the lawsuit. They accused the board members—who were serving in a voluntary capacity—of mishandling the dispute and filed claims against them for intentional infliction of emotional distress, negligence, and gross negligence. Reprinted courtesy of Robert A. Bragalone, Gordon Rees Scully Mansukhani and B. Ryan Fellman, Gordon Rees Scully Mansukhani Mr. Bragalone may be contacted at bbragalone@grsm.com Mr. Fellman may be contacted at rfellman@grsm.com Read the full story...

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Lawsuit Gives Teeth to Massachusetts Pay Law

September 16, 2024 — Joseph Barra - Robinson+Cole
“The Massachusetts Legislature passed the state’s Prompt Pay Act 14 years ago to improve the downstream flow of money on most large-scale private construction projects. While the act established detailed protocols for administering applications for payment and other important construction phase processes, several questions about its interpretation and impact remained unanswered. Over the years, I watched as a significant portion of the Massachusetts design and construction community either ignored the law’s exacting requirements or were unaware of their applicability. The first indication of how the act would be interpreted came in 2022, when the state appeals court decided Tocci Building Corp. v. IRIV Partners LLC. In that case, the court strictly construed the act. It held that an owner (and its agent) who failed to promptly advise the project’s general contractor of specific factual and legal reasons why it was withholding payment, coupled with a failure to certify that funds were being withheld in good faith, violated the law—making the contractor liable for the unpaid funds. Read the full story...
Reprinted courtesy of Joseph Barra, Robinson+Cole
Mr. Barra may be contacted at jbarra@rc.com

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California Supreme Court Finds Vertical Exhaustion Applies to First-Level Excess Policies

August 26, 2024 — Tred R. Eyerly - Insurance Law Hawaii
Addressing issues left open in its seminal decision in Montrose, the California Supreme Court found that the language in the first-level excess policies meant that the insured could access the policies upon exhaustion of the directly underlying policies purchased for the same policy period. Truck Ins. Exchange v. Kaiser Cement & Gypsum Corp., 2024 Cal. LEXIS 3271 (Cal. June 17, 2024). From 1944 through the 1970's, Kaiser manufactured asbestos-containing products at numerous different facilities. By 2004, more than 24,000 claimants had filed product liability claims against Kaiser alleging that they had suffered bodily injury as a result of exposure to Kaiser's asbestos products. Kaiser tendered these claims to Truck, one of several primary insurers that had issued CGL policies to Kaiser. In 2001, Truck initiated this coverage action to determine its indemnity and defense obligations to Kaiser. Truck later amended its complaint to add a cause of action for contribution against several of Kaiser's excess insurers. The issue presently before the court was whether Truck was entitled to contribution from various coinsurers that issued first-level excess policies to Kaiser during the period in question. 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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Construction Defect Disputes: Know Your Measure of Damages!!!!!

January 21, 2025 — David Adelstein - Florida Construction Legal Updates
Remember this: know your measure of damages in a construction defect dispute. If you don’t, as shown below, the outcome can be unforgiving. The measure of damages is one of your most important elements of proof. You are filing suit for damages; thus, knowing what you can reasonably recovery is paramount. In a recent dispute, Bandklayder Development, LLC v. Sabga, 50 Fla.L.Weekly D91e (Fla. 3d DCA 2025), a residential developer sold a single-family house while it was under construction in an as-is purchase agreement. Post-closing, the purchasers claimed defects and served a Florida Statutes Chapter 558 notice of construction defects letter. The purchaser subsequently initiated a construction defect lawsuit. During the nonjury trial, the purchaser’s expert testified that the purchasers suffered damages approximating $323,000 calculated as of January 19, 2022 (which was the date of the expert’s report). The expert further testified that the cost to finish the incomplete/defective work increased by 35% at the date of the May 2023 trial. However, the expert never testified as to the amount of damages as of the date of the contractual breach, which at the latest, would have been in April 2018 when the notice of construction defects letter was sent (or, at its earliest, June 2017 when closing occurred). At trial, the judge entered judgment for the purchasers in the amount of about $425,0000. This was reversed on appeal with judgment to be entered in favor of the developer. Why? Because the purchasers employed the wrong measure of damages and the only thing that prevented them from introducing the right measure of damages was within their control. Harsh outcome for not applying the correct measure of damages! 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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Los Angeles Is Burning. But California’s Insurance Industry Is Not About to Collapse.

January 14, 2025 — Jerry Theodorou - R Street
Five fires are raging in the Los Angeles outskirts currently – the Palisades Fire, the Eaton Fire, the Lidia Fire, the Sunset Fire, and the Hurst Fire. They have been stoked by a trifecta of 100 mph wind gusts, elevated heat, and bone-dry grass and shrubs serving as tinder. The severity of the fires has raised questions about the role of climate change in the conflagrations and insurers’ claims-paying capacity. But while we recognize the immensity of the hardship and tragedy to many Angelenos from the fires, we also must recognize that California’s insurance industry is not about to collapse. Many have ignored or missed recent reforms to California insurance regulation that are poised to make the private market more sustainable, and help stem an exodus of insurers from the Golden State. Whether the intensity of wildfires is exacerbated by climate change is an open question. An R Street study found that natural catastrophes have increased in severity, but not in frequency. And the main reason catastrophe severity has risen is an increase in the built environment – there is simply more stuff now to be destroyed. Read the full story...
Reprinted courtesy of Jerry Theodorou, R Street
Mr. Theodorou may be contacted at jtheodorou@rstreet.org

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Chicago Cubs Agree to Make Wrigley Field ADA Improvements to Settle Feds' Lawsuit

December 03, 2024 — James Leggate - Engineering News-Record
Major League Baseball’s Chicago Cubs have entered into a settlement with the U.S. Dept. of Justice over renovations to Wrigley Field, federal and Cubs officials announced Oct. 31. As part of the settlement, the team agreed to update Wrigley Field with more accessibility options for people with disabilities. Read the full story...
Reprinted courtesy of James Leggate, ENR
Mr. Leggate may be contacted at leggatej@enr.com

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