Justia Construction Law Opinion Summaries

Property owner Crescent City Property Partners, L.L.C., and a builder, Greystar Development and Construction, LP, entered into a contract in March, 2002 for the construction of a mixed-use development in Lafayette. Alleging defects in the builder's performance, and pursuant to the arbitration clause in the construction contract, Crescent filed an arbitration claim against Greystar in 2008, also naming as a defendant Greystar's surety, American Manufacturers Mutual Insurance Company. In response, Greystar filed a third party demand against various subcontractors. The Supreme Court granted writs in consolidated cases to consider whether the court of appeal correctly vacated the arbitration award, which had been confirmed by the district court. The court of appeal vacated the award on the basis the arbitration panel, in applying a statute of peremption incorrectly, disturbed a vested right of the plaintiff and, thus, the panel violated the plaintiff's due process rights. The court of appeal found the arbitration panel's interpretation of the law placed an impossible burden on the plaintiff, a burden the panel deemed fundamentally unfair, thereby requiring vacatur of the arbitration panel's award. After its review, the Supreme Court found that the court of appeal essentially misinterpreted the laws concerning arbitration, and, thus, erred in failing to limit its review to the factors mandating vacatur articulated in La. Rev. Stat. 9:4210. In reversing the court of appeal's decision, the Court reiterated well-settled law that otherwise fairly and honestly obtained arbitration awards may not be overturned merely for errors of fact or law. View "Crescent Property Partners, LLC v. American Manufacturers Mutual Insurance Co." on Justia Law

FTR has constructed buildings for public entities for 15 years. In 1999, FTR submitted the winning bid of $7.345 million to construct a District school. During construction, FTR submitted approximately 150 proposed change orders (PCO). FTR claimed some were necessary because the District’s plans were inadequate or misleading. The District denied most of the PCOs on the grounds that the work was covered under the basic contract, the amounts claimed were excessive, or that a PCO was not timely under the contract. Construction was completed in 2001. Public Contract Code 7107 allows a public entity to withhold funds due a contractor when there are liens on the property or a good faith dispute concerning whether the work was properly performed. The court of appeal held that the trial court properly assessed penalties against District because it did not timely release retained funds; properly rejected the District's action under the False Claims Act, Government Code 12650; and properly assessed prejudgment interest. The court erred in its interpretation of a contract provision imposing time limitations to submit claims for extra work as requiring a showing of prejudice and erred in awarding fees for work not solely related to FTR's section 7107 cause of action. View "FTR Int'l, Inc. v. Rio Sch. Dist." on Justia Law

Plaintiff purchased a home from Laux. Almost two years later, she sued the homebuilder, Shapell for strict liability, negligence, and fraudulent concealment, claiming Shapell built the home on unstable and uncompacted “fill” soil and with an inadequate foundation, causing “substantial differential movement” and numerous defects such as cracked floors, walls, and ceilings. The court granted Shappel summary judgment as to fraudulent concealment and later and entered judgment for Shapell on the other claims, concluding plaintiff lacked standing because her claims accrued when Laux owned the home and he did not assign the claims to plaintiff. The court of appeal reversed. Construing the facts in a light most favorable to plaintiff, there is a triable issue of material fact regarding whether Shapell fraudulently concealed information about the property’s soil conditions. Plaintiff was entitled to have a jury determine the disputed factual issues of when and to whom the causes of action accrued. View "Stofer v. Shapell Indus., Inc." on Justia Law

Metropolitan National Bank agreed to finance construction of a residential subdivision. As security for the note, Ruskin Heights executed a mortgage on the real property in favor of Metropolitan. The afternoon after construction commenced, Metropolitan filed its mortgage. Approximately two years later, Crafton, Tull, Sparks & Associates, Inc. (CTSA) filed an engineering lien against the property. Metropolitan filed a foreclosure complaint against Ruskin Heights and others. CTSA then filed a complaint asserting an engineer’s lien against Ruskin Heights and an amended complaint against Ruskin Heights and Metropolitan, requesting that its lien be declared superior to Metropolitan’s mortgage lien. The cases were consolidated. The circuit court concluded that CTSA’s lien was second in priority to Metropolitan’s lien. CTSA appealed, arguing that its lien should relate back to the commencement of construction and have priority over Metropolitan’s mortgage pursuant to Ark. Code Ann. 18-44-110. The Supreme Court affirmed, holding that Metropolitan’s lien did not have priority over CTSA’s engineer’s lien because section 18-44-110 does not allow for an engineer’s lien to relate back to the date of construction. View "Crafton Tull Sparks & Assocs., Inc. v. Ruskin Heights, LLC" on Justia Law

The issue this case presented for the Supreme Court's review centered on a challenge to the State Liquor Control Board's spirits distribution licensing fee structure brought by Association of Washington Spirits and Wine Distributors (Association). Specifically, the Association challenged the Board's decision to exempt distillers who distribute their own manufactured spirits and others acting as distributors pursuant to certificates of approval from contributing to a shortfall of $104.7 million in licensing fees imposed on persons holding spirits distributor licenses. The Association asked the Supreme Court to hold that the distillers must contribute proportionately to eliminating the shortfall. The Court rejected the Association's arguments, holding that the Board acted within its authority and did not act arbitrarily or capriciously. Additionally, the Board did not violate the privileges and immunities clause of article I, section 12 of the Washington State Constitution. View "Ass'n of Wash. Spirits & Wine Distribs. v. Liquor Control Bd." on Justia Law

Bellingham Marine hired Major Engineering to construct a travel lift pier at the Channel Islands Harbor. Bellingham hired Moffatt, a civil engineering firm, to prepare the plans, which required that the concrete have a specific air entrainment and that the concrete, when cured, attain a specific compressive strength. Major's contract with Bellingham provided that if the concrete failed to meet the compression strength standard, that it would be removed and replaced at Major's expense. Major hired State, which submitted a concrete mix design. Moffatt, at the request of Major, reviewed and approved the design. It was not part of Moffatt's job duties. State delivered seven truck loads of wet pre-mixed concrete. After the concrete was cast, Major's testing lab took a sample that showed the concrete had inadequate compressive strength. Major demolished and rebuilt the affected portion of the pier. It sued; State filed a cross-complaint for implied equitable indemnity and contribution, alleging that Moffatt failed to use reasonable care in reviewing and approving the mix design. The court dismissed, finding that Moffatt was not in privity of contract with Major or State and that the cross-complaint was barred by the economic loss rule. The court of appeal affirmed. View "State Ready Mix Iv. Moffatt & Nichol" on Justia Law

In 1988, Defendant pled guilty to sexual intercourse without consent and was sentenced to thirty years imprisonment with ten years suspended. In 1992, Defendant escaped from prison. After he was apprehended, he was convicted with escape and other charges. In 2007, Defendant was discharged to serve the suspended portion of his sentence. In 2011, the district court orally found that Defendant had substantially violated the conditions of his parole. The court then imposed a new sentence of ten years with all time suspended and imposed fourteen new conditions to Defendant’s suspended sentence. Thereafter, the district court revoked Defendant’s suspended sentence, sentenced Defendant to ten years imprisonment with five years suspended, and reimposed the fourteen new conditions on his suspended sentence. The Supreme Court affirmed, holding that the imposition of fourteen new conditions on Defendant’s suspended sentence for his 1988 crime did not violate ex post facto principles. Remanded. View "State v. Piller" on Justia Law

The School District entered into a construction contract with Amoroso. Pursuant to Public Contract Code 22300, Amoroso elected to have the retention held in an escrow account in the form of securities. The escrow agreement stated that “District shall have the right to draw upon the securities and/or withdraw amounts from the Escrow Account in event of default by Contractor as determined solely by District.” The District gave written notice of material breach on March 30, 2011, based on Amoroso’s failure to complete, timely or at all, any of the three project phases and requested that Amoroso cure by April 4. Amoroso contested the assertions of material breach by letter dated April 1. The District sent notice of termination on April 18 and filed suit. On April 28, the parties entered into an “Exit and Demobilization Agreement,” “in lieu of any final termination or statement of default under the Contract.” The District sent a letter requesting withdrawal of $3.5 million from the escrow account, attaching its attorney’s memorandum as to why withdrawal was permissible. Amoroso unsuccessfully sought an injunction. The court of appeal affirmed, rejecting Amoroso’s claim that a public project owner must await judicial resolution of the underlying contract dispute before it can withdraw retention funds. View "Pittsburg Unified Sch. Dist. v. S.J. Amoroso Constr. Co., Inc." on Justia Law

In building their home, Plaintiffs purchased SuperFlex, a stucco-like material, to cover the house’s exterior. GrailCoat Worldwide, LLC and GrailCo, Inc. (collectively, GrailCoat), the manufacturers of SuperFlex, provided an express twenty-year warranty for the product. Several years after the construction of their home was completed, the product failed. Plaintiffs brought suit against GrailCoat and Hartley Construction, Inc., the company that had designed and built the home, for damages. Hartley moved for summary judgment under N.C. Gen. Stat. 1-50(a)(5), North Carolina’s six-year statute of repose for claims arising out of improvements to real property. The trial court granted summary judgment for Defendants. The Supreme Court reversed the trial court’s dismissal of Plaintiffs’ claim for breach of express warranty against GrailCoat, holding that GrailCoat knowingly and freely entered into a valid contract of sale with Plaintiffs that provided for a warranty term that exceeded the repose period, and therefore, GrailCoat waived the protections provided by the statute of repose. View "Christie v. Hartley Constr., Inc." on Justia Law

Lane Myers Construction agreed to build two separate homes for Dick and Kym Kyker. The Kykers obtained a construction loan through National City Bank. The bank periodically paid Lane Myers on draw request forms that indicated that Lane Myers had no lien on the property. Because the Kykers failed to repay Lane Myers as promised, Lane Myers recorded a mechanic’s lien against the property. Lane Myers then filed suit seeking to enforce its lien. The district court granted summary judgment for the Kykers and National City, concluding that the draw requests substantially complied with the Utah Mechanics’ Lien Act in effectively waiving Lane Myers’ right to file a mechanic’s lien. The court of appeals reversed, concluding that the forms were not in substantial compliance with the Act because they failed to incorporate the four essential elements of the statutory “form” necessary to waive and release lien rights. The Supreme Court reversed and remanded, holding (1) the Act requires only a waiver and release signed by the lien claimant, and the “form” set forth in the Act is merely a safe harbor; and (2) genuine issues of material fact precluded summary judgment in this case. View "Lane Myers Constr., LLC v. Nat’l City Bank" on Justia Law