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This blog focuses on real estate, land use and construction-related topics affecting Virginia and the Washington, D.C. metro area. With topics ranging from contract drafting and negotiation to local and regional land use project updates, the attorneys at Bean, Kinney & Korman provide timely insight and commentary on the issues affecting owners, builders, developers, contractors, subcontractors and other players in the industry. If you are interested in having us cover a specific topic, please let us know.

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July 27, 2013
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Topics Litigation

On July 25, 2013, the United States Court of Appeals for the Fourth Circuit decided Sansotta v. Town of Nags Head, a case out of North Carolina.  Sansotta dealt with the important issue of “ripeness,” which asks whether a case is procedurally appropriate for a court to make its decision.   

WhatA Virginia federal court has ruled that by proactively replacing defective drywall rather than waiting to get sued and found liable, a contractor was left without liability insurance coverage. This decision should send shivers down the spine of not just contractors, but also owners and developers.

The builder, Dragas Management, built 70 houses in the Tidewater Virginia area with Chinese drywall. After it received multiple reports of health symptoms and property damages, Dragas filed claims on multiple liability and umbrella insurance policies. It also stated in writing to the carriers that it was planning on beginning a remediation protocol and forwarded the same to the carriers. Four home owners filed suit against Dragas and later voluntarily dismissed the cases based on the remediation protocol.

Pest ControlA decision issued this month by the Supreme Court of Virginia, Kaltman v All American Pest, answers a question often debated by Virginia lawyers regarding the economic loss rule.  The case also may contain a hidden Trojan horse to contract defenses that everyone should pay attention to.

We delve into a more legal, technical and lengthy post this week for a good reason — a recent decision from a Virginia trial court (PDF of decision) points to a new avenue for claims by buyers of real estate in Virginia.

Virginia General AssemblyVirginia's General Assembly has passed a bill that, among other things, raises the upper limit of cases that may be filed in the General District Court.  This increase will potentially make it easier to try certain matters more cost effectively moving forward.

Stretch ArmstrongThose wishing to stretch indemnity clauses to the limit may want to read the recent Supreme Court of Virginia case, Uniwest Construction v. Amtech Elevator Services.  This case, in addition to a recent indemnification case from the 4th Circuit, demonstrate that there are some real risks to demanding excessive indemnity obligations in a contract.  You may actually wind up with nothing if you go too far.

Although obviously based upon sound legal principles, it was still surprising to find out that the Supreme Court held in Ligon v. County of Goochland that whistleblower protections for county employees against retaliatory firings under the Virginia Fraud Against Taxpayers Act ("VFATA") were barred by the doctrine of sovereign immunity.  As many of our readers know, the doctrine of sovereign immunity gives immunity to the Commonwealth, as well as localities as political subdivisions of the Commonwealth, from liability for damages and from suits to restrain governmental action or to compel such actions (such as tort liability for actions or omissions of a county's agents and employees).  However, while the VFATA was likely intended to create protection for the Commonwealth's employees from retaliatory discharge for reporting corruption and fraudulent behavior, the Supreme Court found that the plain language of the statute failed to explicitly include retaliatory discharge necessary for it to waive its sovereign immunity.  So basically, a corrupt county employee can fire a whistleblower, and the whistleblower can't sue the county to get his job back or for damages.

October 5, 2010
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Back in August, I posted about Judge Williams’ decision in Kersey v. PHH Mortgage Corp. to kick a foreclosure case back to state court due to lack of subject matter jurisdiction. If you recall, the home owner in that case argued that PHH could not foreclose because they failed to provide a face-to-face meeting as required by the deed of trust.  Judge Williams refused to allow the lender to hang its hat on HUD or FHA regulations to invoke federal question jurisdiction. And faced with a $71,397 mortgage, Judge Williams refused to find the requisite $75,000 amount in controversy to allow diversity jurisdiction.

The Virginia Supreme Court has released its opinion in the first of the pending Case Watch. Commonwealth of Virginia v. AMEC Civil, LLC, and the companion case of AMEC Civil, LLC v. Commonwealth of Virginia had twenty-two assignments of error on AMEC’s part, along with two assignments of error and seven assignments of cross-error on VDOT’s part.

September 16, 2010
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Topics Litigation

The Supreme Court of Virginia has issued its long awaited notice decision in the Commonwealth v. AMEC Civil LLC case.  The result is a pretty painful smack-down of the substantial bulk of the contractor's claims based on lack of statutory notice.  Not surprisingly, the court strictly construed statutory notice requirements for claims against the Virginia Department of Transportation under the umbrella of its historic strict statutory construction rules.  Notice was deemed a condition precedent.  Actual notice, which had originally satisfied the trial court due to lack of prejudice to VDOT, failed to comply with the statute's requirement for written notice.

What are the take-aways?

  1. If you think you may be entitled to additional compensation, ask for it in writing and reserve your claim rights;
  2. Scrutinize your contracts closely for all claims and notice requirements;
  3. Scrutinize any applicable statutory notice provisions closely as well;
  4. Do not trust the other side playing along and being fair and taking care of you, that is the path to potential ruin;
  5. If you have any inkling of of a dispute, make sure you formalize all claims and demands and notices in writing;
  6. Do not expect project meeting minutes and e-mails to suffice to establish notice.