Friday, January 25, 2013

CAHB's Position Statement Regarding SB 13-52

I received today a communication from the Colorado Association of Home Builders regarding the background and benefits of Senate Bill 13-052. Please take a moment to read this information.


Please Support Senate Bill 13-52

Supporting Transit-Oriented Development and Multi-Family Housing

Background:

  • Affordable housing and transit-oriented, mixed-use developments—or TODs—are facing a crisis of scarcity in Colorado—especially in the Denver metro area.
                                                      
  • Since 2007—when the General Assembly opened mixed-use developments to a host of legal attacks—the percentage of owner-occupied, multi-family units built in the Denver metro area has declined from 25 percent of all units built to 2 percent. With the increased risk of litigation, developers have clearly avoided construction of new multi-family developments.

  • Lack of construction of owner-occupied, mixed-use development denies consumers the most affordable housing product available and denies those interested in easy access to mass transit the opportunity of owning units near light-rail stations.

  • Multi-family developments fit well with current urban-planning trends, and the Denver metro area may be one of the best examples of this across the nation.

  • RTD’s FasTracks is relying on TODs as a key component of the project’s development, future ridership and financial projections.

SB13-52, the Transit-oriented Development Claims Act of 2013:

    •   Establishes a right to repair for construction professionals that receive a notice of claim for a construction defect in a TOD

    • Creates a binding arbitration requirement for claims against construction professionals with respect to TODs and makes construction professionals immune for environmental conditions including  noise,  odors,  light, temperatures,  humidity,  vibrations,  and  smoke  or  fumes related to transit, commercial, public and/or retail use

    • Clarifies the statute of repose for the 6-year statute of limitations for actions against architects, contractors, builders, builder vendors, engineers or inspectors involved in improvements to real property


Who Supports of SB-52?

  • Associated General Contractors of Colorado
  • Colorado Association of Home Builders
  • C3, the Colorado Competitive Council
  • Colorado Concern
  • Colorado Contractors Association
  • Denver Metro Chamber of Commerce
  • Mayor Bob Murphy, Lakewood
  • Mayor Marc Williams, Arvada
  • Mayor Heidi Williams, Thornton
  • Mechanical & Plumbing Contractors of Colorado
  • NAIOP Colorado

Wednesday, January 23, 2013

Higgins, Hopkins, McLain & Roswell Announces Bret L. Cogdill as Special Counsel


Higgins, Hopkins, McLain & Roswell is pleased to announce Bret L. Cogdill as Special Counsel (effective from January 1, 2013).

Bret is a 2001 graduate of the University of Denver, College of Law and was awarded an internship with the State Department, serving at the U.S. Embassy in Sarajevo, Bosnia & Hercegovina. After graduating from law school, Bret served in the U.S. Army as an officer in the Judge Advocate General Corps. Since joining the firm in 2005, Bret has concentrated his practice in construction defect litigation and has represented developers and general contractors in several cases involving large, multi-family developments.

David McLain, co-founding member of the firm stated “Bret is a valuable team member at our firm and provides seniority and insight into complex litigation matters.” Co-founding member Sheri Roswell also commented that “Bret’s abilities at negotiating settlements is unsurpassed and the ease in which he manages our clients cases makes us proud to have him be Special Counsel to HHMR.”

You can reach Bret by telephone at (303) 653-0046 or by e-mail at Cogdill@hhmrlaw.com.

Monday, January 21, 2013

Colorado Senate Bill 13-052: The “Transit-Oriented Development Claims Act of 2013.”


Last fall the Denver Regional Council of Governments approached the Colorado Association of Home Builders to inquire as to why there are no builders developing or constructing for-sale, multi-family projects along the newly constructed light rail lines. By surveying its membership, the CAHB quickly learned that the biggest impediment to such construction is Colorado’s litigation environment, i.e., “if you build it, they will sue.” This started a dialogue within the industry in order to determine what changes developers and general contractors would like to see made in order to consider again building for-sale, multi-family construction. The result of this dialogue is Senate Bill 13-052, introduced on January 16, 2013, and known as the Transit-Oriented Development Claims Act of 2013, sponsored by Senators Scheffel and Cadman and Representative DelGrosso. You can find the current iteration of SB 13-052 here.  In short, the bill contains the following components:

With respect to construction defect actions involving transit-oriented development, the bill makes the following changes to the law:

Section 1 creates the “Transit-oriented Development Claims Act of 2013.”

Section 2 institutes a right to repair for construction professionals that receive a notice of claim with respect to a construction defect in a transit-oriented development.

Section 3 institutes a binding arbitration requirement for claims against construction professionals with respect to transit-oriented development. This section also makes construction professionals immune to suit for environmental conditions including noise, odors, light, temperatures, humidity, vibrations, and smoke or fumes casually related to transit, commercial, public, or retail use.

With respect to construction defect actions in general:

Section 4 clarifies that the 90-day tolling provision for construction professionals’ third-party claims found within C.R.S. § 13-80-104 tolls both the statute of limitations and the statute of repose. This section is meant to ameliorate the effects of Thermo Development, Inc. v. Central Masonry Corp., 195 P.3d 1166 (Colo. App. 2008) and to protect subcontractors and design professionals from ongoing “shotgun litigation.”

I expect that the plaintiffs’ construction defect litigation attorneys will oppose the bill. In addition, I expect that subcontractors and their carriers may oppose section four of the bill, believing that they would rather have claims brought against them within six years of substantial completion than to end “shotgun litigation.”

SB 13-052 was assigned to the Senate Judiciary Committee, but is not yet scheduled for hearing. For additional information regarding the history of the bill, check here.

To learn more about SB 13-052 or construction litigation in Colorado, you may contact David M. McLain by telephone at (303) 987-9813 or by e-mail at mclain@hhmrlaw.com

Monday, January 14, 2013

Colorado Abandons the “Completed and Accepted Rule” in Favor of the “Foreseeability Rule” in Determining a Contractor’s Duty to a Third Party After Work Has Been Completed


In a recent case, the Colorado Court of Appeals found that a contractor had a duty to a third party to warn it of a dangerous condition, even after the contractor had completed its work and the owner had accepted the contractor’s workCollard v. Vista Paving Corp., -- P.3d --, 2012 WL 5871446 (Colo. App. 2012).  While not an earth shattering or entirely new concept, the decision rendered in Collard directly accepted the foreseeability rule at the expense of the completed and accepted rule.  Id.

In Collard, the City of Grand Junction (“the City”) hired Vista Paving Corp. (“Vista”) to construct two road medians according to the City’s plans and designs.  On July 9, 2007, Vista began work on the medians.  According to its contract with the City, Vista was responsible for traffic control during construction of the medians.  On July 19, 2007, Vista completed its construction of both medians.  On that date, the City’s project inspector conducted his final inspection of Vista’s work.  The City’s inspector then told Vista that its work had been completed and that Vista was authorized to leave the site.  Vista requested permission to remove the traffic control devices to which the City’s inspector agreed.  Vista removed all of its traffic control devices.

The City’s inspector testified that after his inspection he notified the City’s traffic control division that since Vista was finished with its work the traffic division could come in and restripe the road so it was safe for third-party motorists.  The City’s inspector and the City’s project manager for installation of the medians both swore in affidavits submitted to the district court that Vista, upon completion of its work, was not responsible for traffic control.  Thereafter, for five days leading up to July 24, 2007, the City did not put any traffic control devices in place at the medians or repaint the dividing line that was leading directly into the center of one of the newly constructed medians.

At 3:30 a.m. on July 24, 2007, a truck collided with the median flattening two tires and damaging its tire rims.  Roughly two hours later, Collard was driving on the road and collided with one of the newly constructed medians, totaling her vehicle and causing her various injuries.  Collard sued the City and Vista under Colorado’s Premises Liability Act § 13-21-115 (the “PLA”) and common law negligence.  The claims against the City were dismissed based on immunity under Colorado’s Governmental Immunity Act, §§ 24-10-101 to 120.  Vista filed a motion for summary judgment regarding the PLA claim which the court granted, and the Court of Appeals upheld, based on the evidence that Vista finished its work and was authorized to leave the work site and remove its traffic control items.  Thus, the only claim remaining was the common law negligence claim against Vista.

The district court judge granted a motion for summary judgment in the favor of Vista regarding the common law negligence claim.  However, the Court of Appeals reversed that decision because the motion was granted on the wrong basis.  The Court of Appeals found that the trial court’s reasoning reflected an application of a common law doctrine known as the “completed and accepted” rule.  Thus, the Court in Collard addressed, as a matter of first impression, whether Colorado has adopted the completed and accepted rule or the more modern “foreseeability rule.”

Generally, under the “completed and accepted” rule, an independent contractor owes no duty of care to third parties with respect to the work it has performed once that work has been completed by the contractor and accepted by the property owner or general contractor. Once the contractor’s work is accepted, the general contractor or owner becomes answerable for any damages or injuries resulting from the defective or dangerous condition of the work. However, as the Court of Appeals notes, the recent trend among United States jurisdictions has been to abandon the competed and accepted rule entirely in favor of the foreseeability rule.

The Court of Appeals went on to state that “the foreseeability rule provides that a construction contractor is liable for injury or damage to a third person as a result of its work, even after completion of the work and acceptance by the owner where it was reasonably foreseeable that third persons would be injured by such work due to the contractor’s negligence or failure to disclose a dangerous condition known to such contractor.”  Collard, 2012 WL 5871446 at 9.

The Court of Appeals conducted a lengthy discussion regarding both rules and the fact that Colorado appellate courts have not officially adopted one or the other.  In the end, the Court concluded that Colorado has rejected the completed and accepted rule in the specific context of construction law, including repair, installation, and performance on a service contract.  The Court found that Colorado appellate courts have consistently relied on the foreseeability rule.

In applying the foreseeability rule to the Collard case, the Court of Appeals did add one caveat.  The Court concluded “as a matter of first impression in Colorado, that because Vista’s road construction work created a dangerous condition, it had a tort duty, for a reasonable period of time, either to eliminate the condition or to warn foreseeable users (such as Collard) of the road hazards that foreseeably could result in injuries, even if its work had been completed and accepted by the City; however, this duty will not be imposed if Vista had a reasonable good faith belief that another authorized party (here, the City) would promptly take the necessary measures to eliminate the dangerous condition or provide adequate warnings to foreseeable users.” Id. at 14 (emphasis added).

Based on that conclusion, the case was remanded to the lower court to review the case under the proper duty rule, foreseeability.  Specifically, the Court stated that attention should be paid to whether Vista had a reasonable, good fair belief that the City would promptly take the necessary measures to eliminate or provide warnings of the alleged dangerous condition on the site to third parties.

The attorney who drafted this entry is no longer with the firm. For additional information regarding Colorado construction litigation, please contact David M. McLain at (303) 987-9813 or by e-mail at mclain@hhmrlaw.com

Disclaimer

The information contained in this blog is provided for informational purposes only. It is not legal advice and should not be construed as providing legal advice on any subject matter.