Posts Tagged ‘Construction Law Monitor’

IRS Aid to Help Victims of Chinese Drywall

On October 7, 2010 Author By Seth Smiley        

Just last week the Internal Revenue Service (IRS) announced a plan to help homeowners who have corrosive Chinese Drywall in their home with tax breaks on items that have been destroyed as a result of the Drywall.

IRS website gives a good break down on the relief effort affecting repairs for drywall losses from drywall installed between 2001-2009. Entitled Revenue Procedure 2010-36, the procedure covers the following:

  • Homeowner must pay for the repair of the loss and make the claim in the year of payment.
  • You cannot make a claim that has been paid for by insurance or reimbursed by another source.
  • If the homeowner does have a pending claim or suit they can claim reimbursement for 75% of the unreimbursed amount.

Many news sources have reported on this same topic: New York Times, New Orleans Times Picayune.

This is the first major federal effort to help compensate homeowners with tainted drywall. The drywall has affected homeowners in many states with the most concentrated in Florida and Louisiana.

Posted in:     Chinese Drywall, Construction News, Federal  /  Tags: , ,   /   Leave a comment

Construction Outlook Grim through 2010 – Staying Ahead of Accounts Receivables To Retain Its Importance

On July 13, 2009 Author By Scott Wolfe Jr        

Ken Simonson, the chief economist for the Associated General Contractors of America, doesn’t have good news for the construction industry as the challenging year 2009 drags into its 3rd Quarter.

According to Simonson, the commercial construction industry forecast remains grim “at least through 2010.”

For contractors, suppliers, and other construction professionals throughout the nation, this means that good record-keeping and collection practices remain important.

Almost one year ago, Wolfe Law Group posted an article on its Construction Law Monitor after Ken Simonson reported that 2009 would present economic challenges to contractors.

Now more than ever, the article stated, contractors should consider the benefits of a construction or mechanics lien.  The article went on to state:

As soon as the construction project comes to a halt or payment is late, contractors, subcontractors and suppliers should rush to file its construction / mechanics lien to protect its interest in the property. Construction liens are available in virtually every state, and works to transform the project job site as a sort of “collateral” to the contractor for its payment.

The time available to file a construction lien is not indefinite, and the legal requirements should be followed to the letter. However, when filed correctly, a construction lien can help your company recover payment for its project.

Although the stimulus spending will be cause for some optimism in the construction industry, it appears economic struggles will stick around into 2010.    And the recommendations of Wolfe Law Group in 2009 are repeated today.

This article was originally posted on Express Lien’s topic-specific Construction Lien Blog.

Posted in:     Collections, Construction News, Mechanics Lien  /  Tags: , , , , ,   /   2 Comments

Analyzing Choices Before All Parties Related to Chinese Drywall Claims

On May 15, 2009 Author By Scott Wolfe Jr        

Wolfe Law Group’s general construction law blog, the Construction Law Monitor, published three articles over the past two weeks that analyzed the choices faced by builders, homeowners and construction attorneys involved with Chinese Drywall claims.

The three-part series of articles provides these parties with a useful discussion of the decisions that must be confronted as each deal with damages sustained by the installation and supply of tainted drywall.

The article series can be found under the Chinese Drywall Tag on the blog.   Or by clicking on one of the following links, whereby each article is briefly discussed.

Builders
This article discusses issues related to making insurance claims, remedying the drywall problem within homes, the duty to mitigate damages and options available to the builder in litigation.

Construction Attorneys
This article discusses the role of class action suits in the imported drywall crisis, warranties and the role of builders in the suits, and how the duty to mitigate damages affects all parties.

Homeowners
This article discusses the choices facing homeowners who have tainted drywall in their homes.   It examines the pros and cons of class action suits, individual litigation, and making insurance claims….as well as the ultimate unfortunate job that homeowner might be forced to take:  fixing the drywall out of their own pocket (at least for now).

This post originally appeared on Wolfe Law Group’s topic-specific Chinese Drywall Blog.

Posted in:     Chinese Drywall  /  Tags: , ,   /   Leave a comment

Green Building and Risk Management

On April 29, 2009 Author By Scott Wolfe Jr        

Just recently, the U.S. Green Building Council published an update to its readers explaining Risk Management issues to its readers, explaining that while green building is growing even in the current U.S. Economy, it presents unknowns that makes it difficult for the industry and insurance underwriters to manage risks.

Here is a snippet:

Underwriting insurance coverage is the art of understanding, assessing, and mitigating risk. Green building has presented challenges to insurance carriers stemming from the fact that green building design and construction is new. New things are tougher to understand from a historical loss perspective, requiring leading insurance carriers to take a proactive approach to understanding the possible ramifications of providing expanded coverage to meet the needs of firms engaged in the green building industry, while anticipating the market demand for these specialty insurance products.

As mentioned in previous posts, as the green building market continues to boom, green litigation and losses becomes more likely.   What if the planned LEED certification is not achieved?  What if the design is not as energy efficient as planned?

And the questions go on and on.

One question that is still unanswered, as hinted by the USGBC above, is with regard to Risk Management & Insurance.

In December 2008, Wolfe Law Group published an informative article on its Construction Law Monitor titled Green Building Insurance & Limiting Exposure.   The article discusses the need for specialty insurance, the packages available to contractors and the idea of green building performance bonds.

Just last week, ACE USA announced the launch of a Green-Specific Contractors Insurance Program, joining the ranks of companies like Fireman’s Fund, Travelers & AON.

Like everything else in the green building industry, the waters here are untested.   While we can read the policies and the brochures on the policies, it’s too early to determine what types of claims will be paid versus those denied, or the role green building insurance will play – or ever play – in protecting a contractor from professional liability losses.

Posted in:     Insurance  /  Tags: , , , , ,   /   2 Comments