Time for a Checkup? How to Increase the Lifespan of Your Building

I recently went to the Dr. with the usual case of seasonal sniffles that had turned into a sinus infection. While in the office she asked me how long it’s been since I have had a complete physical. The next few moments of uncomfortable silence seemed to speak volumes. Truth be told, I don’t know if I had ever had a complete physical and the prospect of starting now seemed like a journey into the scary unknown. My Dr. took the next couple of minutes, calmed my fears and explained to me the importance of uncovering the root causes of medical conditions or “proactive treatment” as she called it, instead of merely treating the symptoms, “reactive treatment.”

This concept started me thinking about what other important areas of life do we mistakenly “reactively treat?” Since I am in the construction industry my mind immediately turned to our primary investment. People often do whatever is necessary to protect their 401k or other “paper” investments but fail miserably to protect their single largest investment; their home, condo, townhouse, commercial building, or whatever the structure type happens to be. Most people in fact treat their building the way I was viewing my health, “reactively.”

The problem with this approach is twofold. First, by only treating the symptoms, in my case the runny nose; on a building it could be painting over a water stained window sill, replacing a rotten piece of siding, or whatever…you never solve the underlying problem. Without the root cause being properly identified the chance for a large or catastrophic occurrence is greatly multiplied. Second, when you only treat the symptoms you might think you are saving money. Very quickly, however, those repairs add up; $125 here, $200 there and before long you have spent $3000/$5000 without ever identifying the true problem. By only putting “Band-Aids” on your building you have probably allowed what could have been a simple issue to become a major financial endeavor.

Did your mother ever tell you, “an ounce of prevention is better than a pound of cure” or maybe you have said it yourself? It’s great advice that seems to have application in many areas. It is time to apply it to your building. The above mentioned water stained window sill…it could be hiding serious water intrusion and rot, or the rotten piece of siding could be telling you that elements that should remain exterior are become interior concerns. In my case, my physical exam showed that I had certain allergies; with this knowledge and proper medication the symptoms are gone. No more Dr. visits and costly antibiotics. So to, your building’s physical exam will help you to prevent catastrophic failure and ultimately lessen the financial impact as well as tell you what you need to know to make sure that you get the most from your investment.

For more information contact Watkins Service at 843-448-3900 or visit us atwww.watkinsservicesinc.com

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Parties In Privity May Sue in Tort Over Construction Defects

Last month’s Oregon Appellate Court decision clarifies that parties in privity with one another MAY sue in tort for construction defects.
Previously, the law seemed relatively straight forward:
Unless parties are in a “special relationship” (eg, physician-client; engineer-client), parties in contract with one another generally may not bring a separate cause of action in tort for construction defects. Jones v. Emerald Pacific Homes, Inc., 188 Or App 471, 71 P.3d 882 (2003). Instead, parties were limited to the remedies agreed to via contract.
That’s no longer the case.
In Abraham v. T. Henry Construction, Inc. et al, Case No. A136228, plaintiff home owners sued their contractors and subcontractors over construction defects (resulting in water damage) based on contract and tort. While Defendants successfully dismissed the contract claim (based on statute of limitations), Defendants were unable to dismiss the tort claims on summary judgment.
Although the court found that there was no “special relationship” between the parties, the court held that the tort claim survives because violations of building code constitute a breach of duty of care independent of contractual duties. The court found that plaintiffs had pled the requisite elements (essentially negligence per se) and allowed the claim.
Much to every contractor’s chagrin, virtually every alleged construction defect can be categorized as a building code violation. Ergo, tort claims in this context will survive summary judgment….unless the Supreme Court overturns the Abraham decision….

Oregon District Court Addresses the Meaning of “Condominium” in a CGL Policy

In Bridgetown Condominium Homeowner’s Assn. v. Granite State Ins. Co., 2009 U.S. Dist. LEXIS 51568, Judge Anna Brown of the Oregon District Court recently examined the meaning of the undefined term “condominium” within the meaning of a CGL policy. InBridgetown, the plaintiff homeowner’s association had previously settled a state court action with a defendant developer for claims at a condominium project. The project consisted of fourteen single-family dwellings. The plaintiff entered into a stipulated judgment with the insured defendant in which the plaintiff agreed it would seek a portion of the stipulated judgment amount from the defendant’s insurer. The plaintiff then brought this garnishment action against the insurer


The policy at issue contains a “Designated Work Exclusion” that bars coverage for “A. Condominiums, multi-unit homes, townhouses, or apartment buildings which contain 5 or more single family units. B. Any building or structure in excess of three (3) stories or any building or structure in excess of forty (40) feet in height.” The plaintiff contended that the undefined term “condominium” is ambiguous because the term is susceptible to more than one meaning, and when properly interpreted does not exclude coverage for plaintiff’s claims.
Employing Oregon’s rules to interpret the terms of an insurance contract, the court first determined whether the term has a plain meaning. Oregon courts may look to dictionary definitions to determine whether a term has a plain meaning. The plaintiff had provided a dictionary definition that “condominium” means either a building or complex containing a number of individually owned units, or the individual units. The court concluded that the dictionary definition established that “condominium” has more than one plausible meaning, and so the court examined the term in light of the context in which the term is used in the policy.
After examining the policy, the court rejected the plaintiff’s argument that the “Designated Work Exclusion” excludes only condominiums that “contain 5 or more single family units,” which the plaintiff argued demonstrates the insurer’s intent to exclude coverage of condominiums that are comparatively large buildings containing more than five single family units. The court also rejected plaintiff’s argument to apply the ejusdem generisprinciple of contract interpretation to the “Designated Work Exclusion.” In agreeing with the insurer, the court found that while the exclusion contains an enumeration of specific things (i.e., condominiums, multi-family homes, townhouses, and apartment buildings), that enumeration is followed by an even more specific description (i.e., “which contain 5 or more single family units.”). The court found that the application of the ejusdem generisdoctrine does not establish either ambiguity in the “Designated Work Exclusion” nor indicate that the “Designated Work Exclusion” does not apply.
By applying Oregon’s rules to interpret the terms of an insurance contract, the district court concluded that both the plain meaning of “condominium” in the policy’s “Designated Work Exclusion,” and its meaning within the policy as a whole indicate that the “Designated Work Exclusion” applies to the project at issue, and the particular policy excludes coverage for the project.