Chinese Drywall Seminar Coming to New Orleans July 31st

A seminar on the Chinese Drywall crisis will be held in New Orleans, Louisiana, this July 31, 2009.   The seminar is being billed as “a practical, one-day seminar for attorneys, engineers, architects and contractors,” and will examine a host of topics related to Chinese Drywall claims including:

  • The damages and health effects caused by defective drywall;
  • The status of Chinese Drywall lawsuits in Louisiana and elsewhere;
  • Option of pursuing damages through a class or individual action;
  • Proposed Legislative solutions;
  • Exploration of liability among manufacturers, builders, suppliers, and others.

Wolfe Law Group’s Scott Wolfe is presenting at the seminar’s second segment on the matter of “Exploring the Current Status of Chinese Drywall Claims and Litigation.”

Scott Wolfe is sticking around to the seminar’s third segment where he will co-present with the Berniard Law Firm’s Jeffrey Berniard on the matter of “Exploring Potential Liability for Damages Caused by Chinese Drywall Problems.”

Learning credits are available for participating professionals, including 5.0 approved CLE hours for attorneys in the states of Louisiana, Alabama, Mississippi and Texas.

More information can be found at the Half Moon Seminars website promoting the seminar here or by downloading the brochure here.

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

Making Money Off Chinese Drywall – Know the Legal Risks and Contact Counsel

Once the Chinese Drywall story began dominating news in the construction industry, attorneys, contractors, scientist and inspection outfits naturally looked to cash in on the crisis.

The rush to capitalize on the new demand for drywall inspections and replacement lead Florida’s Palm Beach Post to headline one of its articles on the topic “There’s gold in them there walls.”

While filling a void for services in demand is good, and profitable, those rushing to the aid of Chinese Drywall victims should analysis the legal risk of their new ventures to ensure they aren’t over-exposed and one-day facing expensive litigation and claims.

Here’s a breakdown of some of the legal risk associated with these new ventures.

No Puffing

puffing n. the exaggeration of the good points of a product, a business, real property, and the prospects for future rise in value, profits and growth. Since a certain amount of “puffing” can be expected of any salesman, it cannot be the basis of a lawsuit for fraud or breach of contract unless the exaggeration exceeds the reality. However, if the puffery includes outright lies or has no basis in fact (“Sears Roebuck is building next door to your store site”) a legal action for rescission of the contract or for fraud against the seller is possible.

The Florida Attorney General has already issued a consumer alert for scam artists trying to capitalize on Chinese Drywall problems, and other state’s are likely to follow suit with similar warnings.

While your business may not be a scam, the AG warnings and news reports on related scams will heighten the concern of your customers…and may make your customers over-sensitive to unfulfilled promises of your product or service.

Your company may eventually be exonerated from a complaint to the Attorney General’s office, but it will be subjected to the complaint, incur expense, and possibly find itself with negative press.

To avoid these legal troubles, tell things like it is with your produce and service, and try to avoid “puffing.”   It would also help to have an attorney go through your promotional materials and ensure that you are not misrepresenting your company’s services.

Know the Unknown

Here is a fact:  it’s impossible to know the unknown.   So, why are we suggesting that you do know the unknown?   Because we’re suggesting that you simply know that the unknown is there.

And with Chinese Drywall…there is a lot of unknowns.

Anyone setting up a business to remedy, repair, inspect or investigation Chinese Drywall should realize that experts just aren’t yet sure of what causes Chinese Drywall, or how to find it and properly replace it.

If your company purports to repair Chinese Drywall problems, be cautious that a coating may or may not do the trick, that the drywall may or may not need total replacement, and that other building elements may be affected.   With the homeowner’s health and integrity of the property at possible risk, incorrect moves can expose you or your company to substantial damages.

Knowing the unknown involves two steps:

– Take inventory of the unknowns associated with your concept; and

– Legally protect yourself with disclaimers, good contracting and clear communication.

Consult Legal Counsel

Since scam artist have increased consumer sensitivity, the legal risks are high and the unknowns are plenty, it’s worth discussing your business plans with counsel.

Through advice and help with contracting, an attorney competent in construction law can help protect your company against liability risks it proceeds to provide services to a new and unpredictable customer.

Learn about good general contracting practices at our firms general construction law blog, the Construction Law Monitor here.

Also, Wolfe Law Group would be happy to review your company’s business model to advise you of its inherent risks, and to help craft a contract that can communicate the risks to the consumer and best protect your business from liability.  Contact us to learn more.

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

How To Dispute A Louisiana Construction Lien

Louisiana lien laws are codified in La. R.S. 9:4801, which is referred to as the Louisiana Private Works Act.  While the state has some notice requirements, it is generally a non-notice state [read about notice requirements for Louisiana here].

But what happens when a lien is filed improperly?

Depending on your perspective, it’s either fortunate or unfortunate that parish recording offices are required to file mechanic’s lien upon presentation.

So…if a subcontractor liens a project for $10 million when he’s only owed $35.00, the lien is recorded.   If a laborer liens a project five years after its substantially complete, the lien is recorded.  Or if the lien fails to include information required by law, it is still recorded.

While the construction or mechanic’s lien may be legally improper, it gets on the books, and that means it can have the effect of preventing a sale, transfer or refinancing of the property.

The Private Works Act provides a procedure by which any interested party can dispute the validity of a construction lien.  If they are successful at removing the lien, the Act provides the disputing party the ability to recover attorneys fees and costs.

Scott Wolfe recently published a Legal Guide on the national lawyer ranking website, Avvo.com.  The guide is titled “How to Dispute a Construction Lien in Louisiana,” and guides an interested party through these three steps:

1)  Answer the Obvious Question:  Is the Lien Improper?  [read common mistakes]

2)  Make Written Demand for Cancellation of the Lien [see template letter]

3)  File Suit to Demand Removal of the Lien [see similar lawsuit]

Read the legal guide in full at Avvo.com by clicking here.

Wolfe Law Group frequently works with clients who dispute the validity of construction and mechanics liens in Louisiana and Washington.   Contact us today for more information about how to demand the cancellation of a construction or mechanic’s lien filed against your property, or on your project.

New Orleans Now At Center of Chinese Drywall Litigation. What Does it Mean?

Post-Katrina New Orleans drastically increased the demand for drywall in Louisiana, but as fate would have it, this was precisely the wrong time to buy drywall in America.  As far as the volume of imported and installed defective Chinese Drywall goes, Louisiana is second only to Florida.

In the past year, class action suits have been filed in multiple states on behalf of property owners with Chinese Drywall.

On June 15, 2009, the United States Panel on Multidistrict Litigation ordered that all class actions be transferred to New Orleans, LA, and handled by the Louisiana Eastern District Court.

In the transfer order, the Panel on ML explained the selection of Louisiana’s Eastern District with the following:

No district is a clear focal point of this litigation…On balance, we are persuaded that the Eastern District of Louisiana is a preferable transferee forum for this litigation. Centralization in this district permits the Panel to effect the Section 1407 assignment to a judge who has extensive experience in multidistrict litigation as well as the ability and temperament to steer this complex litigation on a steady and expeditious course.

[read the transfer order].

The Eastern District website has already published a web page to administer the litigation.

Kean Miller’s Louisiana Law Blog has a great explanation of the Panel for Multidistrict Litigation, and the technical aspects of the transfer.   As explained on that blog, only ten total actions have been transferred to the Louisiana district court…but more are likely to follow suit.

Order does not affect cases filed in State Courts

While the transfer order will affect all of the federally filed class actions, and later tag-along cases, it will not affect cases that are filed in state courts.   The order exclusively governs those actions that are filed in federal jurisdictions.

Cases filed against contractors or suppliers directly, in local courts, will not be consolidated with the multidistrict litigation, and accordingly, will not be subject to any delays caused by the ever-growing action.

Perhaps another reason why we’ve questioned whether a local action directly against builders would be more beneificial to homeowners.

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

Starbucks Dreams About Taking the LEED

As the green building movement gains momentum in Louisiana, and across the nation, many have debated whether going LEED (or just going green) is worth the increased project costs.

While it certainly won’t put an end to the debate, a recent announcement out of Seattle-based Starbucks is interesting.  The coffee giant (with recent financial woes) announced the opening of a new LEED location in Seattle’s Pike Place Market, and very aggressive goals to get LEED certifications across the country, at its headquarters, and even at its roasting facilities.

What does this mean for green building in Louisiana?

It’s really too soon to say, but here are some possibilities:

(1)  Louisiana Starbucks locations may be among those getting LEED certification in the next few years;

(2) The move may influence other retail chains to build green;

(3) The committmenet from such a retail giant adds to the nation’s and Louisiana’s general green momentum.

It will be interesting to watch…but once again, as the demand for green building products and services increases, so will the supply.  From the supply perspective (architects, contractors, etc.), it’s important to ensure that your company is providing the services it promises, and protects itself from energy performance milestones that may be out of their control.

Louisiana Not Missing The Green Revolution

An article in New Orleans’ City Business Magazine this week reports that “green” jobs in Louisiana have grown in the past decade.

The data – taken from a report that analyzed the growth of clean energy jobs across the nation – demonstrated that Louisiana’s growth in the green sector has been average.  The City Business story noted that “Louisiana had the 24th most clean-energy businesses an the 22nd most green jobs.”

Remember that previously on the Louisiana Green Law blog, we asked whether the Green Building Boom was finally arriving in Louisiana.  It’s no secret that since Hurricane Katrina, rebuilding the Big Easy “green” has been all the buzz.

As the City Business blog notes, even the New York Times recognizes that Louisiana is in the hunt for money in the green economy, although missing venture capital funding and a lot of the deep pockets that exist in California and along the West Coast.

However…as with all my discussions about green opportunities, it’s important for capitalizing businesses to be cautious of the risks [see blog category:  Green Building Risks].

Is your business’ green advertising really greenwashing?

If your product or service doesn’t increase energy performance, or doesn’t qualify for the anticipated LEED credit or other green credit, will your company be exposed to litigation and damages?

Unfortunately these days, there are more questions than answers.  It’s prudent to consult with an attorney if your company is experimenting in the green industry.  It’s a huge sector with lots of opportunity, but it’s worth analyzing the risks, and protecting your investments.

This post originally appeared on Wolfe Law Group’s topic-specific Louisiana Green Building Law Blog.

Painting Your Roof White Saves Energy? Contractors Should Be Careful with Green Promises.

Anyone familiar with green building or the LEED Certification process should know that great emphasis is placed on the reflectivity of open spaces.

Under LEED Credit SS 7.1, for example, parking lots and open spaces must have a reflectivity (SRI) of at least 29 to qualify for credit. Similar, roof installations must contain a percentage of vegetation or reflectivity to achieve credit SS 7.2.

The idea of pavement and roofs being white, instead of black, in other words, isn’t new.

However, in the news this week is a rather radical proclamation by a scientist at Lawrence Berkeley National Lab in California, who opine that painting rooftops whiter will cause enough sunlight to bounce back into space and cool the planet. They also aver that it will save in energy costs, as the planet – and individual homes – will stay cooler.

Contractors in Louisiana might want to take note of the study, as the state has generally hot summers and year-long weather. There may soon be a market in taking residential and commercial roof installations, and coloring them white.

Marketing the sale of a “white roof” or “white roof coating” has already begun actually.  See this Craig’s list ad, and Spray Foam Louisiana’s website for cool roof systems.

Of course, with any type of green construction, it will be important to insulate your company’s offering from liability. The idea of a “white roof” lowering energy costs for individual homeowners is just that: an idea, and there are many other variables (insulation, roof type, etc.) impacting the energy costs of a home of business.

One of the dangers with “green building” is the promises that come along with the construction offers. Selling your service by highlighting energy savings and performance enhancements is legally problematic if the service doesn’t result in savings and efficiency.

If your company is engaged in a service that promises energy savings, be aware, and speak with an attorney about how you can protect yourself from potential liability by smart contracting.

This post originally appeared on Wolfe Law Group’s topic-specific Louisiana Green Building Law Blog.

Lien on Property or Lien on Funds? It’s Two Different Collection Tools

Liens are one of the most powerful collection tools available to workers in the construction industry. Mechanics Liens are inexpensive and hard-hitting, and perhaps one of the most effective ways to collect on non-paying projects.

A properly filed construction lien can affect a property’s title, entangles multiple parties to your dispute, and helps get you paid.  Suppliers, prime/sub/sub-sub contractors and laborers all have the rights to lien a property they performed work on.

Bradley Coxe  Hodges & Coxe, PC law firm wrote some basic information within JD Supra explaining the two broad types of a mechanics’ lien-  the property or funds lien.

Property liens are the most popular and widely used in each state.  The homeowner is responsible for getting the worker paid for his completed job.  This, when filed and recorded correctly within the respective county or parish places a hold on the owner’s land preventing them from selling or turning over until the matter is determined by the courts.

The second type of lien is the lien on funds; which is when the payor, not the owner, is responsible to pay for the work.  Whomever performed work on the property that was not contracted directly with the owner can send a notice to the owner letting them know 1- they have not been paid  and 2- they should not pay whomever is in charge of getting the money (in most cases, this is the prime or general contractor)  The funds that are owed to the general or prime contractor is what has been liened.  If the general contractor has been paid after a notice was supplied to the owner, a sub-contractor can then lien the property.

This post originally appeared on the Construction Lien Blog.