Construction Law Insights

United States ex rel. Engineered Servs., Inc. v. T.H.R. Enters., Inc., Civil No. 4:14cv21 (E.D. Va. Jan. 23, 2015)

The Navy contracted with THR Enterprises, Inc. (“THR”) to upgrade the HVAC system in one of its buildings. THR subcontracted with Applied Control Specialists (“Applied”) to install the Direct Digital Control System. Applied Assigned the subcontract to Engineered Services, Inc. (“Engineered Services”).

Several Change Orders were issued. The second Change Order extended the completion date of the prime contract to February 13, 2013. The third change order did not list any completion date, but left the date to be determined. THR received an extension of the prime contract’s completion date to November 15, 2013. Engineered Services completed its work by November 15, 2013, and the Navy paid THR in full, without assessing any penalty for delay. Engineered Services filed a claim, but THR filed a counterclaim seeking damages incurred as a result of Engineered Services’ failure to complete the work by February 13, 2013.

The third Change Order, in conjunction with the extension obtained by THR from the Navy, extended Engineered Services’ performance period under the contract to November 15, 2013. The inclusion of the “to be determined” language in the third Change Order must be read to have meaning in the context of other evidence including the extension THR received from the Navy. The delays were not substantially caused by Engineered Services. Thus, Engineered Services was entitled to an extension to the same extent THR obtained an extension from the Navy for the prime contract.

U.S. f/u/b/o Harbor Construction Co., Inc. v. THR Enterprises, Inc. and Hanover Ins. Co., Civil No. 4:14cv17, 2014 WL 4452755, 2014 U.S. Dist. LEXIS 125919 (E.D. Va., Sept. 9, 2014)

Harbor Construction Co., Inc. (“Harbor”) brought breach of contract, Miller Act, and unjust enrichment claims against THR Enterprises, Inc. (“THR”) and its surety, Hanover Insurance Company (“Hanover”). Harbor alleged that it completed the electrical work required under the subcontract and change order work, but that THR failed to pay Harbor the amounts owed. THR filed a motion to stay the proceedings and compel arbitration. The court found that the plain language of the subcontract expressly authorized THR to elect arbitration as an alternative to litigation and granted THR’s motion.

Handback v. DRHI, Inc., LLC, No. 1:14-cv-1789, 2015 WL 1137584, 2015 U.S. Dist. LEXIS 30897 (E.D. Va. Mar. 11, 2015), appeal docketed, No. 15-1434 (4th Cir. Apr. 23, 2015)

Under the contract, Hanback would receive $70,000 per approved. If, however, only five or fewer lots were approved, Hanback would only receive $400,000 for the 2.14 acres. Five or fewer lots were approved, and Hanback was paid $400,000. In 2007, DRHI purchased property adjacent to the 2.14 acres and submitted a combined development plan, which the city approved in 2007. Under the plan, the 2.14 acres would be used as a buffer zone and the remaining portion of the property would be used for 15 single-family homes. DRHI submitted subdivision plans for the 15 lots in 2009, which were approved in 2010. In May 2012, Hanback demanded payment based on the approval of DRHI’s plans with more than 5 approved lots. In December 2014, Hanback filed a complaint against DRHI.

Hanback had no cause of action for declaratory judgment because both the alleged breach of contract and the claimed damages had already occurred, and therefore, a declaratory judgment could not provide any guidance to the parties to clarify their legal relationship or for their future conduct under the contract. Hanback’s claim was barred by Virginia’s five-year statute of limitations for breach of a written contract. The breach occurred in 2007 when the lots were approved, because the parties’ contract provided for payment upon approval of the lots. Hanback failed to state a claim because the contract required additional payments from DRHI only if six or more lots were approved. Because only 5.5 lots were approved, the contract did not entitle Hanback to payment of more than the $400,000 already received.

77 Const. Co. v. UXB Int’l, Inc., No. 7:13CV00340, 2015 WL 1800353, 2015 U.S. Dist. LEXIS 49943 (W.D. Va. Apr. 16, 2015)

77 Construction Company (“77 Construction”) sued UXB International, Inc. (“USB”). UXB moved to enforce the settlement between the parties. The court found that the agreement was merely an agreement to agree because: (1) Several conditions were not triggered; (2) UXB retained unilateral authority to modify the agreement; and (3) The parties came to no meeting of the minds on several terms.

Under the agreement: (1) 77 Construction agreed to withdraw and resubmit certain invoices, but UXB retained “sole discretion” to certify or submit those invoices for payment; (2) 77 Construction could submit additional requests for equitable adjustment, depending on whether certain conditions were triggered; (3) The settlement amount depended upon the acceptance of an expert report by both parties, which did not happen. Hence, the price of agreement was unknown. The parties also admitted in their joint status report to the court that the agreement was not intended to settle part or all of their claims, but to “narrow the issues” and “facilitate the resumption of settlement discussions.”

Alami v. Lincoln Prop. Co., 61 F. Supp. 3d 551, 2014 U.S. Dist. LEXIS 165954 (E.D. Va. Nov. 24, 2014)

Tenants, the Alamis’, sued the landlord, Lincoln Properties, for damages caused by a delay in the buildout of their leased premises. The court dismissed the breach of Work Agreement claim because the language of the lease precluded any claims for consequential damages associated with landlord’s delay in completing the buildout of Plaintiff’s storefront. The court dismissed the negligence claim because D.C. precludes recovery for negligence claims based on a breach of contract under the economic loss doctrine. The court dismissed the promissory estoppel claim because plaintiffs failed to plead sufficient facts for the court to determine where the last act of reliance occurred.

William H. Gordon Assocs. v. Heritage Fellowship, Record No. 150279, 2015 Va. LEXIS 91 (Va. June 5, 2015)

Owner, Heritage Fellowship, sued its civil engineer and general contractor after the failure of a storm water retention system designed by the engineer and installed by the contractor. The engineer argued that the general contractor’s submission of the specified storm water retention system, as well as the contractor’s error in its shop drawings and its improper installation of the system, shifted responsibility from the civil engineer to the general contractor for the eventual failure of the storm water retention system. Following an eight-day bench trial, the trial court found that the failure of the project engineer to meet its professional standard of care was the sole cause of the collapse. The case is on appeal to the Supreme Court of Virginia.

T&B Elec. Co. v. SimplexGrinnell, LP, Case No. 1:15cv438 (JCC/TCB), 2015 U.S. Dist. LEXIS 67838 (E.D. Va. May 26, 2015)

T&B Electrical Company (“T&B”) contracted with R.E. Daffan, Inc. (“Daffan”)  for T&B to perform electrical work. T&B contracted with Simplex to install the security package. T&B alleged that Simplex failed to perform its duties in a timely manner, and, as a result, completion of the entire project was delayed. Because of Simplex’s late completion, T&B had to compromise its claim against Daffan that it failed to fully pay T&B for its work.

The Court enforced the contract’s choice of law clause and applied Massachusetts law. Under Massachusetts’ law, a contract failing to specify a time for performance contains an implied term of performance within a reasonable time. Reasonable time is determined with reference to the nature of the contract and the probable intention of the parties as indicated by it. Because T&B’s Complaint alleged Simplex’s performance did not occur within a reasonable time, T&B’s Complaint stated a plausible claim. Therefore, the court denied Simplex’s motion to dismiss.

Columbia Gas Transmission, LLC v. Vlahos, No. 3:14-CV-138, 2015 WL 965987, 2015 U.S. Dist. LEXIS 26437 (E.D. Va. Mar. 4, 2015)

Columbia Gas Transmission, LLC (“Columbia Gas”) sought declaratory and injunctive relief against Vlahos because Vlahos had constructed a fence interfering with Columbia Gas’ easement granting it a right-of-way to lay and maintain a natural gas line on Vlahos’s property. Columbia Gas filed a motion for summary judgment, supported by exhibits and expert testimony. Vlahos failed to comply with warnings regarding his burden to present affidavits or sworn statements to contest Columbia Gas’s evidence. In light of Vlahos’ failure to respond to Columbia Gas’ motion and present contrary evidence, the Court accepted all of Columbia Gas’ factual allegations as true. Relying on Columbia Gas’s expert testimony, the Court found there to be no dispute of material fact that Vlahos’s fence interfered with Columbia Gas’ ability to safely access, inspect, maintain, and repair its existing pipeline and also increased the risk of danger to surrounding persons or property. Accordingly, the Court granted summary judgment to Columbia Gas.

Transcontinental Gas Pipe Line Co., LLC, No. 3:14-cv-00405-HEH, 2014 WL 6685480, 2014 U.S. Dist. LEXIS 164872 (E.D. Va. Now. 25, 2014)

Transcontinental Gas Pipe Line Company, LLC (“Transco”) is acquiring property necessary to build nearly 100 miles of interstate natural gas pipeline. All defendants were properly served with Transco’s Complaint for condemnation for temporary and permanent easements. Transco reached agreements to pay just compensation for the condemnation with all but two of the owners.

Transco moved for summary judgment and no defendant responded or opposed the motion. The court found that there was no genuine issue as to any material fact and entered judgment for Transco. The fair market value of the property as of the date of the taking is the appropriate measure of compensation in a condemnation proceeding. Based on the breadth, the court accepted the appraisal report submitted with Transco’s motion.

L-3 Communications Corp. v. Serco Inc., 39 F. Supp. 3d 740 (E.D. Va. 2014)

The court granted L-3 Communications Corporation and L-3 Applied Technologies, Inc. (collectively “L-3”) motion to remand their suit against Serco, Inc. for tortious interference with L-3’s confidentiality and business contracts.

Removal was not proper under federal question § 1331 jurisdiction. Allegations involving violations of Federal Acquisition Regulations do not necessarily create federal question jurisdiction because state courts can apply federal regulations to facts. L-3’s tortious interference claims did not involve a “uniquely federal interest,” because such interests occur only in limited areas not existing in this case, such as disputes involving: (1) the obligations to, and rights of, the United States under its contracts; (2) the liability of federal officers for official acts; and (3) civil liabilities arising out of federal procurement contracts directly relating to national defense.

Removal was not proper under federal officer § 1442(a)(1) removal jurisdiction because such jurisdiction requires a defendant to establish: (1) that it is a “person” within the meaning of the statute; (2) that the defendant acted pursuant to a federal officer’s directions; (3) (3) that a causal nexus existed between the defendant’s actions under color of federal office and the plaintiff’s claims; and (4) that a colorable federal defense exists.

United States Smoke & Fire Curtain, LLC v. Bradley Lomas Electrolok, Ltd., 612 Fed. Appx. 671 (4th Cir. Va. May 22, 2015)

The District Court dismissed U.S. Smoke & Fire Curtain, LLC (“Curtain”) complaint without prejudice because the forum-selection clause in its distribution agreement with Bradley Lomas Electrolok, Limited (“BLE”) applied to the claims raised in Curtain’s complaint. The Fourth Circuit Court of Appeals affirmed.

BLE did not waive its right to seek enforcement of the forum-selection clause by removing the case to federal court. Termination of the distribution agreement did not bar BLE’s enforcement of the forum-selection clause, because dispute resolution provisions are generally enforceable beyond the expiration of the contract if they are otherwise applicable to the disputed issue and the parties have not agreed otherwise. The forum selection clause applied to the claims raised in Curtain’s complaint, because the claims arose in connection with the distribution agreement and fell within the ambit of the broadly worded clause.

XL Specialty Ins. Co. v. Truland, Case No. 1:14cv1058 (JCC/JFA), 2015 U.S. Dist. LEXIS 62288 (E.D. Va. May 11, 2015)

Surety XL Specialty issued numerous payment and performance bonds on behalf of the several Truland entities (the “Truland Entities”). Under the indemnity agreement, the indemnitors, including Robert and Mary Truland, promised to deposit collateral security to indemnify XL from any losses or liability that XL may incur by issuing the bonds. The Truland Entitles incurred substantial debts to their subcontractors and suppliers for the bonded projects. XL was sued for payment under the bonds. XL brought suit to enforce the collateral security and indemnification provisions of the Indemnity Agreement.

The court granted XL Specialty’s motion to dismiss Mary Truland’s counterclaim for declaratory judgment. Declaratory judgment is granted when the declaratory relief sought will serve a useful purpose in clarifying and settling the legal relations at issue and will terminate and afford relief from uncertainty, insecurity and controversy giving rise to the proceeding. Mrs. Truland’s counterclaim and first affirmative defense were repetitious. Accordingly, the issue she raised in her counterclaim would already be resolved during the litigation and a declaratory judgment would not add anything to the proceeding.

Canopius U.S. Ins., Inc. v. Cresco, Inc., No. 1:14CV172, 2014 WL 5107063, 2014 U.S. Dist. LEXIS 142345 (E.D. Va. Oct. 6, 2014)

The subcontractor improperly installed the walk-in freezer over an un-insulated floor. The freezer’s failure resulted in the loss of thousands of dollars of frozen dough and created condensation, which caused water damage and mold on drywall. Canopius asserted that the damages alleged and work performed fell outside the scope of the policy issued to Cresco and that the policy was void for Cresco’s material misrepresentations.

Canopius asserted that the damages alleged and work performed fell outside the scope of the policy issued to Cresco and that the policy was void for Cresco’s material misrepresentations. The policy contained a classification limitation exclusion proving that the insurance does not apply to property damage for operations which are not classified or shown in the declarations. The policy also contained a total mold exclusion. In the declarations, Cresco represented that the company’s scope of work was limited to carpentry and interior painting and made certain representations regarding the nature of its business as a small, artisan contractor.

The magistrate found that: (1) The policy was void and that Canopius had no duty to defend or indemnify Cresco in any future actions due to Cresco’s material misrepresentations on the insurance application regarding the scope and nature of its business; and (2) The classification limitation exclusion applied, because the property damage was caused by work outside the scope of carpentry and interior painting, and that the mold exclusion barred the mold claim. The District Court adopted the magistrate’s report and entered declaratory judgment in favor of Canopius.

Mulvey Const., Inc. v. Bituminous Cas. Corp., 571 Fed. Appx. 150 (4th Cir. 2014)

A city utility worker was killed in a construction accident on a project for a McDonald’s in West Virginia. His estate brought a wrongful death action against the general contractor, Mulvey Construction, Inc. (“Mulvey”), and its subcontractor, DCI/Shires (“DCI”). Mulvey and McDonald’s requested that DCI’s insurance company, Bituminous Casualty Corporation (“Bituminous”), defend and indemnify them in the wrongful death action. Bituminous refused.

Mulvey’s insurance company, One Beacon Insurance Company (“One Beacon”), paid to settle the wrongful death case on behalf of Mulvey and McDonald’s and filed suit against Bituminous and DCI’s insurance agency, Brown & Brown Insurance Agency (“Brown”). The Fourth Circuit Court of Appeals affirmed The District Court’s summary judgment in favor of Bituminous and Brown on all counts. Virginia does not recognize the use of estoppel to extend an insurance policy’s coverage. The Court also interpreted the language of the policy to not include Mulvey as an additional insured.

Allstate Prop. & Cas. Ins. Co. v. Ploutis, Record No. 141536, 2015 Va. LEXIS 109 (Va. Sept. 17, 2015)

On March 19, 2010, Ploutis’ home and certain contents were damaged when water pipes burst. Ploutis’s home was insured by Allstate. Allstate provided an initial payment, but the parties were unable to reach agreement on the cost of remaining repairs.

Ploutis filed a complaint on March 16, 2012, but an order of nonsuit was entered on February 22, 2013. Ploutis then re-filed on August 21, 2013. The policy required that actions be brought within two years “after the inception of loss or damage.”

After a nonsuit only the statute of limitations is tolled, not a contractual period of limitations. Although a policy cannot have a shorter limitation period than the statute of limitations, this does not alter the contractual nature of the policy’s limitations period. Use of standard policy form language does not convert the contractual limitations period into a statute of limitations. If the policy’s limitations period was in the language of the General Assembly and expressed in words which the statute requires to be inserted into the policy, word for word, line for line, number for number, it remains a voluntary agreement between the parties to the insurance contract and not a statute of limitations.

Capital City Real Estate, LLC v. Certain Underwriters at Lloyd’s London, 788 F.3d 375 (4th Cir. Md., June 10, 2015)

Capital City Real Estate, LLC (“Capital City”) subcontracted the foundation, structural, and underpinning work for the 57 Bryant Street, Washington, D.C. renovations to Marquez Brick Work, Inc. (“Marquez”). The subcontract between Capital City and Marquez required Marquez to indemnify Capital City for damages caused by Marquez’s work and required Marquez to maintain certain general liability insurance naming Capital City as an additional insured.

On November 17, 2008, certain underwriters at Lloyd’s London (“Lloyd’s”) issued an insurance policy (the “Policy”) to Marquez, effective from November 17, 2008, through November 17, 2009. In December 2008, Lloyd’s also issued an Endorsement (the “Endorsement”) to the Policy listing Capital City as an additional insured under the Policy, but only with respect to liability for property damage caused in whole or in part by: (1) Marquez’s acts or omissions; or (2) (2) the acts or omissions of those acting on Marquez’s behalf in the performance of Marquez’s ongoing operations for Capital City in Washington, D.C.

On June 9, 2009, during the course of Marquez’s work, the common wall shared by 57 Bryant Street and 55 Bryant Street collapsed. 55 Bryant Street was owned by Leon Yates (“Yates”) and insured by The Standard Fire Insurance Company (“Standard Fire”). Capital City’s insurer sent a letter to Lloyd’s notifying them of the collapse and tendered the claims, but received no response to either the initial letter or subsequent correspondence. On June 7, 2012, Standard Fire filed a complaint against Capital City. Capital City responded by filing a third party complaint against Marquez and its owner claiming that Marquez was required to defend and indemnify Capital City. Thereafter, Lloyd’s denied coverage and Capital City filed a declaratory judgment action against Lloyd’s seeking a declaration that Lloyd’s has a duty to defend Capital city under the Policy.

The Fourth Circuit Court of Appeals found that:

  • The Endorsement controlled the scope of coverage under the Policy.
  • The unambiguous language provided coverage to Capital City for property damage caused by Marquez, either in whole or in part.
  • Coverage was not limited to Capital City’s vicarious liability, because the Policy did not contain vicarious liability limitation language.
  • Because the underlying complaint did not make clear that Marquez conducted the foundation, structural, and underpinning work that led to the collapse of the common wall, Capital City was entitled to rely on its extrinsic evidence to establish those facts, and thereby, establish a potential for coverage.

R.T. Atkinson Building Corp. v. Archer Western Construction, LLC and Traveler’s Casualty Surety Company of America; Docket No. Cl15-488 (Norfolk Cir. Ct., May 5, 2015)

R.T. Atkinson Building Corp. (“RTA”) filed suit on a payment bond against the principal of the contract, Archer Western Construction, LLC (“Archer Western”) and its surety, Traveler’s Casualty Surety Company (“Travelers”). The court denied Archer Western’s motion for summary judgment and held that: (1) Notice is given when received by the contractor under the Little Miller Act; and (2) Disputed issues of fact existed on whether the USPS tracking history for the notice was authentic, admissible, and proved whether delivery occurred beyond the 90 days within which to give written notice.

Smith v. Clark/Smoot/Russell, A JV, 796 F. 3d 424 (4th Cir. Md. 2015)

In 2012 and 2013, relator Brian K. Smith worked on several federal construction projects subject to the Davis-Bacon Act. Smith believed that Shirley Contracting Co., LLC d/b/a Metro Earthworks (“Shirley/Metro”) and Clark Construction Group, LLC (“Clark”) (collectively, “Defendants”) failed to pay him the required Davis-Bacon Act wages for the work he performed on the projects. Smith lodged a complaint with the Department of Labor’s Wage and Hour Division, which concluded that Smith was not being paid appropriate wages under the Davis-Bacon Act.

On January 2, 2013, Smith filed under seal a False Claims Act complaint. Smith’s attorney disclosed to Clark and Shirley/Metro that he had filed a False Claims Act complaint in which they were defendants. On January 23, 2013, Smith’s attorney served the Government with a copy of the complaint and, on February 7, 2013, an attorney representing Shirley/Metro contacted the Government regarding the communications his client had received from Smith’s attorney. The Government moved for a partial lifting of the seal, and Smith’s attorney consented to the Government’s motion. The Government elected not to intervene. On Defendants motion to dismiss, the District Court dismissed the complaint with prejudice.

The Fourth Circuit Court of Appeals reversed and remanded. When the violation results in incurable and egregious frustration of the statutory objectives underlying the filing and service requirements, dismissal with prejudice is merited under the False Claims Act. In this case, however, the seal violation did not incurably frustrate the purposes of the False Claims Act’s seal provisions, because the Government still was able to investigate the claims and the disclosure was only to the parties and not the public. The District Court’s use of the primary jurisdiction doctrine as a justification for dismissal with prejudice was not proper, because the primary jurisdiction doctrine results in only a stay or dismissal without prejudice.

McLain v. KBR, Inc., 2015 U.S. App. LEXIS 14207, 612 Fed. Appx. 187 (4th Cir. Va. 2015)

McLain filed a complaint against KBR, Inc. under the False Claims Act, 31 U.S.C. §§ 3728-33 (2012) (“FCA”), asserting that KBR submitted false claims for payment in connection with electrical work it performed in Iraq pursuant to a government contract. The Fourth Circuit Court of Appeals held that claims under the FCA must meet the more stringent particularity requirement. The Court found that the amended complaint failed to plead fraud with the requisite specificity.

Holmes v. Culver Design Build, Inc., No. 2091-13-4, 2015 WL 324610, 2015 Va. App. LEXIS 26 (Va. Ct. App. Jan. 27, 2015)

Holmes contracted with Culver for Culver to construct a 3 bedroom addition to a residence. Culver acquired the necessary building permits and constructed the addition, but it did not obtain a final inspection of the addition by the Alexandria City Code Administration. Two years after the addition was constructed, Holmes and his wife purchased the property. They requested an inspection by the City Code Administration, and the inspection revealed extensive water damage caused by construction deficiencies.

Culver obtained a permit to abate the violations, but Culver and Holmes could not agree how to correct the violations. Years passed without any work on the addition, and because corrective measures were not taken, the condition of the property worsened. Holmes filed a complaint against Culver with the Board requesting that Culver’s license be suspended and that Culver be disciplined for failing to abate existing code violations. The Board denied Holmes standing on the ground Holmes’ requested relief to suspend Culver’s license until it abated the violation exceeded the Board’s regulatory authority. Holmes appealed the Board’s finding to the Circuit Court, which sustained Culver’s demurrer and dismissed Holmes’ appeal.

The Virginia Court of Appeals affirmed. Holmes was not aggrieved because the Board’s limited, disciplinary proceeding neither denied Holmes a personal or property right nor imposed upon Holmes a burden or obligation. The court held that: (1) The Board was not authorized to enforce the Uniform Statewide Building Code; (2) Required Culver to abate existing violations; or (3) Award Holmes a personal remedy for violations committed by Culver.

Associated Aluminum Prods. v. Elvira-Menez, 2014 Va. App. LEXIS 317, Civil No. 2301-13-2 (Va. Ct. App. Sept. 16, 2014)

Silvestre Elvira-Menez worked for an uninsured subcontractor of the Appellant when he was injured while placing shingles during the course of a construction project on which the Petitioner was the general contractor. The Worker’s Compensation Commission granted Elvira-Menez Temporary Total Disability benefits for an injury in the course of his employment. The Commission further found the Petitioner liable for payment of these benefits, because Petitioner subcontracted with an uninsured subcontractor and therefore qualified as Mr. Elvira-Menez’s statutory employer. The Court of Appeals affirmed the Commission’s decision on both counts.

Andon, LLC v. City of Newport News, 63 F. Supp. 3d 630 (E.D. Va. Nov. 20, 2014)

A congregation desired to locate its place of worship in a building located within one hundred feet from the side and rear property line of three neighboring properties that are zoned single-family residential. Andon, LLC, the property owner, filed a variance application with the Newport News Board of Zoning Appeals (the “Board”), but the Newport News Department of Codes Compliance (the “Department”) found that Andon had failed to establish that an “undue hardship” existed under Newport News Code § 45-3203(c)(2), because the property could be used without the variance approval. The Board adopted the Department’s recommendation.

Andon appealed, and the Circuit Court for the City of Newport News affirmed the Board’s decision. Andon then filed suit against the City in the United States District Court for the Eastern District of Virginia, claiming the City’s denial of the variance violated the Religious Land Use and Institutionalized Persons Act (“RLUIPA”). The City filed a motion to dismiss.

The court granted the City’s motion and dismissed the case. The City’s denial of the variance did not amount to a substantial burden on the Congregation’s religious exercise, because the Congregation’s position had not changed. The congregation was still searching for a place of worship. There also was no reasonable expectation that the property could be used as a place of worship, because the Congregation knew the City likely would deny their application for a zoning variance. Suffering the cost of searching for an appropriate location does not amount to a substantial burden.

Wetlands Am. Trust, Inc. v. White Cloud Nine Ventures, L.P., 88 Va. Cir, 341, 2014 Va. Cir. LEXIS 37, Civil Case No. 78462 (Loudoun Cir. Ct. June 19, 2014)

White Cloud Nine Ventures, L.P. (“White Cloud”) owned a Lot 1 and leased the property to Chrysalis Vineyards, LLC (“Chrysalis”). Wetland America Trust, Inc. (“WAT”) holds a conservation easement on Lot 1. Jennifer McCloud is the General Partner of White Cloud and the Managing and only Member of Chrysalis. McCloud bought Lot 1 with the intent of expanding her vineyard and opening a creamery and bakery to be housed in a farm building with a tasting room.

WAT filed suit in the Circuit Court for Loudoun County, alleging 14 violations of the Conservation Easement. The primary issue was whether the term “farm building” in the Conservation Easement restricted McCloud’s intended use or was ambiguous. The Court found the term “farm building” in the Conservation Easement to be ambiguous, and therefore, interpreted it in favor of the free use of the property and against restrictions.

Duran-Quezada v. Clark Construction Group, LLC, 582 F. App’x. 238 (4th Cir. Md., Aug. 29, 2014) (unpublished)

Individual Plaintiffs filed a lawsuit asserting a private cause of action under the Davis-Bacon Act against Defendants Clark Construction Group, LLC, Balfour Beatty Construction, LLC and Manganaro Midatlantic, LLC. The Fourth Circuit Court of Appeals affirmed the District Court’s decision to dismiss the case for failure to state a claim upon which relief may be granted

A private remedy exists only if Congresses’ intent to create the private remedy can be inferred from the language of the statute, its structure or some other source. An implied private right of action is not supported by the language, history, or structure of the Davis-Bacon Act. Thus, no private cause of action exists under the Davis-Bacon Act.

Demetres v. E. W. Const., Inc., 776 F.3d 271 (4th Cir. 2015)

Demetres, an employee of Ashland Construction Company (“Ashland”), a North Carolina company, was severely injured on a job site in Virginia by an employee of one of Ashland’s subcontractors, East West Construction (“East West”), a Virginia company. Demetres received workers’ compensation in North Carolina through Ashland. Demetres brought suit against East West in Virginia.

Virginia law governed the action, because the injury in question occurred in Virginia. The Virginia Workers’ Compensation Act (“VWCA”) barred recovery for personal injury suits where, as here, the injured employee of a general contractor attempts to sue a subcontractor who was engaged in the general contractor’s “trade, business or occupation.” Thus, Virginia courts lacked subject matter jurisdiction.

Power Fuels, LLC v. Federal Mine Safety and Health Review Commission, 777 F.3d 214 (4th Cir. 2015)

The MSHA assessed the plant for safety violations affecting the braking systems and warning devices of trucks used at the facility. The plant owners contested the violations on the grounds that OSHA had jurisdiction, not MSHA. The court held that because the facility “blended,” “mixed,” and/or “prepared” the coal for burning, the more particularized Mine Safety and Health Administration standards applied rather than the generalized OSHA standards.

Nat’l Fair Hous. Alliance, Inc. v. Hunt Invs., LLC, Civil Action No. 3:14-cv-716, 2015 U.S. Dist. LEXIS 91682 (E.D. Va. July 14, 2015)

In June 2014, NFHA and HOME (collectively the “Plaintiffs”) became aware that the multifamily housing complex designed and constructed by Hunt Investments, LLC (“Hunt”), Cedar Street Genesis, LLC (“Cedar Street”), Genesis Homes Manager, LLC (“Genesis Homes”), Walter Parks, Architect, PLLC (“Parks”) (project’s architect), and MGT Construction Management, Inc. (“MGT”) (project’s general contractor) (collectively the “Defendants”) did not include the required elements of accessible and adaptable design. As of May 8, 2015, all of the units were either being rented or were available to rent immediately, and the only construction left was the construction of the clubhouse. Plaintiffs requested declaratory and injunctive relief.

The Court denied Defendants’ motion to dismiss because:

  • The case was ripe for decision even though the complex was a covered “multifamily dwelling.”
  • There was an immediate threat, because the apartments were being rented or were immediately available to be rented.
  • There would not be a significant burden on Defendants, notwithstanding that the construction had not been fully completed.

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