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Baldwin Builders v. Coast Plastering Corporation
Ron Lauter represented Coast Plastering, and successfully won this appeal which established new law in California that where a contractual provision separately provides for the recovery of attorneys' fees incurred...
Karas v. Miller
Stemming from his expertise as a construction defect and business dispute attorney, Mr. Campbell was asked to defend his client, an established homeowner's association law firm, against claims of fraud, misrepresentation...
Defina v. Gosch Automotive
Partner Ron Lauter represented an automotive company in a wrongful termination claim in which plaintiff alleged he was fired because of a perceived disability arising out of a heart conditions.
Nationwide Mutual Insurance v. Evans
This is a multi-million dollar liability claim involving the 2002 "Gavalin Fire" in San Diego County. Approximately 40 residences were destroyed or damaged in a brush fire that was allegedly started because of...
Bonner v. Rotec Industries
Partner William P. Volk represented an industrial machinery manufacturer who designed and built large "rock hoppers" used for conveying large amounts of rock and gravel to construction and landscaping sites.

San Diego, California Business & Commercial Law Blog

San Diego Condo Owners Wait for Five Years before Construction Defect Lawsuit is Resolved

  • 10
  • May
    2011

The recent settlement of a drawn-out construction defect lawsuit has resulted in San Diego homeowners being able to rest easy knowing their condos will finally be fixed.

In 1927, the El Cortez opened in downtown San Diego at 702 Ash Street. The hotel became popular in the 1950s when a cocktail lounge was added to the roof, complete with a glass elevator all the way up to the 17th floor. Over the years, the building exchanged ownership numerous times and fell into a state of neglect and disrepair. In 2000, it was restored to its 1920's look and re-opened as a residential apartment complex. The apartments were converted to condominiums a few years later, when the housing boom in California was on the rise.

California Schools and Earthquake Compliance

  • 26
  • April
    2011

The Japanese earthquake and tsunami that devastated cities throughout that country reminds those in California of what is at stake. A compelling aspect of the Japanese experience was that the majority of the deaths appear to have been caused by the tsunami, and not directly by the earthquake damage to buildings.

Japan benefited from years of stringently enforced earthquake resistant building codes. California, too, has various earthquake requirements in its building code. For public schools, a specific code applies. Known as the Field Act, it was passed in the aftermath of the earthquake almost 80 years ago.

Insurance Policy States Insurer Will Agree to Defend Policy Holder in "Suit." California Supreme Court Clarifies the Meaning of "Suit"

  • 21
  • March
    2011

The California Supreme Court ruled that a federal adjudicative proceeding before an administrative law judge qualifies as a "suit," activating an insurance company's duty to defend their policy holders.

In a previous case, the California Supreme Court held that a pollution-cleanup order from an environmental agency was not a "suit" and therefore, the company's insurer was not required to cover the cost of the company's cleanup obligations under the order.

However, the Court recently clarified the meaning of "suit" for insurance purposes. It held that a quasi-judicial adjudicative proceeding requiring more than three weeks of trial is a "suit." Accordingly, in such instances, an insurance company must defend the suit and provide coverage under its liability insurance policy.

The Issue: Does a "Hearing" Qualify as a "Suit" To Trigger Duty to Defend?

The issue arose when a manufacturer's inadequate work was discovered in a construction project overseen by an agency of the U.S. Department of the Interior. The agency's contracting officer found the manufacturer responsible for $40 million in damages, and the manufacturer appealed the decision to the former Interior Department Board of Contract Appeals.

The Board of Contract Appeals proceedings involved a 22-day hearing with testimony from numerous witnesses. The parties later agreed to a settlement by which the manufacturer paid the U.S. government $10 million.

The manufacturer was insured under several comprehensive liability insurance policies, and it asked its insurers to pay for the cost of its defense in the proceedings as well as the $10 million settlement. Many insurers refused to pay. The manufacturer then filed a lawsuit against the insurers that did not pay, claiming bad faith and breach of contract.

The Litigation

The trial court sided with the insurers, finding that the Board of Contract Appeals proceedings were not a "suit" as defined in their insurance policies or the previous cleanup-order case. The manufacturer appealed. The state appeals court ruled that defense and coverage costs were due under certain policies that defined a "suit" as a "civil proceeding." But, for policies that did not specifically define "suit," no coverage was required because the Board of Contract Appeals litigation was not a court proceeding-the definition provided in the previous cleanup-order decision.

California Supreme Court Overturns Lower Court, Finds "Proceedings" Same as a "Suit"

The California Supreme Court granted review of the case to determine whether the Board of Contract Appeals proceedings were a "suit" that triggered a duty to defend and provide coverage. The Court reasoned that, because the proceedings involved the filing of a complaint and testimony from sworn witnesses before an administrative law judge, a reasonable insured party would perceive the proceedings as a "suit" and expect coverage by its insurer.

Therefore, defense and settlement coverage is required when an insurance policy defines a suit as "civil proceedings" and also when federal adjudicative proceedings are held before an administrative law judge. If an insurance company denies coverage for such proceedings, an insured may be able to sue the insurance company for bad faith.

If you have questions about the often-confusing and complex process of determining the scope of an insurance policy, contact a knowledgeable insurance lawyer in your area.

Businesses Beware, California Court Rejects Sophisticated User Doctrine Defense, Awards Millions to Plaintiff Exposed to Asbestos

  • 02
  • March
    2011

Recent California Case Sheds Light on Toxic Tort Complex Area of Law

The California Court of Appeals recently upheld a huge toxic torts judgment against Houston-based polymer and chemical company, Union Carbide Corporation (UCC).

Larry Stewart, a California resident, filed a lawsuit in the Los Angeles County Superior Court against Union Carbide for asbestos exposure from drywall compounds produced by the company. A jury found Union Carbide liable and Stewart was eventually awarded over $7 million in damages.

Union Carbide appealed claiming that they weren't responsible because they sold the products Stewart used to third parties (Hamilton Materials and U.S. Gypsum) who carried the obligation to warn Stewart. Thus, UCC argues that they should've been immune under the Sophisticated User Doctrine.

The doctrine essentially states that manufacturers have "no duty to warn a member of a particular trade or profession against dangers which should be known in that particular field of expertise."

So, UCC argued that the chemical components they manufactured were bought not by Stewart, but by Hamilton Materials and U.S. Gypsum - "sophisticated users"-and therefore had no duty to warn them or Stewart.

However, UCC was never able to argue this defense because the jury was not instructed in regards to the Sophisticated User Doctrine defense.

Unfortunately, the Appeals Court agreed and UCC lost their appeal. In rejecting UCC's argument, the 2nd District Court of Appeals specifically stated that the Sophisticated User Doctrine defense is not applicable to purchasers of toxic materials.

Implications for Companies

This case potentially has implications not only for companies that manufactured products that included asbestos, but those in other industries as well.

The verdict shows just how important it is for companies to lay out protocols for:

  • Communicating the potential dangers associated with the use of toxic substances
  • Responding appropriately to injured parties who raise concerns about hazardous products
  • Complying with regulatory and statutory guidelines concerning the use, sale or disposal of potentially dangerous materials

Sources:

California's Conventional Farmers at Odds with Organic Farmers

  • 03
  • February
    2011

The California Department of Food and Agriculture (CDFA) has protected the Golden State's agricultural industry since 1880. With nearly 90,000 ranches and farms and over $37 billion in revenue, the agricultural industry is crucial to California's economy. Supported by carefully defined laws, the CDFA monitors exotic diseases and pests, ensures marketplace equity, and builds coalitions within agricultural infrastructure. While not generally a conflict, equity and safety can create unusual dilemmas - such as in the case of organic farming.

California Organic Farming Boom

In 2009, organic products, including food and non-food products, reached $26.6 billion in the United States and $50.4 billion worldwide. In America, over 4 million acres are certified for organic farming. Claiming nearly 20 percent of the nation's organic farming operations and accounting for 34 percent of organic sales, the state of California sustains its people on the strength of this industry.

Organic food production is a highly regulated system. For the Golden State, organic food regulations are addressed under the California Organic Products Act of 2003 (COPA). Foods deemed natural are not governed by this regulation, but regulated under other aspects of California's food and beverage laws. The COPA addresses requirements for various practices, including mechanical processes, organic product characterization, ecological considerations and pesticide application, and tolerance.

Case in Point

In 2010, the pesticide regulations and organic farming codes came into conflict when Jacob Farms, a 120 acre herb farm and certified organic farm, sued Western Farm Service, an agricultural chemicals dealer. The plaintiff argued that pesticides (lawfully applied by Western Farm), volatilized, and ultimately contaminated Jacob Farms organic food products. The ultimate issue was whether Jacob Farms could seek compensation for tainted crops he could not sell to organic distributors and grocers, such as Whole Foods.

The California Sixth Appellate District Court affirmed the lower court's decision in favor of Jacob Farms.

Attorneys for the defendant, Western Farms, argued that the company (and other pesticide companies that follow the law) didn't break the law and thus shouldn't have been held liable for damages.

Because organic farming is such an important component of California's agricultural industry, conflicts involving organic farming will continue to be a hot topic for California residents.

California legislators and the CDFA may need to concentrate on issues the state's existing laws do not address.

Sources:

Settlement May Pave Way for New Casino

  • 30
  • November
    2010

Battles between developers and environmentalists are sometimes difficult and can easily drag on for years without resolution. A case in point involves years of litigation between developers, union leaders and members of several environmental groups over a California casino and resort. However, recently, the parties finally established an agreement. Although some people still doubt that the development will leave the area better than it is now, the agreement suggests signs of progress with the project.

The Project

Since 2004, the Guidiville tribe has negotiated with the city of Richmond to purchase land called Point Molate near the shoreline. They want to build a $1 billion resort with a 4,000 slot casino, 1,100 hotel rooms, and various commercial and retail spaces. Additionally, they also wish to construct homes on the property for their 114 tribal members.

Settlement Agreement

The settlement agreement, called the Shoreline Protection agreement, was finally reached last month between the tribe, local environmental groups and union representatives. The agreement requires that the tribe keep a majority of the site open, work to preserve and revitalize the land and shoreline, as well as build a trail for residents to use.

The development is projected to cost the tribe millions of dollars, but some say, it shows their commitment to conserve the Richmond community and environment.

Pros and Cons

Advocates say that the level of conservation with this development would most likely fail with other types of projects. Other supporters argue that the project is good for the community. The resort could bring 4,500 jobs to the area, with most going to Richmondites.

There are still some who oppose the project. The mayor of Richmond in particular thinks the casino would bring more poverty and crime. He is also skeptical that the agreement even means the project will happen. Senator Feinstein is also against the project and believes Richmond can do better.

Signs of Progress

The settlement agreement seems mutually beneficial for both the tribe and community. Despite years of litigation and negotiation, it's possible for projects like these to move forward.

Study Finds Toxins in Residential Construction Products

  • 18
  • November
    2010

Despite new and improved regulations and technological innovations, dangerous products still seem to fall through the cracks and placed on the market for resale. Wood flooring and wallpaper products are the latest. A recent study discovered the products contained various chemical additives known to cause cancer.

Researchers from the Ecology Center, a Michigan-based non-profit, studied several different home improvement products and uncovered dangerous toxins. Specifically, the Center tested more than 1,000 flooring samples and more than 2,000 different types of wallpaper and found chemicals that exceeded appropriate safety levels.

Lead, phthalates and cadmium were among the toxins found in the study. These types of toxins link to cancer as well as to a wide variety of ailments, including birth defects, asthma, and learning disabilities.

Flooring

Phthalates, a commonly used plasticizer made from oil, is known to cause breathing problems in children. The Center found four types of phthalates (a chemical currently banned in all children's products) in vinyl flooring products. Organotin stabilizers were also discovered in the wood flooring; a toxin that can impact the brains of infants.

Wallpaper

The study also revealed that approximately 53 percent of wallpaper samples studied contained lead, chromium, phthalates and other chemicals; 13 percent of the samples contained high levels of cadmium.

Particular Dangers to Small Children, Pets

Small children, who spend much of their time on floors and carpeting, along with pets, are the most susceptible to the toxin exposure due to their tendency to insert foreign objects into their mouths.

If you or your child experiences an unknown illness, experts suggest visiting a doctor. Should a doctor determine the illness is borne from a home-based toxin, experts advise individuals consult with an attorney knowledgeable in this area of law.

Animal Shelter Litigation Prime Example of Development Disasters

  • 11
  • November
    2010

Disputes between construction companies contracted to build a particular structure and the developers who hired them are common in new construction projects. Issues with contracts, materials, timelines and budgets often arise between contractors and developers to the detriment of all parties involved. An animal shelter in San Mateo County, California, is a prime example of a development project halted due to project obstacles and conflicts.

Facility Dreams

The Peninsula Humane Society hired the Wentz Group to build the Tom and Annette Lantos Center for Compassion, a $22.5 million facility funded mostly with private donations. The Center (a cutting-edge facility complete with a two-story indoor dog park in a cage-free environment), should have been opened already, but will not open until med-2011. Early last month, the Humane Society filed a lawsuit in San Mateo County Superior Court against the Wentz Group.

Lawsuit Assertions

The Society is claiming the Group failed to return building funds owed to them. The Humane Society is also claiming the Wentz Group increased the project costs by millions of dollar because of poor and costly decisions. In particular, the Society alleges the Group failed to pay their subcontractors. The Society claims they provided Wentz almost $600,000 earlier this year to pay their subcontractors, but these funds went undistributed and caused at least one subcontractor to in-turn seek payment from the Humane Society.

The Wentz Group claims the money in question is held in a project account and will be paid to subcontractors once they resolve conflicts about completed work. Wentz's attorneys argue that the Human Society mismanaged the design process for the building project and is now blaming the Group.

Wentz claims that the Group owes no money to the Society. In fact, according the Wentz, the Human Society owes them additional funds.

Adding to the numerous allegations from both parties remains the problem with the private donors. The donors are now funding a project that includes increased and unnecessary costs, including a delayed opening, new contractor payments, and legal fees.

Campbell, Lauter & Murphy

  • 10
  • June
    2010
The body of laws that govern our interactions with our fellow citizens is a living, breathing organism - changing with the times just as humanity does. Every day, in courts and in legislative halls around the nation, new laws are passed and new legal precedents are set that may affect our clients' cases.

For this reason, we at the law offices of Campbell, Lauter & Murphy,  Attorneys at Law, take seriously the "practice" aspect of "law practice." We work hard to stay informed and up to date so as to represent our clients as capably and effectively as we can. We work equally hard at communicating with our clients and keeping them informed.

We assume that you have arrived at this blog because you are interested in some aspect of the law that forms our law practice: business law, construction law, environmental law and personal injury. Or perhaps you arrived on this page because you were looking for information on how to contact one of our attorneys.
 
We welcome your inquiry about any legal matter. And we invite you to peruse our website, read our blogs and consider how well suited we are to address your concerns. Whether you become a client of Campbell, Lauter & Murphy,  Attorneys at Law, or not, we are honored to know that you stumbled across our online material, and we invite you to visit again often  and engage in mental dialog with our law firm through these blog posts.
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