District of Columbia’s Proposed Green Building Code

Martha L. Perkins – January 18, 2013

Summary

Heads up to developers, owners, engineers, architects, contractors, subcontractors, suppliers, consultants, commissioning agents, insurers, and sureties that do business in the District of Columbia.  There’s a proposed new code in town:  a Green Building Code based on the 2012 International Green Construction Code (IgCC).

DC’s proposed version, however, includes some modifications to the IgCC to try and customize it for the DC area and feasibility of application.

See the code here.

The comment period is still open until 5:00 pm on February 22, 2013. Comments must be submitted in writing to Helder Gil, Legislative Affairs Specialist, Department of Consumer and Regulatory Affairs, 1100 Fourth Street, SW, Room 5164, Washington, DC 20024, or by email at ConstructionCodes@dc.gov.

DC’s Green Code Process 

In the District of Columbia, it is the Construction Codes Coordinating Board (CCCB) that is responsible for finalizing building codes to recommend to the DC City Council for enactment.  A Technical Advisory Group (TAG) is a subcommittee for the CCCB, with each TAG dedicated to a particular model code review and/or revision.  A TAG will vote on any addition or change, which it then recommends to the CCCB.  Once the code is finalized, it is voted on by the City Council.

This proposed Green Code was published in the DC Register on December 7, 2012, for public comment by February 22, 2013 (this date was just extended from January 25, 2013).  The proposed DC Green Code is thus still in the comment period.   In addition, if deemed necessary, there will be a second comment period.  It is intended that the City Council will vote on the code in Spring 2013, with full compliance required by Spring 2014. The CCCB Green TAG is chaired by Bill Updike of the District Department of the Environment (DDOE), with eight members from various sectors of the design and construction industries as well as a representative from the DCRA.  The Green TAG has worked long hours for over a year to modify the IgCC.

DC’s Proposed Green Code:  A Few Key Points

The Green Code would initially apply to all commercial buildings of 10,000 square feet or more and all multifamily residential buildings four stories or higher and over 10,000 square feet.

The Green Code would apply to new construction and substantial renovations.

In order to ensure flexibility, the Green Code would permit alternative compliance paths, including the following:

LEED certification under the DC Green Building Act of 2006 (GBA);

IgCC;

ASHRAE Standard 189.1; and

Enterprise Green Communities Certification under the GBA.

The post-occupancy provisions in the IgCC, among others, were removed from the proposed DC Green Code.

The codifying of a commissioning agent is a new concept.  The commissioning agent could be a design professional or an approved commissioning agent.  The DCRA will have a list of approved commissioning agents.

“Stretch” items in the proposed Green Code were moved to Appendix A, which has about 75 possible project electives.  Of that number, fifteen are required for new construction, and thirteen are required for substantial renovations.  Some are not in the base code, and some are enhancements of items in the base code.

The DCRA will hire a Green Building Coordinator in late January/early February 2013 (name has not been released).  Then the DCRA will hire inspectors and will train those inspectors and private sector inspectors during the next one and one-half years.

The DCRA will issue a Green Building Program Manual by Spring 2014 to provide guidance concerning the DC Green Code.

The Role of the GBA and LEED in Light of the DC Green Code

There are discussions in the development community that the enactment of the Green Code would marginalize the GBA with its LEED certification requirements.  Accordingly, the argument goes, the GBA should be repealed.  Such a position, however, is based on a misunderstanding of the role of LEED certification in the sustainability world.  LEED certification is voluntary, and it is a non-enforceable rating system.  That a number of jurisdictions and entities–from federal agencies, to states, to counties and towns–have adopted various versions of LEED as a mandatory building requirement does not change the fact that LEED was designed to be an aspirational goal, not a code.  Those jurisdictions and entities, seeking sustainability goals, adopted LEED requirements because of a dearth of green building codes.

The IgCC rectified that issue, and now the District of Columbia is in the process of painstaking efforts to refine and modify the IgCC into an enforceable and workable green building code.

Conclusion

Stakeholders in the development, real estate, and construction industries that do business in the District of Columbia should follow closely the adoption of the DC Green Building Code.  The rapid progression of initiatives in the sustainability world necessitates staying on top of the game, including understanding the impacts of the final version of the DC Green Code.  The one-year grace period for implementation of the DC Green Code, from Spring 2013 to Spring 2014, will give everyone time to prepare for the challenges–and the opportunities.

via District of Columbia’s proposed Green Building Code – Lexology.

Building Codes Vital Piece of Storm Damage Puzzle

The Marietta Times – January 11, 2013

I read “Emergency Center Upgrade Funded” with interest. After a storm, the power grid, building construction, and other conditions are on everyone’s mind. But the increased number and severity of “wind events” nationally should prompt a reexamination in every community.

Verisk Analytics conducted an analysis comparing our severe-storm computer models to millions of commercial buildings we survey for a building’s wind damageability. Our analysis shows roughly 38 percent of the total U.S. insured property value is in coastal counties. In New York, 62 percent of insured value is along the coast. In Florida, that number skyrockets to almost 80 percent – but it is by no means exclusively a coastal phenomenon. Eighteen of the top 20 catastrophic events in the U.S. involved wind. The remaining two that did not involve a wind peril were the Northridge earthquake and the attacks of 9/11. Compounding the problem is the storm trend. Of those 18 wind events, 15 occurred since 2000.

While fire continues to be the most common cause of property loss, it is evident that property owners, the construction industry, and municipalities responsible for local building codes need to become more proactive in addressing the threat of wind and storm events.

via Building codes vital piece of storm damage puzzle – MariettaTimes.com | News, Sports, Jobs, Ohio, Community Information – The Marietta Times.

The Only Four Good Reasons to put Arbitration in Your Contract

Liz Kramer – January 4, 2013

Let’s say you are considering updating your form contract, or you are in the midst of negotiating a new contract with someone. Should you include mandatory arbitration for resolving any disputes? Assuming you have the choice, my view is you should only include arbitration if at least one of these four factors are present:

Having a knowledgeable industry professional decide the dispute is very important (an architect, engineer, doctor, reinsurance expert, etc), instead of a judge or jury without that expertise, because disputes are likely to be very technical.

Keeping the proceedings confidential (and not publicly available in court filings) is very important to you. (Although, if either party moves to vacate, much of your arbitration proceeding could become part of a court record.)

You do not want class actions. (They can be precluded in an arbitration agreement; it is less clear whether they can be precluded without an arbitration agreement.)

You want to arbitrate because other parties on the same project or deal have arbitration provisions. (For example, if the owner and general contractor on a construction project are bound to arbitrate, the owner and architect may also want to agree to arbitrate in case the architect is implicated in claims between the owner and general.)

It is a relatively short list. But, in my view, these are the only four bases on which arbitration has a significant advantage over litigation. You will note that speed of resolution is not on the list (unless parties opt for expedited proceedings, arbitrations generally take about as long as court proceedings — the median case valued between 1 and $10 million dollars administered by the AAA took 414 days to get to an award). You will also note that cost is not on the list (in my experience on complicated commercial matters, there is no cost saving to arbitration and I found a recent study supporting my anecdotal evidence). Speed and cost used to be the primary reasons people chose arbitration.

There are other potential reasons to choose arbitration that I am also discounting. For example, the risk of an illogical jury verdict is not significantly greater in my mind than the risk of an illogical arbitration award. I also do not see any advantage to the greater informality and looser rules in arbitration, or find it less adversarial. And, although you can make someone conduct the arbitration hearing in the basement of your building, you could just as easily have a forum selection clause choosing your home town courthouse in most circumstances, so I do not count that as a big advantage for arbitration.

It’s the start of a new year and a great time to step back and revisit our reasons for inserting arbitration in our contracts.

via The only four good reasons to put arbitration in your contract – Lexology.

10 Bad Faith Insurance Claim Practices

D.J. Banovitz – January 7, 2013

Learn about some common bad faith insurance claim practices. If you are dealing with a denied claim after unfair practice, get legal help from a Denver attorney.

Unfortunately, bad faith insurance practices can leave victims without the compensation to which they are entitled following an accident. There are many different types of practices insurance adjusters or companies may use, and some may be left facing an unfairly denied claim. Fortunately, by filing a claim of bad faith, victims of these practices may fight for compensation.

In one case, as relayed by the Albuquerque Journal, a man’s family was awarded nearly $12 million after evidence was presented that the insurance company had altered its records about a week and a half after the man’s accident to make it appear that he did not have coverage. The insurance company contended that the policy lapsed only 90 minutes before the crash. While not all awards will be this large, consumers who are unfairly treated by an insurance company may have recourse to recover damages.

10 Bad Faith Insurance Claim Practices

1. Unjustified delay of settlement. Insurance companies may delay your claim for no valid reason. They do this in hopes that if they take too long, you will just forget about it.

2. Lack of communication. In some cases, the insurance company may not notify you of its decision in a timely manner or may fail to respond to correspondence.

3. Lack of proper investigative techniques. When investigating your claim, the insurance company may use illegal or unethical methods to obtain information regarding your claim. In some cases, the company may refuse to investigate your claim at all and simply deny it.

4. Unreasonable demands. In order to delay the process or find a way to deny the claim, the company may ask for an unreasonable amount of documents in order to start the process. It may ask for items unrelated to the case and deny your claim if you cannot provide them.

5. Lowball offers. In this case, the insurance company may offer an unreasonably low settlement. Do not accept any offer before consulting your attorney.

6. Use of threats. The company may threaten the victim by ordering him or her to do something or to not do something or else the company will refuse to pay the claim.

7. Changing the policy. A company may change the terms of the policy after a claim is filed, and use its new terms to deny the claim.

8. Cancelling the policy. The company may cancel the policy after a person makes a claim.

9. Not disclosing the policy limits. If the adjusters will not reveal aspects of the policy, you may be dealing with a bad faith insurance claim practice.

10. Conflict of interest. An insurance adjuster may attempt to handle your claim and the claim of the other party.

 

via 10 Bad Faith Insurance Claim Practices.

CA Court of Appeal Holds Design Professionals Owe a Duty of Care to Condo Homeowners for Professional Negligence

Edward P. Garson, Ian A. Stewart and John R. Clifford – December 20, 2012

In Beacon Residential Community Association v. Skidmore, Owings and Merrill LLP (December 14, 2012), the trial court sustained the demurrer (a response in a court proceeding in which the defendant does not dispute the truth of the allegation but claims it is not sufficient grounds to justify legal action) of the design professionals on the grounds that “liability could not be premised on negligent design, and that [the Association] was required to show that the design professionals had ‘control’ in the construction process, assuming a role beyond that of providing design recommendations to the owner.” The Court of Appeal reversed, finding a common law and statutory basis for a duty of care.

The Beacon Residential Condominiums project, one of the largest residential projects developed in San Francisco within the past 15 years, consists of 595 residential condominium units on 16 floors. The condominium owners’ association and some of the purchasers (collectively, the Association) sued approximately 40 defendants, including the developers, the design professionals, the general contractor and subcontractors. The complaint alleged multiple defects affecting the health and safety of the occupants, including excessive solar heat gain, making the units uninhabitable because of the negligent approval of cheaper windows and inadequate ventilation within the residential units. The complaint also alleged structural cracks and water intrusion.

Skidmore, Owings and Merrill LLP (SOM) and HKS Architects, Inc (HKS) provided architectural and engineering services, construction administration and construction contract management for the project. Their project fees were in excess of $5 million. SOM and HKS demurred to the third amended complaint, arguing they owed no duty of care to the Association or its members.

The trial court agreed, holding that liability could not be premised on negligent design. The plaintiffs were required to show that “the design professionals had ‘control’ in the construction process, assuming a role beyond that of providing design recommendations to the owner.”

Common Law Factors in Determining Whether to Extend a Duty of Care

The Court of Appeal found that under the common law a duty of care would run to all foreseeable persons and is not dependent on a finding of privity. Relying on several older cases, the court noted: “In considering liability of design professionals to third party purchasers of residential construction, we do not chart unexplored territory or view this case as truly a matter of first impression. The issue, as we view it, is not whether a design professional owes a duty of care to these purchasers, but the scope of that duty.”

The question of duty is essentially one of public policy. “The determination whether in a specific case the defendant will be held liable to a third person not in privity is a matter of policy and involves the balancing of various factors, among which are the extent to which the transaction was intended to affect the plaintiff, the foreseeability of harm to him, the degree of certainty that the plaintiff suffered injury, the closeness of the connection between the defendant’s conduct and the injury suffered, the moral blame attached to the defendant’s conduct, and the policy of preventing future harm.” (Citing Biakanja v. Irving (1958) 49 Cal.2d 647, 650–651.)

The court analyzed each of these factors and found that extending a duty of care to design professionals was consistent with public policy. “A design professional providing plans and specifications for residential construction cannot be unaware of the fact that his or her work will have a direct bearing on the integrity, safety and habitability of property intended for residential occupancy.” The court found that the contracts among the developers, design professionals and contractors could affect the relationships among those parties, but would not limit the tort duty owed to the purchasers. “While a duty of care arising from contract may perhaps be contractually limited, a duty of care imposed by law cannot simply be disclaimed.”

The court also relied on Bily v. Arthur Young & Co. (1992) 3 Cal.4th 370, where the California Supreme Court held that an accounting professional’s duty of care in preparing an independent audit of a client’s financial statements did not extend to third parties. “The Bily court again emphasized the important role of policy factors in determining negligence, observing that ‘mere presence of a foreseeable risk of injury to third persons [is not] sufficient, standing alone, to impose liability for negligent conduct’ and that ‘[p]olicy considerations may dictate a cause of action should not be sanctioned no matter how foreseeable the risk … for the sound reason that the consequences of a negligent act must be limited in order to avoid an intolerable burden on society.’”

In Bily, the court set forth additional factors to be considered in determining whether a duty exists: “Those considerations are: (1) potential imposition of liability out of proportion to fault; (2) the possibility of private ordering of the risk; and (3) the effect on the defendants of third party liability.” The court analyzed each of these factors and found that extending a duty of care for design professionals was not inconsistent with public policy. The exposure was not unlimited as in Bily, as potential plaintiffs were limited to the purchasers. Moreover, the developers, design professionals and contractors are able to spread the risk of loss among themselves through contractual indemnity and insurance. “While the individuals and entities participating in the development process may have the ability to privately order allocation of liability among themselves by contract or through structuring of insurance coverage, the buyer does not. Thus, in contrast to Bily, it is the alleged tortfeasors, and not the home buyers who are capable of being more ‘effective distributors of loss.’”

The court in reaching its conclusion that a duty had been properly alleged, distinguished the decision in Weseloh Family Ltd. Partnership v. K.L. Wessell Construction Co., Inc. (2004) 125 Cal App. 4th 152 (Weseloh), which was relied on by the trial court by emphasizing that the Fourth District Court of Appeal viewed the issue as one of first impression and its decision was “premised on the evidentiary record before the court.” In Weseloh, the design professional was hired by the subcontractor to design a retaining wall that ultimately failed. Both the property owner and general contractor sued the design engineer, and the court in applying the Biakanja and Bily factors determined that no duty existed. We anticipate that the design professionals may argue that a conflict exists within the circuits in seeking review before the Supreme Court.

Statutory Basis for Duty: Senate Bill 800

The California legislature passed Senate Bill 800, which became effective January 1, 2003, as Civil Code sections 895, et seq. The bill, commonly known as the “Right to Repair Law,” established mandatory procedures regarding construction defect litigation for new residential construction. The law also defines “defects” by functions or components of a structure (e.g., with respect to water issues, roofs, windows, doors, decks, foundation systems and slabs, hardscape, exterior walls, retaining walls, etc.).

In reviewing SB800, the court opined that “it is clear in the legislative history that the Legislature assumed that existing lawimposed third party liability upon the design professionals” and “[t]he plain language of Senate Bill No. 800 provides that a design professional who ‘as the result of a negligent act or omission’ causes, in whole or in part, a violation of the standards set forth in section 896 for residential housing may be liable to the ultimate purchasers for damages.”

The Court concluded: “To the extent that a Biakanja/Bily policy analysis is not otherwise dispositive of the scope of duty owed by a design professional to a homeowner/buyer, SB 800 is.” We note that Senate Bill 800 only applies to new residential construction.

Despite the extensive analysis by the court, there remain open questions regarding the extent of the duty of care of design professionals to ultimate purchasers. We will provide further analysis if this important issue is taken up by the California Supreme Court.

CA Court of Appeal holds design professionals owe a duty of care to condo homeowners for professional negligence – Lexology.