Posted on Thu, Sep 29, 2011
This is a continuing article series on Construction Defects in New York, These include an introduction (part 1), design defects (part 2), defective construction (part 3), improper materials (part 4), improper installations (part 5) and finally important time limitations which apply to seeking legal action for defective construction in New York (part 6).
Although construction litigation can be complex and often requires expert testimony, one of the most complicated areas is simply determining the timeframe a party has to bring forth an action in New York. The answer can vary based on whom the claims are brought against and the type of claim being made.
The issue of when a claim arises is also one without a simple answer. Unlike most other actions under the law, it may not always be clear when a construction defect first occurred. Generally, under New York construction law, most construction defects are considered to have accrued at the time the construction reached a stage of ‘substantial completion.’[1]
Claims of negligence or malpractice of the design professionals are subject to a three-year statute of limitations.[2]
For claims relating to defective materials, the time limits that apply are fact specific and may vary from case to case depending on whether the claims are for goods or services.[3] Some defective material claims have a four-year statute of limitations,[4] while others must be brought in three years.[5] Claims for breach of contract are subject to a six-year statute of limitations.
Under the New York General Obligations Law, developers of buildings five stories or under must provide buyers with warranties that cover different elements of the construction for periods of one, two or six years, depending on the type of defect. The one-year warranty is for claims of shoddy workmanship; two years, for defects in systems like plumbing, electrical or temperature regulation and six years for structural defects.
For latent construction defects, however, it may be possible for claims of defective construction be made substantially beyond the limits of substantial completion. (See Latent Defects, Part XX)
Where a latent construction defect has only been discovered beyond the expiration of the above timeframe, it still may be possible for a damaged owner to assert its claims under varying theories of negligence and/or contract law.
Your comments and article topic suggestions are invited in the field below.
The author, John Caravella Esq., is a construction attorney and formerly practicing project architect at The Law Office of John Caravella, P.C., representing architects, engineers, contractors, subcontractors, and owners in all phases of contract preparation, litigation, and arbitration across New York and Florida. He also serves as an arbitrator to the American Arbitration Association Construction Industry Panel. Mr. Caravella can be reached by email: John@LIConstructionLaw.com or (516) 462-7051.
[1] When a structure has attained substantial completion may also be open to interpretation, depending on the underlying project documents, including the contract(s) and certifications for payment from the architect of record, among others. Generally a project has reached substantial completion when it is able to be used by the owner for its intended purpose. See City School Dist. of City of Newburgh v. Hugh Stubbins & Assoc. Inc., 85 N.Y.2d 535
[3] Sale of goods are generally governed by the Uniform Commercial Code (U.C.C.)
[4] N.Y. C.P.L.R. 214(6); claims under UCC have a four-year statute of limitation
[5] For claims based upon a strict products liability theory
This is a general information article and should not be construed as legal advice or a legal opinion. Readers are encouraged to seek counsel from a construction lawyer for advice on a particular circumstance.
Posted on Mon, Sep 26, 2011
This is a continuing article series on construction defects in New York, These include an introduction (part 1), design defects (part 2), defective construction (part 3), improper materials (part 4), improper installations (part 5) and finally important time limitations which apply to seeking legal action for defective construction in New York (part 6).
Construction defects relating to materials can also be based on their installation. If products are installed incorrectly this can result in an unacceptable condition to the project owner. (Subcontractors would be wise to always review and follow the manufacturer’s installation instructions for the materials they are installing). Plumbing installations are often examples of improper installation. Although the type of pipes used may be correct to the contract, significant plumbing problems could result if they are not pitched correctly in their installation.
Improper installations also pose a large risk of liability to the architects or engineers who are contracted to supervise the work. For example, an engineer was found liable for the installation of faulty anchor bolts when the engineer was aware of this improper installation and this defect caused a steel column to fall, resulting in the death of a construction worker.[1]
Often issues relating to leaking roofs are split between those claiming materials to be defective and those claiming defective installation are the cause of the leak. A good example of how poor installation techniques on the part of the roof installer can create a defective roof can be seen in this youtube video, where a roof installation is examined to determine cause of leakage.
One of the most common reasons for skylight leaks is poor fitting due to inadequate installation. Installing a skylight requires precision and skill, as generally is beyond the skill level of most homeowners and should be done by a roofing professional.
The determination of whether a faulty condition is the result of defective materials or is the result of defective installation can only be made by qualified engineering inspections. Should any legal claims be necessary to recover these resulting damages, a written engineering report is the best method for establishing the defective conditions. Engineering reports of defective construction can be submitted to the court as evidence and your engineer can provide testimony as to their findings of the defective conditions observed. This testimony can include their recommendations on how best to correct these defects.
Your comments and article topic suggestions are invited in the field below.
The author, John Caravella Esq., is a construction attorney and formerly practicing project architect at The Law Office of John Caravella, P.C., representing architects, engineers, contractors, subcontractors, and owners in all phases of contract preparation, litigation, and arbitration across New York and Florida. He also serves as an arbitrator to the American Arbitration Association Construction Industry Panel. Mr. Caravella can be reached by email: John@LIConstructionLaw.com or (516) 462-7051.
[1] Clemens v. Benzinger, 211 A.D. 586, 207 N.Y.S. 539 (4th Dep’t 1925).
This is a general information article and should not be construed as legal advice or a legal opinion. Readers are encouraged to seek counsel from a construction lawyer for advice on a particular circumstance.
Posted on Thu, Sep 22, 2011
This is a continuing article series on construction defects in New York, These include an introduction (part 1), design defects (part 2), defective construction (part 3), improper materials (part 4), improper installations (part 5) and finally important time limitations which apply to seeking legal action for defective construction in New York (part 6).
Even where designs are to the correct level of competency and the construction has been performed with due diligence and care, problems may still arise on a project. As is true with other types of construction defects, disputes as to the performance of materials selected for the project will invariably result in finger pointing between the architect or engineer who specified the material, the supplier who supplied the material and even the laborers who installed the material.
Having defective or improper materials installed can result in the construction being non-conforming (or unacceptable) to the owner. Defective or improper materials can create issues as minor as a correctible cosmetic flaw, to as large as the structure not being usable for its intended purpose.
Should a supplier provide defective materials to the subcontractor, the supplier may be found responsible for any damages alleged against the subcontractor as a result of the defective material.[1]
Where defective materials have been installed in a project, the proper measure of damages to the owner is equal to the cost of repairing or replacing the defective goods and any damages due to breach of warranty on the goods.[2]
The exception to this rule, however, is where the cost of performing the corrective work greatly exceeds the value to be attained. In such a case the measure of damages available is the difference in value, where materials were improperly substituted, but were of like quality and make no appreciable difference in the value of the work.[3]
Contractors may be wise in seeking the inclusion of a disclaimer in its contract with the owner, whereby contractor would be absolved of any liability for defects relating to the use of the owner’s specified materials.
When dealing with issues around improper materials, an immediate fix may be necessary. If you decide to look into making immediate repairs or if you have already repaired your construction defect, you need to track all steps in this process, as these documents may become critical in a claim.
Keep a copy of all contracts or statements of work. If you have any correspondence with the builder, the developer, architect, contractor, or any other building professional, you need to document them and/or keep a copy of the emails, faxes and letters. If possible, it would be prudent to take before and after photos as well.
Your comments and article topic suggestions are invited in the comment field below.
The author, John Caravella Esq., is a construction attorney and formerly practicing project architect at The Law Office of John Caravella, P.C., representing architects, engineers, contractors, subcontractors, and owners in all phases of contract preparation, litigation, and arbitration across New York and Florida. He also serves as an arbitrator to the American Arbitration Association Construction Industry Panel. Mr. Caravella can be reached by email: John@LIConstructionLaw.com or (516) 462-7051.
[1] Community Steele Corp. v. Terra Marine Dredging Corp., 176 A.D.2d 1196.
[2] Mayfair Kitchen Center, Inc., v. Nigro, 139 A.D.2d 885.
[3] Jacob & Youngs v. Kent, 230 N.Y. 239, 244.
Posted on Mon, Sep 19, 2011
This is a continuing article series on Construction Defects in New York, These include an introduction (part 1), design defects (part 2), defective construction (part 3), improper materials (part 4), improper installations (part 5) and finally important time limitations which apply to seeking legal action for defective construction in New York (part 6).
For a defect to be construction based, it can range in scope from a contractors failure to perform to completion of the project, to gross deviations from the approved construction plans and specifications. The existence of a defect alone, however, does not necessarily mean it is the contractor who is to blame.
After all, the contractor is only responsible for satisfying its performance of the construction contract. However, should the contractor have any reason to suspect there is defect in the design of the project, the contractor has a duty to point these out to the owner or designer.[1] This duty to call out such observations was established in New York in the matter of Caceci v. DiCanio Const. Corp. 72 N.Y.2d 52, 530 N.Y.S.2d 771, 526 N.E.2d 266 (1988). Although the plans and specifications of this project did not call for any additional foundation work, the soil at the site was comprised of large amounts of organic materials, including trees, which made it incumbent upon the contractor to point this deficiency out. The contractor’s failure to do so resulted in substantial liability.
The work performed by a contractor in New York is judged to the legal standard of the community, unless the contract itself provides for some other higher standard to be applied. The failure of the contractor to complete the work may not prevent the contractor from earning payment of the contract work, less any additional costs to correct and complete the work.[2]
Typically for defective construction it is the property owner who files suit against the contractor for the defects, although it may be possible for a contractor to be sued by a third person should they be injured on the property as a result of the defect.[3] Further, an owner may also bring suit against the subcontractor who performed the defective work, despite not having any contract connection with the subcontractor.[4]
That is not to say, however, that design professionals are off the hook with respect to liability for defective construction. Should the design professional have the additional responsibilities of supervision of the work in addition to its design work, where a failure to supervise can be established as the cause of the defective construction, the design professional will be held liable for the resulting construction defect.[5]
In New York construction litigation, it is the party seeking legal assistance in remedying the construction defects who bears the burden of establishing that the problems are due to faulty construction. Typically this is done through the use of qualified engineering inspections and reports. Only after properly researching and documenting the cause of the problem can any subsequent attempts at correcting the problem be expected to work.
Where the defects to the construction are reasonably repairable, the valuation used by courts in New York is to award in damages the market price of the completing or correcting work required.[6] Where a defect to construction is not reasonably repairable, even to render the building unusable, the measure of damages is still the market valuation of the correcting and completing the work required, not the loss in market value of the property.
When discussing defective construction it is likely that water intrusion will be part of the symptoms being shown. No discussion of construction defects would be complete without mention as to the dangers of mold. An in-depth examination of mold, and the dangers it presents, can be found in: GUIDANCE FOR BUILDING OWNERS, CONSTRUCTION CONTRACTORS AND OTHER PARTIES TO THE CONSTRUCTION PROCESS.
Your comments and article topic suggestions are invited in the field below.
The author, John Caravella Esq., is a construction attorney and formerly practicing project architect at The Law Office of John Caravella, P.C., representing architects, engineers, contractors, subcontractors, and owners in all phases of contract preparation, litigation, and arbitration across New York and Florida. He also serves as an arbitrator to the American Arbitration Association Construction Industry Panel. Mr. Caravella can be reached by email: John@LIConstructionLaw.com or (516) 462-7051.
[1] Rubin v. Coles, 142 Misc. 139, 253 N.Y.S. 808 (City Ct. 1931).
[2] Pilgrim Homes & Garages, Inc. v. Fiore, 75 A.D.2d 846, 427 N.Y.S.2d 851 (2d Dep’t 1980).
[3] Inman v. Binhampton Housing Authority, 3 N.Y.2d 137, 164 N.Y.S.2d 699.
[4] Raltson Purina Co v. Arthur G. McKee & Co., 158 A.D.2d 969, 551 N.Y.S.2d 720 (4th Dep’t 1990).
Where the owner is an intended third-party beneficiary to the subcontractor agreement, owner may sue for breach of contract and express warranty.
[5] Lake v. McElfatrick, 139 N.Y. 349, 34 N.E. 922 (1893).
[6] Van Deloo v. Moreland, 84 A.D.2d 871, 444 N.Y.S.2d 744 (3d Dep’t 1981).
This is a general information article and should not be construed as legal advice or a legal opinion. Readers are encouraged to seek counsel from a construction lawyer for advice on a particular circumstance.
Posted on Thu, Sep 15, 2011
This is a continuing article series on Construction Defects in New York, These include an introduction (part 1), design defects (part 2), defective construction (part 3), improper materials (part 4), improper installations (part 5) and finally important time limitations which apply to seeking legal action for defective construction in New York (part 6).
Defects in construction design demonstrate themselves in various and wide-ranging ways, and sometimes by the actions the defects cause others to do. For example, people commonly falling on stairs may suggest something improper with the design of the staircase. A visible sagging or bowing of a structural member would suggest something improper in its design or selection by the engineer. Further, reports of people repeatedly slipping on ice can indicate an improper condition with drainage design.
Design based liability only arises generally where the design professional (architect or engineer) failed to perform in accord with the standard of care typically exercised by similar professionals in the community.[1] Generally, if it can be determined that the defect is based in the design, the general contractor will not be liable for a design defect.[2] All responsibility relating to a design issue, therefore, rests solely with the design professional who rendered the design, as a contractor cannot be liable to an owner for the failure of a design element it had no part in.[3]
The effects and ramifications to design professionals of defective construction designs is a contributing factor to malpractice insurance rates and causes significant risks to the design professionals as outlined in New York Needs Statute of Repose.
Typically, the property owner is best served obtaining an indpendent engineering evaluation with a written report documenting the problematic condition, documenting the appropriate repair action(s) to be taken and to provide re-inspection of any corrective work performed by the builder.
A property owner in New York faced with design defects is entitled to be placed in as good a position as they would have been had the design contract been properly performed.[4] This provides for damages that range in proportion to the extent of the defect, such as remedial correction costs, the lost market value of the property as a result of the defect, or the cost of total reconstruction if the defect renders the property unusable.
The more complex and unusual the architect’s design, the more latitude an architect is allowed. This latitude however can be quite narrow. For example, one architect was found liable for damages to the owner for roof repairs, not because the roof was installed incorrectly, but because the design of the roof caused owner significantly increased maintenance and repair costs.
Design liability may also rest with the architect for items that are actually beyond the design of the architect. New York courts have held that an architect will be liable to the owner for any damages incurred as a result of the architect's approval of engineering drawings where a defect therein causes damage to the owner.
Your comment and article topic suggestions are invited in the field below.
The author,
John Caravella Esq., is a construction attorney and formerly practicing project architect at
The Law Office of John Caravella, P.C., representing architects, engineers, contractors, subcontractors, and owners in all phases of contract preparation, litigation, and arbitration across New York and Florida. He also serves as an arbitrator to the American Arbitration Association Construction Industry Panel. Mr. Caravella can be reached by email: John@LIConstructionLaw.com or (516) 462-7051.
[1] Hotel Utica, Inc., v. Armstrong, 62 A.D.2d 1147, 404 N.Y.S.2d 455 (4th Dep’t 1978).
[2] MacKnight Flintic Stone Co., v. City of New York, 160 N.Y. 72, 54 N.E. 661.
[3] Carrols Equities Corp., v. Villnave, 76 Misc 2d 90 (Sup 1973).
[4] Manniello v. Dea, 92 A.D.2d 426, 461 N.Y.S.2d 582 (3d Dep’t 1983).
This is a general information article and should not be construed as legal advice or a legal opinion. Readers are encouraged to seek counsel from a construction lawyer for advice on a particular circumstance.
Posted on Mon, Sep 12, 2011
Defects exist throughout all construction projects and it’s likely no construction project is ever completed perfectly. In New York construction however, perfection is not the legal standard by which construction is generally measured. The standard used to judge completed construction is the ordinary and reasonable skill that is usually exercised by architects, engineers, contractors and others in that work.
[1]Therefore, not all defects are necessarily actionable under New York construction law.
However, various types of defects are recognized under New York construction law. Each of these are separately defined and are resolved by the courts by varying methods. In this series of articles, on New York construction defects, each recognized defect and the methods used to address these by the courts will be explained. These include design defects (part 2), defective construction (part 3), improper materials (part 4), improper installations (part 5) and finally time limitations, which apply to seeking legal action for defective construction in New York (part 6).
To start, a determination of the type of defect involved is necessary in determining which party (or parties) may ultimately be responsible for the defect. Ultimate responsibility could rest with the owner, the architect, the engineer, the contractor (and its subcontractors), suppliers or others. And rarely do any of the parties admit fault with any of their own work. If the owner blames its contractor for faulty work, the contractor will likely point blame in the direction of the architect or engineer, and so on.
Generally, a design professional (architect or engineer) will not be liable to the owner for construction defects, and likewise, the contractor will not be responsible to the owner for design defects.[2]
Defects do not necessarily make themselves visible in the same way, as not all construction defects are open, obvious, and prompt in their appearance. A latent construction defect may be concealed and hidden from inspection. A patent defect, however, is one that is open and obvious. Therefore defective construction could contain variations of latent design defects and patent construction defects.
Additional information relating to the important factors latent design defects play on the overall lifecycle of a building can be found in an excellent paper written by Wai-Kiong Chong, M.A.SCE and Sui-Pheng Low, Latent Building Defects: Causes and Design Strategies to Prevent Them.
Your comment and future article topic suggestions are invited in the field below.
The author,
John Caravella Esq., is a construction attorney and formerly practicing project architect at
The Law Office of John Caravella, P.C., representing architects, engineers, contractors, subcontractors, and owners in all phases of contract preparation, litigation, and arbitration across New York and Florida. He also serves as an arbitrator to the American Arbitration Association Construction Industry Panel. Mr. Caravella can be reached by email: John@LIConstructionLaw.com or (516) 462-7051.
[1] Major v. Leary, 241 A.D. 606, 268 N.Y.S. 413 (2d Dep’t 1934).
[2] MacKnight Flintic Stone Co. v. City of New York
This is a general information article and should not be construed as legal advice or a legal opinion. Readers are encouraged to seek counsel from a construction lawyer for advice on a particular circumstance.
Posted on Tue, Sep 06, 2011
Bonds are a common requirement in New York construction. Bonds are a source of protection for the contractors, subcontractors and suppliers working under them or they can provide protection for the owner having the work performed. Often, however, there are some basic misconceptions with respect to bonds and insurance.
Although each has its place in the construction process, the purpose and intent behind bonds and insurance are quite different. With respect to insurance, the insurer assumes covered risks within limits. Bonds, however, guarantee to extend credit upon the occurance of covered events, within limits. The insurer charges its premium fee based on its calculation of risk exposure spread across all insured. The bonding company is paid its fee for guaranteeing a line of credit on behalf of its principal. The bonding company will issue its bond only when it has been assured that the principal is capable of performing the contract work and/or is able to repay any losses the bonding company might experience. Unlike insurance, the bonding company will be seeking recovery of any losses suffered under the bond.
Bonds found in typical New York construction include:
Performance Bonds
Performance bonds typically cover the risk an owner might suffer should its contractor abandon or otherwise fail to complete its contracted work. Typically the contractor is required to provide the owner with a performance bond. In some situations a contractor may also require a performance bond from subcontractors. This type of bond secures the obligation to perform under the contract, and may be liable for the amount needed to correct and complete the remaining work.
Payment Bonds
Payment bonds typically cover the risk an owner might suffer should its contractor fail to remit timely payments to its subcontractors working on the project. Unpaid subcontractors on the owner’s project greatly increases the owner's exposure to the filing of liens, litigation and work slowdowns. These bonds protect not only the property owner but also the subcontractors and suppliers working on the project in the event contractor fails to provide proper payment.
Subcontractors would be well served in requesting from the contractor copies of all bonds issued on the project.
For contractors who may need to make claim under a New York payment bond, time may be of the essence. Formalities of proper claim filing procedures and filing deadlines apply for the claim to be valid.
Your comments and article topic suggestions are invited in the field below.
The author, John Caravella Esq., is a construction attorney and formerly practicing project architect at The Law Office of John Caravella, P.C., representing architects, engineers, contractors, subcontractors, and owners in all phases of contract preparation, litigation, and arbitration across New York and Florida. He also serves as an arbitrator to the American Arbitration Association Construction Industry Panel. Mr. Caravella can be reached by email: John@LIConstructionLaw.com or (516) 462-7051.
This is a general information article and should not be construed as legal advice or a legal opinion. Readers are encouraged to seek counsel from a construction lawyer for advice on a particular circumstance.
Posted on Thu, Sep 01, 2011
Changes are an unavoidable aspect of construction. Although thorough effort and coordination are required in preparing the original project contract, specifications and construction drawings, there will still be changes. This is why owners are provided the right to make changes to the work under a typical contract changes clause.
However, the ability for owner requested changes, even if provided in the contract, are not without limitations, restrictions and consequences. After all, what purpose would any of the project documents, contracts and drawings serve if they were subject to constant change? What good would the contract serve if the owner could make any change(s) without consequence?
The reign of the owner to make changes provided for under a typical contract changes provision is limited by the general scope of work provided for in the construction contract.[1] The limit of changes available to the owner is the main purpose for which the contract was created. For example, should an owner enter into a construction contract with a contractor for the construction of a proposed ice rink, with an accessory snack bar, a change seeking to remove the construction of the ice rink from the contract would violate the purpose of the original contract. On the other hand, should the owner decide to go ahead with the construction of the ice rink without the snack bar, the original purpose in constructing an ice rink would not be violated, and that would be a permissible change.
A “Cardinal Change” is one where the purpose of the original agreement has been frustrated or made impossible by the extent of the requested change. A cardinal change amounts to the contractor’s agreement being breached by the owner.
“The test to be applied is whether the supplemental work [or change] ordered so varied from the original plan, was of such importance, or so altered the essential identity or main purpose of the contract that it constitutes a new undertaking.”[2] Indeed, under New York construction law, it is the impact on the original purpose of the construction contract of the proposed addition or omission[3], not the size of the change, which is the court’s consideration in determining a cardinal change. This is an issue which will vary from project to project as the underlying facts and purposes of construction will vary from project to project. New York courts have found in some settings changes of +/- 40% or more may be an allowable change[4], where others seeking changes of 2% have been found to be cardinal changes[5], allowing the contractor to potential damages for breach of contract.
In the private construction context, the contractor may accept a cardinal change and proceed to perform its revised duties, which would result in the creation of a new agreement. The contractor may also be entitled to consider a proposed cardinal change as an abandonment of the original agreement by the project owner, and recover damages for the value of its work in excess of the contract value.
In the public construction context however, the contractor runs the risk of non-payment for work if it accepts a cardinal change. Although a public owner may make changes within the existing scope of work, without complying with competitive bidding statutes, it cannot make a new or different contract.[6] Further, simply performing work ‘under protest’ may not be sufficient to preserve the contractor’s right to compensation.
When faced with a potential cardinal change or a deductive change order it is wise to seek legal advice as the contractor may waive their right to compensation and right to its lost profits, among other possible remedies under New York Construction Law.
Your comments and article topic suggestions are invited in the field below.
The author, John Caravella Esq., is a construction attorney and formerly practicing project architect at The Law Office of John Caravella, P.C., representing architects, engineers, contractors, subcontractors, and owners in all phases of contract preparation, litigation, and arbitration across New York and Florida. He also serves as an arbitrator to the American Arbitration Association Construction Industry Panel. Mr. Caravella can be reached by email: John@LIConstructionLaw.com or (516) 462-7051.
[1] McMaster v. State, 108 N.Y. 542, 15 N.E. 417 (1888).
[2] Albert Elia Bldg. Co., v. Container Corp. of America,
[3] Del Balso Const. Corp. v. City of New York, 278 N.Y. 154, 15 N.E.2d 559 (1938).
[4] Kinser Const. Co. v. State, 204 N.Y.381, 97 N.E. 871 (1912).
[5] Litchfield Const. Co. v. City of New York, 224 N.Y. 251, 155 N.E. 116 (1926).
[6] Albert Elia Bldg. Co., Inc., v. New York State Urban Development Corp., 54 A.D.2d 337, 388 N.Y.S.2d 462 (4th Dep’t 1976).
This is a general information article and should not be construed as legal advice or a legal opinion. Readers are encouraged to seek counsel from a construction lawyer for advice on a particular circumstance.