For this week’s Guest Post Friday, Musings welcomes back Timothy R. Hughes, Esq., LEED AP. Tim (@timrhughes on Twitter) is a Shareholder in the Arlington, Virginia firm of Bean, Kinney & Korman, P.C. In his practice as a business, corporate, and construction law attorney, Tim was the Chair of the Construction Law and Public Contracts Section of the Virginia State Bar. He was recognized by Virginia Lawyer’s Weekly as a 2010 “Leader in the Law” and a member of the Legal Elite for Construction Law for 2010 by Virginia Business Magazine. A regular speaker and writer, Tim is the lead editor of his firm blog, Virginia Real Estate, Land Use and Construction Law.
Green construction liability risk has received a lot of discussion over time. My take is that sustainable design and construction projects present the same type of risk profile as other construction projects, with the caveat that there may be “a little more”. A little more risk. A little more lack of predictability. A little more process overlay. Thus, green construction claims really are just “more of the same”.
I have watched and participated in the discussion. With regards to the Chesapeake Bay Foundation building, the reality is that any project can face challenges of product specification and performance, green or not. We can see plenty of examples where products have created tremendous risk and liability to the construction industry, the avalanche of EIFS litigation and Chinese drywall standing as just two of the most recent examples. A product failed, but that is nothing truly new.
The Destiny USA project strikes me the same way. Any project that presents the funding and delay debacle that is Destiny USA is certain to trigger nastiness. The green portions of the project are not truly driving the risk in my mind. Yes, the current trigger for discussion is whether the green bonds retain their tax characteristics, but this project has already been troubled and litigated.
Where sustainable projects currently present a somewhat different profile is the oddity of the LEED process overlay. This overlay translates to ceding code type decisions to a voluntary third party organization. Delays after construction in obtaining certification mean that limitations periods can be extended, particularly in states having a discovery trigger. Having the potential for decertification arising from a failure to meet minimum program requirements adds a bit of flavor. Finally, injecting the potential for LEED challenges into the mix adds some more process entanglement.
All this translates to the same types of projects, the same types of disputes, the same types of issues, and the same types of cases … perhaps just a little more of the same in my estimation.