The New Hampshire Supreme Court’s recent decision in Kimball Union Academy v. Genovesi, Case No. 2012-492 (N.H. June 28, 2013) sets forth an expansive view of personal jurisdiction in New Hampshire, which could subject out-of-state design professionals to the jurisdiction of New Hampshire courts for work they perform even if they never enter into any contracts in New Hampshire or perform any work in the state.
The facts as alleged by Kimball Union Academy were that it entered into a contract with JDE, Inc, a Florida corporation, to design and build a field house facility on its campus. Pursuant to the contract, JDE was required to supply an architect and an engineer, both licensed in New Hampshire, for the project’s design. Instead, JDE apparently hired Genovesi, a professional engineer residing in New Jersey who was not licensed in New Hampshire, to perform certain design work for the footings and foundation system of the field house. Kimball Union alleged that there were a number of problems with the design work prepared by JDE and the professional engineer, which prompted Kimball Union to terminate its contract with JDE and commence litigation.
The professional engineer argued that the case against him should be dismissed because he lacked the requisite contacts with New Hampshire to allow New Hampshire courts to exercise jurisdiction over him. Specifically, he alleged (1) all the work he performed on the project took place in his office in New Jersey, (2) he did not transact any business in New Hampshire because his involvement was solely with JDE, a Florida corporation, and its president, a Pennsylvania resident, and (3) he lacked any other contacts justifying jurisdiction because he never resided in New Hampshire, never owned any real property in New Hampshire, never advertised in New Hampshire, never had any business interests in New Hampshire, and had never even been in New Hampshire since a ski vacation more than thirty years before the circumstances of the case arose.
The New Hampshire Supreme Court rejected these arguments. The Court concluded that the professional engineer had sufficient contacts with New Hampshire to allow New Hampshire courts to assert jurisdiction over him because he was aware that the plans he was developing would be utilized in constructing a building in New Hampshire. Further, the Court concluded that the evidence showed that an integral part of his work was to ensure that the design of the building would fit the specifications of the location in New Hampshire. Accordingly, the Court concluded that Kimball Union could proceed with its action against him in New Hampshire.
The New Hampshire Supreme Court’s ruling should put all design professionals on notice that they may be subject to the jurisdiction of New Hampshire courts for work they perform on projects in the state even if (1) they are not licensed in the state, (2) do not contract directly with any New Hampshire entities, and (3) perform all of their work on the project outside the state.
For more information on professional liability matters, contact Attorney Nathan Fennessy at 603.410.1500 or a member of Preti's Professional Liability Practice Group.
Legal updates, news and commentary from Preti Flaherty's Professional Services Attorneys
ISO Makes Changes to Its Commercial General Liability Coverage Forms
The Insurance Services Office (ISO) recently filed various changes to its Commercial General Liability Coverage (CGL) forms. Insurance experts expect that these changes, which became effective in most states in April 2013, will soon be widely adopted by carriers nationwide. Several of these changes could have significant impacts on risk allocation in construction contracts.
In the construction context, changes to the ISO’s Additional Insured (AI) endorsements could be particularly impactful. AI’s endorsements are frequently used as a means of contractual risk transfer in construction contracts. However, in light of the ISO’s revisions, contracting parties must take care to ensure that the 2013 ISO AI endorsements align with their contractual intent.
Willis North America’s Construction Practice publication, Blueprint, provides a helpful summary of several key changes to the AI endorsements and their potential impacts on construction contracting. Blueprint further discusses the interplay between the AI endorsements and various states’ laws, provides general tips for contracting parties, and considers the benefits and drawbacks to the use of non-ISO AI endorsements. Construction professionals who use AI endorsements in their contracts would be well-served by reviewing Blueprint’s helpful primer on this subject.
For more information on professional liability matters, contact Preti Flaherty Attorney Benjamin Piper at 207.791.3000 or a member of Preti's Professional Liability Practice Group.
In the construction context, changes to the ISO’s Additional Insured (AI) endorsements could be particularly impactful. AI’s endorsements are frequently used as a means of contractual risk transfer in construction contracts. However, in light of the ISO’s revisions, contracting parties must take care to ensure that the 2013 ISO AI endorsements align with their contractual intent.
Willis North America’s Construction Practice publication, Blueprint, provides a helpful summary of several key changes to the AI endorsements and their potential impacts on construction contracting. Blueprint further discusses the interplay between the AI endorsements and various states’ laws, provides general tips for contracting parties, and considers the benefits and drawbacks to the use of non-ISO AI endorsements. Construction professionals who use AI endorsements in their contracts would be well-served by reviewing Blueprint’s helpful primer on this subject.
For more information on professional liability matters, contact Preti Flaherty Attorney Benjamin Piper at 207.791.3000 or a member of Preti's Professional Liability Practice Group.
Virginia Attorney Suspended for Instructing Client to Alter His Facebook Page
Monday, August 26, 2013
According to the ABA Journal, a Virginia lawyer has agreed to a five year suspension for advising his plaintiff-client to clean up his Facebook photographs.
The client had sued a cement company for wrongful death after one of its trucks tipped over onto the vehicle he was driving, killing his wife. Prior to trial, opposing counsel requested screen shots of the client’s Facebook page. The lawyer then instructed a paralegal to tell the client to clean up his Facebook page. Following this instruction from the lawyer’s office, the client deleted sixteen photographs, including one in which he was holding a beer can and wearing a t-shirt with a provocative slogan. Defense lawyers recovered the photographs prior to trial, and jurors were told about the deleted photos. Only after the trial did the lawyer disclose to the court emails between him, the paralegal, and the client concerning the Facebook page.
According to the ABA Journal, as a sanction for the lawyer’s conduct, the trial judge ordered him and his client to pay $722,000 to lawyers representing the concrete company for their legal fees, and the judge reduced the client’s $8.5 Million jury award.
The Virginia Supreme Court later reinstated the verdict. The lawyer, however, was suspended for five years for violating ethics rules requiring candor toward the tribunal, fairness to opposing party and counsel, and prohibiting “dishonesty, fraud, deceit or misrepresentation.”
For more information on professional liability matters, contact PretiFlaherty Attorney Simon R. Brown at 603-410-1500 or contact a member of PretiFlaherty's Professional Liability Practice Group.
The client had sued a cement company for wrongful death after one of its trucks tipped over onto the vehicle he was driving, killing his wife. Prior to trial, opposing counsel requested screen shots of the client’s Facebook page. The lawyer then instructed a paralegal to tell the client to clean up his Facebook page. Following this instruction from the lawyer’s office, the client deleted sixteen photographs, including one in which he was holding a beer can and wearing a t-shirt with a provocative slogan. Defense lawyers recovered the photographs prior to trial, and jurors were told about the deleted photos. Only after the trial did the lawyer disclose to the court emails between him, the paralegal, and the client concerning the Facebook page.
According to the ABA Journal, as a sanction for the lawyer’s conduct, the trial judge ordered him and his client to pay $722,000 to lawyers representing the concrete company for their legal fees, and the judge reduced the client’s $8.5 Million jury award.
The Virginia Supreme Court later reinstated the verdict. The lawyer, however, was suspended for five years for violating ethics rules requiring candor toward the tribunal, fairness to opposing party and counsel, and prohibiting “dishonesty, fraud, deceit or misrepresentation.”
For more information on professional liability matters, contact PretiFlaherty Attorney Simon R. Brown at 603-410-1500 or contact a member of PretiFlaherty's Professional Liability Practice Group.
Pay Promptly or Pay Penalties
The Vermont Supreme Court recently issued a ruling that should serve as a reminder to all contractors and owners of the importance of complying with prompt pay requirements.
In Dorr v. LaCoste, an owner refused to pay any part of a contractor’s inflated invoice. The Contractor sued. The court held that the owner was in the wrong for not paying the undisputed portion, and as a result, the court ordered the owner to pay its obligation, plus interest, and a penalty of 1% per month. The interest and penalties added up to nearly half of the original balance.
The takeaway from this case is that owners dealing with contractors (and contractors dealing with subs) should be extremely careful when withholding payment, and should only hold back money that is reasonably in dispute, and even then, it is essential to provide written notice of the basis for the withholding.
For more information on professional liability matters, contact PretiFlaherty Attorney Ken Rubinstein at 603-410-1500 or a member of PretiFlaherty's Professional Liability Practice Group.
In Dorr v. LaCoste, an owner refused to pay any part of a contractor’s inflated invoice. The Contractor sued. The court held that the owner was in the wrong for not paying the undisputed portion, and as a result, the court ordered the owner to pay its obligation, plus interest, and a penalty of 1% per month. The interest and penalties added up to nearly half of the original balance.
The takeaway from this case is that owners dealing with contractors (and contractors dealing with subs) should be extremely careful when withholding payment, and should only hold back money that is reasonably in dispute, and even then, it is essential to provide written notice of the basis for the withholding.
For more information on professional liability matters, contact PretiFlaherty Attorney Ken Rubinstein at 603-410-1500 or a member of PretiFlaherty's Professional Liability Practice Group.
Maine Spending Less to Promote Obamacare
Friday, August 9, 2013
Maine is spending less to spread the word about the start of Obamacare’s open enrollment session compared to other states. According to the Associated Press, Maine’s community groups and health centers have budgeted $2 million or $1.50 per person to promote the new marketplace to buy health insurance. The new marketplace or healthcare exchange is scheduled to open this October. Maine’s insurance exchange will be operated by the federal government. By comparison, Vermont which is operating its own state-based exchange, is spending approximately $2.7 million on marketing initiatives or $7 per person.
For more information on professional liability matters, contact Attorney Adam Shub at 207.791-3000 or a member of Preti's Professional Liability Group.
For more information on professional liability matters, contact Attorney Adam Shub at 207.791-3000 or a member of Preti's Professional Liability Group.
INDICTMENT ISSUANCE OF EX PARTE SEARCH WARRANT TO OBTAIN CRIMINAL DEFENDANTS' E-MAILS UPHELD BY MASS SUPREME COURT
In a decision impacting the attorney-client privilege, on July 15, 2013, the Massachusetts Supreme Judicial Court held that the post-indictment issuance of an ex parte search warrant to obtain e-mails of a defendant under indictment is not prohibited under Massachusetts court rules. While upholding the search warrant in Preventive Medicine Associates, Inc. et al v. Commonwealth, the Court established clear guidance as to the circumstances when a search warrant – rather than a subpoena - may be executed by law enforcement against an indicted defendant. The opinion also details safeguards that must be followed to ensure that prosecutors do not access e-mails protected by the attorney-client privilege.
In its holding, the SJC required that, in future cases, only a superior court judge may issue a search warrant seeking e-mails of indicted criminal defendants. Additionally, the supporting affidavit for search warrant must notify the judge that the individual whose e-mails are being sought is under indictment, and detail the connection between the pending indictment(s) and the search warrant being sought. The affidavit also must explain law enforcement’s need for a search warrant, rather than seeking the information via subpoena.
In this case the SJC approved the Commonwealth’s use of a group of assistant attorneys general, or “taint team,” to identify and segregate e-mails protected by the attorney-client privilege, in part, because the defendants were given the opportunity to review the taint team’s work and contest its determinations regarding privilege. In future cases, however, the Court held that the judge issuing the search warrant may require the use of an independent special master to review the e-mails or, upon a sufficient showing of necessity by the Commonwealth, authorize the use of a taint team, but only if specific safeguards are in place to protect the attorney-client privilege.
For more information on professional liability matters, contact Attorney Simon Brown at 603.410.1500 or a member of Preti's Professional Liability Group.
In its holding, the SJC required that, in future cases, only a superior court judge may issue a search warrant seeking e-mails of indicted criminal defendants. Additionally, the supporting affidavit for search warrant must notify the judge that the individual whose e-mails are being sought is under indictment, and detail the connection between the pending indictment(s) and the search warrant being sought. The affidavit also must explain law enforcement’s need for a search warrant, rather than seeking the information via subpoena.
In this case the SJC approved the Commonwealth’s use of a group of assistant attorneys general, or “taint team,” to identify and segregate e-mails protected by the attorney-client privilege, in part, because the defendants were given the opportunity to review the taint team’s work and contest its determinations regarding privilege. In future cases, however, the Court held that the judge issuing the search warrant may require the use of an independent special master to review the e-mails or, upon a sufficient showing of necessity by the Commonwealth, authorize the use of a taint team, but only if specific safeguards are in place to protect the attorney-client privilege.
For more information on professional liability matters, contact Attorney Simon Brown at 603.410.1500 or a member of Preti's Professional Liability Group.
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