CLOSE X
RSS Feed LinkedIn Instagram Twitter Facebook
Search:
FMG Law Blog Line

Statute of Repose Does Not Bar Claims Resulting from Improper Maintenance

Posted on: January 9th, 2020

By: Tom McCraw

The Massachusetts Appeals Court recently held that the six-year statute of repose (G.L. c. 260, § 2B) did not bar a homeowner’s insurer’s subrogation claim against a gas company for damages caused by the company’s failure to maintain a gas meter that caused a fire on the homeowner’s property in February 2015.

The gas company, Bay State Gas d/b/a Columbia Gas, had installed the gas meter on the property in 1996, attaching the meter to a high-pressure gas pipe rising out of the ground but not installing supports to brace the pipe.  Bay State Gas retained ownership of the meter and maintained it over the years prior to the fire.  The incident occurred when the meter broke off from the pipe under the weight of significant snowfall, causing a fire that damaged the homeowner’s property.  The insurer, Penn-America, paid the homeowner’s claim and subrogated against Bay State.  Bay State obtained summary judgment in the trial court on grounds that the claim was barred by the six-year statute of repose, as the meter had been installed nearly 20 years before the incident.

The Appeals Court vacated the decision, noting that the six-year statutory period applies only to actions of tort “for damages arising out of any deficiency or neglect in the design, planning, construction, or general administration of an improvement to real property.”  The Appeals Court rejected Bay State Gas’ argument that the failure to include supports for the pipe was a defect in the original design in 1996. Instead, it agreed with Penn-America that the incident resulted from Bay State Gas’ breach of its continuing duty to maintain the meter – as Bay State had done throughout the years – and was beyond the scope of the statute.

In light of the Penn-America case, those in the construction industry should carefully evaluate whether any ongoing maintenance obligations for older improvements are sufficiently up to code as those obligations are seperate and distinct from issues with the original design, and not within the statute of repose.

If you have any questions or would like more information, please contact Tom McCraw at [email protected].

Penn-America v. Bay State Gas Co. d/b/a Columbia Gas, No. 19-P-86 (Mass. App. Ct. Dec. 20, 2019)

AB5: California’s Controversial Gig-Work Law Took Effect January 1, 2020

Posted on: January 7th, 2020

By:  Margot Parker

As of January 1, 2020, California’s AB5 may require employers to reclassify hundreds of thousands of independent contractors as employees with broad labor law protections.  The new law codifies the “ABC test” adopted by the California Supreme Court in Dynamex Operations West, Inc. v. Superior Court of Los Angeles in 2018.  Under the ABC test, a worker may only be classified as an independent contractor if it can be shown that:

A. The worker is free from the control and direction of the hiring entity, both under the contract for the performance of work and in fact;

B. The worker performs work that is outside of the usual course of the hiring entity’s business, and

C. The worker is engaged in independently established trade, occupation, or business that is of the same nature as the work performed for the hiring entity.

This strict three-pronged test now applies to the requirements of the California Labor Code and the California Unemployment Insurance Code.  Beginning July 1, 2020, it will also apply to the California Workers Compensation Code.

While the law provides exemptions for certain occupations and industries (including accountants, architects, dentists, insurance brokers, lawyers, and engineers), the Legislature declined to exempt app-based ride services and food delivery companies, whose workers complain they often earn less than minimum wage.  Uber, Lyft, DoorDash, Postmates and Instacart are mounting a ballot initiative to exempt their workers, while trucking associations, photographers, and freelance journalists have brought other initiatives opposing the law.

Given such controversy, the law’s author intends to introduce additional legislation to clarify AB5 this year.  In the meantime, employers should consult with legal counsel and review independent contractor classifications to ensure proper classification of workers pursuant to the ABC test.

If you have any questions or would like more information, please contact Margot Parker at [email protected].

Federal Court Temporarily Enjoins California’s Ban On Mandatory Arbitration Agreements

Posted on: January 7th, 2020

By: Brad Adler

Employers will recall that California passed a law in October, 2019 (AB 51) that would limit the ability of employers to require mandatory arbitration of certain statutory employment claims as of January 1, 2020.  Specifically, AB 51 provided that employers could no longer require, as a condition of employment, that a job applicant or employee arbitrate any alleged violation of the California Fair Employment and Housing Act or the California Labor Code.  After AB 51 was passed, a coalition of business groups led by the U.S. Chamber of Commerce filed a lawsuit seeking to block AB 51 from taking effect.

On December 30, 2019, Judge Kimberly Mueller of the Eastern District of California granted a temporary restraining order in response to that lawsuit, which effectively blocks AB 51 from going into effect until the Court holds a preliminary injunction hearing on January 10, 2020.  At the January 10 hearing, the Court will decide whether to grant a preliminary injunction that would block implementation of AB 51 until the case is fully resolved.  As a result of the Court’s temporary restraining order, at least as of right now, it still is lawful to continue requiring employees to sign arbitration agreements.  But please be aware that the lawsuit challenging AB 51 is moving quickly so employers with California employees should continue to monitor this lawsuit.

If you have any questions or would like more information, please contact Brad Adler at [email protected].

NLRB Reverses Obama-Era Ruling And Finds That Employers Can Prohibit Use of Company Email for Union Activities

Posted on: January 2nd, 2020

By: Brad Adler

On December 17, 2019, the National Labor Relations Board (NLRB) ruled in Caesars Entertainment that employees have no right under the National Labor Relations Act to use an employer’s email system for union activities, including organizing. This decision reverses a controversial and unprecedented ruling by the NLRB in 2014 (Purple Communications)  that essentially found that employers could not prohibit employees from using the employer’s email system for union activities.

While the scope of any ban on using email for non-work purposes will vary based on the facts of each case, the good news is that the NLRB, as currently constituted, has recognized that an employer fundamentally is in charge of how its equipment, including email system, can be used by employees.  In light of this ruling, we suggest that employers work with their labor and employment counsel to ensure that the language of any current work rules clearly sets out the respective company’s expectations on how work equipment, including email, should be used by employees.

If you have any questions or would like more information, please contact Brad Adler at [email protected].

California Lawyers Should Not Lie

Posted on: December 20th, 2019

By: Greg Fayard

It seems obvious, but lawyers shouldn’t lie. A new Rule of Professional Conduct applicable to California lawyers says that while representing a client, a lawyer shall not knowingly make a false statement of material fact or law to a third person.

Rule 4.1 is aimed at lawyers communicating with opposing counsel or an opposing party. This duty to not misrepresent facts or law to others includes a lawyer “agreeing” with statements he or she knows are false. For example, if a lawyer hears a factually untrue statement said in a court hearing, and orally agrees with that statement, knowing it is false, that verbal affirmation runs afoul of the rule.

However, if the lawyer remained silent after hearing the false statement, such silence would likely not violate the rule—as silence is not an affirmation. Of course, the best practice for all lawyers, in California and elsewhere, is to tell the truth, don’t lie to others, and correct statements that the lawyer knows are untrue, even if it may not necessarily help the client’s case.

If you have any questions or would like more information, please contact Greg Fayard at [email protected], or any other member of our Lawyers Professional Liability Practice Group, a list of which can be found at www.fmglaw.com.