Today, Green Building Law Update continues a discussion of the Shaw Development v. Southern Builders case, which demonstrates the emergence of green building litigation. On Monday, we reviewed basic facts related to the legal case and on Wednesday we looked at the contract between the two parties to determine green building responsibilities. Today we focus on the causes of action alleged by Shaw Development in the counter-complaint.
When owners and developers move forward with green building projects, they often do so with the goal of achieving a specific green building certification. What happens if a building fails to achieve the anticipated level of green building certification?
The owner may blame the designers, engineers, contractors and subcontractors for such a failure and sue one or all of the parties. Based on the counter-complaint and Project Manual, Shaw Development anticipated that the Project would achieve LEED Silver Certification and brought an action for breach of contract and negligence against Southern Builders when the certification was not obtained.
The liability of parties for failure to achieve a green building certification will be determined by the relevant contracts or related promises, which were reviewed on Wednesday. If a contractor guarantees a specific green building certification, the contractor will be responsible for the failure to achieve certification. The contractor should only commit to constructing the building per the approved design and using the approved materials. If the contractor performs in accordance with the contract, design and specifications, there should be no liability even if the building does not achieve the desired certification level. The contractor also needs to make sure that potential liabilities flow down to its subcontractors. The owner, on the other hand, may have valid reasons for requiring that the contractor guarantee green building certification. For example, the project may have to achieve certification to comply with green building codes or regulations.
On Monday, we will review the related damages alleged by Shaw Development and finish the discussion of this case. In the meantime, check your green building contract!
- The Anatomy of America’s First Green Building Litigation (gbNYC)
- The First LEED Lawsuit…Great…. (Real Life LEED)
- Open the Floodgates: The Era of Green Building Litigation (Greener Buildings)