I have one last green building legal development to tell you about before I take my hiatus.
When people ask me about green building disputes, I tell them that they will arise from three scenarios. A project may not comply with regulatory requirements — i.e. Destiny USA. Second, disputes may arise from green building certification — i.e. Bain v. Vortex Architects (via Stephen Del Percio’s Green Real Estate Law Journal). And finally, new green building materials and techniques can lead to defects and litigation.
We now have a lawsuit describing this third scenario: The Chesapeake Bay Foundation, Inc., et. al. v. Weyerhaeuser Company (PDF). The lawsuit involves the first project to obtain LEED Platinum certification, the Chesapeake Bay Foundation’s ("Foundation") Philip Merrill Environmental Center. The project has received numerous awards and accolades from Treehugger.
The following is a description of the Plaintiffs’ allegations.
The Foundation contracted with the architecture firm SmithGroup to design the project in 1998 and Clark Construction Group to build the project in 1999.
Because of its environmental mission, the Foundation wanted the project to incorporate "recycled and environmentally-friendly construction products. . . " The design also included a roof truss system and various columns and beams that were exposed to the weather.
The contract documents permitted the use of Parallel Strand Lumber — or Parallams — for the roof truss system, columns and beams. According to the Foundation’s website, Parallams are green because they are produced from fast-growth trees.
Clark contracted with Trus Joist MacMillan, a subsidiary of Weyerhaeuser Company, in 2000 to supply the Parallams. Weyerhaeuser delivered parallams that had been treated with PolyClear 2000, after allegedly assuring SmithGroup that the treatment was suitable for exposed building components. Weyerhaeuser allegedly never received approval to use PolyClear 2000.
Construction was substantially complete December 7, 2000. Shortly after completion, water intrusion was identified at various portions of the project. Throughout 2003, various modifications were made, including adding a sealant to the Parallam, that resolved the leakage.
In 2009, the Foundation performed an inspection and observed deterioration of weather-exposed Parallams, including widespread rot. A subsequent expert report asserted that "the Parallams had not been treated to the levels prescribed by the contract documents or else the preservative had deteriorated because it was unsuitable for the application."
The Foundation, SmithGroup and Clark subsequently entered into an agreement to remediate the project and to pursue litigation against Weyerhaeuser.
According to the lawsuit filed by the Foundation, SmithGroup and Clark, Weyerhaeuser provided "defective, inferior and or unsuitable building products" for the Foundation’s project. The lawsuit goes on to allege five causes of action:
- Breach of contract
- Common law indemnity
- Negligent Misrepresentation; and
Most interesting to me is the negligent misrepresentation argument, where the Plaintiffs divulge that the building is at risk of collapse:
"As a result of Plaintiffs’ reliance on Weyerhaeuser’s assurances that Parallams pressure-treated with PolyClear 2000 was appropriate material for use in construction of the Project and that the preservative had been adequately applied — which statements were untrue — the structural integrity of the Project is in jeopardy and the building is now at risk of collapse. Thus, the defective condition of the PolyClear 2000 has created a clear risk of death or serious injury at the project."
The lawsuit goes on to assert damages in excess of $6,000,000.
The Chesapeake Bay Foundation case is an example of green building litigation that can develop as a result of the materials and products that go into the project. The Foundation chose specific products because of their environmental appeal. But these products allegedly failed when exposed to the elements. While this lawsuit could occur on any construction project, the introduction of new green materials can result in unanticipated results and lawsuits.
Photo Credit: Miss Leslie