Real Estate Journal — Green Buildings — February 26 - March 10, 2016 — 9B
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G reen B uildings & E nvironmental S ervices By Neil Andrew Stein, Esquire, Kaplin Stewart Be Green, Not Green With Envy
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and are not being properly field tested, sometimes lead- ing to disputes. A good example is a court’s 2014 grant of summary judg- ment to a product supplier on the grounds that the suit filed by the building owner almost ten years after the construction was completed in 2001, was time-barred. But the Fourth Circuit Court of Appeals has now overturned that decision, setting the stage for a trial in which the building owner, the Chesa- peake Bay Foundation, will square off against behemoth Weyerhaeuser. At issue will
be the Foundation’s attempt to prove Weyerhaeuser's li- ability for construction flaws at the Foundation's Annapolis "Platinum" rated headquar- ters. The green design called for exposed structural wood made with a special coat- ing to prevent rotting. After rotting was discovered, the Foundation determined that Weyerhaeuser had not used the contracted-for protective coating, which may not have been effective in any event. The advent of green build- ing technologies and designs are certainly a positive step in creating building and con-
struction techniques that will create more ecologically friendly and energy sustain- able systems. However, the potential litigation risks in a variety of areas may lead one to invoke the old adage that “no deed goes unpunished.” A builder or owner must maintain diligent risk man- agement practices to antici- pate as much as possible the consequences of being green. There are plenty of strate- gies available to balance the green goals of an owner or developer with business re- alities and risk evaluation. However, no project owner
or design professional (or at- torney for that matter) should succumb to scare tactics and “fear of the unknown.” Be green, not green with envy. Neil Stein is a principal at Kaplin Stewart and member of the Land Use, Zoning & Development group. Stein has over 25 years of experience repre- senting real estate owners, developers, lenders and builders in complex land use, zoning, environment and corporate matters, as well as design profes- sionals in contracting and business structuring. n
ombining the words “green” and “real es- tate” can invoke a
r a n g e o f emo t i o n s , b e g i nn i n g with apathy, and continu- ing to fear and perhaps even to opti- mism. While green build-
Neil Stein
ing concepts continue to ma- ture, the actual use of "green building" techniques, designs and construction materials are still relatively new. The United States Green Building Council is a private organi- zation that has created and operates a the "Leadership in Energy & Environmental Design" system. Rating lev- els, using a points system, may include benefits such as property tax breaks and financing incentives, as well as the intangible benefit of an enhanced reputation. Nonetheless, different com- panies, in different markets, facing unique economic condi- tions, may decline to go green for a variety of reasons. Many building owners, developers and contractors fear the be- lated discovery of a serious defect in design or construc- tion. As the demand for green buildings grows, the risks as- sociated with their construc- tion will continue to evolve. In the future, courts are sure to address legal issues pertain- ing to green building design, construction and ownership. As a result, legal, design and construction professionals must stay ahead of the curve by identifying and addressing areas of potential liability, but without frightening their clients into retreat. Unquestionably, risk arises because green construction requires an increased up- front cost, an often compli- cated LEED certification pro- cess and the often unknown future performance of green products and systems. Project owners commonly require ad- ditional contract provisions and warranties, which come with an increased exposure to potential liability for breach of contract or warranty by design professionals and con- tractors. The performance of new products and technolo- gies that are being developed for green construction may be risky. Many of these products are being developed quickly
Firmly Rooted in the Law and in the Community We are well grounded in every facet of real estate law, from acquisition to construction. We are committed to serving the needs of our clients and our communities.
Contact: NEIL A. STEIN • nstein@kaplaw.com 910 Harvest Drive, Blue Bell, PA 19422-0765 • 610-941-2469 • www.kaplaw.com Visit our Real Estate Blog: www.philadelphiarealestatelaw.com Visit our Construction Blog: www.pennsylvaniaconstructionlawyer.com Other Offices: Cherry Hill, NJ 856-675-1550 • Philadelphia, PA 215-567-3120 Kaplin Stewart A t t o r ne y s a t L aw
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