Welcome To Build On This
By Grant M. Yoakum, Esq.

In this issue of Build On This, Joel Mirman outlines the potential consequences of a recent judicial decision concerning certain costs involved in the discovery phase of a lawsuit. The way your company stores electronic data could result in high costs if you are required to produce certain types of information in response to the discovery process.

My article highlights an item in Ohio’s current budget bill which could double the cost of recording and copying real estate documents. Ken Fisher’s article on insurance and contract terminology discusses terminology problems that tend to arise in construction documents. The terminology is sometimes ignored but can lead to serious consequences. Finally, this issue offers a brief biography of Don Leach, Managing Partner of the Firm’s Columbus office and one of the leading real estate and construction attorneys in our region.

We have also included a brief reader survey at the end of this edition . Please take a moment to complete and return the survey so we can tailor the format and content of Build on This to meet your needs.

Please feel free to call the authors or another Buckingham attorney if you would like to know more about one of the topics discussed in this issue of Build On This, or if you would like to learn how this information might apply to your specific situation.

Grant Yoakum is an Associate attorney and member of the Real Estate & Construction Law and Business Law Practice Groups.  He can be contacted at gyoakum@bdblaw.com or 216.615.7356.

Whose Cost Is It?
By Joel H. Mirman, Esq.

A New York Federal District Court recently issued a decision challenging what had been considered to be the “Gold Standard” regarding who pays the high cost of responding to discovery requests requiring expensive production of electronically stored data.   

In Zubulake v. UBS Warburg, 2003 WL 21087884 (S.D.N.Y. May 13, 2003), the Plaintiff requested that the Defendant produce "[a]ll documents concerning any communication by or between UBS employees concerning Plaintiff."  The Plaintiff knew that additional responsive e-mail existed that the Defendant had failed to produce.  She requested that the Defendant produce the e-mail from archival media. Claiming undue burden and expense, the Defendant urged the court to shift the cost of production to the Plaintiff, citing the Rowe Entertainment, Inc. v. The William Morris Agency, 205 F.R.D. 421 (S.D.N.Y. 2002) decision.   

The court noted that the application of the Rowe factors may result in disproportionate cost shifting away from large defendants, and the court modified the test (adding two factors, combining two and removing one) to seven factors:  

1.     The extent to which the request is specifically tailored to discover
----- relevant information;  

2.     The availability of such information from other sources;

3.     The total cost of production compared to the amount in controversy;  

4.     The total cost of production compared to the resources available to
----- each party;  

5.     The relative ability of each party to control costs and its incentive to do so;  

6.     The importance of the issue at stake in the litigation and; 

7.     The relative benefits to the parties of obtaining the information.   

The court listed the factors in descending order of importance, stating that they should not all be weighted equally. Applying the new test, the court ordered the Defendant to produce, at its own expense, all responsive e-mail existing on its optical disks, active servers, and five backup tapes as selected by the Plaintiff.  The court determined that only after the contents of the backup tapes are reviewed and the Defendant's costs are quantified will the court conduct the appropriate cost-shifting analysis. 

Companies should consider re-evaluating how they store their data in order to minimize production costs in the event they are confronted with such requests. 

Joel Mirman is a Shareholder and a member of the Litigation Practice Group.  He can be contacted at jmirman@bdblaw.com or 614.227.4264.

Recording Fees to Double
By Grant M. Yoakum, Esq.

A portion of Ohio's current budget bill doubles certain costs associated with real estate documents.  House Bill 195 was passed by the Ohio Legislature, and one of the means for increasing revenues is that effective August 1, 2003, the recording fees and copy costs will double at all of Ohio's county recorders.  In other words, a two-page deed that previously cost $20 to record will now be $40.  Obviously, the increased cost will have the most significance for documents containing more pages, such as a condominium declaration and by-laws or recorded loan documents. The increased cost for copies will likewise be more significant for lengthy documents that are not available through another source.  It is not clear at this time whether the individual county recorder, auditor or fiscal officer will have any discretion in implementing the higher fees.  If you need to record lengthy documents and can control the timing, you should try to complete the process early and avoid the August 1, 2003 fee increases.

Grant Yoakum is an Associate attorney and member of the Real Estate & Construction Law and Business Law Practice Groups.  He can be contacted at gyoakum@bdblaw.com or 216.615.7356.

Avoid Outdated and Unachievable Insurance Requirements
By Kenneth A. Fisher, Jr., AIA, CSI       

Several common errors in construction contracts result from the use of outdated and unachievable insurance requirements.  While many of these problems go unnoticed or are simply ignored in the routine exchange of insurance certificates, some of the errors could lead to expensive consequences. 

The most persistent error involves the specification of commercial general liability coverage.  Although the name was changed to “commercial general liability” over 20 years ago, many contracts still refer to “comprehensive general liability” insurance.  Even older names that occasionally appear include public liability insurance, manufacturers and contractors liability insurance, and contractual liability insurance.

Similarly, business auto liability insurance is often incorrectly called “comprehensive automobile liability.”  And rather than a “combined single” limit, the proper way to specify limits on business auto coverage is through an “each accident” limit.

A more serious problem concerns builder’s risk insurance.  The AIA’s A201-1997, General Conditions of the Contract for Construction, for example, requires “property insurance written on a builder’s risk ‘all-risk’ or equivalent policy form.”  Builder’s risk policies, however, typically exclude various perils which would be included in a true “all risk” form. 

The gap between requirements and available coverage also extends to the A201’s waiver of subrogation.  That waiver explicitly includes “the Architect [and the] Architect’s consultants.” Most builder’s risk insurers, however, will not agree to waive subrogation against design professionals.

The solution to the builder’s risk problems is to strike the unachievable requirements and describe the particular policy that the owner intends to purchase or specify that the owner will purchase “commercially available” coverage.  

Misnomers and unachievable requirements also plague additional-insured requirements.  The terms “additional named insured,” “named insured,” and “coinsured” are no longer used.  The current term is “additional insured.”  Two commonly specified but unachievable requirements are mandating additional insureds on a builder’s risk policy or that a person be named as an additional insured on a professional liability policy although the person is not a member of the associated profession. 

Kenneth Fisher is an Associate attorney and a member of the Real Estate & Construction and Litigation Practice Groups.  He can be contacted at kfisher@bdblaw.comor 614.227.4290.

Buckingham to Serve as Counsel for Insureds of Chubb Insurance Company

Buckingham, Doolittle & Burroughs is pleased to announce that Chubb Insurance Company has approved Buckingham to serve as counsel for its insureds.  Chubb is especially strong in areas such as directors and officers liability insurance (in profit and nonprofit areas), employment insurance and other niche risks.  If you are currently insured with Chubb, and wish to have a Buckingham attorney represent your Company, your nonprofit or you as an individual, you need only request that your broker include a rider specifying defense work by Buckingham.  Chubb has agreed to honor these requests.  If you have any questions, you can contact Gerald B. Chattman, Managing Partner of Buckingham, Doolittle & Burroughs, LLP, Cleveland. 

Gerald Chattman is a Shareholder and member of the Employment Law Practice Group.  He can be contacted at gchattman@bdblaw.com or 216.615.7354.

Practice Group Profile Featuring Donald B. Leach, Jr., Esq.

Donald B. Leach, Jr. is Managing Partner of the Columbus office of Buckingham, Doolittle & Burroughs and currently serves as Vice President and Assistant Treasurer of the Firm’s Board of Managers.  A graduate of Union College, Schenectady, New York, Don earned his Juris Doctorate from The Ohio State University College of Law.  He has a Martindale-Hubbell rating of AV, which indicates very high to pre-eminent legal ability and very high ethical standards, and is listed in the 2003-2004 edition of The Best Lawyers in America® and the 2002-2003 edition of Chambers Global – The World’s Leading Lawyers.  He is a recipient of the Columbus Bar Association Community Service Award and is a member of the Million Dollar Advocates Forum.

This year Don received a unique honor:  He is the 49^th recipient of the Cornerstone Award from the Builders Exchange of Central Ohio – the first attorney to be so honored. The Builders Exchange is a 110-year-old, 1300-member commercial construction trade association based in Columbus.  Don was the first practicing attorney to ever be elected to the organization’s Board of Directors and to serve as its President.  He has spearheaded the participation of Buckingham, Doolittle & Burroughs in the Builders Exchange, taught many of its educational programs, and was involved in the creation of a number of BX programs, including its Idea Exchange and the Law Group.  During Don’s term as President, the Builders Exchange adopted a strategic plan that is still an integral part of its success.

“The Cornerstone Award is a great honor,” says Don.  “It recognizes the volunteer hours I have devoted to the Builders Exchange and to the industry.  I earn my livelihood from this industry, and I believe that it is appropriate for me to give back, to give time to improve the way things happen in construction.  Through the Builders Exchange, I have been able to facilitate communication and organize efforts that have benefited many different members of the construction industry.”

Don values the role of Builders Exchange in fostering communication and cooperation. “Both the legal profession and the construction industry are experiencing changes due to technology as well as time and money pressures.  But both still boil down to relationships.  The Builders Exchange is a terrific resource for the central Ohio construction industry – it’s a forum for people to work and meet in a non-competitive environment.

“A spin-off benefit of my involvement in the Builders Exchange has been that I have been able to provide an added service to clients because I have had the chance to meet so many of those who are involved in the construction industry,” Don continues.  “This enables me to provide service beyond the expected because I can know who to contact when an issue comes up so that it can be addressed.  This gives me the chance to do what I really love – solve problems.”

In any construction project, Don focuses on both the details of a construction project and the “big picture” of what his client needs to achieve.  He starts by helping his client develop appropriate relationships with the wide range of people and businesses providing the services needed to complete the project.  During the contracting process he helps his client define the risks involved and clarify how they will be handled and who will be responsible for each.

As the construction progresses, Don explains, “Issues will arise.  It’s impossible to anticipate everything that may come up.  I will then work to help resolve any problems.  I have found that it is crucial to address the issues as they arise and not let them fester.  At the end, I work with my client to clean up loose ends and unresolved issues – and then to celebrate the successful result!”

A lifelong resident of the Columbus area, Don has served as treasurer for a number of Columbus Public Schools levy and bond-issue campaigns and is active in a number of community organizations, including the Upper Arlington Parks and Recreation Advisory Board, the Upper Arlington Civic Association, The Rotary Club of Columbus and the YMCA Youth in Government Program.  Don’s commitment to the welfare of the construction trade and the legal profession is illustrated by leadership positions he has held for the Construction Law Committee and the Real Property Institute of the Columbus Bar Association.  He is also a member of the Government, Education & Construction Law Committee of the Ohio State Bar Association.

Don is proud – and relieved – to have survived five years of service coaching his daughter Anna’s elementary soccer team and is currently wondering why he allowed himself to be elected President of the parent organization for his daughter Gwen’s high school rowing team.  Joking aside, though, he is grateful for tremendous support and balance in his life provided by his wonderful wife Jane, who has just resumed her career as an elementary school principal with the Columbus Public Schools, and his active, involved teenaged daughters.

Don Leach is a Shareholder and member of the Real Estate & Construction Law and Business Law Practice Groups.  He can be contacted at dleach@bdblaw.com or 614.227.4262.

The attorneys of Buckingham, Doolittle & Burroughs are committed to providing you with timely legal news that is helpful to you and your business.   Please take a moment to answer a few questions about our newsletter so we may continue to send you the news you want to read about.

To complete the survey on line go to: http://www.bdblaw.com/newpublications3.asp or click here for a printer friendly version, complete and fax to 330.252.5473 Attn: Lorna Henderson

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Out and About – Recent Presentations:

Robert A. Hager, John P. Slagter (Buckingham Cleveland^SM), and David W. Woodburn (Buckingham Akron^SM) were presenters at the Buckingham Annual Real Estate & Construction Law Seminar held in Akron, Ohio.  Their topics were “Fairness in Contracting Act:  ‘Level the Playing Field,’” “Legal Strategies for Real Property Tax,” and “Case Law Update.”

RobertA. Hager(Buckingham Cleveland^SM) presented “Litigation of Liens” at the Ohio State Bar Association sponsored seminar titled “Real Estate Litigation” in Cleveland, Ohio. 

Donald B. Leach, Jr. (Buckingham Columbus^SM)presented “Liens and Encumbrances Affecting Real Estate”  on behalf of the Ohio State Bar Association Continuing Legal Education Institute in Columbus, Ohio.  He also spoke on “The How’s and Why’s of Paperwork” at the Ohio’s Mechanics’ Lien Law Seminar sponsored by The Builders Exchange of Central Ohio. 

CraigB. Paynter(Buckingham Columbus^SM) gave a presentation titled “Litigation of Liens” at the Ohio State Bar Association Seminar in Columbus, Ohio. 

John P. Slagter(Buckingham Cleveland^SM)spoke at “Boundary Law in Ohio,” sponsored by the National Business Institute.  His topics were “Water Boundaries, Ethics, and Handling Right-of-Way Problems.”

William G. Williams(Buckingham Canton^SM) organized and moderated the Stark County Bar Association sponsored seminar titled “Stark County Government’s Involvement in Real Estate Transactions” held in Canton, Ohio. 

If you are interested in obtaining information on upcoming seminars or would be interested in having speakers from Buckingham, Doolittle & Burroughs, LLP make a presentation to your organization, please contact: Lorna Henderson, Sr. Marketing Coordinator, at lhenderson@bdblaw.com or 800.686.2825 ext. 473.

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1.800.682.2825 - Buckingham Boca Raton ^SM
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