 Good afternoon, everyone. Welcome to another episode of condo insider. That's the show for condo living and for people who live and work in the condominium community in the state of Hawaii. Thank you for joining us. I've got as my guest today and this is, you know, in conjunction with, you know, a series of programs we're doing about building safety. You know, especially after the that condo collapse in Florida, we've had a lot of, you know, inquiries about, you know, doing shows to give you information on how to keep your building safe. So I'm really happy to have with me today. I've got Kyle Pinale and he's with birding while who's the law firm in Hawaii and on the mainland. Hi, Kyle. Hi, thanks for having me. Okay. Thanks for being with us. Kyle, why don't you give us some information about your firm? What does your firm do? Tell the viewers what they what you do. Birding and while is a full service condominium association law firm with 39 lawyers and Tyler birding and the teams that work with him and I'm on one of those teams. We primarily handle the condominium construction defects portion of our work, and Steve while primarily handles the general counsel work and Steve while and also the teams that work with him. I've been representing owners for over 33 years with clients from luxury high rises to mid to low rise multifamily buildings to single family homes. And the firm is headquartered in California and has a Hawaii office, which is where I work as a construction defect litigator. And your license to practice in Hawaii right. I am licensed to practice here in Hawaii, and I laid out here and work out here. And I'm also licensed in California. Okay, you know, and one of the big, you know, topics that we get, you know, a lot of questions about is building safety. So why don't you tell our viewers, you know what what specifically mean what kind of special work does your firm do to assist associations and making sure that their buildings are safe. We work with associations of varying ages, Jane. We work with younger buildings that were are built less than 10 years ago, that still have legal recourse to potentially see compensation from a developer for any construction defects. We also work with buildings who are trying to perform reconstruction or update or repair conditions that the association has determined to require updating. And we've, and then also we've worked with older association buildings those older than 10 years, sometimes many 1020 30 years old. On addressing possible building at structural issues or building waterproofing issues that can result in structural issues, and those types of safety issues, but primarily because only one of those three that I've just mentioned have legal rights, typically, we primarily work with buildings that are younger than 10 years old, and that have a legal capability under the law to seek compensation from a developer. But let's talk about some of these younger buildings. And you know we're talking about like a brand new building right something that you know was built within the last 10 years. And so let's take a building that you know was completed, maybe a year ago, and you know the developers there and he's selling you know the units, and, and, and typically they control the board I mean they might set up an association. And they sit on the board and they they hold, you know, positions on the board of directors. And at some point, I think it's after they sell 50 50% of the building, then they kind of have to step back, but all of all of these brand new condominiums. The developer has certain reserved rights, and then, and, and at some point, the developer goes away. And you know this is a brand new building it's brand new spanking news supposed to be everything works right. So why should anybody be worried about the building, and having a problem. The reason why association should be concerned or should investigate, in our opinion, whether a building has a problem Jane is that if a developer or builder builds a building component incorrectly. That defect exists at the moment it is constructed. So the, the incorrect building materials or building installation is present from the very beginning. If you have some type of building deficiency like that water typically which is our the primary culprit for damage in our defect cases. We're at a, for example, at a wall that is improperly waterproof and start to get into the building immediately. And for many of these types of building components, they're actually hidden from view. So it's a homeowner likely wouldn't be able to identify whether there is water intrusion into the interior of a building wall or an exterior wall. So, a lot of this damage and go without being noticed. So it's an incumbent on an association was important for an association to have an idea of the health of its building and whether there is water getting into components that ordinary people cannot see. Okay, so let's say you've got a building that has a construction defect that you can't see. They don't, you know, and so you know it starts, you know, maybe allowing water in the building, maybe through windows that aren't, you know, installed correctly or some pipes, you know that are done and nobody can tell. Right. And let's say the building decides you know after after a while they've had all these problems with water released and they go out and hire structural engineer. And this is like 10 years after the building is completed, or maybe year 12. What's the problem of waiting that long to do something about this construction defect. What's the problem with waiting. The problem Jane is that every building and every association has a limited amount of time to bring a claim to seek compensation for construction defects. So you mean as they wait too long, they can't sue. Yeah, if you wait too long, you lose it. But that presents a significant risk for associations, especially those that are around the 10 year mark. But we would argue that waiting till the 10 year mark is risky, because you run, you could potentially face problems that take significant amount of time to investigate and if you start investigating them right at the end. Before you run out of time, you could potentially lose the claim. And so the, but before I get too deep into that Jane, I got to explain that for new buildings like new condominium buildings. There are deadlines that a condominium building has that start immediately after construction. So a street that applies has a particular definition on that starting or has a unique definition on that starting point, which allows some ambiguity and some argument by lawyers, but for purposes of this conversation I'll just say that starting point begins at the end of construction. So for new buildings. There are outside, there's an art outside limit, and then also inside limit or deadline to when an association can bring claims. So the outside deadline that you typically make here is 10 years, 10 years and that's called a statute of repose. Those means the deadline starts after a specific given moment in time, based on an event, which in this case is a construction of the building. So new buildings, they have 10 years. However, there are also inside limits that can override that 10 year period. So you have various claims that you could bring as an association to seek recovery against the developer. Some of those claims are research contract claims. So we'll call those contract claims. Other claims are what we call tort claims may hear of negligence or various types of claims like that. So in Hawaii, you have two years to bring a negligence claim or tort claim and six years to bring a breach of contract claim. And I'll go through some examples here to kind of identify how these limits work with one another, because it's very important it's, it is confusing. But, and that's why it's important for an association to have an understanding of what these deadlines are because it's very easy to blow past them. So, there's a 10 year outside limit and then two and six year inside limits. So that's, we have that. So let's use an example like you mentioned Jane in year one. In year one and association discovers a construction defect. And there is an argument about when when an association discovers a defect but we'll ignore that now and just say the association discover the defect in year one. Similarly, you would think new building. I've got 10 years or the association has 10 years. This one year has gone by so the association has nine more years to invest. Why should we investigate now, we have plenty of time to look into those those nasty construction defects later. The problem with that is, you only have a two year period from the moment you discover an issue for your negligence or tort claims. You discover in year one, that means you have only until year three to bring your claims, or else those claims are gone forever. So, and from year one, you would also have six years of year seven, you would have another deadline to bring your contract claims. So let's say you're an association and you say, well, we've only had one year passed by. We think it's, it would be smart to begin investigating during year seven or eight. You could but then and then you also discover various construction defects during that time, you could have easily blown through your two year period, and your six year period, and lost almost all if not all of your claims and potential for recovery. So what you're saying is that even for these brand new buildings that are in a brand spanking new. I mean they really, the association has a duty. A due diligence of due diligence to check into the you know the safety of their, their building to make sure there's no construction defect before that 10 years. The deadline passes right otherwise they will lose, they will lose the right to sue the developer. Yes, we'd argue that this is part of that duty of due diligence is for an association to understand one, the deadlines that it faces to potentially lose his claims but also to understand the safety and the status of the building itself. So if they want to do in a find out and do their due diligence, who do they hire to go and check out the building. I mean do they do a structural engineer or mechanical engineer me who is it that you know is going to tell them that they've got a construction defect. There are many people that are involved in that type of investigation, potentially, and there are several steps that we would actually recommend even before you get to that point, Jane, to determine whether an association has a construction defect or alternatively to maximize the safety and well being of the building. So I'm going to take a short step back and say, we have three recommendations for associations on what they should do to investigate their buildings and maximize the safety of their building. The first is we recommend that association performs required maintenance, and this sounds simple, it doesn't sound too complicated, but it actually can get quite complicated and I'll talk about that in a second. Second, we recommend that association perform a reserve study as required by Hawaii law. We had an episode a few weeks ago about reserve studies, and they are valuable tools, and they are valuable because they help an association understand some building components, but our third recommendation addresses the building components that typically may not be addressed or caught in a reserve study. And that is, we recommend that association perform a forensic investigation. And this forensic investigation. Yeah, this gets to the question you were asking about the team. A forensic investigation is where a team typically of either a forensic architect, a forensic engineer, like you mentioned, Jane, or a contractor, or some combination of those three. Open up areas of the building in order to investigate building components and areas that are hidden from normal view. So a reserve study in our experience in Hawaii is where it and a reserve study specialist, who they do great work and we have a lot of respect for them. A reserve study specialist investigates the useful life for the remaining years that building component items have before they need to be replaced, and it may comment on current construction defects that an inspector can see. Most of these reserve studies in our experience are based on visual inspections of the building, but there are many areas of the building, like behind exterior walls are within exterior walls, structural conditions within balconies structural steel and concrete lanais that are not visible they're covered up. So you, there is a potential area of exposure for associations that do not know the status of those hidden components. A forensic investigation uncovers the current condition of hidden components, which allows an association to appropriately budget for those repairs. So that an association one understands the safety or safety risks to its buildings but then also sufficiently funds them to recover or to repair those risks. And you know for this forensic audit. I mean, investigation. How much does something like that cost and how long does it take. Well, I am not a forensic. I don't work for a forensic company in terms of like a forensic architect firm, each firm probably has its own. It has its own fee structures, but I will say that the cost of a forensic investigation can be significant. They can also be reasonable so a forensic investigation, in our opinion, doesn't necessarily mean a minimum amount of money that doesn't necessarily necessarily require a minimum amount of money that an association must spend in order to do this investigation. Forensic consulting companies and experts and engineers and architects, they may have flexible fee structures where they can, they can adjust their scope based on an association's financial capability to spend. Like I said, there are law firms out there who, if they for qualifying buildings, particularly buildings under 10 years, and birding a while is one of these types of law firms will offer a complimentary preliminary investigation program, where someone like our birding a while and the law firm that we partner with routinely in Hawaii McKee and Sheldon mailing, we work with friend a forensic architect to do a visual inspection of the building identify areas that may require destructive investigation where building layers are peeled back and then present the information to a board to make a decision on how the board would like to proceed. And what do you charge what do you what do what your firm charge for this service for doing this for a condominium. So for a preliminary forensic investigation, our firm and we offer a complimentary service here. It is a program where we work with experts or we work with experts to do. As I mentioned a visual and visual inspection followed by some type of presentation. However, that on its own it is not going to be a full investigation where many building layers are opened up oftentimes we don't open up building layers. It is enough to at least give the board information on how it can move forward, and these experts that we work with are are very experienced in this line of work. There are experts who focus primarily on designing construction and then there are also experts who have practices where they peel back building layers for these forensic investigations. Experts are are very experienced and what that means is they're able to identify things with their just by looking at them visually. When many homeowners wouldn't be able to and there have been many cases where we're the lawyers who I work with we're walking aside and we see things that look like just mere dots or you know mere marks. And our experts are able to say well you see that mark right there that to me based on how this building appears to be constructed, constructed can be an area where water is getting into the building or so there is a lot that an expert can see in a visual inspection forensic expert can see in a visual inspection that an association member might not see. I mean, when should an association take advantage of this service. I mean, do you should they wait until year 10. Our recommendation is no. And we recommend that association start, you know, take advantage of this type of service which you know complimentary means it's free. So, take advantage of that type of service early in its life cycle. Because if you find something wrong, and you have to do further investigation, you don't want to run up against that 10 year deadline, or the six year or the two year deadline. Right yeah and, and what we find in our cases Jane is that many times homeowners are the first line of defense typically if an association doesn't perform a forensic investigation. What they rely on our homeowners who experienced leaks into their windows, for example, who contact either the association's manager or the board and say we have leaks at this window. Could you please help us since this appears to be a common area item. If, if an association has several of those types of messages from owners. That association subsequently enters into either mediation with a developer through or some other type of alternative dispute resolution or a lawsuit. A developer will point to those communications and say, Association, you discovered this issue, many years ago, and therefore you blew the two year or the sixth year, even if the lawsuit or the investigation was was done before the 10 year had run. So, there is risk, if you allow these types of communications to come in and you don't investigate that. Can I ask you something in Hawaii with the construction defect cases. Now it's required. I mean the people who have been in condos for a long long time they knew that back in the back in the day. The construction defect cases would involve a whole bunch of attorneys and a whole bunch of insurance companies. I mean, it was just, it was just very expensive and time consuming. And so the construction industry went to the legislature and now there's a requirement that you have to mediate do mediation before you can file a lawsuit on a construction defect. Right. So how does that play into your 10 day 10 year deadline. So let's say you find a claim, and you contact the developer and say hey, we're starting this claim, and they say okay but you got to take us to mediation first. So let's say you go into mediation, that's going to take what maybe six, you know, six, seven months, right to prepare for go through the mediation and complete it. And you're eating up into your, your statute of repose aren't you. Yes, long story short, yes. And if this were in California. California has a process where you submit a notice to builder what what California California law calls it where you communicate to the builder based on statute, certain violations of building standards. And at that point, the statute of repose and the statute of limitations are called paused. So that stops the clock, but we don't have that type of statute in Hawaii right. That's correct. Yes, here in Hawaii. If you file a note or send a notice of claim to a builder, which is what the statute requires that does not stop the statute of repose or the statute of limitations what stops those is filing a lawsuit. Now, Hawaii law on this issue, it's called the contractor repair act. It does allow for parties to engage in mediation as you mentioned, as you mentioned, but it is, it requires it actually, but it does allow a party or like an association for example, to file a lawsuit. Without it, they would look, they would burn through the statute of limitations or repose. So, although the statute doesn't have isn't as plaintiff friendly or association friendly as the one in California in terms of notice filing the notice with the or sending a notice to a builder. It does allow you if, if you are going to run out of time and if the mediation what does look like it's going to blow through the two year the six year or even a 10 year to file a lawsuit before that those time limits have run up. Well, you know, in Hawaii, what there's, you know, some typical construction deep what are some noteworthy construction defect specific to Hawaii that people should want to maybe look out for. Hawaii is a marine environment and water is the bane of associations existence when it comes to construction defects so water intrusion into all areas of the building from roofs to siding to windows to foundations to concrete to slabs to exterior walls water intrusion is particularly bad and here in Hawaii, it's the marine environment has a very salty air. So things corrode faster waters bad because it causes metals to corrode. It causes wood to get some bacteria, which turns into dry rot, and both of those metal and wood which are typically used as structural members can become compromised by water intrusion. Now what we're seeing lately, Jane, are some pretty unique construction defects that that you know it's just it's just how the construction defect field develops in Hawaii. Around 10 years ago, roughly, there were these structural anchors that hold down a building to the ground or to foundation, and they were called anchor straps. That was a what was happening where these anchor straps were corroding in the Hawaii environment, you, you possibly to the salty air, salty soils, or and the humid air. And so you would have homes that were supposed to be tied down or anchored down with steel that no longer are so the common description that you hear or analogy that you hear is like in the Wizard of Oz where the home blows away. But this, the structural foundation would not be as secure as it as designed. So that was a, a development in the industry, roughly 10 years ago, when what we're seeing now are different construction defects. One of them, another structural one is we are finding that windows at associations are supposed to be designed to withstand minimum loads from wind. If it blows on the windows it could create if it blows past windows, it can create almost suction forces out of the building. So engineers typically design these windows to withstand those types of forces, especially here in Hawaii where you have hurricanes and tropical hurricanes. So what we're finding is that's that some of these windows are installed and are put in, and they don't meet those structural minimums, which creates a risk of a window failure in the event of a hurricane or tropical storm. So that's a unique one. Another construction defect that is unique here to Hawaii deals with a building component called a part of an exterior finished system. There's a product out there called a direct applied exterior finished system. It's typical to Hawaii. It's basically like stucco. If you think of stucco buildings. So we found in our experts have indicated to us that several of our case in several of our cases, the deep system is installed incorrectly for various reasons. There are many components with system. It's very easy to install them incorrectly actually that the layer on the exterior wall is only an eighth of an inch thick so you can run into issues if the system isn't installed correctly. And what we're also finding is that replacement contact contractors major building contractors in in Hawaii are not willing to warrant deeps replacement system so warrants were a deep product that is installed that they install in place of a defectively installed product. And they're also not seeing letters from these manufacturers, certifying or warranting these products we've seen letters that warrants the, or excuse me that warrant the system. We've seen letters that warrant the product, but not the systems themselves. So, because this product is installed and these systems are installed regularly through throughout Hawaii that is a unique construction defects or construction issue. Yeah, but the messages to the associations who are listening now is, you know, even for brand new buildings, you can't sit around and just wait for for something to happen you have to be proactive and start investigating especially since you've got these deadlines, and you have to be contractor to walk away, and not have, you know, not having to, to fix whatever construction defect, they have caused, but you know, we run out of time and you know we, I have more questions I never even got to. When you come back and and and and be a guest on another show because you know we still have more questions to ask. And you know this is a very, very interesting and important area, especially after what happened in Florida. I think everybody's really really concerned about what steps they can take to make sure that their building is safe. You know, even the ones that are newly built and the ones that have been around for a while. So thank you very much for being with us today, Kyle, and for your for the listeners. Please join us next week for another show and we're going to be talking about resources. And, and, and my guest next week is going to be from murmur Moelie Lee resident managers association. So please join us next week for another episode of condo insider Mahalo and Aloha. Thank you.