1. The Legal Edge: Solving Today’s Construction Problems Texas Housing Conference July 28-30, 2014 Hilton Hotel Austin, TX

2. Presenters Moderator Bobby Bowling, Tropicana Homes Panel Members Vijay D'Cruz, Locke Lord Joe Davis, Husch Blackwell Chris Ryman, Coats | Rose

3. Presented to: The Texas Affiliation of Affordable Housing Providers Managing Construction Defect Claims Chris E. Ryman Coats, Rose, Yale, Ryman, & Lee, P.C. www.coatsrose.com

4. s ● Violation of Industry Standard ● Violation of Building Code ● Failure to follow Plans and Specifications ● Design Deficiencies ● Product Failures CONSTRUCTION DEFECT

5. ● Early Investigation ●Retain specialized consultants ●Gather key documents: ◘ Contracts ◘ Complaints ◘ Prior inspection reports ●Testing ●Photographs ●Preserve Evidence INVESTIGATION

6. ● Key Questions ◘ Is it a construction / design / combination defect? ◘ What standard does it violate? ◘ How does it cause any damage? ◘ What damage does it cause? ●Your expert should propose a repair plan ●Secure a bid for the cost to implement repair plan ●Share this information with key players REPAIR PLAN AND BID

7. ● Identify and notify the responsible parties ◘ Architect ◘ Engineer ◘ General contractor ◘ Supplier ◘ Subcontractors ●Invite the responsible parties to participate in the resolution of the claim ●Provide repair plan and bid NOTICE

8. INSURANCE, BONDS AND INDEMNITY ● Determine if you have insurance/performance bond ●Notify the insurer/surety ● Cooperate by providing key information ● Performance/Maintenance Bond ● Indemnity Agreements

9. WARRANTY ● Determine what warranties are implicated ●Comply with warranty notice ●Implied and express warranties ● Remedies provided

10. MITIGATION ● Make temporary repairs ● Track and document costs ● Always notify responsible parties before making any repairs

11. OPPORTUNITY TO REPAIR ● Consider allowing the responsible party to repair according to repair plan ● Warranty for Repairs ● Payment of Money

12. RESOLUTION ● Mediation ● Arbitration ● Litigation ● Cost-Benefit Analysis ● Specialized Consultants ◘Attorneys ◘ Consultants

13. Chris E Ryman Coats | Rose 3 E. Greenway Plaza Suite 2000 Houston, Texas 77046 (713) 653-7345 cryman@coatsrose.com