Perten Succeeds in Construction Dispute Case

(December 13, 2017, Boston, MA) – Sheehan Phinney Shareholder John H. Perten successfully defended the firm’s client in a construction dispute.

Our client, a home builder, had a falling out with its customer. The customer claimed that the home had all sorts of defects and did not comply with the requirements of the contract. To buy peace, the builder agreed to a modest payment in exchange for a full release. The customer accepted and cashed the settlement check. Approximately one week later, the customer approached the builder to advise that he was refinancing the home with a Veteran’s Administration guaranteed loan. To do so, he needed the builder to execute a VA form warranty. That form attested to the fact that the home had been constructed in accordance with the VA approved plans and contained no defects. As an accommodation, the builder signed the form, and the customer got his loan.

Two years later, the customer filed suit against the builder for construction defects. As to the release, the customer argued that by signing the VA warranty, the released claims had been revived. On our motion for summary judgement, the Court agreed with our client’s argument that the release was broad and binding. The Court rejected the customer’s claim that VA warranty revived the released claims. The Court noted that the VA warranty did not specifically reference the released claims and, by its express terms, was signed merely to induce the VA to issue the guaranteed loan. As a result, the Court dismissed all claims against our client.

This is an important victory for our client. The potential liability was several hundred thousand dollars. Legal fees alone would have been significant. The issue of revival is not well developed in Massachusetts caselaw, yet we convinced the Court to reject the revival argument and the claim that by signing the VA warranty, our client had given birth to a new cause of action.

Perten has a general business practice and a broad litigation background. He frequently acts as outside general counsel for companies and organizations who seek practical advice on a wide variety of issues experienced during day-to-day business activities. Perten is an adjunct faculty member at Babson College, where he teaches business law to MBA candidates.  In 2011 he received the Dean’s Award for Excellence in Teaching, 2011. He currently serves on the Board of Directors for the Builders and Remodelers Association of Greater Boston. Perten is admitted to practice in both New Hampshire and Massachusetts. He received his J.D. cum laude, from Suffolk University Law School and his B.A. from Cornell University.

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Sheehan Phinney is a full service business law firm representing local, national and international clients with innovative approaches and practical solutions. Founded in 1937, Sheehan Phinney has grown to more than 60 attorneys with four offices throughout Massachusetts and New Hampshire and is known for professional excellence, practical counsel and commitment to both its clients and the communities it serves.