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Worthwhile effort to hobble ADA lawsuit abuse

mark handler

mark handler

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Worthwhile effort to hobble ADA lawsuit abuse

Published: May 26, 2015 Updated: 4:15 p.m.

http://www.pe.com/articles/ada-768194-california-business.html

State Sen. Richard Roth’s bill to encourage compliance with the American Disabilities Act, while enhancing protections for small-business owners, has passed early hurdles this month, a positive sign in a state wrought with often-abusive lawsuits.

When President George H.W. Bush signed the ADA into law in 1990, there was certainly no intention of empowering a relatively small number of litigious individuals to engage in a form legal extortion under the guise of advancing the rights of the disabled.

Yet that has too often been the reality of the ADA in states with civil justice systems long-ago skewed away from dispensing justice. Last year it was found that the Golden State leads the nation in ADA-related lawsuits, with more cases filed in California than in Florida, New York, Pennsylvania and Texas combined.

That’s in large part because California particularly incentivizes those seeking easy money to seek damages through the Unruh Civil Rights Act, which guarantees damages of at least $4,000 for any violation of any anti-discrimination law.

In California, it doesn’t matter if a violation is small, trivial or hardly perceptible. If certain signs aren’t in certain places, parking lots not precisely measured or doors not of certain dimensions, it is possible to claim these violations constitute discrimination and thus lead to settlements that can be painful to small businesses.

At this point in time, taking on the connection between the Unruh Act and the ADA is impossible. To propose separating the two to any degree will result in being cast as an enemy of the disabled, with no amount of logical or reason prevailing through the cacophony of outrage.

Sen. Roth, D-Riverside, proposes a more modest set of solutions that are still worth supporting. The proposals, by way of SB251, include business tax credits for enhancing accessibility and, most significantly, provide a pathway for business owners to be protected from violations of accessibility standards with timely fixes.

The California Chamber of Commerce has flagged the bill as a “job creator.”

While there are sure to be particular details that need more fleshing out, Mr. Roth’s bill is one of the better bills on ADA compliance seen in a while. At some point common sense must prevail and business-owners should be given a chance to fix any violations before being subject to abusive lawsuits.
 
ADAguy said:
Interesting but businesses already have a tax incentive, No?
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Explain how that provides any kind of motivation?

It's not a grant. You have to spend multiple thousands of dollars to recoup a fraction of that in a tax write off. You can never make the money back you spent.

Brent.
 
MASSDRIVER said:
Explain how that provides any kind of motivation?It's not a grant. You have to spend multiple thousands of dollars to recoup a fraction of that in a tax write off. You can never make the money back you spent.

Brent.
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Actually it's more than a tax write off, it's actually a tax credit of up to $10,250 per Year Plus Increase Trade-Offs. Here's More Information: http://www.ada.gov/archive/taxpack.htm
 
Msradell said:
Actually it's more than a tax write off, it's actually a tax credit of up to $10,250 per Year Plus Increase Trade-Offs. Here's More Information: http://www.ada.gov/archive/taxpack.htm
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The amount of the tax credit is equal to 50% of the eligible access expenditures in a year, up to a maximum expenditure of $10,250. There is no credit for the first $250 of expenditures. The maximum tax credit, therefore, is $5,000.

$5,000. in 1994 is equal to just over $8,000. in 2015 so it may be worth looking at the tax credit amount again. Then again CA could give their own state tax credit since I believe it is the state's Unruh Civil Rights Act that is being used to file the lawsuits under.

http://www.in2013dollars.com/1994-dollars-in-2015?amount=5000
 
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mtlogcabin said:
The amount of the tax credit is equal to 50% of the eligible access expenditures in a year, up to a maximum expenditure of $10,250. There is no credit for the first $250 of expenditures. The maximum tax credit, therefore, is $5,000.$5,000. in 1994 is equal to just over $8,000. in 2015 so it may be worth looking at the tax credit amount again. Then again CA could give their own state tax credit since I believe it is the state's Unruh Civil Rights Act that is being used to file the lawsuits under.

http://www.in2013dollars.com/1994-dollars-in-2015?amount=5000
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And be a little more precise, using your inflation rate and the numerater set in the 90's, your tax credit maxes out at $3,125.

For whatever reason nobody looks at the actual numbers. Also, construction cost inflation has tripled, so what you got for 10,000 costs 30,000 today. So figure a 10% tax credit in real numbers. And that's if you haven't maxed your deductions to zero, in which case that credit won't apply. Uncle Suger sure as hell ain't gonna send you any money over the top.

Brent.
 
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MASSDRIVER said:
And be a little more precise, using your inflation rate and the numerater set in the 90's, your tax credit maxes out at $3,125. For whatever reason nobody looks at the actual numbers. Also, construction cost inflation has tripled, so what you got for 10,000 costs 30,000 today. So figure a 10% tax credit in real numbers. And that's if you haven't maxed your deductions to zero, in which case that credit won't apply. Uncle Suger sure as hell ain't gonna send you any money over the top.

Brent.
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Also note that all ADA work should be done by licensed insured contractors, all owners of properties doing any work on thier properties should get certificates of insurance from their contractors, my insurance companies have also required that all ADA work be designed by licensed insured architects, and my insurance companies have always required that I get hold-harmless and indemnification agreements from those architects' insurance companies. Not all architects' insurance carriers will list contractors on their policies and provide the hold-harmless and indemnification agreements.

This makes sense since it's possible that the architect may miss one little thing and the rolling extortionists can and will bring an action. This is not a problem with new work because ADA compliance is built into the project and the dollar volume is high enough to absorb the added liability, but with small (like under $100,000) ADA remodeling projects compliance can only be provided by larger well-insured contractors.
 
Further Point: if the owner of a property he leases allows the tenant to remove barriers, be sure and obtain a permit and obtain a sign off by the local B.O. as many plaintifffs with will insist/require work that is more than the minimum. It then remains for the judge to accept or reject self-performed work by the defendent.
 
MASSDRIVER said:
Your avatar speaks volumes. Brent
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Brudgers was fond of saying that code officials force people to do a dance. I almost always got a kick out of brudgers. Every now and then he had me laughing out loud. I did it for him.

And by the way, yours does too.
 
I think the AIA ought to do every thing it can to get this whole private right of enforcement totally removed from the ADA and the codes, it exposes both architects and contractors to tremendous liability, the way contractors' liability is now working is that they are settling most claims as quickly as possible, because litigation is so expensive, and then cancelling the insurance, once one company cancels you can't buy insurance from any company for 10 years. This probably isn't the case for contractors and architects who pay millions a year in insurance premiums, but it is for us small guys, so again ADA work is limited to only large architectural and construction firms.
 
Leaving the mom n pop stores to hang by their thumbs without knowledgeable representation? (he who has the gold, controls the game; as always)
 
I have done a very small access barrier removal project for sole proprietor very small business. Very patiently went through the situation with business owner and negotiated an "indemnity" that was formatted by a very sharp business attorney. No E&O liability insurance was used for the project.
 
\ said:
No E&O liability insurance was used for the project.
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But an architect's E&O policy is a year long policy, so you don't carry E&O? As a contractor I can't work on a project designed by an architect without E&O, and I have to be named on that policy as additionally insured, I also insist that the owner also be named on the architect's policy as additionally insured in the hope that if there is litigation I can negotiate with the owner to sue around me.

I've mentioned before but on an ADA compliance job on a large Aaron Green Catholic Church I used my standard AGC hold harmless and indemnification clause, still the archdioceses' attorneys and my attorney argued for a week over one word in the agreement (that one word cost me $700 to resolve). ADA work is very expensive, there is always the threat of being sued, that church had several contractor parishioners who offered to do the job at no cost, none could get insurance to do it.
 
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Local Church and library ADA consultants should consider doing them Pro Bono as I have done.

Also note: the methods and means by which an owner choses to remove barriers are their calls to make. We only concurr as to the acceptability of the result (no?).
 
conarb said:
But an architect's E&O policy is a year long policy, so you don't carry E&O? As a contractor I can't work on a project designed by an architect without E&O, and I have to be named on that policy as additionally insured, I also insist that the owner also be named on the architect's policy as additionally insured in the hope that if there is litigation I can negotiate with the owner to sue around me.I've mentioned before but on an ADA compliance job on a large Aaron Green Catholic Church I used my standard AGC hold harmless and indemnification clause, still the archdioceses' attorneys and my attorney argued for a week over one word in the agreement (that one word cost me $700 to resolve). ADA work is very expensive, there is always the threat of being sued, that church had several contractor parishioners who offered to do the job at no cost, none could get insurance to do it.
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Two thoughts:

1. Speaking as an architect: my attorney and my liability insurance company require any indemnifications to be mutual. You get listed on my policy if I get listed on your policy. Also, the indemnification is for "established" claims of error or omission. That means we're not paying your attorney bills unless and until a court first determines we were at fault.

2. In your specific example, you mentioned a catholic church. Aren't churches exempt from ADA? Or was this a public / commercial / educational use that happened to take place at the church?
 
\ said:
2. In your specific example, you mentioned a catholic church. Aren't churches exempt from ADA? Or was this a public / commercial / educational use that happened to take place at the church?
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Yes churches are exempt but many churches allow their facilities to be used for other purposes that do require compliance, this was voluntary, in fact the board member who contacted me when no members could qualify had a son in a wheelchair and he argued for ADA compliance.
 
The church exemption offers further proof that it is not a discrimination issue, and should only be a code compliance issue.

Brent.
 
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