Cambridge Massachusetts Building Expert Directory

Know and Meet Your Notice Requirements or Lose Your Payment Bond Claims

May 17, 2021 — Chris Broughton, Jones Walker LLP - ConsensusDocs
Time is of the essence in the construction industry, and failing to provide timely notice of your payment bond claim can end your chance of recovery. Payment bonds guarantee payment for the subcontractors and suppliers who provide labor or materials on covered construction projects. Federal and state statutes governing payment bonds on public projects and the specific terms of non-statutory, private payment bonds have strict notice and timing requirements. Claimants who fail to provide timely notice can forfeit their chance of recovery. This article provides a brief overview of the notice requirements for payment bond claims – who has to give notice, what notice is required, and when you have to give notice. Payment bond protection is a frequent feature in construction. Payment bonds are required on most federal construction projects of over $100,000 under the federal Miller Act. Similar state statutes, typically referred to as “Little Miller Acts,” also require payment bonds on most state and local construction projects. Owners on private projects may require their general contractor to provide a payment bond to protect the property from liens. Finally, general contractors may also require subcontractors to provide payment bonds on public or private projects. Read the court decision
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Reprinted courtesy of Chris Broughton, Jones Walker LLP
Mr. Broughton may be contacted at cbroughton@joneswalker.com

New Jersey Court Washes Away Insurer’s Waiver of Subrogation Arguments

May 27, 2019 — William L. Doerler - The Subrogation Strategist
Subrogating insurers often address waiver of subrogation clauses in the form contracts drafted by the American Institute of Architects. In ACE Am. Ins. Co. v. Am. Med. Plumbing, No. A-5395-16T4, 2019 N.J. Super. LEXIS 45 (App. Div.), ACE American Insurance Company (ACE) argued that the waiver clause in the AIA General Conditions form A201-2007 did not extend to the post-construction loss at issue. Adopting what the court termed the “majority” position, the Appellate Division held that, by reading §§ 11.3.5 and 11.3.7 together, the waiver applied to bar the insurer’s subrogation claim. The Appellate Court’s ruling makes pursuing subrogation against New Jersey contractors using AIA contract forms more difficult. In this matter, Equinox Development Corporation (Equinox Development), ACE’s insured, contracted with Grace Construction Management Company, LLC (Grace Construction) to build the “core and shell” of a new health club (the Work). Grace Construction subcontracted the plumbing work to American Medical Plumbing, Inc. (AM Plumbing). Read the court decision
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Reprinted courtesy of William L. Doerler, White and Williams LLP
Mr. Doerler may be contacted at doerlerw@whiteandwilliams.com

Single-Family Home Gain Brightens U.S. Housing Outlook: Economy

January 21, 2015 — Shobhana Chandra – Bloomberg
Builders broke ground in December on the most single-family homes in almost seven years, propelling an unexpectedly large gain in U.S. housing starts that signals construction will contribute more to economic growth in 2015. Work began on 728,000 houses at an annual rate, a 7.2 percent increase from November and the most since March 2008, a Commerce Department report showed Wednesday in Washington. Total housing starts, which include apartments, climbed 4.4 percent to a 1.09 million pace. Read the court decision
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Reprinted courtesy of Shobhana Chandra, Bloomberg
Ms. Chandra may be contacted at schandra1@bloomberg.net

Missouri Asbestos Litigation Reform: New Bill Seeks to Establish Robust Disclosure Obligations

March 15, 2021 — Jennifer B. Pigeon - Lewis Brisbois
Missouri State Senator Eric Burlison is reviving attempts to reform asbestos litigation in the State of Missouri through the introduction of SB 331. This bill was pre-filed on December 29, 2020 and first read on January 6, 2021. The bill establishes disclosure procedures for claimants in asbestos-related lawsuits. Specifically, the bill, if passed, would require claimants in civil asbestos-related lawsuits to file a sworn information form within 30 days of filing an asbestos-related lawsuit. The required disclosures under SB 331 include, but are not limited to (1) each asbestos-containing product to which the exposed person was exposed and each physical location at which the exposure occurred; (2) the identity of the manufacturer or distributor of specific asbestos-containing products for each named exposure; (3) the specific location and manner of each exposure; (4) the beginning and end dates of each exposure, the frequency and length of each exposure, and the proximity of the asbestos-containing product or its use to the exposed person; and (5) a certification that any claim that can be made with a bankruptcy trust concerning any asbestos injury to the exposed person has been filed. Read the court decision
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Reprinted courtesy of Jennifer B. Pigeon, Lewis Brisbois
Ms. Pigeon may be contacted at Jenna.Pigeon@lewisbrisbois.com

Construction Company Head Pleads Guilty to Insurance and Tax Fraud

December 20, 2012 — CDJ STAFF
The former head of Orients Construction Company and of Melrose Construciton Company, Herlindo Garcia-Merlos, has entered a guilty plea to charges that the gave false informoation to his insurer, New Jersey Manufacturers Insurance Group, for more than three years in order to lower his workers compensation payments. Mr. Garcia-Merlos was able to underpay by more than $315,000 as a result of this deception. Mr. Garcia-Merlos additionally failed to file tax returns for his companies and underreported his wages on his own tax returns. The State of New Jersey is seeking an eight-year prison term and restitution of more than $400,000. Read the court decision
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From ‘Cuckoo’s Egg’ to Today’s Cyber Threat Landscape

September 02, 2024 — Aarni Heiskanen - AEC Business
In 1990, I read an exciting book titled The Cuckoo’s Egg: Tracking a Spy Through the Maze of Computer Espionage. The author, astronomer Clifford Stoll, managed computers at Lawrence Berkeley National Laboratory (LBNL) in California. He was tasked with resolving an accounting error of 75 cents in the computer usage accounts. The tedious process eventually led him to disclose a German hacker who had gained access to U.S. military secrets through LBNL’s computers. He had been selling information to the KGB for years. Today’s threat landscape in construction The LBNL incident was one of the first—if not the first—documented cases of a computer break-in. Fast-forward to today and cyber-attacks are an everyday phenomenon that occurs more often in construction. Read the court decision
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Reprinted courtesy of Aarni Heiskanen, AEC Business
Mr. Heiskanen may be contacted at aec-business@aepartners.fi

Liability policy covers negligent construction: GA high court

October 31, 2010 — Michael Bradford in Business Insurance

ATLANTA—Negligent construction that results in damage to surrounding property constitutes an occurrence under a commercial general liability policy, the Georgia Supreme Court has ruled.

In a 6-1 opinion Monday in American Empire Surplus Lines Insurance Co. Inc. vs. Hathaway Development Co. Inc., the Georgia high court upheld a lower court ruling that the general contractor’s claim for damage caused by a subcontractor’s faulty plumbing work was covered.

The ruling on construction defects is the latest in number of such cases across the United States

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Reprinted courtesy of Michael Bradford of Business Insurance.

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Arkansas Federal Court Fans the Product Liability Flames Utilizing the Malfunction Theory

September 14, 2020 — Michael J. Ciamaichelo - The Subrogation Strategist
To establish a product liability claim in Arkansas, the plaintiff must prove that the product was supplied in a defective condition, which rendered it unreasonably dangerous and that the defective condition was the proximate cause of the claimed damage or injury. Ordinarily, a plaintiff relies upon direct evidence of a product defect to establish its product liability claim. However, in some cases, the product sustains so much damage that it is impossible for a plaintiff to obtain direct evidence of a defect. The malfunction theory allows a plaintiff in a product liability action to establish a defect through circumstantial evidence, when direct evidence of a defect no longer exists. In order to utilize the malfunction theory, a plaintiff must present evidence that an unspecified product defect was the most likely cause of the damage/accident and rule out all other possible causes of the damage/accident. In Am. Nat’l Prop. & Cas. Co. v. Broan-Nutone, No. 5:18-CV-5250, 2020 U.S. Dist. LEXIS 117116, the United States District Court for the Western District of Arkansas ruled that the plaintiff offered sufficient evidence under “the malfunction theory” to defeat a summary judgment motion in a product liability action involving a bathroom fan that was destroyed in a fire. Read the court decision
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Reprinted courtesy of Michael J. Ciamaichelo, White and Williams LLP
Mr. Ciamaichelo may be contacted at ciamaichelom@whiteandwilliams.com

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