SEATTLE WASHINGTON BUILDING EXPERT
DIRECTORY AND CAPABILITIES

Ruling Dealing with Constructive Changes, Constructive Suspension, and the Implied Covenant of Good Faith and Fair Dealing

January 22, 2024 — David Adelstein - Florida Construction Legal Updates
A dispute pending in the Armed Services Board of Contract Appeals (ASBCA) dealt with interesting legal issues on a motion to dismiss. See Appeals of McCarthy Hitt-Next NGA West JV, ASBCA No. 63571, 2023 WL 9179193 (ASBCA 2023). The dispute involves a contractor passing through subcontractor claims due to impacts caused by the COVID-19 pandemic and the government’s response to the pandemic. More particularly, the claim centers on the premise that the government “failed to work with [the contractor] in good faith to develop a collaborative and cooperative approach to manage and mitigate the impacts and delays arising from the COVID-19 pandemic.” See Appeals of McCarthy Hitt. The contractor (again, submitting pass through claims from subcontractors) claimed: (a) constructive changes to the contract entitling it to an equitable adjustment under the Changes clause of Federal Acquisition Regulation (F.A.R.) 52.243-4; (b) construction suspensions of the contractor’s work entitling it to an equitable adjustment under the Suspensions of Work clause of F.A.R. 52-242-14; and (c) the government breached the implied covenant of good faith and fair dealing. Each of these legal issues and theories will be discussed below because they are need-to-know legal issues. Keep these legal issues in mind, and the ASBCA’s ruling on the motion to dismiss as its analysis may demonstrate fruitful in other applications. Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

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English v. RKK. . . The Saga Continues

December 16, 2019 — Christopher G. Hill - Construction Law Musings
Remember back in 2018 when I thought I’d told you the end of the English Construction story regarding its various consultants, etc.? I was wrong. The matter went up on appeal to the 4th Circuit Court of Appeals where the Appeals Court considered the summary judgment granted to the defendant Rummel, Klepper & Kahl (“RKK”) based upon what came down to a contributory negligence reading of the indemnity clause that was allowed to survive in the first district court opinion relating to these ambiguous contracts finding that English was negligent so couldn’t recover. The 4th Circuit also considered the finding that defendant CDM Smith did not breach its contract as a matter of law and that English’s negligence was the cause of the damages. The Court of Appeals reversed both of the holdings by the Western District of Virginia court, essentially stating that there was enough of a factual dispute to render any summary judgment to be premature. As to English’s arguments regarding the indemnity scheme in the contracts, the court found that the interpretation was at least ambiguous enough that summary judgment was inappropriate, stating:

While we are not prepared to settle conclusively these interpretation disputes at the summary judgment stage, English’s proffered interpretation is, at the very least. reasonable. Indeed, of the two interpretations, English’s seems to be more closely aligned with the actual language in the contract. The district court thus erred in rejecting English’s interpretation and adopting RK&K’s interpretation as a matter of law.

[A]t bottom, while the district court was authorized to construe unambiguous language as a matter of law, it could not resolve genuine disputes regarding the meaning of ambiguous contractual language against the nonmoving party on summary judgment. We therefore vacate the court’s grant of summary judgment to RK&K and remand for further proceedings.

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Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

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New Defendant Added to Morrison Bridge Decking Lawsuit

March 26, 2014 — Beverley BevenFlorez-CDJ STAFF
The Morrison Bridge in Multnomah County, Oregon, has added a new company to their lawsuit regarding problems with the slip-resistant FRP decking, according to The Oregonian. The county has already named the installer, the supplier, and the manufacturer. Now, they have added Hardesty & Hanover, LLP, the company “that contracted with the decking manufacturer to provide engineering and design for the project.” The Oregonian reported that “the county has identified a construction design professional who can testify that Hardesty & Hanover made errors that contributed to the Morrison Bridge's damage,” according to the amended complaint. First, Conway construction (the deck installer) filed suit against the decking manufacturer and supplier. Then, the “county inserted itself into the suit last fall,” stated The Oregonian, and “is seeking more than $2 million to repair or replace the decking, plus damages.” A trial is scheduled for February 2015. Read the court decision
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Home Prices Expected to Increase All Over the U.S.

July 09, 2014 — Beverley BevenFlorez-CDJ STAFF
According to a survey of the National Association of Realtors (as quoted by the Housing Wire), home prices are expected “to increase in all states and the District of Columbia over the next 12 months, with most of the heavy growth in Florida, Texas, and California, among other states.” The highest expected price growth was “in states with low inventory levels, strong cash sales, and strong growth sectors (e.g., technology, oil).” Read the court decision
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Fluor Agrees to $14.5M Fixed-Price Project Cost Pact with SEC

September 25, 2023 — Debra K. Rubin - Engineering News-Record
Fluor Corp. has agreed to pay $14.5 million to resolve a U.S. Securities and Exchange Commission investigation for alleged “improper accounting” and "overly optimistic" cost and timing estimates in bidding two legacy fixed-price projects that forced the company to restate its 2020 financial results, the agency said on Sept. 6. Reprinted courtesy of Debra K. Rubin, Engineering News-Record Ms. Rubin may be contacted at rubind@enr.com Read the full story... Read the court decision
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Construction Managers, Are You Exposing Yourselves to Labor Law Liability?

February 22, 2021 — Timothy P. Welch - Hurwitz & Fine, P.C.
When dealing with construction site accidents, who a party is matters. Under Labor Law sections 200, 240(1) and 241(6) owners, contractors, and their agents have a non-delegable duty to provide reasonable and adequate protection to workers from risks inherent at work sites, with a specific emphasis placed on elevation-related hazards. Given the near strict liability nature of Labor Law section 240(1), it is critical to identify whether a party is a proper Labor Law defendant from the get-go. While identifying the owner (and usually the contractor) may be relatively straightforward, identifying “their agents” has proven to be a more complex undertaking. It should be noted that the requirements set forth in the Labor Law are non-delegable from the standpoint of the owner or contractor, however, the duties themselves can be assigned to “agents” of an owner or “agents” of a contractor. When such an assignment occurs, the same non-delegable duty held by the owner or contractor is imposed on the agents as well. Moreover, “once an entity becomes an agent under the Labor Law it cannot escape liability to an injured plaintiff by delegating the work to another entity.[1]” An entity that often skirts the line between being an agent and not, is the Construction Manager. Traditionally, the Construction Manager has been found to be outside the purview of the Labor Law when its scope of work is narrowly focused on scheduling and general coordination of the construction process. However, when a Construction Manager’s scope expands, so does its risk that it may, in fact, become a proper Labor Law defendant. Read the court decision
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Reprinted courtesy of Timothy P. Welch, Hurwitz & Fine, P.C.
Mr. Welch may be contacted at tpw@hurwitzfine.com

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DC Circuit Issues Two Important Clean Air Act and Administrative Law Decisions

December 16, 2019 — Anthony B. Cavender - Gravel2Gavel
The U.S. Court of Appeals or the District of Columbia has recently issued two important rulings on the Clean Air Act in particular and administrative law in general: California Communities Against Toxics, et al., v. EPA and Murray Energy Corporation v. EPA. The Battle of the Memos: Seitz Makes Way for Wehrum In the California Communities case, decided on August 20, 2019, the court held, in a 2 to 1 decision, that a petition to review a change in EPA policy announced in an agency memorandum which reversed an agency policy announced nearly 25 years ago in another agency memo must be rejected because the memo at issue was not a “final agency action” subject to the Administrative Procedure Act (APA). In 1995, the “Seitz Memo,” which interpreted Section 112 of the Clean Air Act and addresses the regulation and control of hazardous air pollutants from stationary sources, stated that once a source of toxic emissions is classified as “major,” the facility remains subject to regulation as a major source even if the facility makes changes to the facility to limit its potential to emit such toxics below the major source threshold. Then, in 2018 under a new administration, the “Wehrum Memorandum” was issued which reversed this policy and its interpretation of the law. (Both memos were issued without any kind of advance notice or opportunity to comment.) If a source takes steps to limit its potential to emit, then it may be regulated as an area source, and subject to less rigid regulation. The court majority held that the Wehrum Memo was not a final agency action and was not subject to judicial review when it was measured against both prongs of the “finality test” devised by the Supreme Court in the cases of Bennet v. Spear, 520 US 154 (1997) and US Army Corps of Engineers v. Hawkes, 136 S. Ct. 1807 (2016). While the memo undoubtedly represented the consummation of the agency’s decision-making process, the memo had no direct and appreciable legal consequences, and not therefore being a final action, the case must be dismissed. Judge Rogers filed a strong dissenting opinion. Read the court decision
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Reprinted courtesy of Anthony B. Cavender, Pillsbury
Mr. Cavender may be contacted at anthony.cavender@pillsburylaw.com

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New Case Alert: California Federal Court Allows Policy Stacking to Cover Continuous Injury

November 23, 2016 — William S. Bennett - Saxe Doernberger & Vita, P.C.
“Stacking” is a practice that is very favorable for policyholders, especially in environmental coverage cases involving extended pollution events. It allows a policyholder to combine the limits of multiple consecutive policies to cover continuous injury claims occurring over multiple policy periods. Without stacking, insurers can limit a policyholder’s recovery to a single policy limit. The Eastern District of California recently decided that a policyholder could stack the limits of six consecutive policies, where the occurrence was a continuous injury spanning all six policy years. Among other rulings, the court determined that the plain language of the policy under dispute did not prevent stacking. Read the court decision
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Reprinted courtesy of William S. Bennett, Saxe Doernberger & Vita, P.C.
Mr. Bennett may be contacted at wsb@sdvlaw.com

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