Real Estate & Construction News Round-Up (11/02/22) – Flexible Workspaces, Sustainable Infrastructure, & Construction Tech
November 15, 2022 —
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law BlogThis week’s round-up dives into digital transformation in the construction industry, renewed interest in flexible workspaces, and how the infrastructure sector can become more resilient and sustainable, both economically and environmentally.
- Digital transformation in the construction industry is top of mind for many firms, but most are still in the beginning and intermediate phases of implementing new digital capabilities. (Ursula Cullen, PBC Today)
- Companies could mitigate climate hazards and build resilience into the life cycle of their infrastructure and capital projects by facilitating a comprehensive approach to understanding risk. (Brodie Boland and Daphne Luchtenberg, McKinsey & Company)
- The use of drones in project planning, as well as the incorporation of other technology, is proposed as an alternative solution to addressing the construction industry’s labor shortage. (Shaun Passley, For Construction Pros)
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Pillsbury's Construction & Real Estate Law Team
Commercial Construction Lenders Rejoice: The Pennsylvania Legislature Provides a Statutory fix for the “Kessler” Decision
July 16, 2014 —
Thomas C. Rogers – White and Williams LLPIn May 2012, the Pennsylvania Superior Court rendered its now infamous “Kessler” decision. The Kessler decision resulted in fundamental changes in the operation of the Pennsylvania Mechanics Lien Act as it applied to construction loans where the visible commencement of work on the project commenced before the recordation of the construction loan’s open-end mortgage.
Essentially, the Kessler decision held that if the visible commence of work on the project began prior to the recording of the open-end mortgage and any loan advances were made other than for what are commonly considered “hard construction” costs, then any unpaid contractors and subcontractors who later filed mechanics’ liens would have their liens take priority over the lien of all of the construction loan advances.
Subsequent to the Kessler decision, both the lending and title insurance communities in Pennsylvania have struggled mightily to structure deals around the problems created by Kessler and to provide lenders with title insurance coverage for construction loans when work commenced before the recordation of the open-end mortgage.
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Thomas C. Rogers, White and Williams LLPMr. Rogers may be contacted at
rogerst@whiteandwilliams.com
Jason Smith and Teddie Arnold Co-Author Updated “United States – Construction” Chapter in 2024 Legal 500: Country Comparative Guides
May 28, 2024 —
Jason Smith & Edward (Teddie) Arnold - The Construction SeytJason Smith and
Teddie Arnold, partners in Seyfarth’s Washington, DC office, have co-authored an updated “United States – Construction” chapter in the 2024 edition of The Legal 500: Country Comparative Guides. Seyfarth continues to participate as an exclusive contributor for this comprehensive overview of construction-specific laws and regulations in the United States. Topics covered include, but are not limited to, requirements and obligations, permits and licencing, procurement, financing and security, and disputes, as well as insight and opinion on current challenges and opportunities. To access and download a copy of the chapter, click
here.
Reprinted courtesy of
Jason N. Smith, Seyfarth and
Edward V. Arnold, Seyfarth
Mr. Smith may be contacted at jnsmith@seyfarth.com
Mr. Arnold may be contacted at earnold@seyfarth.com
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State And Local Bid Protests: Sunk Costs and the Meaning of a “Win”
July 11, 2022 —
Amy Anderson - ConsensusDocsAcross the United States, state and local agencies often use competitive bidding to award contracts for various types of work. Generally speaking, a bid protest is when an unsuccessful bidder challenges the award by the state or local agency to another competitive bidder. Procurement at this level is entirely distinct from federal procurement.
The details of any bid protest will be specific to the locality. However, a question that very often comes up when a state or local agency uses competitive bidding: what happens when I lose the bid? More specifically, if I should not have lost because my bid was the lowest or best value, can I make the state or local agency award the bid to me?
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Amy Anderson, Jones Walker LLP (ConsensusDocs)Ms. Anderson may be contacted at
aanderson@joneswalker.com
Pennsylvania Civil Engineers Give the State's Infrastructure a "C-" Grade
November 28, 2022 —
American Society of Civil EngineersPENNSYLVANIA. — The Pennsylvania Council of the American Society of Civil Engineers (ASCE) released the 2022 Report Card for Pennsylvania's Infrastructure today at three congruent news conferences across the state including Harrisburg, Lehigh Valley, and Pittsburgh, with 15 categories of infrastructure receiving an overall grade of a "C-". This is the same grade issued by the council in its 2018 report. A "C-" means Pennsylvania's infrastructure is in mediocre condition and requires attention. Pennsylvania's aviation and rail networks are helping to drive economic growth in the region and an improved roadway network is helping increase efficiency for the regional and national economies, but an aging infrastructure network and struggling water systems threaten the health, safety and welfare of the region. Civil engineers graded aviation (B-), bridges (D+), dams (C), drinking water (D), energy (C), hazardous waste (B-), levees (C), parks (C+), ports (C+), rail (C), roads (C-), solid waste (C+), stormwater (D), transit (D), and wastewater (D-).
"Considering Pennsylvania's aging infrastructure and its critical role in our state's economy, policy makers must continue to prioritize dedicated funding to update and improve all infrastructure assets," said Rep. Mike Carroll, D-118. "Failure to do so will seriously harm the quality of life for every citizen."
"This report shows that Pennsylvania's infrastructure has seen some noteworthy improvements and that our lawmakers are prioritizing the built environment, but out-of-sight, out-of-mind systems such as water and wastewater pipelines are lacking the necessary attention," said David DiGioia, chair, 2022 Report Card for Pennsylvania's Infrastructure. "With help from the Bipartisan Infrastructure Law, we could improve our communities for generations if we double down on investment and close our funding gaps across all sectors included in this report."
The Report Card was created as a public service to citizens and policymakers to inform them of the infrastructure needs in their state. Civil engineers used their expertise and school report card-style letter grades to condense complicated data into an easy-to-understand analysis of Pennsylvania's infrastructure network. ASCE State and Regional Infrastructure Report Cards are modeled after the national Infrastructure Report Card, which gave America's infrastructure an overall grade of 'C-' in 2021.
To view the report card and all five categories, visit https://infrastructurereportcard.org/state-item/Pennsylvania/.
ABOUT THE AMERICAN SOCIETY OF CIVIL ENGINEERS
Founded in 1852, the American Society of Civil Engineers represents more than 150,000 civil engineers worldwide and is America's oldest national engineering society. ASCE works to raise awareness of the need to maintain and modernize the nation's infrastructure using sustainable and resilient practices, advocates for increasing and optimizing investment in infrastructure, and improve engineering knowledge and competency. For more information, visit www.asce.org or www.infrastructurereportcard.org and follow us on Twitter, @ASCETweets and @ASCEGovRel.
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Contractors: Beware the Subordination Clause
October 15, 2014 —
Garret Murai – California Construction Law BlogA bit of mechanics lien trivia.
What is the only state in the United States in which mechanics liens are a constitutional right?
If you answered California, ding, ding.
Article XIV of the California Constitution states:
Mechanics, persons furnishing materials, artisans, and laborers of every class, shall have a lien upon the property upon which they have bestowed labor or furnished material for the value of such labor done and materials furnished; and the Legislature shall provide, by law, for the speedy and efficient enforcement of such liens.
But how does that constitutional right stand up against contractual rights? Not so well it seems.
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Garret Murai, Kronick Moskovitz Tiedemann & GirardMr. Murai may be contacted at
gmurai@kmtg.com
More (and Simpler) Options Under New Oregon Retention Law
October 21, 2024 —
Michael Yelle - Ahlers Cressman & Sleight PLLCSimilar to the changes made by the Washington Legislature last year, the Oregon Legislature recently changed its retention law. Oregon public works agencies and large commercial project owners are now required to accept surety bonds in lieu of withholding retainage on construction projects. There is also no longer a requirement to deposit retention funds in an interest-bearing escrow account.
The owner or public agency must accept the bond in lieu of retainage unless specific grounds exist. For example, public agencies must find there is “good cause” for rejection of the bond based on the “unique project circumstances. Private owners have less discretion to reject a bond and if the bond meets the statutory requirements, per ORS 701.435(1)(a) “the owner and lender shall accept” the bond “in lieu of all or any portion of the retainage…”
Courts have not analyzed when “good cause” exists for public agencies to reject bonds or exactly what will allow a private owner to reject a bond. However, an agency or owner cannot have a general policy to reject retention bonds. The statute does not provide next steps if the contractor disagrees with a decision to reject the bond. It may be necessary to proceed under the contract’s dispute resolution procedure or it may be more appropriate to take the issue directly to the courts.
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Michael Yelle, Ahlers Cressman & Sleight PLLCMr. Yelle may be contacted at
michael.yelle@acslawyers.com
Supreme Court Addresses Newly Amended Statute of Repose for Construction Claims
June 26, 2023 —
David R. Cook Jr. - Autry, Hall & Cook, LLPWe have been following the protracted legal battle concerning
Southern States Chemical, Inc. v. Tampa Tank & Welding, Inc. This case had been litigated at the Supreme Court and resulted in legislation. In the latest round, the Supreme Court answered whether Georgia’s statute of repose for construction claims applies to claims arising or brought before the statute was amendment in 2020.
What is a Georgia’s statute of repose? Under the statute, “[n]o action to recover damages: (1) For any deficiency in the survey or plat, planning, design, specifications, supervision or observation of construction, or construction of an improvement to real property; (2) For injury to property, real or personal, arising out of any such deficiency; or (3) For injury to the person or for wrongful death arising out of any such deficiency shall be brought against any person performing or furnishing the survey or plat, design, planning, supervision or observation of construction, or construction of such an improvement more than eight years after substantial completion of such an improvement.”
The case began ten years ago when Southern States suited Tampa Tank and Corrosion Control for alleged defects in renovating a 24-foot tall, 130-foot wide storage tank. The tank renovation was completed in 2002, and in 2011, the tank was found to leak sulfuric acid.
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David R. Cook Jr., Autry, Hall & Cook, LLPMr. Cook may be contacted at
cook@ahclaw.com