Do You Really Want Mandatory Arbitration in Your Construction Contract?
June 25, 2019 —
Christopher G. Hill - Construction Law MusingsIf you are in construction, you have likley run across (or even drafted) a dispute resolution provision into your construction contract. If you’ve been building for any length of time, you’ve read dispute resolution provisions containing mandatory arbitration clauses. These clauses can be found in the AIA documents and in many of the contracts that I review for my clients in my role as construction lawyer and counselor. More often than not, these arbitration clauses require arbitration (read “private court”) and refer to one of several sets of rules, though most likely the American Arbitration Association (“AAA”) Construction Industry rules. In Virginia, as in most of the United States, these clauses are read liberally and enforced by courts except in limited cases such as waiver.
The main justification for requiring arbitration over litigation is to avoid the fees and expense of the litigation process. In the right circumstances, arbitration does just that. With a carefully drafted arbitration clauses and with the right case that requires expertise in construction that a judge does not have (they have to liten to all manner of disputes so are necessarily generalists), arbitration can and should be a streamlined and less expensive version of litigation.
However, in my time as a construction attorney, I have more often run into situations where the arbitration process is at least equally expensive and frankly not much more streamlined. The additional administrative burden coupled with the possibility of paying for at least half of the hourly charges of one to three arbitrators is often not worth the additional expertise of those arbitrators. Many construction claims simply come down to non-payment and whether the work was performed properly. In my opinion, the fine judges in the Commonwealth of Virginia are more than capable of hearing this evidence and making a ruling.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Legislation Update: S-865 Public-Private Partnerships in New Jersey Passed by Both Houses-Awaiting Governor’s Signature
July 02, 2018 —
Steven M. Charney & Charles F. Kenny - Peckar & Abramson, P.C.New Jersey is finally close to being among the many states with broad authority to develop or improve public projects through a Public-Private Partnership (P3) delivery method. This contracting model has stimulated growth and improvements in other States and led to the delivery of projects that may not otherwise have happened. Senate Bill 865 (“S-865”), after undergoing some last-minute amendments in a frenzied legislature dealing with budget and other critical issues, has passed in both houses of the Legislature and is waiting for Governor Murphy’s signature, which is expected shortly. The law will be effective 180 days from formal enactment. The administrative framework is now in place to make Public-Private Partnerships a reality in New Jersey.
Reprinted courtesy of
Steven M. Charney, Peckar & Abramson, P.C. and
Charles F. Kenny, Peckar & Abramson, P.C.
Mr. Charney may be contacted at scharney@pecklaw.com
Mr. Kenny may be contacted at ckenny@pecklaw.com
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Golden Gate Bridge's $76 Million Suicide Nets Near Approval
June 30, 2014 —
Alison Vekshin – BloombergOfficials of the agency that runs San Francisco’s Golden Gate Bridge today approved a $76 million funding plan to erect a suicide barrier along the span, where people plunge to their deaths at a rate of about once a week.
The Golden Gate Bridge Highway and Transportation District’s 19-member board voted unanimously to approve the funding, which includes $20 million from district reserves.
“We must fight mental illness on many fronts and this budget action is a critical component of saving the lives of people who might not see that their brightest days are ahead of them,” Senator Mark Leno, a Democrat from San Francisco, said in a news release yesterday ahead of the meeting.
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Alison Vekshin, BloombergMs. Vekshin may be contacted at
avekshin@bloomberg.net
Edgewater Plans to Sue Over Pollution During Veterans Field Rehab
August 13, 2014 —
Beverley BevenFlorez-CDJ STAFFIn New Jersey, “Borough officials have announced plans to sue ‘all responsible parties’ over new contaminants inadvertently brought onto Veterans Field during soil remediation that was halted last year,” reported The Record.
According to The Record, Waterside Construction “trucked in contaminated crushed concrete” and has “been in mediation for months” with the borough over the issue.
“Waterside violated the sanctity of the public trust by improperly disposing of PCB waste materials at Veterans Field,” Timothy Corriston, special counsel to the borough, told The Record. “They believe that others are partly responsible. That is ultimately what will be litigated.”
Spokesman Alan Marcus wrote in an email to The Record, “Waterside continues to be willing to participate in mediation and hopes to reach an amicable settlement among all of the parties.”
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Navigating the New Landscape: How AB 12 and SB 567 Impact Landlords and Tenants in California
March 11, 2024 —
Sharon Oh-Kubisch - Kahana FeldThere are various changes in the Landlord-Tenant laws in CA that became effective in 2024.
For the purposes of this article, I wanted to focus on Assembly Bill (AB) 12 and Senate Bill (SB) 567 only.
Governor Gavin Newsom recently signed AB 12 into law, a legislation that limits the amount landlords can charge for security deposits to just one month’s rent for unfurnished apartments. While the law aims to make housing more accessible, it raises several concerns for landlords and tenants alike. AB 12, was authored by Assemblyman Matt Haney, D-San Francisco; it passed both the Senate and the Assembly houses in September. The legislation introduces a notable shift from existing law, under which landlords can charge up to two months’ rent for an unfurnished unit and three months’ rent for a furnished one. This exception does not apply when the prospective tenant is a military service member, however.
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Sharon Oh-Kubisch, Kahana FeldMs. Oh-Kubisch may be contacted at
sokubisch@kahanafeld.com
Mercury News Editorial Calls for Investigation of Bay Bridge Construction
July 01, 2014 —
Beverley BevenFlorez-CDJ STAFFEditors at the San Jose Mercury News called for investigations of the construction of the new eastern span of the Bay Bridge: “It's time for public officials, especially members of the Metropolitan Transportation Commission, state legislators and Gov. Jerry Brown, to demand thorough independent analyses.”
Problems with the $6.5 billion structure were found about nine months ago, which led to questions regarding the “integrity and maintenance costs” that were allegedly covered up by Caltrans officials. Issues raised included questions “about the strength of thousands of bolts, including at the base of the tower and the connections of the main cable; cracked welds in the suspension span; and rusting of the single cable holding up the bridge.”
The Mercury editors, however, do not show much optimism about the situation: “It's likely that, absent a political outcry, Caltrans will sign off. From the start, agency officials have failed to adequately oversee the construction and thrown public money at problems while trying to cover-up their own failures. Brown, ultimately responsible for Caltrans, has dismissed concerns about the bridge's integrity.”
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Construction Contract Clauses Which Go Bump in the Night – Part 1
November 10, 2016 —
Garret Murai – California Construction Law BlogScope, time and cost provisions may be the most important clauses in your construction contract but they’re not the only ones which can impact your bottom line. The first in a multi-part series, here are some other important construction contract clauses you may (or may not realize you should) be losing sleep over.
Provision: Incorporation and Flow-Down Provisions
- Typical Provision: “The term ‘Contract Documents’ shall include, without limitation, the Prime Contract, drawings, specifications and other agreements between Contractor and Owner, insofar as they relate in any way, directly or indirectly, to Subcontractor’s Work under this Agreement, and are hereby incorporated by reference. Subcontractor agrees to be bound to Contractor in the same manner and to the same extent as Contractor is bound to Owner under the Contract Documents. Where, in the Contract Documents, reference is made to Contractor, and the work and specifications therein pertain to Subcontractor’s trade, craft, or type of work, such work or specifications shall be interpreted to apply to Subcontractor rather than Contractor.”
- What it Means: An incorporation provision literally “incorporates” another document or documents into a contract by merely referring to them by title or description and it is not uncommon for a lower-tiered contractor to never see those documents.
A flow-down provision requires a lower-tiered contractor to comply with all obligations which a higher-tiered contractor, typically a direct contractor, owes to a higher-tiered party, typically, the owner. The intent of the provision to ensure that a lower-tiered subcontractor has no greater rights against a direct contractor has against the owner.
- What You Can Do: Lower-tiered contractors should obtain a copy of all documents to be incorporated into their contract and review them to ensure that they understand the obligations and any limitations to their rights.
Lower-tiered contractors should also seek to include language requiring that a higher-tiered contractor assume toward the lower-tiered contractor all obligations and limitations on their rights that the owner assumes toward or is subject to with respect of the general contractor.
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Garret Murai, Wendel Rosen Black & Dean LLPMr. Murai may be contacted at
gmurai@wendel.com
Stop by BHA’s Booth at WCC and Support the Susan G. Komen Foundation
May 12, 2016 —
Beverley BevenFlorez-CDJ STAFFIf you’re attending the annual West Coast Casualty Seminar at the Disneyland Hotel today and tomorrow, be sure to stop by the Bert L. Howe & Associates, Inc., booth and
Sink a Putt for Charity. This year, participant’s efforts
on the green will help benefit the Susan G. Komen Race for the Cure. As in years past, sink a putt in the BHA golf challenge and win a $25 Best Buy gift card, and for every successful putt made, BHA will make a $25 cash donation in the golfer’s name to the Susan G. Komen Foundation.
New this year, BHA is hosting three
Championship Rounds and during those periods BHA will double their charitable contributions. For every ATTEMPTED (sink or miss), BHA will make a $50 donation to Susan G. Komen, and for every putt MADE (sunk), the golfer will also win a $50 Best Buy gift card.
Championship rounds are going on today between the times of 10:30am-10:45 am, 3:00pm-3:30pm, and 5:30pm-6:30pm. So be sure to get over to the BHA booth for your chance to support important cancer research as well as possibly taking home a nice gift card for yourself.
BHA also wishes to thank Dave Stern for all of his hard work for the construction defect community in putting together this
must go to seminar and for promoting such worthwhile charities each year.
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