Construction Trust Fund Statutes: Know What’s Required in the State Where Your Project Is Underway
June 22, 2020 —
Christopher D. Cazenave - ConsensusDocsConstruction trust fund statutes have been around for decades. At least 15 states have passed similar statutes. Other states, but not all, do not have an express statute but have interpreted state law to hold that payments received by a general contractor and deposited in a business account establishes a “trust fund.” See e.g., Cal. Bus. & Prof. Code § 7108.
The purpose of these laws is straightforward—protect contractors and suppliers against nonpayment for the labor and materials provided for the construction or repair of property. But while the purpose is straightforward, each state’s law differs by imposing different requirements, different privileges, and different remedies. This article provides an overview of how these statutes work as well as a sampling of important requirements and potential pitfalls that you should look out for when a construction trust fund statute applies to your project.
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Christopher D. Cazenave, Jones Walker LLPMr. Cazenave may be contacted at
ccazenave@joneswalker.com
Construction Payment Remedies: You May be Able to Skate by, But Why?
April 06, 2016 —
Garret Murai – California Construction Law BlogMy grandfather used to say that “anything worth doing, is worth doing well.”
It wasn’t until later that I learned the quote wasn’t his, but a quote from Philip Stanhope the Fourth Earl of Chesterfield, who said in his posthumously published and quite lengthily titled Letters to His Son on the Art of Becoming a Man of the World and a Gentleman, that “whatever is worth doing at all, is worth doing well.” I’m not sure where my grandfather, who wasn’t a man of letters, picked up this quote, but I like his version better.
While “anything worth doing, is worth doing well” can be said to apply to a wide variety of things in life, including living itself, it applies equally to the world of construction payment remedies, which have requirements that are both detailed and deadline driven.
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Garret Murai, Wendel Rosen Black & Dean LLPMr. Murai may be contacted at
gmurai@wendel.com
Norfolk Southern Agrees to $310M Settlement With Feds Over 2023 Ohio Derailment
June 21, 2024 —
James Leggate - Engineering News-RecordNorfolk Southern Corp. has agreed to pay more than $310 million and implement safety improvements as part of a settlement with the U.S. Environmental Protection Agency and U.S. Dept. of Justice over the disastrous February 2023 train derailment in East Palestine, Ohio, officials and the company announced May 23.
Reprinted courtesy of
James Leggate, Engineering News-Record
Mr. Leggate may be contacted at leggatej@enr.com
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A Chicago Skyscraper Cements the Legacy of a Visionary Postmodern Architect
December 31, 2024 —
Mark Byrnes - BloombergA handsome and eclectic stretch of buildings along Michigan Avenue known as “Chicago’s Front Door” offers a view that reflects the city’s status as a destination for serious architecture. Louis Sullivan and Dankmar Adler’s Auditorium Building, where a young Frank Lloyd Wright designed interiors, is right there on Grant Park; so is Daniel Burnham’s Railway Exchange, where he drew up the 1909
Plan of Chicago.
Now a glass-and-aluminum apartment tower anchors the southern end of this scene, filling in a rare gap within this landmarked
streetwall and putting a bow on the career of another heroic figure in Chicago’s architectural history: Helmut Jahn.
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Mark Byrnes, Bloomberg
First-Time Homebuyers Make Biggest Share of Deals in 17 Years
February 22, 2018 —
Prashant Gopal – BloombergMillennials are playing homeownership catch-up.
First-time buyers rushed into the market last year, making 38 percent of all U.S. single-family home purchases, the biggest share since 2000, data released Thursday by Genworth Mortgage Insurance show. The 2.07 million new or existing homes bought by first-timers was 7 percent more than in 2016, according to the insurer, part of
Genworth Financial Inc.
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Prashant Gopal, Bloomberg
Texas Supreme Court Rules on Contractual Liability Exclusion in Construction Cases
January 22, 2014 —
Beverley BevenFlorez-CDJ STAFFThe Texas Supreme Court ruled on Ewing v. Amerisure Ins. Co. on January 17th, a “much-anticipated” decision according to Carl A. Salisbury of Kilpatrick Townsend & Stockton LLP. “Construction projects are always the subject of contracts among owners and contractors” Salisbury stated in his article on Lexology.com. The recent decision demonstrates that “an exclusion in the standard Comprehensive Liability Insurance policy that precludes coverage for ‘liabilities assumed under contract’” does not usually “apply to construction contracts.”
In 2008, Ewing Construction Company built a set of tennis courts in Corpus Christi, according to Salisbury. “Shortly after construction was complete, according to the school district, ‘the courts started flaking, crumbling, and cracking, rendering them unusable for their intended purpose of hosting competitive tennis events.’” After the school district sued Ewing in state court, Ewing “turned the suit over to Amerisure, its CGL insurer, seeking a defense and indemnity. Amerisure denied all coverage, citing the contractual liability exclusion in its policy. This inspired Ewing to sue the carrier in federal district court for the Southern District of Texas.”
After several rulings and appeals, the case eventually reached the Texas Supreme Court: “According to the Ewing court, the contract claims that Ewing failed to perform in a good and workmanlike manner ‘are substantively the same as its claims that Ewing negligently performed under the contract because they contain the same factual allegations and alleged misconduct.’ Failure to perform in a ‘good and workmanlike manner’ is functionally and substantively the same as performing negligently. ‘Accordingly,’ the Ewing court said, ‘we conclude that a general contractor who agrees to perform its construction work in a good and workmanlike manner, without more, does not enlarge its duty to exercise ordinary care in fulfilling its contract, thus it does not ‘assume liability’ for damages arising out of its defective work so as to trigger the Contractual Liability Exclusion.’”
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COVID-19 Response: California Occupational Safety and Health Standards Board Implements Sweeping New Regulations to Prevent COVID-19 in the Workplace
December 14, 2020 —
Peter Shapiro, Drake Mirsch & Jade McKenzie - Lewis BrisboisOn November 19, 2020, the California Occupational Safety and Health Standards Board (OSHSB) proposed sweeping and significant new emergency standards to reduce employee exposure to COVID-19. These standards have been accepted by the Office of Administrative Law and are effective as of November 30, 2020. Accordingly, it is critical that employers familiarize themselves with these new requirements and begin to implement these standards as quickly as possible.
The standards include COVID-19 prevention in the workplace, multiple COVID-19 infections and outbreaks in the workplace, “major” COVID-19 outbreaks in the workplace, prevention in employer provided housing, and prevention in employer-provided transportation to and from work. They apply to all California employers and places of employment, except places with one employee who does not have contact with others, employees working from home, or employees in specified health care facilities, services or operations when covered by section 5199.
COVID-19 Prevention Program
Employers are required to establish, implement, and maintain an “effective” written COVID-19 Prevention Program. Under the Program, an employer is responsible for developing a system for communicating about COVID-19, identifying and evaluating COVID-19 hazards, investigating and responding to COVID-19 cases, correcting COVID-19 hazards, providing training and instructions to employees regarding COVID-19, ensuring all employees are physically distanced, providing face coverings, implementing policies regarding personal protective equipment and recordkeeping, ensuring COVID-19 cases are excluded from the workplace, and prohibiting symptomatic employees from returning to work unless certain requirements are met.
Reprinted courtesy of
Peter Shapiro, Lewis Brisbois,
Drake Mirsch, Lewis Brisbois and
Jade McKenzie, Lewis Brisbois
Mr. Shapiro may be contacted at Peter.Shapiro@lewisbrisbois.com
Mr. Mirsch may be contacted at Drake.Mirsch@lewisbrisbois.com
Ms. McKenzie may be contacted at Jade.Mckenzie@lewisbrisbois.com
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Your Bad Faith Jury Instruction Against an Insurer is Important
March 09, 2020 —
David Adelstein - Florida Construction Legal UpdatesA statutory bad faith claim against an insurer is derived from Florida Statute s.
624.155. A bad faith claim against a first party insurer, such as a property insurer, must be statutory. Check out the hyperlink of the statute, but a party must first file a Civil Remedy Notice identifying the statutory violations to preserve the statutory bad faith claim giving the insurer an opportunity to cure.
In a noteworthy case, Cooper v. Federated National Insurance Company, 44 Fla. L. Weekly D2961a (Fla. 5th DCA 2019), the Fifth District Court of Appeal dealt with the jury instruction for an insured’s statutory bad faith claim against their property insurer. The insured filed a bad faith claim predicated on the property insurer violating the provisions of Florida Statute s.
626.9541(1)(i)3, which involves unfair claim settlement practices. The insured had a jury trial and submitted a proposed jury instruction regarding bad faith that tracked the very essence of their bad faith claim and was modeled after s. 626.9541(1)(i)(3). The trial court, however, denied this jury instruction, instead adopting a standard jury instruction for bad faith. The jury returned a verdict in favor of the property insurer and the insured appealed arguing it was reversible error for the trial court NOT to present to the jury their bad faith jury instruction. The Fifth District agreed and ordered a new trial finding that the trial court’s failure to present the jury instruction amounted to a miscarriage of justice.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com