Embracing Generative Risk Mitigation in Construction
February 12, 2024 —
Georgia Stillwell - Construction ExecutiveProject delays have long plagued the construction industry, with risk often identified as the primary culprit. However, finding effective solutions to mitigate risk on complex projects has remained daunting. Traditional methods for simulating risk primarily focus on extending project timelines, overlooking the diverse range of opportunities available for risk mitigation. With the construction industry’s digital transformation, generative methodologies have emerged to handle complex decision-making in uncertain situations. This article aims to shed light on the limitations of existing risk modeling and introduce a novel approach known as generative risk mitigation to enhance decision-making under deep uncertainty.
According to McKinsey, 98% of megaprojects experience cost overruns exceeding 30%. Project delays have become so pervasive that the industry has grown accustomed to them. For example, in 2022, the UK government issued ‘
The Green Book,’ which requires contingency funds in projects, such as a 44% contingency budget for standard civil projects. This implies that for a $100 million project, you should allocate $144 million to manage expected risks. There is no denying significant academic literature on the root cause of these delays: it is ‘risk,’ and there is an entire industry based on it.
Conversations with project directors and risk experts reveal the same issue, different project. And that issue is that we cannot easily forecast risk, qualify the impacts or fully understand the opportunities that exist to mitigate risks and make timely decisions. A method that will finally help us overcome this has emerged within the industry.
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Georgia Stillwell, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Location, Location, Location—Even in Construction Liens
October 28, 2015 —
Craig Martin – Construction Contractor AdvisorWe all know the importance of filing a construction lien within 120 days of your last work. Nebraska Construction Lien Act, § 52-137. But, equally, if not more important is filing the construction lien on the correct property.
Often times on a construction project, the exact address of the project may not be known. And, if there are a few buildings going up on the same general site, it is difficult to determine which property or building address you are working on.
Sometimes you can look at the contract. For example, the AIA family of documents lists the address on the first page. But, what if the wrong address is listed? What if the wrong owner is listed?
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Craig Martin, Lamson, Dugan and Murray, LLPMr. Martin may be contacted at
cmartin@ldmlaw.com
Robinson+Cole’s Amicus Brief Adopted and Cited by Massachusetts’s High Court
July 31, 2024 —
Erica Whaley - Construction Law ZoneEarlier this year, the
Associated Subcontractors of Massachusetts hired Robinson+Cole attorney
Joseph Barra to submit an amicus brief to the Massachusetts Supreme Judicial Court for consideration in the appeal pending before it in
Business Interiors Floor Covering Business Trust v. Graycor Construction Co., Inc. In its June 17, 2024 decision in that case, the Court interpreted the Massachusetts Prompt Pay Act, which applies to private construction projects and “requires that parties to a construction contract approve or reject payment within” an allotted time period and in compliance with certain procedures else such payments will be deemed approved. Two years ago, the Massachusetts Appeals Court, in
Tocci Building Corp. v. IRIV Partners, LLC, decided that an owner who fails to timely advise its general contractor of the reasons as to why it was withholding payment, coupled with failure to certify that such funds are being withheld in good faith, violates the Prompt Pay Act and makes the owner liable for funds owed.
[1] However, the Tocci Building Court left open the question of whether one who violates the Prompt Pay Act forfeits its substantive defenses to non-payment, such as fraud, defective work, or breach of material obligation of the contract.
The facts of Business Interiors involve a general contractor, Graycor, which subcontracted Business Interiors to perform certain flooring work for a movie theatre in Boston’s North End. When Graycor failed to formally approve, reject, or certify, in good faith, its withholding of payment of three of Business Interiors’ applications for payment as prescribed by the Prompt Pay Act, Business Interiors brought suit alleging, among other things, breach of contract. Business Interiors then moved for summary judgement arguing that Graycor’s failure to comply with the Act rendered it liable for the unpaid invoices.
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Robinson + Cole
Construction Defects Are Not An Occurrence Under New York, New Jersey Law
June 18, 2014 —
Tred R. Eyerly – Insurance Law HawaiiThe New York Supreme Court, Appellate Division, determined there was no coverage for construction defects under New York or New Jersey law. Nat'l Union Fire Ins. Co. of Pittsburgh, PA v. Turner Constr. Co., 2014 N.Y. App. Div. LEXIS 3546 (N.Y. App. Div. May 15, 2014).
The property owner retained Turner Construction to serve as the general contractor. Turner subcontracted with Permasteelisa North America Corporation to design and build the exterior wall, a "curtain wall," which consisted of granite and glass.
A segment of the pipe rail system fell to the street from the eighth floor of the building. An investigation determined that more than 20% of the pipe rail connections surveyed did not conform to the building plans. Additional problems included inconsistencies in the method of rail attachment, bent brackets on the pipe rail system, cracked glass louvers, cracked glass panels, and water infiltration.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
First Quarter Gains in Housing Affordability
May 20, 2015 —
Beverley BevenFlorez-CDJ STAFFAccording to the National Association of Home Builders’ (NAHB) Eye on Housing, the combination of low interest rates and home prices has provided a “solid boost in nationwide affordability in the first quarter of 2015.” Furthermore, “66.5 percent of new and existing homes sold between the beginning of January and end of March were affordable to families earning the U.S. median income of $65,800.” Syracuse, New York remained the U.S.’s most affordable major housing market, while the San Francisco-San Mateo-Redwood City, California region was the nation’s least affordable major housing market. All five of the least affordable small housing markets were in California.
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Roots of Las Vegas Construction Defect Scam Reach Back a Decade
August 05, 2013 —
CDJ STAFFRecent court documents in the Las Vegas HOA scandal reveal that the late Nancy Quon, thought to be a mastermind in the scam was involved with a similar case before 2001. The Las Vegas Review-Journal reports that the Nevada attorney general’s office launched an investigation of the Starfire condominium complex. Claims were made that an architect and a construction company attempted to fill the Starfire board with straw buyers. Quon represented a resident to filed a claim over defective windows.
Chris Rasmussen, the attorney for Edith Gillespie, Leon Benzer’s half sister, has noted that his client was not charged in the Starfire case, but the Review-Journal notes that no one was, as the insurance company settled quickly, which ended the chances for a criminal investigation. The Starfire case is described as “a $6 million lawsuit based on fraudulent construction defect claims.” Quon, Benzer, and their co-conspirators are alleged to have modeled their subsequent actions after Starfire.
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Construction Defect Claim Not Timely Filed
January 27, 2020 —
Ryan M. Charlson - Florida Construction Law NewsIf construction defect claims are not timely filed, Florida Statutes provide design and construction companies with a formidable defense. As a case in point, a Miami-Dade Circuit Court Judge issued an Order granting summary judgment based on Fla. Stat. § 95.11(3)(c), Florida’s Statute of Limitations governing actions founded on alleged construction defects.
In Covenant Baptist Church, Inc. v. Vasallo Construction, Inc. and Lemartec Engineering & Construction Corporation, Plaintiff alleged multiple construction defects against two Defendants. The alleged defects were focused on water intrusion through the roofing systems and were known to the Plaintiff on August 13, 2006. However, four years and eleven months later, Plaintiff filed suit acknowledging that the building had “been plagued with water intrusion issues for a number of years,” and that Plaintiff’s complaints “regarding the water intrusion [had] been met largely with ‘band-aid’ type ineffective repairs.”
Lemartec Engineering & Construction Corporation (“Lemartec”), filed a Motion for Summary Judgment as to multiple counts and rested its Motion squarely on the shoulders of Florida’s four-year statute of limitations. Importantly, the statute begins to run “where there has been notice of an invasion of legal rights or a person has been put on notice of his right to a cause of action” Snyder v. Wernecke, 813 So.2d 213,216 (Fla 4th DCA 2002) (citing City of Miami v. Brooks, 70 So.2d 306 (Fla. 1954)). Plaintiff attempted to bypass the four-year nature of the statute by trying to classify the defects in question as latent.
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Ryan M. Charlson, Cole, Scott & KissaneMr. Charlson may be contacted at
Ryan.Charlson@csklegal.com
Skanska Will Work With Florida on Barge-Caused Damage to Pensacola Bay Bridge
October 19, 2020 —
Jim Parsons - Engineering News-RecordFlorida Dept. of Transportation investigators continue to assess damage to the Pensacola Bay Bridge, which sustained multiple impacts from two construction barges unmoored by Hurricane Sally’s storm-driven waves on Sept. 15.
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Jim Parsons, Engineering News-Record
ENR may be contacted at ENR.com@bnpmedia.com
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