Cambridge Massachusetts Building Expert Directory

My Construction Law Wish List

December 31, 2014 — Garret Murai – California Construction Law Blog
I’ve been good this year. Not great mind you, but good, and good is the standard, right? So, here’s my construction law wish list this holiday season: 1.More Transparency. So much uncertainty and resultant litigation exists for the simple reason that contractors and subs don’t know when a higher tiered contractor or owner (on a lender financed project) has been paid for their work. So how about a requirement that owners, contractors and subcontractors of all tiers be required to disclose when payment applications are submitted, when payments are made and in what amount, and what pay applications have been paid. And because I’m pretty sure I’m at least within the 20th percentile of “good” this year how about a requirement that this information be provided through an online database accessible by all persons working on projects valued at over a certain dollar amount, say $500,000. Read the court decision
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Reprinted courtesy of Garret Murai, Wendel Rosen Black & Dean LLP
Mr. Murai may be contacted at gmurai@wendel.com

The Prompt Payment Rollercoaster

February 23, 2016 — Garret Murai – California Construction Law Blog
This past year we wrote about a case involving California’s prompt payment laws and the current state of confusion with the prompt payment statutes which are scattered throughout the state Code and which are inconsistent in the use of their terminology and, thus importantly, application. In United Riggers & Erectors, Inc. v. Coast Iron & Steel Co., California Court of Appeals for the Second District, Case No. B258860 (December 18, 2015), the Court of Appeals for the Second District addressed whether under one of the prompt payment statutes, Civil Code section 8814, a general contractor may withhold retention without being subject to prompt payment penalties if there is a dispute of any kind between the general contractor and the subcontractor, or only when the dispute relates to the retention itself. Read the court decision
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Reprinted courtesy of Garret Murai, Wendel Rosen Black & Dean LLP
Mr. Murai may be contacted at gmurai@wendel.com

Out of the Black

May 30, 2022 — John Drentlaw - Construction Executive
Even if you previously weren’t familiar with the term “black swan event,” you’ve likely become intimately familiar with what one looks like over the past two years. Coined by author Nassim Taleb in his book The Black Swan: The Impact of the Highly Improbable, the term refers to a rare, unpredictable event—perhaps, say, a pandemic—that has an extreme impact. “Extreme” certainly seems to be an accurate description of the impact that the COVID-19 pandemic has had on the construction industry, at nearly every level. The Commercial Construction Index (CCI) fell from 74 to 56 during Q2 2020 and remained statistically unchanged through Q3 of that year. Recovery has been slow, with the CCI remaining eight points below pre-pandemic levels through the end of 2021. Prices for raw materials such as lumber and steel have been extremely volatile, reaching historic highs and dramatic lows. March and April of 2020 alone saw 1.1 million jobs disappear from the industry—roughly half as many jobs as were lost throughout the entire Great Recession (although many of these jobs have since returned). While the industry has persevered through what should be the worst of these effects, many contractors and project owners are now wondering: How can we predict the next black swan event? Reprinted courtesy of John Drentlaw, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the court decision
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CC&Rs Not the Place for Arbitration Agreement, Court Rules

May 24, 2011 — CDJ STAFF

In January, the California Court of Appeals ruled that an arbitration clause inserted in a development’s CC&Rs by the developer could not be enforced. The case, Villa Vicenza Homeowners Association v. Noble Court Development, involved a case in which, according to the opinion, “following the first sale Nobel controlled the board of directors of the Association and because the initial condominium buyers noticed defects in common areas and common facilities and did not believe Nobel had provided a reserve fund sufficient to repair the defects, the condominium owners brought a derivative action on behalf of the Association against Nobel.”

The court concluded, “The use of CC&R's as a means of providing contractual rights to parties with no interest in or responsibility for a common interest development is also problematic from the standpoint of determining what if any consideration would support such third-party agreements. By their terms the CC&R's bind all successors, even those with whom a third party such as Nobel has never had any contractual relationship and to whom Nobel has not provided any consideration.” The court determined that “the trial court did not err in denying Nobel's motion to compel arbitration.”

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Delaware State Court Holds that Defective Workmanship Claims do not Trigger Coverage by a Builder’s Commercial General Liability Policy

April 15, 2015 — Marc S. Casarino – White and Williams LLP
Guided by federal case law, on March 31, 2015 a Delaware state court held for the first time in Westfield Ins. Co. v. Miranda & Hardt Contracting and Building Services LLC that a builder’s poor workmanship is not an occurrence for which the builder’s insurance policy affords coverage. In the underlying case giving rise to the coverage dispute, a homeowner alleged that a builder deviated from approved building plans, used inadequate materials, improperly installed materials, violated building codes, and fraudulently represented that a home was properly constructed. The homeowner sued the builder under theories of negligence, negligence per se, and fraud. The insurer denied the builder’s request for defense and indemnification for the homeowner’s claims, citing in part that the allegations of defective workmanship did not qualify as an “occurrence” as defined by the builder’s insurance policy. The builder did not dispute that the underlying complaint alleged defective workmanship. However, the builder asserted that because it had not yet been proven that its work was defective, the insurer had prematurely denied coverage. The court properly rejected the builder’s argument, and reiterated that under Delaware law the court must compare the allegations of the complaint to the insurance policy terms to make a coverage determination. Whether the complaint’s allegations are ultimately meritorious is irrelevant to the initial coverage determination according to the court. Read the court decision
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Reprinted courtesy of Marc S. Casarino, White and Williams LLP
Mr. Casarino may be contacted at casarinom@whiteandwilliams.com

Georgia Legislature Passes Additional Procurement Rules

May 30, 2018 — David R. Cook Jr. - Autry, Hall & Cook, LLP
On May 3, 2018, Governor Nathan Deal signed HB 899 into law, officially making it Act 389. Act 389 modifies O.C.G.A. § 13-10-4 and § 36-91-23 relating to public works bidding and contracts of state and local governments, respectively. Both sections are modified in the same bill because they contain the same language. The bill prohibits the disqualification of bidders based upon lack of previous experience with the project’s desired construction delivery method. Before the modifications, the code protected a contractor from disqualification only for lack of previous experience on a job of comparable size. After the modification, the law expands to prohibit disqualification based on lack of previous experience with comparable job size and lack of previous experience with the construction delivery method. Read the court decision
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Reprinted courtesy of David R. Cook Jr., Autry, Hall & Cook, LLP
Mr. Cook may be contacted at cook@ahclaw.com

Payment Bond Claim Notice Requires More than Mailing

August 04, 2015 — Christopher G. Hill – Construction Law Musings
It’s been a while since I posted something new relating to Virginia’s “Little Miller Act” and its various notice requirements for a subcontractor to make a payment bond claim. I have posted on the basics of a Virginia payment bond claim previously here at Musings. One of these basics is the 90 day notice requirement for suppliers or second tier subcontractors with no direct contractual relationship to the general contractor. A recent case from the Norfolk, Virginia Circuit Court examined when notice is “given” under the Little Miller Act. In R T Atkinson Building Corp v Archer Western Construction, LLC the Court looked at the question of whether mailing of the notice of claim is enough to constitute notice being “given” in a manner that would satisfy the statutory requirements. In that case, the supplier mailed the notice within the 90 day window, but the defendant argued on summary judgment that it did not receive the notice until 2 days after the 90 day window had closed. In support of this contention, the defendant provided tracking information showing delivery by the USPS on the non-compliant date. Read the court decision
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Reprinted courtesy of Christopher G. Hill, Law Office of Christopher G. Hill, PC
Mr. Hill may be contacted at chrisghill@constructionlawva.com

Evergrande’s Condemned Towers on China’s Hawaii Show Threat

January 24, 2022 — Bloomberg News
The wrecking ball headed for 39 apartment blocks on a tropical island at the southern tip of China poses the latest threat for China Evergrande Group as local governments race to reclaim land ahead of a looming restructuring of the embattled developer. The government of Danzhou, a city in the province of Hainan, has asked Evergrande to tear down what it says are illegal buildings within 10 days. The order was signed Dec. 30, meaning the company could start demolition work on the near-complete condos by Jan. 9. Evergrande has appealed the order, according to a media report. The Hainan edict is among the most extreme in a spate of government actions to seize Evergande’s property and land holdings, underscoring risks to its most-prized assets as the firm prepares for what could be the largest restructuring ever in China. In recent months, at least 11 land parcels have been targeted for confiscation by local authorities for reasons ranging from idle projects to missing fee payments. Read the court decision
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Reprinted courtesy of Bloomberg

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