Exculpatory Provisions in Business Contracts
May 30, 2018 —
David Adelstein - Florida Construction Legal UpdatesAn exculpatory provision in a contract is a provision that relieves one party from liability for damages. It shifts the risk of an issue entirely to the other party. Such a provision is generally drafted by the party preparing the contract that is looking to eliminate or disclaim liability associated with a particular risk, oftentimes a risk within their control. These provisions are also known as limitation of liability provisions because they do exactly that — limit liability as to a risk. For this reason, they can be useful provisions based on the context of certain risks, and are provisions that are included in business contracts (such as construction contracts).
While such clauses are disfavored, they are enforceable if they are drafted clearly, unambiguously, and unequivocally. If they are unclear, ambiguous, or equivocal, they will construed against enforcement. See Obsessions In Time, Inc. v. Jewelry Exchange Venture, LLP, 43 Fla.L.Weekly D1033a (Fla. 3d DCA 2018) (finding exculpatory clause in lease ambiguous and, therefore, unenforceable as to lessor looking to benefit from the exculpatory clause).
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David Adelstein, Florida Construction Legal UpdatesMr. Adelstein may be contacted at
dadelstein@gmail.com
Updates to AIA Contract Applications
January 07, 2025 —
Anand Gupta - Construction Law Zone BlogThe construction industry often relies on contract forms drafted by the American Institute of Architects (AIA). These AIA forms include agreements between owners, designers, consultants, contractors, subcontractors, and construction managers. Some prefer to use the forms in the stock form, but others prefer to modify the language to their benefit. These modifications can be made in Microsoft Word and uploaded into AIA’s current web-based system, ACD5, to create redlines against the standard AIA forms (Checked-Drafts) and final clean versions without the “DRAFT” watermarks. Law firms and clients keep repositories of these modified templates for future projects.
A common issue with modifying documents offline in Microsoft Word and passing the documents back-and-forth between different email and document management systems is that the metadata of the forms becomes corrupted. AIA technical support then must reset the metadata, which takes hours or days. This delay can pose challenges to clients when they are up against a deadline.
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Anand Gupta, Robinson+ColeMr. Gupta may be contacted at
agupta@rc.com
Construction Defects Up Price and Raise Conflict over Water Treatment Expansion
August 27, 2013 —
CDJ STAFFThe owner of a regional water treatment plant in California has filed a lawsuit against the where they operate. Construction defects lead to cost overruns at the Modesto Irrigation District’s water treatment plant. Now the question is whether MID or Modesto will be paying for the expenses. Both parties sued Black & Veatch and others, receiving $14.9 million.
But the problems have lead to the cost of the water treatment plant expansion ballooning to $107.5 million, a big jump over the planned $62.9 million. Also, instead of being completed in 2009, the completion date has been pushed to 2015.
Modesto originally agreed to pay for the expansion, which will increase plant’s ability to provide drinking water to 66 million gallons per day with the agreement that MID would provide the water at the cost of producing it. But now the cost to Modesto of those additional 36 million gallons a day is an additional $44.6 million.
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Evaluating Construction Trends From 2023 and Forecasting For 2024
February 12, 2024 —
Jason Feld & Dominic Donato - Kahana FeldAs we begin 2024, it is informative to evaluate what transpired in 2023 in the construction industry, and especially the use of construction technology. 2023 ushered in a variety of newly implemented construction technologies including 3D printed entire houses, improved wearables that detect all aspects of the construction worker from location to temperature to heart rate, increased use of modular construction for entire apartments, hotels, and condominium projects, and eco-friendly and conservation minded technologies to minimize carbon footprint, water preservation and sustainable construction methods, to name a few.
2023 also identified some significant issues in the construction industry. First and foremost, the labor shortages and hiring of skilled and qualified workers continued to be an issue resulting in increased delays, construction accidents, and project mismanagement. The skyrocketing interest rates, decline in commercial/office projects, supply chain issues, material price fluctuation and increase changes in scope of projects all negatively impacted the construction industry in 2023. There is also the demand for renewable and infrastructure projects put strain on construction resources as the projects became “mega” with larger and more complex construction leading to multi-party, high dollar, and more complex claims. Finally, there is a growing trend of construction claims and litigation being financed by third party litigation funding sources for personal/bodily injury claims and construction defect claims.
Reprinted courtesy of
Jason Feld, Kahana Feld and
Dominic Donato, Kahana Feld
Mr. Feld may be contacted at jfeld@kahanafeld.com
Mr. Donato may be contacted at ddonato@kahanafeld.com
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BHA has a Nice Swing: Firm Supports Wounded Warrior Project at WCC Seminar
May 01, 2015 —
CDJ STAFFIn just two weeks, the 22nd West Coast Casualty (WCC) Construction Defect Seminar returns to the Disneyland Hotel in Anaheim, California. The annual event begins on Thursday, May 14th, with breakfast and registration starting at 7:30am. Panel discussions on various construction defect related topics begin at 8:30am and continue through the morning and afternoon, followed by a cocktail reception in the early evening. The following day includes break-out sessions with the event concluding in the afternoon. Attendees can enhance their seminar experience with the WCC Construction Defect Seminar Mobile App. The event schedule, speaker information, product information, sponsor details, and interactive floorplan can all be accessed through the app. Furthermore, registered attendees will have access to session presentations.
The designated charity for this years’ event is the
Wounded Warrior Project and there are several ways for attendees to support this honorable cause. In addition to the opportunity to purchase a “Buy A Banner” to hang in the seminar hall, there will be a traditional raffle for two American Themed quilts donated by Marianne Cutcher. Bert L. Howe and Associates, Inc. has also stepped up to support Wounded Warriors, and attendees will get the chance to help raise money for this cause in the following manner:
If you stop by the Bert L. Howe & Associates (BHA) booth at the seminar and try their “Sink A Putt For Charity” not only will you have the chance to win a $25 Best Buy gift card, but you’ll also have the opportunity to help raise funds for Wounded Warriors. For every hole-in-one made at their booth, BHA will also make a $25.00 cash donation in the golfer’s name to the Wounded Warrior Project. BHA strongly supports the goals and principles of Wounded Warriors, and is honored to assist the organization in fulfilling its mandate of assisting our returning military heroes who are in need.
Download an invitation and register for WCC Seminar...
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New Evidence Code Requires Attorney to Obtain Written Acknowledgement that the Confidential Nature of Mediation has been Disclosed to the Client
January 02, 2019 —
Steven J. Pearse, Esq. & David A. Napper, Esq. – Chapman Glucksman Dean Roeb & BargerSenate Bill 954: MEDIATION CONFIDENTIALITY DISCLOSURES.
California regards mediation as a beneficial process for parties to resolve disputes in an expeditious and economical fashion. To assure open and candid participation, there is a longstanding policy in California to maintain confidentiality during the mediation process. However, the mediation confidentiality statutes have prevented some clients from suing their·attorneys for alleged malpractice that occurred during the mediation process. (see Cassel v. Superior Court, (2011) 51 Cal.4th 113). Senate Bill ("SB") 954, was recently passed and thereafter approved by the Governor on September 11, 2018 to address this concern.
SB 954, which will amend California Evidence Code section 1122 and add California Evidence Code section 1129, requires that an attorney representing a client participating in a mediation or a mediation consultation provide that client with a written disclosure and acknowledgement containing the mediation confidentiality restrictions as set forth in the California Evidence Code.
This written disclosure and acknowledgement requirement does not apply to class or representative actions. Additionally, the failure of an attorney to follow the new requirement will not be a basis to set aside an agreement prepared in the course of, or pursuant to, a mediation. Any communication, document, or writing related to an attorney's compliance with the disclosure requirement will not be considered confidential and may be used in a disciplinary proceeding if the communication, document, or writing does not disclose anything said or done or any admission made in the course of the mediation.
California Evidence Code section 1129 sets forth the exact language that must be used in the disclosure. It even informs the client that all communications between the client and the attorney made in preparation for a mediation, or during a mediation, are confidential and cannot be disclosed or used (except in extremely limited circumstances), even if the client later decides to sue the attorney for malpractice because of something that happens during the mediation.
The new disclosure requirement will allow mediation to maintain the confidentiality that encourages open and candid communications during the process while ensuring that before clients agree to mediation that the clients are made aware of how that confidentiality can potentially impact them. SB 954, will take effect on January 1,2019.
Reprinted courtesy of
Stephen J. Pearce, Chapman Glucksman Dean Roeb & Barger and
David A. Napper, Chapman Glucksman Dean Roeb & Barger
Mr. Pearce may be contacted at dnapper@cgdrblaw.com
Mr. Napper may be contacted at jpaster@HuntonAK.com
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Real Estate & Construction News Roundup (4/10/24) – Hotels Integrate AI, Baby-Boomers Stay Put, and Insurance Affects Housing Market
May 06, 2024 —
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law BlogIn our latest roundup, DOT’s major grant programs, proptech’s solution to climate change risks, mortgage-locked sellers put their homes on the market, and more!
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Pillsbury's Construction & Real Estate Law Team
Waive It Goodbye: Despite Evidence to the Contrary, Delaware Upholds an AIA Waiver of Subrogation Clause
April 19, 2022 —
Lian Skaf - The Subrogation StrategistSubrogation professionals have always been looking for ways to defeat onerous waiver of subrogation provisions in contracts signed by insureds. However, even when contracts are unsigned, if there is intent when the contract is made – usually long before a loss occurs – a waiver of subrogation can doom what otherwise may have been a strong case. The Superior Court of Delaware considered such a scenario to determine whether a waiver of subrogation provision applied to a multimillion-dollar subrogation case.
In State of Delaware Insurance Coverage Office and Factory Mutual Insurance Co., both as subrogee of the University of Delaware v. DiSabatino Construction Co., Schlosser & Associates Mechanical Contractors, Inc. and V.E. Guerrazzi, Inc., C.A. No. N19C-08-080, 2022 Del. Super. LEXIS 108 (March 17, 2022), the court granted the defendants’ motions for summary judgment, holding that the plaintiffs’ claims were barred by a waiver of subrogation provision in the underlying contract. Thus, the court held that the plaintiffs could not pursue the defendants in their suit to recover damages as a result of a fire. The court specifically denied the plaintiffs’ argument that since the contract was not signed and another “short form” version was later used the waiver of subrogation provision should not apply.
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Lian Skaf, White and Williams LLPMr. Skaf may be contacted at
skafl@whiteandwilliams.com
