Fairfield Connecticut Building Expert Directory

California Precludes Surety from Asserting Pay-When-Paid Provision as Defense to Payment Bond Claim

December 21, 2020 — Nicholas Korst - Ahlers Cressman & Sleight PLLC
In a recent case in California, the Court of Appeals held that a surety who had issued a public works payment bond cannot rely on the “Pay-When-Paid” provision in the subcontract as a defense against the subcontractor’s claim against the payment bond.[1] The case was a public works project in Kern County, CA where the North Edwards Water District (the “District”) hired Clark Bros., Inc. (“Clark”) as the general contractor to build an arsenic removal water treatment plant. Clark hired subcontractor Crosno Construction (“Crosno”) to build and coat two steel reservoir tanks. The subcontract included the following “pay-when-paid” provision, which provided a definition of “reasonable time”: If the Owner or other responsible party delays in making any payment to the Contractor from which payment to Subcontractor is made, Contractor and its sureties shall have a reasonable time to make payment. “Reasonable time” shall be determined according to the relevant circumstances, but in no event shall be less than the time Contractor and Subcontractor require to pursue to conclusion their legal remedies against the Owner or other responsible party to obtain payment, including (but not limited to) mechanics lien remedies. (emphasis added). Read the court decision
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Reprinted courtesy of Nick Korst, Ahlers Cressman & Sleight PLLC
Mr. Korst may be contacted at nicholas.korst@acslawyers.com

Documentation Important for Defending Construction Defect Claims

November 27, 2013 — CDJ STAFF
When insurers are faced with a construction defect claim, they want information. Unfortunately, insurers “typically struggle to find the documents we need to understand what exactly happened and why it happened,” according to Robert Kreuzer, second vice president of construction risk control for Travelers. “The documents are either not there, or they’re inaccurate, or we can’t find them.” Not only does it make determining what happened more difficult, it also slows downs the litigation process. Mr. Kreuzer also noted that by properly documenting and maintaining documents, “you have a better chance of getting yourself out of the dispute, and avoiding that 11-year headache.” Read the court decision
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Providing Your Insurer Prompt Notice

May 20, 2024 — David Adelstein - Florida Construction Legal Updates
Sometimes, when it comes to insurance, you may hear the argument that you breached your insurance policy by failing to provide your insurer with prompt notice as the insurance policy requires. Well, this is not such an absolute issue. With that said, you should absolutely provide your insurer with prompt notice of a claim or loss. No legitimate reason not to. But, if you don’t, it is not an absolute get out of jail free card for your insurer, but it does give them a good argument, which you don’t really want to deal with. In Gulfpoint Construction Co., Inc. v. Westfield Ins. Co., 2024 WL 1759228 (11th Cir. 2024), an insured appealed a trial court’s ruling that found it did not provide prompt notice to its property insurer as the policy required. In this case, notice was provided two years after a loss from a hurricane. The insurer denied coverage and, in doing so, relied on the insured’s failure to provide prompt notice. Although the trial court agreed, the appellate court found this was a genuine issue of material fact. Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

Is Drone Aerial Photography Really Best for Your Construction Projects?

June 09, 2016 — Sherry and Brett Eklund – Construction Informer Blog
It’s no secret that aerial photographs play an essential role in any construction project. They help with the planning process, assist builders in documenting the progress of a project, provide an opportunity to spot potential issues that would otherwise be missed, capture great marketing images, and more. It used to be the only way to get sky-view pictures for construction purposes was to hire an aerial photography team with a piloted aircraft. However, a new player has entered the scene – the drone. And whether you choose to hire a professional aerial photography team using a fixed-wing airplane, helicopter, or drone, or choose to go the DIY route, all have a place in the world of construction. But, using drones is complicated and ever evolving, so we’d like to touch on a few key points to help you understand drone aerial photography. Read the court decision
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Reprinted courtesy of Sherry and Brett Eklund, Desert View Aerial Photography
Ms. and Mr. Eklund may be contacted at their website http://dvaerialphoto.com/contact/

Colorado Construction Defect Action Reform: HB 17-1279 Approved by Colorado Legislature; Governor’s Approval Imminent

June 05, 2017 — Erik G. Nielsen - Snell & Wilmer Legal Alert
Colorado developers frequently cite Colorado’s Construction Defect Action Reform Act (CDARA) as an obstacle to building new condominiums in the state. Developers contend that the law makes it too easy for condo boards to sue developers for workmanship issues, however trivial. As a result, Colorado has seen significant growth in the development of rental apartments, while development of new, for-sale, multi-unit housing, has declined in the state. In 10 years, new condo development in Colorado dropped from 20 percent to just 3 percent of total new-housing starts. Recognizing this issue, Governor Hickenlooper and the Colorado Legislature have taken an interest in reforming CDARA by, among other things, making it more difficult for condo boards and associations to sue construction professionals. Well on its way to becoming law, HB 17-1279 does exactly that. After the enactment of HB 17-1279, the executive boards of homeowners’ associations (HOA) in common interest communities will have to satisfy three broad elements before bringing suit against a construction professional on behalf of the community’s individual unit owners. Read the court decision
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Reprinted courtesy of Erik G. Nielsen, Snell & Wilmer
Mr. Nielsen may be contacted at egnielsen@swlaw.com

New Case Law Alert: Licensed General Contractors Cannot Sue Owners to Recover Funds for Work Performed by An Unlicensed Subcontractor

May 30, 2022 — Michele A. Ellison & Samantha R. Riggen - Gibbs Giden
The opinion in Kim v. TWA Construction, Inc. (2022 Cal. App. LEXIS 412) issued by the Court of Appeal of California Sixth Appellate District, on May 13, 2022, makes it clear that a properly licensed general contractor cannot bring an action for compensation from an owner for work performed by an unlicensed subcontractor. California licensing law has long made explicit that an unlicensed contractor cannot bring or maintain any action to collect or recover compensation for work that contractor performed unless they were duly licensed at all times during the performance of that work. This new ruling extends the scope of this restriction to licensed contractors who hired unlicensed subcontractors. The Underlying Dispute The case involved a dispute between property owners and their former general contractor and its principal (collectively “TWA”). The property owners hired TWA to construct a home, and during the early stages of the project, TWA hired an unlicensed subcontractor to perform tree trimming services and to remove a large eucalyptus tree. The subcontractor partially removed the eucalyptus tree, but was stopped by a neighbor, and it was discovered that the tree was partly located on the neighbor’s property. The neighbor brought suit against the property owners, and eventually TWA, for the damage. The property owners subsequently filed a cross-complaint against TWA, and TWA in turn filed a cross-complaint against the property owners. Reprinted courtesy of Michele A. Ellison, Gibbs Giden and Samantha R. Riggen, Gibbs Giden Ms. Ellison may be contacted at mellison@gibbsgiden.com Ms. Riggen may be contacted at sriggen@gibbsgiden.com Read the court decision
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Unpaid Subcontractor Walks Off the Job and Wins

September 01, 2016 — John P. Ahlers – Ahlers & Cressman PLLC
Make the following inquiry of your constructional lawyer, watch him/her sit up in his/her chair and give your question immediate attention: “I haven’t been paid, can I walk off the job?” The answer to this question is a strong “maybe, but it’s risky.” Walking off the project has a significant downside. The risk is that the judge who reviews your decision, sometimes years after the event, may not agree that the non-payment was a material breach and, thus, suspension of performance (walking off) is not justified. A breach of contract occurs where, without legal justification, a party fails to perform any promise that forms a whole or part of the contract. Not all breaches are equal. Some failures to perform a promise are “nominal,” “trifling” or “technical.” These breaches do not excuse performance under the contract by the non-breaching party. If the breach is “material,” that is, goes to the essential purpose of the agreement, is a question that only a judge decides, and only after the decision was made as to whether to walk off the job or not. Therefore, before deciding whether to walk off the job, you have to second guess what a judge may decide under the circumstances. Since not all judges see things the same way, the decision is fraught with uncertainty and risk. Read the court decision
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Reprinted courtesy of John P. Ahlers, Ahlers & Cressman PLLC
Mr. Ahlers may be contacted at jahlers@ac-lawyers.com

The Connecticut Appellate Court Decides That Construction Contractor Was Not Obligated To Continue Accelerated Schedule to Mitigate Its Damages Following Late Delivery of Materials by Supplier

April 11, 2022 — Robert M. Barrack - Gordon & Rees
In United Concrete Prods. v. NJR Constr., LLC, 207 Conn. App. 551, 263 A.3d 823 (2021), the Connecticut Appellate Court has issued a decision that should be of interest to the Connecticut construction industry and the construction bar. The lawsuit arose out of the late delivery of materials on a construction project, which is a frequent problem on construction projects. In United Concrete Products, the defendant general contractor, NJR Construction, LLC (“NJR”) was retained by the State of Connecticut Department of Transportation (“DOT”) to replace a bridge over the Hockanum River (“Project”). Id. at 555-58 (2021). The Prime Contract provided that NJR with an eight-week time-frame to perform the work, at which time the road would be closed to traffic. Id. The Prime Contract also provided for a bonus of $3,000 for each day the road was opened to traffic prior to the eight week deadline of August 8, 2016, and for liquidated damages of $3,000 for each day the road remained closed beyond the deadline. Id. NJR subsequently entered into a purchase order (“Subcontract”) with the plaintiff, United Concrete Products, Inc. (“United”), whereby United agreed to provide certain concrete components for the Project, including ten pre-stressed concrete beams. Id. The Subcontract required that United deliver the concrete beams by June 7, 2016, but, NJR did not actually schedule the delivery until June 29, 2016. Id. Nevertheless, even with that schedule NJR could have reopened the road by July 19, 2016, which would have allowed it to receive the full $60,000 incentive bonus. However, United did not deliver the concrete beams until July 26, 2016, which caused NJR to lose the incentive bonus, be assessed liquidated damages by the DOT, and to incur additional delay damages. Id. After deducting the amount of $179,500 in damages that it incurred due to United’s late delivery of the beams, NJR paid United the balance of $66,074.75. Id. Read the court decision
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Reprinted courtesy of Robert M. Barrack, Gordon Rees Scully Mansukhani, LLP
Mr. Barrack may be contacted at rbarrack@grsm.com

FAIRFIELD CONNECTICUT BUILDING EXPERT DIRECTORY AND CAPABILITIES