Your “Independent Contractor” Clause Just Got a Little Less Relevant
January 12, 2015 —
Garret Murai – California Construction Law BlogConstruction projects are complex, multi-partied, multi-disciplinary endeavors, in which subcontracting all or a portion of the work to be performed is not uncommon.
When subcontracting work, parties usually make it clear in their contracts that the party performing work is acting as an “independent contractor.” Here’s a fairly typical provision from the AIA A201 General Conditions:
The parties agree that the contractual relationship on Contractor to Owner is one solely of an independent contractor in all respects and that the Contract Documents do not in any way create a partnership, joint venture or any other relationship between Owner and Contractor other than the contractual relationship as specified in this Agreement.
These provisions are intended to shield the contracting party from claims that it is responsible for workers’ compensation premiums, retirement contributions, health care insurance, or other benefits provided for the benefit of employees of the company performing the work. Fair enough.
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Garret Murai, Wendel Rosen Black & Dean LLPMr. Murai may be contacted at
gmurai@wendel.com
Real Estate & Construction News Roundup (9/4/24) – DOJ Sues RealPage, Housing Sales Increase and U.S. Can’t Build Homes Fast Enough
October 07, 2024 —
Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law BlogIn our latest roundup, environmental regulations tighten for commercial properties, Wells Fargo sells most of its commercial mortgage services business, first-time home buyers struggle with housing affordability, and more!
- The U.S. Department of Justice announced that it is suing the real estate company RealPage, saying it engaged in a price-fixing scheme to drive up rents. (Jennifer Ludden, NPR)
- As environmental regulations for commercial buildings and properties tighten across the U.S., green leases and technologies offer owners and operators opportunities to reduce their portfolios’ carbon footprints, generate cost savings and further align with ESG goals. (Nish Amarnath, Construction Dive)
- Wells Fargo & Co. agreed to sell most of its commercial mortgage servicing business to Trimont LLC, ceding the title of biggest US commercial and multifamily mortgage servicer to the Atlanta-based firm. (Hannah Levitt and Scott Carpenter, Yahoo)
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Pillsbury's Construction & Real Estate Law Team
Massachusetts Couple Seek to Recuse Judge in Construction Defect Case
September 30, 2011 —
CDJ STAFFAfter seeing their $1 million jury award overturned on appeal by a judge who called the award “against the weight of evidence and likely due to misapprehension, confusion or passion,” Kathryn and Christian Culley are seeking to have him removed from the case. The Massachusetts Supreme Judicial Court has rejected their claim.
The Culleys claim that Judge Thomas R. Murtagh’s decision was influence by him membership in the Andover Country Club which is represented by the opposing counsel in their construction defect case. Justice Margot G. Botsford had denied the Culley’s request, ruling that they had other remedies available to them.
The SJC noted in their ruling that if the Culleys are alleging judicial misconduct a request must be made to the Commission on Judicial Conduct. Their lawyer plans to file a new motion for recusal with the SJC.
Read the full story…
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Nevada State Senator Says HOA Scandal Shows Need for Construction Defect Reform
November 13, 2013 —
CDJ STAFFA Nevada State Senator sees the ongoing HOA scandal as a sign that the state’s construction defect laws need to be revised. State Senator Mike Schneider says that the law “is flawed and actually makes it too easy to do what these folks have done.” What these folks have done has, of course, lead to a number of indictments and guilty pleas in federal court.
One problem that Senator Schneider points to in current Nevada construction defect law is that homeowner attorneys get 40% of any settlement, sometimes leaving homeowners without sufficient funds to repair the defects. “It’s gotten out of hand. We pay some outrageous costs and fees in this cases.”
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Should a Subcontractor provide bonds to a GC who is not himself bonded? (Bonding Agent Perspective)
May 03, 2017 —
Christopher G. Hill - Construction Law MusingsGuest Post Friday is back, and for this week, Construction Law Musings welcomes Steve Moore. Steve has been the Construction & Surety Manager for Towne Insurance Agency-Invincia, in Chesterfield, VA since 2010. Steve’s experience in the Virginia surety bonding marketplace started in 1985 with USF&G. His underwriting travels took him from USF&G to starting National Grange Mutual’s mid-Atlantic bond department over Virginia, Maryland, Delaware, North & South Carolina, to being Reliance Surety’s “Firemark” bond manager in Virginia. Reliance was purchased by Travelers, where Steve continued to grow the surety book of business and build expertise and relationships. Experience with Travelers and Zurich had Steve handling surety bonds for some of Virginia’s largest and best-of-class contractors. Recently, he was contracted by the Commonwealth’s Attorney’s office to serve as a contract surety expert witness on behalf of the state. He is a 1985 graduate of Virginia Tech with double-major B.S. degrees in Finance and Marketing.
Today, Steve has business and relationships with Travelers, The Hartford, Westfield, CNA, CBIC, Selective, Liberty Mutual, Ohio Casualty, Cincinnati, and many other companies. Steve’s strong foundation of insurance knowledge and in bonding principles and practices allow him to serve as a great resource for his clients.
An old Aesop fable comes to mind when I am asked whether a Sub should bond to an unbonded GC:
"A woodsman entered the forest and asked the trees to give him a handle made of the best wood. After giving the woodsman a stave of hickory, the forest watched the woodsman fashion an axe onto the handle. In a flash, the woodsman began to chop down the various oaks and maples in the forest. The oak then said to a pine, “It serves us right, since we gave our adversary the very thing that contributes to our doom…"
When a subcontractor client of mine asks about bonding to an un-bonded general contractor, a number of questions immediately come to mind. Why isn’t the GC bonded? What is the existing relationship between the GC and Sub? How well is the job financed? While wanting to help my subcontractor procure work, and surely enjoying the commissions from writing a bond, I also want to help my sub client manage unforeseen risk. What are the risks to a sub, when posting a bond to an unbonded GC?
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Christopher G. Hill, The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Condominium Construction Defect Resolution in the District of Columbia
October 26, 2017 —
Nicholas D. Cowie - Maryland Condo Construction Defect Law BlogNewly constructed and newly converted condominiums in the District of Columbia often contain concealed or “latent” construction defects. Left undetected and unrepaired, defects in the construction of a condominium can cause extensive damage over time, requiring associations to assess their members substantial repair costs that could have been avoided by making timely developer warranty claims.
This article provides a general overview of how Washington DC condominium associations transitioning from developer control can proactively and successfully identify defects and resolve construction defect claims with condominium developers and builders.
Condominium Association Responsibility for Timely Evaluation of Common Element Construction
Condominium associations are charged with the responsibility of overseeing and maintaining condominium common element facilities, typically consisting of building roofs, exterior walls, foundations, lobbies, common hallways, elevators, surrounding grounds, and the common structural mechanical, electrical, and plumbing systems. Following the period of developer control, it is incumbent upon a condominium association’s first unit owner elected board of directors to evaluate the construction of the condominium common element facilities and determine whether the existing, developer-created, budget and reserve fund are adequate to cover the cost of maintaining, repairing, and ultimately replacing the condominium facilities over time.
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Nicholas D. Cowie, Cowie & Mott, P.A.Mr. Cowie may be contacted at
ndc@cowiemott.com
Connecticut Federal District Court Keeps Busy With Collapse Cases
October 19, 2017 —
Tred R. Eyerly - Insurance Law HawaiiThe federal district court for the district of Connecticut has faced a slew of collapse cases, recently dismissing several such cases.
The policies under consideration in each case cover the "entire collapse of a covered building structure" or "the entire collapse of part of a covered building structure." The collapse must be "a sudden and accidental physical loss caused by one of a list of specific causes such as defective methods or materials. In most of the recent cases, the insured alleged that the concrete in basement walls or foundations was cracking due to a chemical reaction. It was further alleged that the chemical reaction would continue to progressively deteriorate, rendering the building structurally unstable.
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Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
Lenders and Post-Foreclosure Purchasers Have Standing to Make Construction Defect Claims for After-Discovered Conditions
August 12, 2013 —
W. Berkeley Mann, Jr. - Higgins, Hopkins, McLain & Roswelll, LLCThe Colorado Court of Appeals has decided a case which answers a question long in need of an answer: do banks/lenders have standing to assert construction defect claims when they receive title to a newly-constructed home following a foreclosure sale or deed-in-lieu of foreclosure? The decision was released on August 1, 2013, in the case of Mid Valley Real Estate Solutions V, LLC v. Hepworth-Pawlack Geotechnical, Inc., Steve Pawlak, Daniel Hadin, and S K Peightal Engineers, Ltd. (Colorado Court of Appeals No. 13CA0519).
The background facts of the case are typical of a Colorado residential construction defect case generally. A developer contracted for an analytical soil engineering report from a geotechnical engineering firm (H-P) which made a foundation recommendation. The developer’s general contractor then retained an engineering firm (SPKE) to provide engineering services, including a foundation design. The general contractor built the foundation in accordance with the H-P and SPKE criteria and plans.
The house was not sold by the developer and went into default on the construction loan. These events resulted in a deed-in-lieu of foreclosure to a bank-controlled entity which purchased the house for re-sale. Shortly after receiving the developer’s deed, the bank-related entity discovered defects in the foundation that resulted in a construction defect suit against the two design firms and related individuals.
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W. Berkeley Mann, Jr.W. Berkeley Mann, Jr. can be contacted at
mann@hhmrlaw.com
