CAMBRIDGE MASSACHUSETTS BUILDING EXPERT
DIRECTORY AND CAPABILITIES

Recent Statutory Changes Cap Retainage on Applicable Construction Projects

March 11, 2024 — Patrick McKnight - The Dispute Resolver
Recent reforms to certain state retainage laws have reduced the lawful amount of withholding permitted on construction projects. In theory, retainage allows an owner to mitigate the risk of incomplete or defective work by withholding a certain portion of payment until the construction project is substantially complete. Recent statutory developments in Washington, New York, and Georgia represent significant changes in how much an owner may retain on applicable construction projects in those jurisdictions. The details of each state’s retainage laws vary in many important respects. Most states set caps at 5% or 10%, with important variations depending on the type of project and the amount of progress completed. Some states require retainage to be held in an escrow account, but most do not. Many federal construction projects allow up to 10% retainage, while other federal agencies do not require any retention. See 48 CFR § 52.232-5(e) - Payments Under Fixed-Price Construction Contracts. The ongoing motivation for retainage reform is typically framed in terms of reducing delays in getting payment to subcontractors who complete their scope of work on time and free from defects. Read the court decision
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Reprinted courtesy of Patrick McKnight, Fox Rothschild LLP
Mr. McKnight may be contacted at pmcknight@foxrothschild.com

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National Lobbying Firm Opens Colorado Office, Strengthening Construction Defect Efforts

January 05, 2017 — Beverley BevenFlorez-CDJ STAFF
Michael Best Strategies, a national law and lobbying firm, has recently opened an office in Colorado. According to the Denver Business Journal, the firm “has recruited several big-name associates — a move that could give business leaders even more clout with the Legislature on issues such as construction-defects reform.” One of the firm’s recruits, Jeff Thormodsgaard, the lead lobbyist in the recent movement to make it harder to sue condominium builders, told the Denver Business Journal, “The only change [in the construction-defects reform effort] is that we’re going to be adding more feet and more boots on the ground and more gravitas.” Read the court decision
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Georgia Coal-to-Solar Pivot Shows the Way on Climate Regs

July 02, 2014 — Mark Drajem and Margaret Newkirk – Bloomberg
Georgia small-business owner Julian Smith keeps hearing that the Obama administration’s latest climate regulations will drive up local electric bills. He doesn’t believe the prediction, but he isn’t arguing: The fears are doing wonders for his solar-panel installation company. “My phone is blowing up with new customers,” Smith, owner of SolarSmith LLC of Savannah, said in an interview. “It turns out that if you tell everybody the amount they will spend on electricity will skyrocket, they will believe you.” In Smith’s home state, as in the rest of the nation, businesses and consumers are struggling to size up competing claims about the Environmental Protection Agency’s plan to cut carbon pollution from power plants, released June 2. The proposed regulations are among the most sweeping and complex in the EPA’s history, promising to revamp the way electricity has been generated and distributed for a century. Mr. Drajem may be contacted at mdrajem@bloomberg.net; Ms. Newkirk may be contacted at mnewkirk@bloomberg.net Read the court decision
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Reprinted courtesy of Mark Drajem and Margaret Newkirk, Bloomberg

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Alleged Negligent Misrepresentation on Condition of Home is Not an Occurrence Causing Property Damage

December 17, 2024 — Tred R. Eyerly - Insurance Law Hawaii
The court found that even if the insured's negligent misrepresentations constituted an accident, the disclosures did not cause physical damage to the property. Wood v. USAA Cas. Ins. Co., 2024 U.S. Dist. LEXIS 180624 (D. S.C. Sept. 12, 2024). The insured, Clinton Wood, purchased a townhome in January 2014. After the purchase, Wood experienced leaks and significant water intrusion, as did other townhome owners in the same development. Wood and the other owners retained an engineer to evaluate the cause of the water damage. The engineer determined that the water intrusion was caused by defects in the design and construction of the residence. The engineer told Wood that the proposed repairs would not adequately address and resolve the water intrusion and leaks, and that the problems would continue even if repairs were made. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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ASCE Statement on Hurricane Milton and Environmental Threats

October 15, 2024 — Feniosky Peña-Mora, P.E., President - American Society of Civil Engineers
WASHINGTON, DC. – On the heels of the tragic damage caused by Hurricane Helene throughout the Southeast, Floridians were struck by another major hurricane, Milton, less than two weeks later. Our hearts go out to those impacted again by this storm through property damage, lack of water access, power outages, or worse, loss of life, all before getting a chance to recover from Helene. Civil engineers are dedicated to protecting the public with projects that can lessen the impacts of these storms, and we are eager to help communities rebuild as quickly as possible following events like Milton and Helene. Although we do not yet know the full scope of destruction caused by Hurricane Milton, severe weather, including compound flooding events, are increasing regularly and pose a great risk to our safety and economic vitality. While so many eyes are fixated on hurricanes impacting the Southeast, wildfires are burning across several western states, including the Elk Fire in Wyoming, the largest wildfire the Bighorn National Forest has experienced in more than a century, now spanning over 75,000 acres as the region is experiencing unusually hot and dry weather and strong winds that are helping this fire to spread rapidly. The climate impacts we are accustomed to – wildfires in the West and hurricanes in the Southeast – are getting stronger, and now environmental challenges are occurring in areas we wouldn't suspect, such as Hurricane Helene striking mountain communities in Western North Carolina that have been labeled as "climate safe-havens," and Texas dealing with annual winter storms. ASCE is a leader in codes and standards development and has created an easy-to-understand toolkit for legislators and the public to learn the benefits of these up-to-date standards and determine when and how to adopt them, making our built environment more resilient to natural catastrophes. ASCE's flagship standard, ASCE/SEI 7-22, recently underwent the most significant update to its flooding chapter to ensure structures following this standard are prepared for 500-year flood events. Read the court decision
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Arbitrator May Use Own Discretion in Consolidating Construction Defect Cases

September 01, 2011 — CDJ STAFF

The Mississippi Court of Appeals has ruled in the case of Harry Baker Smith Architects II, PLLC v. Sea Breeze I, LLC. Sea Breeze contracted with Harry Baker Smith Architects II, PLLC (HBSA) to design a condominium complex, which would be built by Roy Anderson Corporation. All parties agreed to arbitration.

Subsequently, Sea Breeze alleged defects and sought arbitration against the architectural firm and started a separate arbitration proceeding against the contractor. The special arbitrator appointed by the American Arbitrators Association determined that it would be proper to consolidate the two actions “since they arose from a common question of fact or law.” HBSA filed in chancery court seeking injunctive relief and a reversal of the decision. Sea Breeze and Roy Anderson filed a motion to compel the consolidated arbitration.

The court noted that the special arbitrator “established that the contract between Sea Breeze and Roy Anderson expressly allowed for consolidation of the two cases.” Further, the arbitrator “concluded that HBSA expressly agreed to consolidation by written consent through its 2008 letter, through which it insisted upon Roy Anderson’s involvement ‘in any mediation and/or arbitration.’”

The court concluded that the chancery court “did not have the power to fulfill HBSA’s request.” The court affirmed the chancery court’s judgment.

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Break out the Neon: ‘80s Era Davis-Bacon “Prevailing Wage” Definition Restored in DOL Final Rule

August 21, 2023 — A. Scott Hecker & Ted North - The Construction Seyt
On August 8, 2023, the U.S. Department of Labor (DOL) announced its final rule related to the Davis-Bacon Act (the “Act”), entitled “Updating the Davis-Bacon and Related Acts Regulations.” However, the official final rule must be published in the Federal Register – likely by week’s end – before going into effect 60 days after publication. DOL issued its notice of proposed rulemaking (“NPRM”) in March 2022 and received more than 40,000 comments from interested stakeholders. Evaluating and addressing those comments took the better part of a year, as DOL did not send the rule to the Office of Information and Regulatory Affairs (“OIRA”) for White House approval until December 16, 2022. After languishing for months, OIRA has now concluded its review, allowing DOL to move forward with its final rule. Reprinted courtesy of A. Scott Hecker, Seyfarth and Ted North, Seyfarth Mr. Hecker may be contacted at shecker@seyfarth.com Mr. North may be contacted at enorth@seyfarth.com Read the court decision
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One More Statutory Tweak of Interest to VA Construction Pros

April 25, 2022 — Christopher G. Hill - Construction Law Musings
While I have focused on the recent “pay if paid” legislation in recent posts, the Virginia General Assembly has taken other action that is of interest to those of us that represent construction professionals in Virginia. One such action is yet another tweak to the so-called “wage theft” statute that essentially made a general contractor the guarantor of all wage payments of its downstream construction partners. The first of the tweaks to the statute passed in 2020 was to create a defense for a general contractor if it obtained a written certification of wage payment from its immediate downstream subcontractor. This year, the General Assembly expanded the protection provided by such certification to all subcontractors. In other words, any contractor or subcontractor can now protect itself from wage theft claims by the use of a certification that all wages were paid from its immediate downstream partner. The text of the changes can be found here. [note that the Governor has sent suggested grammatical amendments that did not affect the substance] Read the court decision
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Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

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