The Pitfalls of Oral Agreements in the Construction Industry
June 28, 2021 —
Matthew A. Margolis - Construction ExecutiveToo often, construction professionals engage with each other to handle a project or series of projects and instead of memorializing their terms in writing, the agreement between the parties consists of nothing more than a conversation and a handshake. Both parties put their trust in each other that the terms they discussed will be honored. Nevertheless, one (or both) of the parties may eventually determine that their trust was misplaced, resulting in a big-money, big-headache dispute.
By having a written contract at the commencement of their relationship, these issues could have been avoided. Here are nine reasons to have a written contract.
Reprinted courtesy of
Matthew A. Margolis, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Mr. Margolis may be contacted at
mmargolis@sbwh.law
Alleging Property Damage in Construction Defect Lawsuit
September 14, 2020 —
David Adelstein - Florida Construction Legal UpdatesWhen there is a construction defect lawsuit, there is an insurance coverage issue or consideration. As I have said repeatedly in other articles, it is all about maximizing insurance coverage regardless of whether you are the plaintiff prosecuting the construction defect claim or the contractor(s) alleged to have committed the construction defect and property damage. It is about triggering first, the insurer’s duty to defend, and second, the insurer’s duty to indemnify its insured for the property damage.
The construction defect claim and lawsuit begins with how the claim and, then, lawsuit is couched knowing that the duty to defend is triggered by allegations in the lawsuit (complaint). Thus, preparing the lawsuit (complaint) is vital to maximize the insurer’s duty to defend its insured.
In a recent opinion out of the Eleventh Circuit, Southern-Owners Ins. Co. v. MAC Contractors of Florida, LLC, 2020 WL 4345199 (11th Cir. 2020), a general contractor was sued for construction defects in the construction of a custom home. A dispute arose pre-completion and the owner hired another contractor to complete the house and remediate construction defects. The contractor’s CGL insurer originally provided a defense to the general contractor but then withdrew the defense and filed an action for declaratory relief asking for the declaration that it had no duty to defend the contractor because the underlying lawsuit did NOT allege property damage. The trial court agreed with the contractor and granted summary judgment in its favor finding that the underlying complaint did not allege property damage beyond defective work. But, on appeal, the Eleventh Circuit reversed.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
Can You Really Be Liable For a Product You Didn’t Make? In New Jersey, the Answer is Yes
December 14, 2020 —
James Burger & Robert Devine - White and Williams LLPNew Jersey has recently expanded liability for product distributors and manufacturers to products that the distributor/manufacturer did not make or sell. This alert discusses this new law and steps that distributors and manufacturers may consider to reduce their potential liability.
In Whelan v. Armstrong International, Inc., the New Jersey Supreme Court held that distributors and manufacturers can be strictly liable for injuries caused by replacement parts added after the point of sale which had not been manufactured or sold by any of the defendants in the case. In Whelan, the defendants’ products had originally been sold with asbestos-containing parts. Mr. Whelan, the plaintiff, argued that asbestos-containing replacement parts were required to repair and maintain the products. The court found that because the products were designed with asbestos-containing parts, “[d]efendants had a duty to provide warnings given the foreseeability that third parties would be the source of asbestos-containing replacement components.” (Emphasis added).
This reasoning, based on “foreseeability,” should give pause to all product distributors and manufacturers—even those who do not make or sell products that contain asbestos. Certainly distributors and manufacturers of products with asbestos-containing parts must take heed that they may now be liable for replacement parts that they neither manufactured nor sold. This alone is a significant holding that expands potential liability.
Reprinted courtesy of
James Burger, White and Williams LLP and
Robert Devine, White and Williams LLP
Mr. Burger may be contacted at burgerj@whiteandwilliams.com
Mr. Devine may be contacted at deviner@whiteandwilliams.com
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If You Don’t Like the PPP Now, Wait a Few Minutes…Major Changes to PPP Loan Program as Congress Passes Payroll Protection Program Flexibility Act
July 27, 2020 —
Ryan J. Udell & Adam J. Chelminiak - White and Williams LLPOn June 5, 2020, President Trump signed into law the Payroll Protection Program Flexibility Act of 2020 (the Flexibility Act). The Flexibility Act provides much-needed flexibility for the Paycheck Protection Program (PPP) and its millions of business participants.
The PPP offers loans to small businesses that have been adversely impacted by the COVID-19 pandemic and the measures taken by various governmental authorities to stem the spread of the virus so that they could keep their employees on the payroll during an eight-week period after receiving the funds. The PPP was particularly alluring to borrowers because the loans could be forgiven. But as the duration of lockdown orders and the accompanying economic aftershocks have extended longer than initially anticipated, particularly in those sectors that depend on in-person business such as restaurants, hospitality and other “main street” retail establishments, many recipients of PPP loans have found it challenging to use the PPP funds for payroll and other authorized purposes within the eight-week period after they had received the PPP funds, as is necessary to preserve eligibility for forgiveness. The Flexibility Act makes several key changes to the PPP program in order to allow borrowers who need a longer re-opening runway to do so without jeopardizing their ability to qualify for loan forgiveness.
This alert outlines the key changes to the PPP made by the Flexibility Act.
Reprinted courtesy of
Ryan J. Udell, White and Williams LLP and
Adam J. Chelminiak, White and Williams LLP
Mr. Udell may be contacted at udellr@whiteandwilliams.com
Mr. Chelminiak may be contacted at chelminiaka@whiteandwilliams.com;
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Lasso Needed to Complete Vegas Hotel Implosion
February 18, 2015 —
Beverley BevenFlorez-CDJ STAFFThe Miami Herald reported that “demolition workers used an Old West method on Tuesday to finish an incomplete casino implosion in Las Vegas.”
The Clarion Hotel and Casino owner Lorenzo Doumani told the Miami Herald that “[t]hey lassoed the building with steel cables, got a crane, and pulled and pulled and pulled.”
Burke Construction used a 2-ton explosive punch to bring the structure down, however, the concrete building dropped four stories but remained upright.
Burke Construction’s corporate safety coordinator, Anthony Schlect, told the Miami Herald that he was investigating the incident.
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Former UN General Assembly President Charged in Bribe Scheme
October 21, 2015 —
Patricia Hurtado & Greg Farrell – BloombergA former president of the United Nations General Assembly and a billionaire Macau developer were accused of taking part in a four-year corruption scheme that included bribes to help fund a campaign for the post at the organization in exchange for the promotion of Chinese businesses.
John Ashe, president of the UN General Assembly from September 2013 to September 2014, accepted more than $1 million in payoffs from developer Ng Lap Seng and an associate to help persuade the international body to build a multibillion-dollar conference center in Macau and promote Chinese businesses, including a bank, in Antigua, according to the U.S.
The new charges, announced Tuesday, relate to an earlier case against Ng, 68, who has a personal net worth of about $1.8 billion. He’s been held in a federal jail in Manhattan since he was arrested Sept. 19, accused of bringing $4.5 million into the country and lying about its purpose to U.S. authorities.
Reprinted courtesy of
Patricia Hurtado, Bloomberg and
Greg Farrell, Bloomberg
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A Classic Blunder: Practical Advice for Avoiding Two-Front Wars
August 23, 2021 —
William Underwood - ConsensusDocs“Ha ha! You fool! You fell victim to one of the classic blunders – the most famous of which is ‘never get involved in a land war in Asia’ – but only slightly less well-known is this: ‘Never go in against a Sicilian when death is on the line.’”[1]
Vizzini forgot to include “never fight a two-front war with your owner and a subcontractor” on his list of classic blunders, but it certainly belongs there. This article examines practical tips and tricks for general contractors to avoid the classic blunder of a two-front war, including recommended contract provisions and sound project documentation practices.
Admittedly, general contractors face a wide array of obligations on a project. And perhaps one of the most delicate balancing acts is managing relationships with the owner and your subcontractors. But far too often general contractors find themselves in the difficult position of fighting a two-front war against one (or more) of their subcontractors and the project owner.
But this does not always have to be the case—there are ways for general contractors to reduce the risk of finding themselves in a two-front war. And every project does not have to devolve in a circular firing squad with you in the middle. That said, this article comes with the caveat that a general contractor cannot avoid a two-front war in every instance, nor does this article examine every imaginable way to reduce the risk of a two-front war (see e.g. https://www.consensusdocs.org/pass-through-subcontractor-claims-liquidating-agreements-and-avoiding-a-two-front-war/). But this article will provide an overview of several key tools that can be used to minimize the risk of falling into a classic blunder.
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William Underwood, Jones Walker LLPMr. Underwood may be contacted at
wunderwood@joneswalker.com
Traub Lieberman Attorneys Named to Hudson Valley Magazine’s 2022 Top Lawyers List
January 24, 2022 —
Traub LiebermanTraub Lieberman is pleased to announce that nine Partners from the Hawthorne, NY office have been named to the 2022 Hudson Valley Magazine Top Lawyers List.
2022 Hudson Valley Magazine’s Top Lawyers:
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Traub Lieberman