Don’t Be Lazy with Your Tenders
October 24, 2022 —
Rick Erickson - Snell & Wilmer Real Estate Litigation BlogOur clients probably spend significant time, money and effort refining and updating their contract provisions covering indemnification and the duty to defend claims arising on their projects. But they should also consider spending an appropriate and adequate amount of time, money and effort when sending notices, or “tenders,” to enforce those critical provisions. Tenders demanding defense and indemnity are strictly interpreted based on what the contract documents require. Getting tenders wrong can result in losing one of the most significant risk-shifting tools in the contract. It can also be a monumental mistake if insurance coverage for indemnification damages and defense costs are lost because of an inadequate tender.
The legal definition of “tender” is simple; it is “[a]n unconditional offer of money or performance to satisfy a debt or obligation.” Black’s Law Dictionary 1479-80 (7th ed. 1999). Whereas “tender of defense” for insurance is “the act in which one party places its defense and all costs associated with said defense with another due to a contract or other agreement … [which] transfers the obligation of the defense and possible indemnification to the party to which the tender was made.” Int’l Risk Mgmt. Inst., Glossary. Thus, when claims arise on your projects, notice by tenders of defense and indemnity will often determine dispute resolution and available insurance proceeds.
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Rick Erickson, Snell & WilmerMr. Erickson may be contacted at
rerickson@swlaw.com
Nevada Governor Signs Construction Defect Reform Bill
February 26, 2015 —
Beverley BevenFlorez-CDJ STAFFAccording to the Las Vegas Review-Journal, Nevada Governor Brian Sandoval “signed the first major Republican-backed reform bill of the 2015 session, a measure making changes to Nevada’s construction defect law.”
Sandoval stated, “During my State of the State address, I challenged the Legislature with passing meaningful construction defect reform. They have met that challenge with the Homeowner Protections Act, which discourages frivolous litigation and strengthens Nevada’s rebounding housing market,” as quoted in the Las Vegas Review-Journal.
The bill, which goes into effect immediately, “restricts the definition of what constitutes a home defect, repeals a provision allowing attorney fees and costs in a home defect judgment, and requires specific descriptions of defects.” It also reduces the statute of limitations from ten years to six years, and prohibits homeowner association boards from filing suits on behalf of homeowners.
Not all legislatures were in favor of the measure. For instance, Sen. Aaron Ford “called the measure the ‘homeowner rejection’ act rather than a homeowner protection act at a joint hearing on the bill,” according to the Las Vegas-Review Journal.
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Professional Services Exclusion Bars Coverage Where Ordinary Negligence is Inseparably Intertwined With Professional Service
August 17, 2017 —
Christopher Kendrick & Valerie A. Moore – Haight Brown & Bonesteel LLPIn Energy Ins. Mutual Ltd. v. Ace American Ins. Co. (No. A140656, filed 7/11/17, ord. Pub. 8/10/17), a California appeals court found that a professional services exclusion barred coverage for wrongful death and other claims blamed on pipeline inspectors’ failure to identify and properly mark a gas pipeline that was ruptured during construction of another pipeline, resulting in an explosion and fire.
In Energy Ins. Mutual, a pipeline owner hired two temporary construction inspectors through a staffing company. The inspectors had to ensure compliance with engineering and safety standards, practices and procedures for pipeline construction, and understand construction drawings and blueprints. They worked together with one of the owner’s employees to perform daily surveillance to ensure the integrity of the pipeline and avoid third party damage.
Reprinted courtesy of
Christopher Kendrick, Haight Brown & Bonesteel LLP and
Valerie A. Moore, Haight Brown & Bonesteel LLP
Mr. Kendrick may be contacted at ckendrick@hbblaw.com
Ms. Moore may be contacted at vmoore@hbblaw.com
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Unpredictable Opinion Regarding Construction Lien (Reinstatement??)
January 17, 2023 —
David Adelstein - Florida Construction Legal UpdatesHere comes the discussion of an appeal I was intimately involved in dealing with a construction lien. See Suntech Plumbing and Mechanical Corp. v. Bella Isla, LLC, 2022 WL 14672765 (Fla. 3d DCA 2022). Unfortunately, it was a losing result on my end but not a losing result to the issue at-hand. You should ask what in the world does this mean. I will tell you.
Here is the fact pattern. A subcontractor files a construction lien foreclosure lawsuit against an owner for unpaid contract balance. In the same lawsuit, the subcontractor sues the general contractor for breach of contract and unjust enrichment associated with an approximate three-year delay on a construction project. The project was scheduled to be completed in 2019. It was not. The project was pushed into COVID and into 2022. (The subcontractor did not sue the general contractor for amounts subject to the lien foreclosure claim.) The general contractor, assuming the defense of the owner, moved to stay the lawsuit pending the outcome of arbitration based on an arbitration provision in the subcontract. The subcontractor did not dispute the arbitration provision, but argued that arbitration provision should not extend to the owner that was (a) not bound by the subcontract, (b) would not be a party to the arbitration, and (c) the amounts pled against the general contractor did not include the amounts subject of the lien foreclosure lawsuit. At a minimum, the lawsuit should be stayed, not dismissed. Nevertheless, the trial court dismissed the entire lawsuit in an order that states that it is a final order with language that the lien may be “reinstated” after the outcome of the arbitration (that the owner is not a party to).
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
Amos Rex – A Museum for the Digital Age
September 10, 2018 —
Aarni Heiskanen - AEC BusinessIn the very heart of Helsinki, a new museum is set to open its doors to showcase the art of the future. Amos Rex is an architectural and artistic gem that seeks to make modern art more accessible for people to experience and enjoy.
The construction work for the museum was almost completed when I visited the site in early August. I met with Kai Kartio, an art historian with years of experience as a museum director.
Kartio has been involved in the construction of Amos Rex from the beginning. The forerunner of Amos Rex was the Amos Anderson Art Museum, which was run by the Konstsamfundet foundation for 50 years in its founder’s own building nearby. Anderson was a Finnish newspaper tycoon and patron of arts who bequeathed his estate to the foundation.
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Aarni Heiskanen, AEC BusinessMr. Heiskanen may be contacted at
aec-business@aepartners.fi
New York Court Discusses Evidentiary Standards for Policy Rescission Based on Material Misrepresentation
August 10, 2020 —
Robert S. Nobel - Traub LiebermanOn July 27, 2020, in the case of Mt. Hawley Ins. Co. v. AKI Renovations Group, Inc., (Sup. Ct. NY Co. 2020), Index No. 159421/2017 (unpublished), the trial court issued an Order granting summary judgment permitting rescission of a CGL policy based upon material misrepresentations in a policy application. The insured submitted an application in which it failed to disclose its demolition operations despite specific questions seeking this information. Mt. Hawley issued a primary and excess policy for the period of December 29, 2016 to December 29, 2017 (collectively, the policy).
Subsequently, the insured sought coverage for a claim in which it was alleged that the insured was acting as a general contractor for demolition of a three-story building when the plaintiff was injured. The insurer advised the defendants that it was rescinding the policy ab initio, and also returned defendants’ premium in its entirety. The insurer asserted that it would not have issued the policy had defendants disclosed their demolition operations, then filed the coverage action seeking a judicial declaration ratifying its rescission of the policy.
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Robert S. Nobel, Traub LiebermanMr. Nobel may be contacted at
rnobel@tlsslaw.com
7 Areas where Technology is Shifting the Construction Business
November 21, 2018 —
Eric Weisbrot – JW Surety BondsThe digital transformation of the last two decades has taken hold of the business environment in a powerful way. Companies in nearly all sectors are experiencing a significant shift in the way business is done, with a heavy focus on improved productivity, increase profitability, and enhanced product and service offerings. The construction industry has been historically slow to update its processes and business models in-line with other industries, but technology is currently making its long-awaited appearance in the sector. Construction professionals can embrace these new solutions to run more efficient businesses and keep a closer eye on profitability by reducing
common costs over time.
These are the seven major areas where technology is changing construction.
1 - Business Management
One of the most apparent shifts taking place in the construction industry thanks to technology is the advancement of business processes and systems behind the scenes. Construction managers and job site owners have countless
digital tools at their fingertips to help with managing all aspects of the business. This includes more efficient ways to manage material use and equipment inventory, logging subcontractor hours and pay, and maintaining reporting requirements from regulatory perspectives. Many software solutions integrate with older, legacy systems, making this change an easy one for construction businesses across the board.
2 – Jobsite Productivity
Another area of transformation in construction is productivity on each job site. Technology has offered job owners and general contractors more efficient methods to keep track of project timelines as well as subcontractor progress from start to finish. The technology advancements in this arena come in the form of wearable devices that track work performed, as well as mobile devices that help keep the often mundane tasks necessary for a project’s success up to date and completed on time.
3 – Worker Safety
Although wearables are being utilized in several different ways in the construction business, these devices are making a significant difference in the safety of workers. From smart helmets to digitally enhanced eyewear, workers are alerted to potential hazards on the job that they otherwise could not identify. Similarly, augmented and virtual reality solutions are being used to train workers before they arrive at a job, preparing them for safety concerns well in advance. Even though most licensed and
bonded construction workers have appropriate training throughout their careers, the addition of these resources has the ability to further reduce the risks often associated with construction work.
4 – Surveying and Monitoring
Unmanned aerial vehicles, also known as
drones, are being used throughout construction. These digital tools are equipped with cameras to offer a bird’s eye view of a construction site to help with surveying and identifying potential hazards for workers. Drones also help with inspections throughout a project’s progression, offering some reduction in cost and improving efficiencies.
5 – Improved Materials
Technology is also playing a role in the materials used on job sites. The addition of 3D printing has proven beneficial for construction companies, as concrete composites, plastics, and other materials are being printed and used to create structures on-site. This offers a more cost-effective and accurate way to complete a project.
6 – Self-operating Equipment
Some technology firms are making waves in the construction industry because they are currently developing and implementing
autonomous equipment solutions. Heavy machinery, like excavators, bricklayers, and bulldozers, are already being used on construction sites to help ease the burden of the labor shortage in the industry. While these machines are not yet mainstream, the benefits they offer mean they are likely to become a staple in construction in the years to come.
7 – Big Data
Finally, technology is shifting the construction business by way of big data analytics. With the detailed information from new software solutions, wearable tech, and drones, construction site managers have more data than they have ever had. This influx of information offers a way to analyze job site progress, budgets, timelines, and efficiency for companies large and small.
Author:
Eric Weisbrot is the Chief Marketing Officer of
JW Surety Bonds. With years of experience in the surety industry under several different roles within the company, he is also a contributing author to the surety bond blog.
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“But I didn’t know what I was signing….”
May 30, 2018 —
Bobby Kethcart - Snell & Wilmer Real Estate Litigation BlogIn real estate cases—which frequently involve long purchase agreements, loan documents, personal guarantees, deeds of trust, etc.—we’ve likely all had a client or opposing party who trots out the line that they didn’t know what they were signing, or they didn’t read or understand what they were signing, so the document shouldn’t be enforced according to its terms.
Most of us instinctively believe the claim is a loser: You signed the document, you’re bound by it.
But is this actually right?
Well, we did some digging. Here is the Arizona law on the subject:
Nationwide Resources Corp. v. Massabni, 134 Ariz. 557, 658 P.2d 210 (App. 1982):
“A mistake of only one of the parties to a contract in the expression of his agreement or as to the subject matter does not affect its binding force and ordinarily affords no ground for its avoidance, or for relief, even in equity.”
“A manifestation of acceptance to the offeror or his agent forms a contract regardless of the intent of the acceptor.”
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Bobby Kethcart, Snell & WilmerMr. Kethcart may be contacted at
rkethcart@swlaw.com
