Protect Workers From Falls: A Leading Cause of Death
August 14, 2018 —
Mark McGhiey - Construction ExecutiveOne of the leading causes of death for construction workers is falls from elevated surfaces, according to the Bureau of Labor Statistics. In 2016, these accidents accounted for more than 30 percent of all construction fatalities. The top four causes of worker deaths (excluding highway collisions) in the private sector construction industry are:
- falls: 384 (38.7%);
- struck by object: 93 (9.4 percent);
- electrocutions: 82 (8.3 percent); and
- caught-in/between:1 72 (7.3 percent).
One of the most common — and costly — causes of claims occur when construction workers fall from elevated surfaces. These accidents represent more than 30 percent of all construction claim payments.
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Mark McGhiey, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Denver Airport's Renovator Uncovers Potential Snag
March 04, 2019 —
Nadine M. Post - Engineering News-RecordThe renovation of the Great Hall of Denver International Airport’s iconic Jeppesen Terminal, roofed by a series of peaked tensile tents that echo the nearby mountains, has hit a bump. Routine but limited concrete testing of the nearly quarter-century-old terminal’s elevated floor slab, to determine whether the floor could support crane loads, shows the compressive strength of the concrete in certain sections is lower than was specified for the original project, more than 25 years ago.
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Nadine M. Post, ENRMs. Post may be contacted at
postn@enr.com
Quick Note: Subcontractor Payment Bond = Common Law Payment Bond
February 16, 2017 —
David Adelstein – Florida Construction Legal UpdatesWhat is a common law payment bond? A common law payment bond is a bond not required or governed by a statute. For example, if a prime contractor provides the owner a payment bond, that bond will be a statutory payment bond. On the other hand, if a subcontractor provides the general contractor with a payment bond, that bond will be a common law payment bond. Why? Because there is not a statute that specifically governs the requirements of a subcontractor’s payment bond given to a general contractor. The subcontractor’s payment bond is aimed at protecting the general contractor (and the general contractor’s payment bond) in the event the subcontractor fails to pay its own subcontractors and suppliers. The subcontractor’s payment bond will generally identify that claimants, as defined by the bond, are those subcontractors and suppliers the subcontractor has failed to pay. This common law payment bond is not recorded in the public records so sometimes it can be challenging for a claimant (anyone unpaid working under the subcontractor that furnished the bond) to obtain a copy of the bond. With that said, an unpaid claimant should consider pursuing a copy of this bond in certain situations, particularly if it may not have preserved a claim against the general contractor’s statutory payment bond.
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David Adelstein, Florida Construction Legal UpdatesMr. Adelstein may be contacted at
dadelstein@gmail.com
Times Square Alteration Opened Up a Can of Worms
January 26, 2017 —
Nadine M. Post – Engineering News-RecordCompared with some of its Manhattan neighbors, a high-rise on the corner of Seventh Avenue and West 47th Street looks standard. Like many buildings in Times Square, the 41-story retail-entertainment-hotel development, nearly topped out, has a tower springing from a boxy base that will sport a flashy billboard.
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Nadine M. Post, Engineering News-RecordMs. Post may be contacted at
postn@enr.com
Fed Inflation Goal Is Elusive as U.S. Rents Stabilize: Economy
March 12, 2014 —
Michelle Jamrisko and Ilan Kolet - BloombergFederal Reserve efforts to nurture a more robust rate of inflation this year are likely to fall short. The reason: the biggest gains in rents are probably over.
The costs to lease residential real estate, the second-biggest component of the price measure tracked by U.S. central bankers, helped put a floor under inflation over the past two years as most other components decelerated. Now, with builders cranking out a record number of multifamily buildings and the job market still far from tight, the outlook for rents is the bleakest it’s been in four years.
“Because the economy is still not in the strongest position and certainly the labor market is not in the strongest position, landlords really can’t extract much more in the way of rent growth,” said Ryan Severino, a senior economist at real-estate data provider Reis Inc. in New York. Also, rents are already high, which makes more increases difficult, he said.
Ms. Jamrisko may be contacted at mjamrisko@bloomberg.net; Mr. Kolet may be contacted at ikolet@bloomberg.net
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Michelle Jamrisko and Ilan Kolet, Bloomberg
Four Key Steps for a Successful Construction Audit Process
May 03, 2021 —
Ronald L. Williams, Fox Rothschild LLP - ConsensusDocsThe implications of the audit provisions contained in construction agreements between owners and contractors owners extend far beyond post-completion bean counting, and can affect multiple aspects of a project, from project administration to relationships with key subcontractors. It is critically important that contractors give audits the attention they deserve by taking the following four steps. First, invest the time to negotiate the audit provisions that ultimately appear in contracts with the owner. Second, ensure that the project team and the owner’s project auditors engage in timely communication during construction. Third, make certain that post-completion audit administration is prompt and complete. And finally, carefully draft adequate “flow-down” provisions with subcontractors and vendors so that they understand and comply with their contractual obligations, as well as the expectations of the contractor and owner. All four aspects are critical, and if not addressed effectively can undermine the profitability of the contract, and contractors’ business relationships with both upstream and downstream parties.
Negotiations
At the outset of contract negotiations, a contractor must completely understand the owner’s audit process expectations. An owner’s understanding of the audit process and its potential pitfalls depends on their own experience, as well as the knowledge of their personnel, including internal audit members and external auditors. Negotiations, which like the audit itself need not be adversarial, can be educational for both the owner and any representatives involved.
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Ronald L. Williams, Fox Rothschild LLPMr. Williams may be contacted at
rwilliams@foxrothschild.com
Developer Boymelgreen Forced to Hand Over Financial Records for 15 Broad Street
September 24, 2014 —
Beverley BevenFlorez-CDJ STAFFThe Manhattan Supreme Court “denied a last-ditch effort by Jeshayahu Boymelgreen to avoid handing over financial records as part of a state investigation into the development of 15 Broad Street in the Financial District,” according to The Real Deal. Attorney General Eric Schneiderman had ordered Boymelgreen to turn over the records. Futhermore, according to court records (as reported in The Real Deal), “the developer was also seeking to reduce the amount of money required to fund a $470,000 escrow account to make repairs at the condo — known as Downtown by Starck — which Boymelgreen jointly developed with Africa Israel.”
“We’re glad to see that the courts are rejecting Boymelgreen’s arguments why he shouldn’t be required to maintain an escrow account as security for the sponsor to obtain a permanent certificate of occupancy for 15 Broad, as was set forth in the very offering he participated in with Africa Israel,” Steven Sladkus, attorney for unit owners at the condo, stated. “Accountability is one step closer to the light at the end of the tunnel.”
Brian Itzkowitz, an attorney representing Boymelgreen, did not return The Real Deal’s calls or emails.
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Will a Notice of Non-Responsibility Prevent Enforcement of a California Mechanics Lien?
March 05, 2015 —
William L. Porter – Porter Law Group, Inc.The “Notice of Non-Responsibility” is one of the most misunderstood and ineffectively used of all the legal tools available to property owners in California construction law. As a result, in most cases the answer to the above question is “No”, the posting and recording of a Notice of Completion will not prevent enforcement of a California Mechanics Lien.
The mechanics lien is a tool used by a claimant who has not been paid for performing work or supplying materials to a construction project. It provides the claimant the right to encumber the property where the work was performed and thereafter sell the property in order to obtain payment for the work or materials, even though the claimant had no contract directly with the property owner. When properly used, a Notice of Non-Responsibility will render a mechanics lien unenforceable against the property where the construction work was performed. By derailing the mechanics lien the owner protects his property from a mechanics lien foreclosure sale. Unfortunately, owners often misunderstand when they can and cannot effectively use a Notice of Non-Responsibility. As a result, the Notice of Non-Responsibility is usually ineffective in protecting the owner and his property.
The rules for the use of the Notice of Non-Responsibility are found in California Civil Code section 8444. Deceptively simple, the rules essentially state that an owner “that did not contract for the work of improvement”, within 10 days after the owner first “has knowledge of the work of improvement”, may fill out the necessary legal form for a Notice of Non-Responsibility and post that form at the worksite and record it with the local County Recorder in order to prevent enforcement of a later mechanics lien on the property.
What commonly occurs however is that early in the process the owner authorizes or even requires its tenant to perform beneficial tenant improvements on the property. This authorization is often set forth in a tenant lease or other written document. The dispositive factor for determining whether the Notice of Non-Responsibility will be enforceable though is that the owner knows that these improvements will be made to the property and intends that they be made, usually long before the work begins. Indeed, the owner has usually negotiated these very terms into the lease contract. The owner then mistakenly believes that once work on the property commences it has 10 days to post and record a Notice of Non-Responsibility and thereby protect itself from a mechanics lien.
The usual error is two-fold. First, the statute states that the Notice is available when the owner “did not contract for the work of improvement”. The fact though is that the owner did contract for the work of improvement. It did so through the lease contract. This is true even though the owner’s contract was not with the contractor or supplier directly. Secondly, the 10 day period to post and record the Notice begins when the owner first “has knowledge” of the work of improvement. This knowledge was of course gained when the lease was negotiated and signed, providing knowledge typically many days before the work has begun. Thus, the 10 day period can also seldom be met. The Notice of Non-Responsibility will therefore fail both rules because the owner has in fact contracted for the improvement and because he does not act within 10 days of gaining this knowledge.
The next event in the typical scenario occurs when the tenant does not pay its contractor. The contractor then has nothing to pay its subcontractors. Material suppliers also go unpaid. Mechanics liens are then recorded by the unpaid claimants, followed by foreclosure actions within ninety days thereafter. Owners will typically point to the Notice of Non-Responsibility they posted and recorded, claiming its protection. Claimants then in turn point to the lease or other evidence that the owner knew of the pending improvements and contracted in some way that the improvements be performed, often also more than 10 days before they posted the Notice. Judges generally agree with the unpaid mechanics lien claimants and the Notice of Non-Responsibility is deemed ineffective.
The fact that the Court does not enforce the Notice of Non-Responsibility under these circumstances is not an unfair result. Since the owner authorized the work to be performed and it received a substantial benefit in the form of those improvements, it is not unfair that the owner should pay for those benefits. It would be inequitable for the owner to obtain the benefit of the improvements which it authorized but for which it did not pay, while allowing those who provided the benefit to go unpaid. Moreover, without such a system in place the door would be open to owners setting up sham “tenants” who would enter into contracts to have work performed, only to disappear when the work is completed, leaving the contractor without a source of payment. The system in place as described above prevents such duplicity. Owners would do well to arm themselves with proper knowledge of when the Notice of Non-Responsibility will and will not protect them and then responsibly use the Notice of Non-Responsibility.
For the legal eagles among you, the following cases illustrate the view of the courts, consistent with the above: Baker v. Hubbard (1980) 101 Cal.App.3d 226; Ott Hardware v. Yost (1945) 69 Cal. App.2d 593 (lease terms); Los Banos Gravel Co. v. Freeman (1976) 58 Cal.App.3d 785 (common interest); Howard S. Wright Construction Co. v. Superior Court (2003); 106 Cal.App.4th 314 (participating owner).
William L. Porter of
Porter Law Group, Inc. located in Sacramento, California may be contacted at (916) 381-7868 or bporter@porterlaw.com
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