Florida Lien Law and Substantial Compliance vs. Strict Compliance
April 20, 2017 —
David Adelstein - Florida Construction Legal UpdatesThere are literally some (or, perhaps, many!) disputes that will make you say “hmm!” The “hmm” is a euphemism for “what is a party thinking?!?” The case of Trump Endeavor 12 LLC v. Fernich, Inc., 42 Fla. L.Weekly D830a (Fla. 3d DCA 2017) is one of these cases because a party (the owner) is banking its defense on a technical “all-or-nothing” argument pertaining to whether a lienor (a supplier) substantially complied with Florida’s Lien Law because a supplier’s Notice to Owner identified the wrong general contractor. This is a challenging argument because the owner has to prove how they were adversely affected / prejudiced by the lack of substantial compliance, which is not an easy burden.
This case concerns the Trump National Doral Miami project. The project consisted of a lodge project and a separate clubhouse project, both of which had different general contractors. On the lodge project, the general contractor hired a painter which, in turn, procured paint from a supplier (the lienor). The supplier visited the project and obtained the Notice of Commencement from the owner so that it could perfect its lien rights. The owner furnished the supplier the Notice of Commencement for the clubhouse project that had a different general contractor. Relying on this Notice of Commencement, the supplier served a Notice to Owner. The Notice to Owner was timely serviced however it identified the wrong contractor – it identified the general contractor for the clubhouse project instead of the lodge project. Although the supplier later learned there was a different general contractor on the lodge project, it did not remedy the issue by serving a Notice to Owner on the correct contractor. Indeed, the contractor for the lodge project learned of the Notice to Owner furnished by the supplier and that the supplier was furnishing paint to the painting subcontractor for purposes of that project.
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David Adelstein, Florida Construction Legal UpdatesMr. Adelstein may be contacted at
Dadelstein@gmail.com
World Cup May Pull Out of Brazil because of Construction Delays
January 28, 2014 —
Beverley BevenFlorez-CDJ STAFFBack in October of last year, CNN reported that a judge suspended construction at one of the stadiums being built for this summer’s World Cup in Brazil. The judge stated that the dangers for construction workers included "being buried, run over, falling from heights and being hit by material, among other serious risks,” according to CNN.
Recently, the Los Angeles Times reported that FIFA is threatening to pull out of Brazil because of construction delays: “We cannot organize a match without a stadium,” Jerome Valcke, FIFA’s secretary general, as quoted in the Los Angeles Times. “This has reached a critical point.”
The deadline for completion of the 12 World Cup stadiums was January 1st, but various delays—including “fatal construction accidents at stadiums in Sao Paulo, Brasilia, and Manaus” as well as worker walk offs over pay—forced FIFA to “relax” the deadline.
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Car Crashes Through Restaurant Window. Result: Lesson in the History of Additional Insured Coverage
December 29, 2020 —
Randy J. Maniloff - White and Williams LLPBack in the day, additional insureds were oftentimes afforded coverage for liability “arising out of” the named insured’s work for the additional insured. When confronted with such language, courts often concluded that it dictated “but for” causation. In other words, but for the named insured doing the work for the additional insured, the additional insured would not be in the liability-facing situation that it is in. The result in some cases: additional insureds were entitled to coverage for their sole negligence. Decisions reaching such a conclusion were generally not well-received by insurers. This was especially so when you consider that the premium received by insurers, for the AI coverage, may not have been enough to buy a package of Twizzlers.
Insurer frustration with such decisions -- which insurers did not believe expressed the intent of additional insured coverage -- led ISO to make revisions to additional insured forms in 2004 (later revisions followed). At the heart of these revisions was an attempt to require fault on the part of the named insured before coverage could be afforded to the additional insured. (This is a very brief and simple history of this complex issue.)
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Randy J. Maniloff, White and Williams LLPMr. Maniloff may be contacted at
maniloffr@whiteandwilliams.com
Is Your Construction Business Feeling the Effects of the Final DBA Rule?
June 04, 2024 —
Nathaniel Peniston - Construction ExecutiveThe Biden administration’s final rule “Updating the Davis-Bacon and Related Acts Regulations” took effect on Oct. 23, 2023. In “the first comprehensive regulatory review in nearly 40 years,” the Department of Labor has returned to the definition of “prevailing wage” it used from 1935 to 1983—before Microsoft released the first Windows operating system.
Construction industry leaders must be aware that this is the most comprehensive review and overhaul of the act in 40 years; with it, the DOL has attempted to modernize its approach to wage creation and fringe benefit allocation. There are more than 50 procedural changes to the act, which means it is very important for contractors to be aware of wage classifications when bidding, performing work on Davis-Bacon Act projects and using applicable fringe dollars for bona fide benefits.
UNDERSTANDING THE CHANGES
Some of the critical adjustments included in the final rule that contractors should be aware of include:
Wage determination changes during a project: Historically, contractors could rely on the wage determinations used to win a project for the life of the project. However, the final rule now requires the contractor to use current wage determinations when a contract is changed or extended. The DOL “proposed this change because—like a new contract—the exercise of an option requires the incorporation of the most current wage determination.”
Reprinted courtesy of
Nathaniel Peniston, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved.
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Mr. Peniston may be contacted at
npeniston@fbg.com
Wisconsin Supreme Court Holds that Subrogation Waiver Does Not Violate Statute Prohibiting Limitation on Tort Liability in Construction Contracts
October 21, 2019 —
Gus Sara - The Subrogation StrategistIn Rural Mut. Ins. Co. v. Lester Bldgs., LLC 2019 WI 70, 2019 Wisc. LEXIS 272, the Supreme Court of Wisconsin considered whether a subrogation waiver clause in a construction contract between the defendant and the plaintiff’s insured violated Wisconsin statute § 895.447, which prohibits limitations of tort liability in construction contracts. The Supreme Court affirmed the lower court’s decision that the waiver clause did not violate the statute because it merely shifted the responsibility for the payment of damages to the defendant’s insurance company. The waiver clause did not limit or eliminate the defendant’s tort liability. This case establishes that while
§ 895.447 prohibits construction contracts from limiting tort liability, a subrogation waiver clause that merely shifts responsibility for the payment of damages from a tortfeasor to an insurer does not violate the statute and, thus, is enforceable.
In Rural Mutual, the plaintiff’s insured, Jim Herman, Inc. (Herman), entered into a contract with Lester Buildings, LLC (Lester) to design and construct a barn on Herman’s property. The contract included a provision that stated the following:
Both parties waive all rights against each other and any of their respective contractors, subcontractors and suppliers of any tier and any design professional engaged with respect to the Project, for recovery of any damages caused by casualty of other perils to the extent covered by property insurance applicable to the Work or the Project, except such rights as they have to the proceeds of such property insurance and to the extent necessary to recover amounts relating to deductibles of self-insured retentions applicable to insured losses. . . . This waiver of subrogation shall be effective notwithstanding allegations of fault, negligence, or indemnity obligation of any party seeking the benefit or production [sic] of such waiver.
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Gus Sara, White and WilliamsMr. Sara may be contacted at
sarag@whiteandwilliams.com
Do Construction Contracts and Fraud Mix After All?
October 27, 2016 —
Christopher G. Hill – Construction Law MusingsOn several occasions here at Construction Law Musings, I’ve discussed the fact that, with a few exceptions, fraud claims and written construction contract based claims do not mix. One of the exceptions to the so called “economic loss rule” that would seem to preclude both fraud and contract claims in the same lawsuit is where fraud is used to induce the contract in the first place. This exception would only apply where an independent duty, wholly outside of the duties created by the contract, is properly plead and proven to the court. For the same reason, namely a separate duty outside of the contract, the Virginia Consumer Protection Act (“VCPA”) may allow for an exception that would allow a cause of action under this statute.
Up until recently, the courts of Virginia have used these exceptions sparingly. However, the recent Loudoun County, VA Circuit Court opinion in Interbuild, Inc. v. Sayers (opinion also found at Virginia Lawyers Weekly) may signal a broadening of these exceptions. In the Interbuild case, the Court considered a claim for fraud in the inducement and breach of the VCPA. The basic facts plead by the plaintiffs were that Interbuild induced them into the contract through statements that it had been an established business since 1981, the project did not require a building permit, it had obtained all necessary subcontractor prices and would provide full-time project supervision, the project would be completed within 16 weeks, 4000 PSI concrete would be used for the project and that the project would be located in the agreed-upon area depicted and that they reasonably relied on these representations in deciding to enter into the contract to build their recreational facility.
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Christopher G. Hill, The Law Office of Christopher G. Hill, PCMr. Hill may be contacted at
chrisghill@constructionlawva.com
You’re Only as Good as Those with Whom You Contract
April 17, 2019 —
Christopher G. Hill - Construction Law MusingsI have been beating the drum of the need to have a solid construction contract as the basis for your construction project and contractor/subcontractor/supplier relationships. I have also emphasized that communication early and often is one of the best ways to assure a smooth project. However, the sad truth is that even with the best contract drafted with the assistance of an experienced construction attorney, if the other party to the contract simply decides not to perform, whether that is through unjustified non-payment or simple refusal to complete a scope of work without reason, it will be an expensive proposition to force compliance or be compensated for the monetary damage caused by such actions.
It is this often unmentioned truth relating to any contract, including those that construction professionals in Virginia deal with on a daily basis, that makes having a good knowledge of those with whom you plan to contract is key to a successful (read profitable) construction project. Of course be sure that any contractor or subcontractor you contract with has the basics of propoer insurance, the right experience and of course a contractor’s license with the proper specialty or specialties. These basics will get you most of the way to assuring that those that contract with you at least are responsible in business. Another key component, if you can find this information out, is the financial wherwithall of the other party. For a General Contractor, this means both sides of the equation: Owner and Subcontractors. For a Subcontractor, the key is the Contractor, but any other information you can get on the Owner is helpful (though this can be difficult) particularly in the face of a “pay if paid” clause.
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The Law Office of Christopher G. HillMr. Hill may be contacted at
chrisghill@constructionlawva.com
Economic Damages and the Right to Repair Act: You Can’t Have it Both Ways
March 16, 2017 —
Garret Murai – California Construction Law BlogIn 2002, the California State Legislature passed Senate Bill 800 also known as the Right to Repair Act (Civil Code Sections 895 et seq.) in an effort to stem a then rising tide in residential construction defect litigation.
SB 800, which applies to newly constructed residential units including single-family homes and condominiums (but not condominium conversions) sold after January 1, 2003, was intended to curb residential construction defect lawsuits by giving developers and others in the construction chain an opportunity to repair construction defects before being sued in court. SB 800 also provides minimum construction standards and limits the time in which a homeowner can bring a claim for construction defects.
In Acqua Vista Homeowners Association v. MWI, Case No. D068406 (January 26, 2017), the California Court of Appeals for the Fourth District examined the circumstances in which homeowners can sue a material supplier under the Right to Repair Act.
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Garret Murai, Wendel Rosen Black & Dean LLPMr. Murai may be contacted at
gmurai@wendel.com
