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
Seattle Council May Take a New Look at Micro-Housing
April 15, 2015 —
Beverley BevenFlorez-CDJ STAFFAccording to the Puget Sound Business Journal, “there’s remorse at [Seattle, Washington’s] City Hall over last year’s controversial decision to make it more onerous and costly to build ultra-affordable micro-housing.” City Council President Tim Burgess stated that the council “may ‘very well’ take up the micro-housing issue again as it works with Mayor Ed Murray on a long-term program to develop more housing.” This comes after Murray “announced a goal of building and preserving 50,000 housing units over the next 10 years.”
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No Repeal Process for Rejected Superstorm Sandy Grant Applications
February 12, 2014 —
Beverley BevenFlorez-CDJ STAFFEven though it’s been revealed that “faulty data” was used to reject many New Jersey recovery grants for victims of Superstorm Sandy, the state has announced that it’s too late to appeal, according to The Wall Street Journal.
“The applicants were informed by letter that they weren't eligible,” state officials told The Wall Street Journal, “and it should have been clear that they needed to appeal last year, so the application process won't be reopened.”
The majority of the rejected applicants that did appeal within the open period were found to be eligible for the grant: “Nearly 80% of people who appealed their rejections ended up winning their cases, according to data released by the Fair Share Housing Center, a public-interest law firm critical of the Christie administration. And of the 8,007 applicants rejected from both programs, 5,583 didn't appeal, or 70%, according to Fair Share Housing Center's analysis.”
U.S. Representative Bill Pascrell called for “an independent monitor” to be “appointed to oversee the state’s storm spending ‘to ensure there isn’t further mismanagement.’”
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Blueprint for Change: How the Construction Industry Should Respond to the FTC’s Ban on Noncompetes
May 13, 2024 —
Matthew DeVries - Best Practices Construction LawIn a groundbreaking move aimed at fostering fair competition and empowering workers, the Federal Trade Commission (FTC) issued a final rule last week to ban noncompete agreements nationwide. This ruling may carry profound implications for the construction industry, prompting construction businesses to reassess their practices and ensure compliance while maintaining competitiveness. Let’s explore how construction companies, large and small, can navigate this regulatory shift effectively.
Noncompete clauses have long been a staple in employment contracts within the construction sector, often used to protect proprietary information and retain skilled talent. However, the FTC’s ban on noncompetes demands a reevaluation of these practices. Employers must recognize the potential consequences of noncompliance, including legal repercussions and reputational damage, and take proactive steps to adapt to the new regulatory landscape.
Communications with Employees
The FTC rule requires employers to provide a form notice of non-enforcement to all present and former employees subject to an unexpired noncompete provisions. However, given the immediate legal challenges to the FTC’s rule and the fact that the 120-day compliance window has not yet begun, there is no reason to take immediate action or begin notifying employees. Instead, business owners should wait for at least 60 days before taking concrete action in response to the rule to see if any court temporarily enjoins the effectiveness of the rule.
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Matthew DeVries, Burr & Forman LLPMr. DeVries may be contacted at
mdevries@burr.com
Construction Contractor “Mean Tweets” Edition
June 04, 2024 —
Garret Murai - California Construction Law BlogBack in the day, if someone had a problem with you the rules of school yard jungle dictated that they had better tell it to your face or you had the right to call them out on it. That, of course, was back then. These days, with social media seemingly everywhere (e.g., Yelp, Twitter, Facebook, etc.), if someone has a problem with you they tell you . . . as well as the rest of the world . . . to your digital face. Jimmy Kimmel has even made it a “thing” with his celebrity “
Mean Tweets” segments.
In
Paglia & Associates Construction, Inc. v. Hamilton, 98 Cal.App.5th 318 (2023), homeowner Vanessa Hamilton was sued by her contractor Paglia & Associates Construction, Inc. doing business as Protech Construction after she posted critical comments to her blog and on Yelp about work performed by Paglia at her home.
The Paglia Case
In or about 2016, after a tree fell on her house, Hamilton’s insurer, Safeco, recommended Paglia to perform the repairs. Paglia and Hamilton entered into a repair contract in 2016 but Paglia did not finish the work until sometime in 2017 claiming that the repair was extensive because Hamilton’s circa 1923 home was in poor condition and current building codes required extensive reconstruction.
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Garret Murai, Nomos LLPMr. Murai may be contacted at
gmurai@nomosllp.com
Doing Construction Lead Programs the Right Way
October 16, 2018 —
Natalie Craigmile - Construction InformerRunning a construction business takes hard work. When you are working on a job, it can be difficult to find time to spend on marketing and advertising. If you are short on time, buying leads through construction lead programs could be a good way to meet new customers, grow your business, and find your next job. Keep reading to learn more about some of the pros and cons of buying leads.
A construction lead generation service exists solely to connect home owners with local home improvement contractors. They market across different construction specialties and reach customers who are looking for construction companies. Once they capture the ‘lead’, which is essentially the contact information and a few project details of that potential customer, they sell the lead to one or more local contractors in their network.
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Natalie Craigmile, Construction Informer
Background Owner of Property Cannot Be Compelled to Arbitrate Construction Defects
November 07, 2012 —
CDJ STAFFIn Truppi v. Pasco Engineering, John Quattro sued Property Management Contractors, Inc. over construction defects in William Truppi’s home. All parties are named in the suit. The California Court of Appeals ruled that Property Management Contractors, Inc. (PMCI) could not compel Mr. Quattro to arbitration.
The background of the case involves two houses built in Encinitas, California by PCMI: one for Mr. Truppi at 560 Neptune, and one for Mr. Quattro at 566 Neptune. Both contracts contained an arbitration provision. Mr. Quattro signed the contract for his residence and Mr. Truppi signed the other. Mr. Quattro then sued PCMI and its principal, William Gregory. Mr. Quattro claimed to be the true contracting party for the 560 Neptune residence and a third party beneficiary of the contract Mr. Truppi signed, and stated that PCMI was aware of this.
PCMI in a demurrer stated that Quattro “had only a ‘prospective beneficial interest in the property upon its eventual sale or lease.’” Mr. Quattro amended his complaint to account for the issues raised by PCMI. The court rejected PCMI’s demurrer to the amended complaint.
Finally, PCMI and Gregory asserted that Quattro was “not the real party in interest” and could not sue. PCMI continues to assert that Quattro lacks standing, but their attorney sent Quattro an e-mail stating, “While my client disputes that you are a party, and that you lack standing to assert the claim, to the extent you do so I believe you are obligated to proceed by way of arbitration.”
The court did not cover the issue of Quattro’s standing in the case, only if he could be compelled to arbitration. The court affirmed the lower court’s finding that Quattro could not be compelled to arbitrate the construction defect claim as neither he nor Gregory signed the contract in an individual capacity. Further, the court noted that PCMI and Gregory “denied the existence of an agreement between themselves and Quattro on the 560 contract,” and cannot compel arbitration on a non-existent agreement. And while non-signatories can, in some situations be compelled to arbitrate, the court found that “these cases are inapplicable because here they seek to have the alleged third party beneficiary (Quattro) compelled by a nonsignatory (Gregory).” The arbitration clause in question “expressly limited its application to persons or entities that signed the 560 contract.”
As Mr. Quattro was not a signatory to that agreement, the court found that he could not be held to its arbitration provision.
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Netherlands’ Developer Presents Modular Homes for Young Professionals
March 05, 2015 —
Beverley BevenFlorez-CDJ STAFFBuilder Magazine reported that Heijmans, a development and building company based in The Netherlands, believes their new modular home, the Heijmans ONE, is a solution for young professionals looking for an affordable, urban option.
“As a designer, I believe prefabricated architecture can beautifully balance quality, experience and economic feasibility,” the project's architect Tim van der Grinten, of Moodbuilders Architecture, told Builder Magazine. “The architecture of this compact house is characterized by natural materials, space, openness and identity. It is a clearly recognizable property that you can make your own.”
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