Construction Trust Fund Statutes: Know What’s Required in the State Where Your Project Is Underway
June 22, 2020 —
Christopher D. Cazenave - ConsensusDocsConstruction trust fund statutes have been around for decades. At least 15 states have passed similar statutes. Other states, but not all, do not have an express statute but have interpreted state law to hold that payments received by a general contractor and deposited in a business account establishes a “trust fund.” See e.g., Cal. Bus. & Prof. Code § 7108.
The purpose of these laws is straightforward—protect contractors and suppliers against nonpayment for the labor and materials provided for the construction or repair of property. But while the purpose is straightforward, each state’s law differs by imposing different requirements, different privileges, and different remedies. This article provides an overview of how these statutes work as well as a sampling of important requirements and potential pitfalls that you should look out for when a construction trust fund statute applies to your project.
Read the court decisionRead the full story...Reprinted courtesy of
Christopher D. Cazenave, Jones Walker LLPMr. Cazenave may be contacted at
ccazenave@joneswalker.com
Missouri Asbestos Litigation Reform: New Bill Seeks to Establish Robust Disclosure Obligations
March 15, 2021 —
Jennifer B. Pigeon - Lewis BrisboisMissouri State Senator Eric Burlison is reviving attempts to reform asbestos litigation in the State of Missouri through the introduction of SB 331. This bill was pre-filed on December 29, 2020 and first read on January 6, 2021. The bill establishes disclosure procedures for claimants in asbestos-related lawsuits. Specifically, the bill, if passed, would require claimants in civil asbestos-related lawsuits to file a sworn information form within 30 days of filing an asbestos-related lawsuit.
The required disclosures under SB 331 include, but are not limited to (1) each asbestos-containing product to which the exposed person was exposed and each physical location at which the exposure occurred; (2) the identity of the manufacturer or distributor of specific asbestos-containing products for each named exposure; (3) the specific location and manner of each exposure; (4) the beginning and end dates of each exposure, the frequency and length of each exposure, and the proximity of the asbestos-containing product or its use to the exposed person; and (5) a certification that any claim that can be made with a bankruptcy trust concerning any asbestos injury to the exposed person has been filed.
Read the court decisionRead the full story...Reprinted courtesy of
Jennifer B. Pigeon, Lewis BrisboisMs. Pigeon may be contacted at
Jenna.Pigeon@lewisbrisbois.com
Property Damage Caused By Construction Next Door Covered as Ensuing Loss
July 16, 2014 —
Tred R. Eyerly – Insurance Law HawaiiDamage to the insureds' property caused by construction undertaken on the adjacent lot was covered under the insureds' property policy. Chubb Indem. Ins Co. v. 21 E. Cedar, 2014 U.S. Dist. LEXIS 79906 (N.D. Ill. June 12, 2014).
The insureds' home sustained damage contemporaneous with demolition, excavation, and construction taking place on a adjacent lot. Chubb paid benefits to the insureds for their loss, and then sought to recover as subrogee from the defendants who performed the construction.
The defendants argued there was no coverage under Chubb's policy. Faulty planning, construction or maintenance were excluded. An exception to the exclusion stated, however, "we do insure ensuing covered loss unless another exclusion applies." Defendants argued characterizing the damages as ensuing losses was purely semantic and self-serving, designed to involve the ensuing loss provision in order to protect Chubb's coverage determination. Chubb contended the exclusion applied only to the specific property being insured and not to a neighbor's property where work is being performed. Therefore, the faulty construction exclusion did not apply and the ensuing loss provision was triggered.
Read the court decisionRead the full story...Reprinted courtesy of
Tred R. Eyerly, Insurance Law HawaiiMr. Eyerly may be contacted at
te@hawaiilawyer.com
ASCE Statement on House Passage of the Water Resources Development Act of 2024
August 05, 2024 —
Marsia Geldert-Murphey, P.E., President of the American Society of Civil EngineersWASHINGTON — The American Society of Civil Engineers (ASCE) commends the House of Representatives for passing H.R. 8812, the bipartisan Water Resources Development Act (WRDA) for 2024. The House WRDA 2024 bill will help improve America's ports and inland waterways, enhance flood risk management and storm risk reduction programs, and prioritize ecosystem restoration. While we urge the Senate to swiftly vote on its version of WRDA, we are encouraged that our nation's critical water resources infrastructure remains a congressional priority.
The House version of WRDA includes several key provisions to enhance the safety of America's dams and levees, which each received a 'D' on the 2021 Report Card for America's Infrastructure, as well as provisions to modernize the nation's inland waterways system, which received a 'D+' in the 2021 Report Card. This includes one of ASCE's top legislative priorities for this year, the reauthorization of the National Dam Safety Program through 2028. But beyond the reauthorization, this bill reduces restrictions on the amount of funds states can receive in National Dam Safety Program State Assistance Grants; improves access to the High Hazard Potential Dam Rehabilitation Grant Program; and requires the incorporation of low-head dams into the National Inventory of Dams. Each of these provisions are critical to ensuring the long-term safety of our nation's dams and ASCE applauds the House for their inclusion. Furthermore, ASCE was pleased to see that the House legislation extends the National Levee Safety Program through 2033, which will help support the establishment of state levee safety programs, develop and publish national guidelines for levee safety, and enhance flood protection nationwide.
While these measures are not included in the Senate version of WRDA, we encourage lawmakers to ensure they are included in a final conference version of the bill.
We thank the House of Representatives for moving forward WRDA 2024 and strongly encourage the Senate to pass its version so that Congress can keep this vital water resources legislation on a biennial schedule and ensure our nation's dams, levees, ports, and inland waterways can support the American economy and protect public safety.
ABOUT THE AMERICAN SOCIETY OF CIVIL ENGINEERS
Founded in 1852, the American Society of Civil Engineers represents more than 160,000 civil engineers worldwide and is America's oldest national engineering society. ASCE works to raise awareness of the need to maintain and modernize the nation's infrastructure using sustainable and resilient practices, advocates for increasing and optimizing investment in infrastructure, and improve engineering knowledge and competency. For more information, visit www.asce.org or www.infrastructurereportcard.org and follow us on Twitter, @ASCETweets and @ASCEGovRel.
Read the court decisionRead the full story...Reprinted courtesy of
Differing Site Conditions: What to Expect from the Court When You Encounter the Unexpected
September 05, 2022 —
Margarita Kutsin - Ahlers Cressman & Sleight[
1]Seattle Tunnel Partners (“STP”), a joint venture of Dragados USA and Tutor Perini, entered into a $1.4 billion contract with the Washington State Department of Transportation (“WSDOT”) to replace the Highway 99 viaduct. In December 2013, a tunnel boring machine (“TBM”) bearing the moniker “Bertha,” then the largest TBM ever built, measuring 425 feet long and 57 feet in diameter, struck an underground pipe. Shortly after the impact, Bertha overheated and eventually could no longer make forward progress. A massive repair effort ensued causing a 2.5-year delay in reaching substantial completion.
WSDOT sued STP for the delay, seeking liquidated damages of $57 million. In response, STP argued its delay was excusable because it was caused by Bertha’s impact with the pipe, and the steel well casing was a Differing Site Condition (DSC) undisclosed in the contract documents. STP asserted counterclaims against WSDOT, alleging breach of contract and seeking $300 million in damages. Ultimately, a jury found that the steel well casing on the pipe was not a DSC, foreclosing STP’s excusable delay defense and counterclaims, and resulting in a $57 million verdict, plus interest, in favor of WSDOT.
Read the court decisionRead the full story...Reprinted courtesy of
Margarita Kutsin, Ahlers Cressman & SleightMs. Kutsin may be contacted at
margarita.kutsin@acslawyers.com
Angelo Mozilo Speaks: No Regrets at Countrywide
September 03, 2014 —
Max Abelson – BloombergSix years after he lost control of the largest mortgage lender in the U.S., and days after news that the U.S. Attorney’s Office in Los Angeles plans to sue him, the Countrywide Financial Corp. founder is baffled by a new effort to punish him, proud of past triumphs and incensed by criticism.
“You’ll have to ask those people, ‘What do you have against Mozilo, what did he do?’” he said in a 30-minute call with Bloomberg News before Labor Day, one of his few interviews since the firm’s downfall. “Countrywide didn’t change. I didn’t change. The world changed.”
Interviews with Mozilo, 75, and three friends show what retirement looks like for a chief executive officer linked to the worst financial crisis since the Great Depression. Remaining out of public view like Lehman Brothers Holdings Inc.’s Richard Fuld or Jimmy Cayne of Bear Stearns Cos., Mozilo has submitted plans for Old West-style offices in California, taught students in Italy about finance, invested in a building in the Arizona desert that houses a Taco Bell and written about his life so that his grandchildren will “know the truth.”
Read the court decisionRead the full story...Reprinted courtesy of
Max Abelson, BloombergMr. Abelson may be contacted at
mabelson@bloomberg.net
How Does Your Construction Contract Treat Float
November 08, 2017 —
David Adelstein - Florida Construction Legal UpdatesAlthough there are different types of construction schedule float and more technical definitions, the definition that makes sense to me is that float is the amount of time a particular activity can be delayed without that activity delaying the project’s completion date (substantial completion date). In looking at a construction schedule, this determination is made from looking at the difference between the early start date for an activity and the late start date for that activity or the difference between the early finish date for that activity and the late finish date for that activity in your CPM schedule (which should be the same amount of time). This is often referred to as “total float” and is the float that I usually focus on since it may pertain to a delay to the substantial completion date of the project and can trigger either the assessment of liquidated damages and/or the contractor’s extended general conditions, whatever the case may be.
Read the court decisionRead the full story...Reprinted courtesy of
David Adelstein, Florida Construction Legal UpdatesMr. Adelstein may be contacted at
Dadelstein@gmail.com
Liability Insurer’s Duty To Defend Insured Is Broader Than Its Duty To Indemnify
June 03, 2019 —
David Adelstein - Florida Construction Legal UpdatesWhen it comes to liability insurance, an insurer’s duty to defend its insured from a third-party claim is much broader than its duty to indemnify. This broad duty to defend an insured is very important and, as an insured, you need to know this. “A liability insurer’s obligation, with respect to its duty to defend, is not determined by the insured’s actual liability but rather by whether the alleged basis of the action against the insurer falls within the policy’s coverage.” Advanced Systems, Inc. v. Gotham Ins. Co., 44 Fla. L. Weekly D996b (Fla. 3d DCA 2019) (internal quotation omitted). This means:
Even where the complaint alleges facts partially within and partially outside the coverage of a policy, the insurer is nonetheless obligated to defend the entire suit, even if the facts later demonstrate that no coverage actually exists. And, the insurer must defend even if the allegations in the complaint are factually incorrect or meritless. As such, an insurer is obligated to defend a claim even if it is uncertain whether coverage exists under the policy. Furthermore, once a court finds that there is a duty to defend, the duty will continue even though it is ultimately determined that the alleged cause of action is groundless and no liability is found within the policy provisions defining coverage.
Advanced Systems, supra(internal citations and quotations omitted).
Read the court decisionRead the full story...Reprinted courtesy of
David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
