Seattle Washington Building Expert Directory

COVID-19 Could Impact Contractor Performance Bonds

March 30, 2020 — Ben Williams & MG Surety - Construction Executive
As COVID-19 continues to expand around the United States and the world, it may only be a matter of time before U.S. construction projects are affected by the virus. Performance bonds guarantee that a project will be completed by a contractor according to the contract. However, what if a contractor cannot complete a project on time due to widespread disease? What, if any, impact could the virus have on a contractor’s surety bond program? Risk Factors Several risks associated with the virus could trigger a performance bond claim. 1. Materials. The Chinese account for a large supply of construction materials, including steel, copper, cabinetry, etc. An inability to obtain these materials could significantly delay or stop a project all together. Even if a contractor is able to obtain them from other sources, it may be at a significantly higher cost than they put into the bid. 2. Labor. There is already a shortage of qualified labor in the construction industry. Additionally, construction already lends itself to the spreading of viruses; workers are often in close proximity, handling common materials, and they may not have an easily accessible place to wash their hands. Furthermore, even though many now have paid sick leave, there is often pressure not to use it. These things could magnify the labor shortage and make it difficult to complete projects on time. 3. Safety. Finally, the world is having a serious shortage of respirators. Because of widespread panic, many people have been purchasing N95 respirators—so much that the Surgeon General has asked people to stop buying them. It has created a shortage for people who really need them, like contractors. If contractors can’t get these safety masks, certain trades will either be unable to work, or risk continuing the project without masks, which would endanger workers and open them up to OSHA penalties. Reprinted courtesy of Ben Williams and MG Surety, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the court decision
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Mr. Williams may be contacted at benw@mgsuretybonds.com

Library to Open with Roof Defect Lawsuit Pending

December 04, 2013 — CDJ STAFF
Repairs to the Medina County District Library in Lodi, Ohio should be complete next spring. The library’s lawsuit over the roof is just beginning. The library building was a $3 million project in 2005, but the building had to close in 2011 when it was determined that the roof was not structurally sound. The lawsuit names six defendants, including the contractor, the framing subcontractor, and the engineering firm. The library seeking damages, legal expenses, and attorney fees. The cost of replacing the roof was $1.5 million. Read the court decision
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Carwash Prosecutors Seek $1.6 Billion From Brazil Builders

February 26, 2015 — Sabrina Valle – Bloomberg
(Bloomberg) -- Some of Brazil’s biggest building companies were targeted for the first time in an investigation into alleged kickbacks at Petroleo Brasileiro SA, with prosecutors seeking 4.47 billion reais ($1.6 billion) in compensation. Federal prosecutors in Parana state accused Camargo Correa, Mendes Junior, OAS, Galvao Engenharia, Grupo Engevix and Sanko of diverting public funds and called for them to be banned from new state contracts, the prosecutors said in an e-mailed statement Friday. The allegations -- called acao de improbidade in Portuguese, or misconduct action -- mark the first time companies have been singled out in connection with Brazil’s biggest-ever corruption scandal, in which Petrobras executives are accused of accepting bribes from a cartel of builders. Until now, only individuals have been accused of wrongdoing. Executives from companies including OAS and Camargo Correa have been jailed since November as part of the first sweep against contractors in the case known as Carwash. Read the court decision
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Reprinted courtesy of Sabrina Valle, Bloomberg
Ms. Valle may be contacted at svalle@bloomberg.net

Virtual Jury Trials of Construction Disputes: The Necessary Union of Both Sides of the Brain

May 17, 2021 — John Dannecker - Construction Executive
Bart Smith is the Senior Project Manager for Simply Best, a general contracting firm. He has been assigned to serve as the liaison with outside counsel in a lawsuit against Holly’s Harleys, a project owner who contracted with Best for the construction of a motorcycle showroom. Best filed suit in federal court for additional project costs it incurred, which it contends were caused by the specification of incompatible materials by Holly’s design firm. The coronavirus pandemic is still raging as the trial date approaches. Courthouse facilities are closed so civil trials are conducted using remote technology, if they occur at all. Bart negotiated the prime contract with Holly’s, and he regrettably allowed Best’s binding arbitration and jury trial waiver clauses in the prime contract to be deleted. Bart worries about how the intricacies of Best’s case can be adequately explained to a jury in a remote trial. His concern approaches panic when Best’s trial counsel explains how the trial will be conducted with none of the parties—their attorneys, the judge, the witnesses or the jury—present in the same location. Reprinted courtesy of John Dannecker, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the court decision
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Fifth Circuit Certifies Eight-Corners Duty to Defend Issue to Texas Supreme Court

June 21, 2021 — Jeremy S. Macklin - Traub Lieberman Insurance Law Blog
In the recent case of Bitco Gen. Ins. Corp. v. Monroe Guar. Ins. Co., No. 19-51012, 2021 WL 955155 (5th Cir. Mar. 12, 2021), certified question accepted (Mar. 19, 2021), the Fifth Circuit Court of Appeals certified to the Texas Supreme Court the question of whether a court can consider extrinsic evidence when determining an insurer’s duty to defend. The underlying lawsuit stems from a construction contract in which J&B Farms of Texas hired 5D, a construction company, to drill a commercial irrigation well through the Edwards Aquifer. Two years after beginning the project, J&B Farms sued 5D and its President for breach of contract and negligence. J&B Farms alleged that while drilling, 5D “stuck the drilling bit in the bore hole, rendering the well practically useless for its intended/contracted for purpose.” 5D then “failed and refused to plug the well, retrieve the drill bit, and drill a new well.” J&B Farms asserted that 5D drilled the well “with unacceptable deviation” and then “abandon[ed] the well.” 5D notified its insurers, BITCO and Monroe, of the lawsuit and demanded a defense from both. BITCO agreed to provide a defense to 5D, but Monroe refused arguing that the alleged property damage fell outside the relevant policy period, and therefore, it had no duty to defend 5D. BITCO then filed a declaratory judgment action seeking a finding that Monroe owed 5D a duty to defend. Read the court decision
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Reprinted courtesy of Jeremy S. Macklin, Traub Lieberman
Mr. Macklin may be contacted at jmacklin@tlsslaw.com

Recent Environmental Cases: Something in the Water, in the Air and in the Woods

July 22, 2019 — Anthony B. Cavender - Gravel2Gavel
State of Texas, et al. v. US EPA. The revised regulatory definition of “Waters of the U.S.” continues to generate litigation in the federal courts. On May 28, 2019, the U.S. District Court for the Southern District of Texas held that the 2015 rulemaking proceedings used by EPA and the U.S. Army Corp of Engineers to redefine this important component of the Clean Water Act were flawed in that the notice and comment provisions of the Administrative Procedure Act (APA) were violated because insufficient notice was provided by these agencies that “adjacent” waters newly subject to the regulatory jurisdiction of these agencies, can be determined on the basis of specific distances, which was a change in the agencies’ thinking, and insufficient notice of this change was provided to the public. In addition, the final rule “also violated the APA by preventing interested parties from commenting on the scientific studies that served as the technical basis” for the rule. However, the court did not vacate the new rule, but remanded the matter to the “appropriate administrative agencies” to give them an opportunity to fix this problem. State of Oklahoma, ex rel. Mike Hunter, Attorney General of Oklahoma v. US EPA and the United States Army Corps of Engineers. A day later, on May 29, 2019, the U.S. District Court for the Northern District of Oklahoma rejected arguments that the new redefinition should be preliminarily enjoined.While this case was filed in 2015, intervening litigation in the federal courts, including the U.S. Supreme Court, caused a substantial delay in the disposition of this case. The court, noting that the tests for granting such an injunction against the federal government are fairly exacting, held that the plaintiffs, the State of Oklahoma and a number of industry groups and associations, failed to convince the court that the harm they would suffer if the rules remained effective would be irreparable. Presumably, this case will be going to trial in the near future. Read the court decision
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Reprinted courtesy of Anthony B. Cavender, Pillsbury
Mr. Cavender may be contacted at anthony.cavender@pillsburylaw.com

New Change Order Bill Becomes Law: RCW 39.04.360

July 08, 2024 — Brett M. Hill - Ahlers Cressman & Sleight PLLC
A new statute (RCW 39.04.360) became effective on June 6, 2024, and it applies to extra work performed by contractors and subcontractors on public and private projects in Washington State. The intent of the original bill was to allow contractors and subcontractors to get paid sooner for undisputed additional work. The statute does not apply to private residential projects of 12 units or less. The statute allows for recovery of interest for contractors/subcontractors at 1% per month (12% per year) on the value of the additional work if the statute is violated. Here are the requirements of the new statute:

Public and private owners must issue a change order for the undisputed amount of additional work performed by a contractor, subcontractor, or supplier no later than 30 days after the work is satisfactorily completed and the change is requested by the contractor.
General contractors, and subcontractors with lower-tier subs, must issue a change order to their subcontractors impacted by the change within 10 days after receipt of the approved change order from the owner/upper-tier contractor.

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Reprinted courtesy of Brett M. Hill, Ahlers Cressman & Sleight PLLC
Mr. Hill may be contacted at brett.hill@acslawyers.com

Buy a House or Pay Off College? $1.2 Trillion Student Debt Heats Up in Capital

June 11, 2014 — Janet Lorin – Bloomberg
Jennifer Day spends 12 percent of her monthly take-home pay on debt that funded a master’s degree in urban and regional planning, money she’d rather be saving toward a home. “I spend $364 a month for student loans,” said Day, 33, who conducts market research for the hospitality industry at a consulting firm in New Orleans. “To me, that is a down payment or ultimately savings down the line.” Under legislation sponsored by U.S. Senator Elizabeth Warren of Massachusetts, Day would save about $75 a month on her payments. The bill, which could come up for a vote on the Senate floor as soon as tomorrow, would let 25 million borrowers with federal and private loans refinance their balances at lower interest rates, according to Education Department estimates. Read the court decision
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Reprinted courtesy of Janet Lorin, Bloomberg
Ms. Lorin may be contacted at jlorin@bloomberg.net

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