Court Bars Licensed Contractor From Seeking Compensation for Work Performed by Unlicensed Sub
June 06, 2022 —
Garret Murai - California Construction Law BlogIt all started with a tree.
A eucalyptus tree to be exact.
What followed is one of the more important cases to be decided under Business and Professions Code section 7031 in recent years. Yes, that Section 7031. The statute variously described by the state’s courts as “harsh[ ],” draconian” and “unjust,” but, importantly, nevertheless valid.
Under Section 7031, an unlicensed contractor is barred from seeking compensation for work requiring a contractor’s license. This has been called the “shield.” However, in addition to the “shield,” project owners can also employ Section 7031’s “sword,” and seek disgorgement of all monies paid to an unlicensed contractor. Section 7031’s “shield” and “sword” applies even if the project owner knew that the contractor was unlicensed. They also apply even if the unlicensed contractor’s work was flawless. And they also apply even if a contractor was unlicensed during a portion of its work. This is because, as courts have stated, Section 7031 is a consumer protection statute intended to protect the public from unlicensed contractors and applies irrespective of the equities.
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Garret Murai, Nomos LLPMr. Murai may be contacted at
gmurai@nomosllp.com
WSDOT Seeks Retraction of Waiver Excluding Non-Minority Woman-Owned Businesses from Participation Goals
September 28, 2017 —
Lindsay K. Taft - Ahlers & Cressman PLLCIf you are a regular reader of our blog, you will likely recognize that our firm has been actively involved and concerned with the results of Washington State Department of Transportation’s (“WSDOT”) Disparity Study, which impacts both Disadvantaged Business Enterprises (“DBE”) and general contractors who bid on federally-funded projects with DBE goals. On June 1, 2017, WSDOT implemented a “waiver”, which excluded Caucasian women-owned firms (“WBEs”) from qualifying for Condition of Award DBE Goals on federally-funded projects. This drastic action was the result of WSDOT’s highly criticized 2012 Disparity Study conducted by BBC Research & Consulting of Denver, Colorado, which concluded non-minority women-owned firms do not face “substantial disparities” in the federally-funded transportation contracting market.
BBC’s study was criticized for a number of reasons, but most concerning was BBC’s flawed and unreliable statistical methodology that did not accurately represent true marketplace conditions. See Ahlers & Cressman letter of January 9, 2014 and Associated General Contractors of Washington article. For example, BBC’s results showed both decreasing WBE availability and availability vastly out of range with other states (e.g., the availability of women-owned construction firms in Washington was just 1.5% compared to 11.96% in Oregon). Nevertheless, based on this flawed BBC study and BBC’s assertion that women-owned firms did not face disparities, WSDOT sought and on June 1, 2017 was granted a waiver precluding general contractors from counting WBE firms towards their DBE goals on federally funded public works projects.
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Lindsay Taft, Ahlers & Cressman PLLCMs. Taft may be contacted at
ltaft@ac-lawyers.com
Is Ohio’s Buckeye Lake Dam Safe?
March 12, 2015 —
Beverley BevenFlorez-CDJ STAFFAccording to Columbus Business First, a report by the U.S. Army Corps of Engineers that “assessed the structural integrity of the Buckeye Lake Dam [located in Ohio] and found serious problems that present significant risks to the public.”
Problems arose, allegedly, from “construction of homes [and] pools and patios that have been built into the earthen embankment.” The U.S. Army Corps of Engineers report stated (according to Columbus Business First) “there was a potential for an eight-foot wave of water, mud and debris that would inundate an area as far as Hebron, more than two miles away.”
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Fifth Circuit Asks Texas Supreme Court to Clarify Construction Defect Decision
November 07, 2012 —
CDJ STAFFThe Fifth Circuit Court has withdrawn its decision in Ewing Construction Company v. Amerisure Insurance Company, pending clarification from the Texas Supreme Court of its decision in Gilbert Texas Construction, L.P. v. Underwriters at Lloyd’s London. The Fifth Circuit had applied the Gilbert case in determining that a contractual liability exclusion barred coverage for faulty workmanship. The Insurance Journal reports that this decision was both applauded and criticized, with a concern noted that “an insurer would now have its pick of either the ‘your work’ exclusion or the contractual liability exclusion without the exception for subcontracted work.”
The Fifth Circuit is now asking the Texas Supreme Court two questions to clarify Gilbert, which Brian S. Martin and Suzanne M. Patrick see as a sign that the Court has realized that it overly expanded the scope of the earlier ruling. A response is expected from the Texas Supreme Court by spring 2013.
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Union Handbilling: When, Where, and Why it is Legal
November 06, 2018 —
Wally Zimolong - Supplemental ConditionsA few days ago, IBEW Local 98 began began protesting a restaurant owned by professional football player Jahri Evans. The organizers are accusing Evans of violating local construction wage standards and are advertising their dispute with “handbills.”
What are handbills?
Walking down Fremont Street in Las Vegas is impossible without one or several characters putting a small business card with “questionable” adult entertainment advertisements in your hand. Some will slap papers to your chest, leaving you no choice but to grab the flyers.
On a different level, this action occurs on a regular basis by union member. But instead of shady characters pushing questionable entertainment, it is union representatives pushing a dispute with a local employer over working conditions. However, in either case the practice is known as i as handbilling.
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Wally Zimolong, Zimolong LLCMr. Zimolong may be contacted at
wally@zimolonglaw.com
Federal Court Enforces “Limits” and “Most We Will Pay” Clauses in Additional Insured Endorsement
September 13, 2021 —
Craig Rokuson - Traub Lieberman Insurance Law BlogIn the recent case of Zurich Am. Ins. Co. v. XL Ins. Am., Inc., 20-CV-4614 (LJL), 2021 WL 3617218 (S.D.N.Y. Aug. 16, 2021), the United States District Court for the Southern District of New York—in deciding a motion for consideration—had occasion to review the 2013 ISO changes to the additional insured endorsement, and held that coverage under a policy providing additional insured coverage was limited to the $1,000,000 required by contract, and not the $2,500,000 limit to the policy.
In Zurich, Zurich and its named insured D.A. Collins sought the full limits of the primary policy issued by XL to the D.A. Collins’ subcontractor, HBI, which are $2,5000 per occurrence and in the aggregate, for an underlying personal injury lawsuit. XL also issued an excess policy in the amount of $5,000,000 to HBI.
The contract between D.A. Collins and HBI required HBI to obtain commercial liability coverage “in an amount of $1,000,000 per occurrence and $2,000,000 in the aggregate. It further provides that the “required limits for the umbrella excess coverage shall be sufficient to provide a total of $5,000,000 per occurrence/aggregate.”
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Craig Rokuson, Traub LiebermanMr. Rokuson may be contacted at
crokuson@tlsslaw.com
Facing Manslaughter Charges In Worker's 2021 Trench Collapse Death, Colorado Contractor Who Willfully Ignored Federal Law Surrenders To Police
February 06, 2023 —
U.S. Department of LaborBRECKENRIDGE, CO – The owner of a Vail construction company facing felony manslaughter charges has surrendered to local law enforcement after the Summit County Sheriff's Office in Breckenridge, Colorado, issued an arrest warrant on Jan. 24, 2023, related to the findings of a federal safety investigation into a deadly trench collapse in November 2021.
In May 2022, the U.S. Department of Labor's Occupational Safety and Health Administration cited Peter Dillon, owner of the now-defunct A4S LLC, after a worker installing residential sewer pipes suffered fatal injuries when the trench around him caved in. The collapse resulted from deteriorating conditions at the project, which A4S LLC could have prevented by using legally required trench protection systems.
OSHA issued three willful citations to A4S LLC for not ensuring the excavation was inspected by a competent person, failing to instruct employees on the recognition and avoidance of unsafe conditions and not having a trench protective system in place. Investigators also issued an additional serious citation for not having a safe means of egress within 25 lateral feet of employees working in a trench.
The agency proposed penalties of $449,583 and placed the company in OSHA's Severe Violator Enforcement Program.
The department referred the case to the 5th Judicial District Attorney's office recommending criminal charges for A4S LLC's refusal to require safety protection, despite worsening trench conditions that included at least one trench collapse.
A4S LLC has since shuttered and Dillon agreed to forfeit any future ownership, leadership or management position that involves trenching or excavation, or the oversight of workplace safety and health.
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Ohio Condo Owners Sue Builder, Alleging Construction Defects
September 10, 2014 —
Beverley BevenFlorez-CDJ STAFFSeventy-four condominium owners that reside in the Villas at Northstar in Westerville, Ohio, have sued Romanelli & Hughes, the builder, for alleged construction issues that led to water intrusion, according to The Columbus Dispatch.
“There have been noted deficiencies at every building out there, with both the roofs and wall systems,” Kevin Fields, a partner at Kasman & Cusimano, the firm that is representing the condo owners, told The Columbus Dispatch. “There’s been severe water infiltration through the walls, which has caused underlying damage, and various roof leaks and roofs not properly secured — in essence, sliding off the buildings.”
Counsel for the builder, Gabe Roehrenbeck, a partner with Thompson Hines law firm, stated that “he could not comment on the specifics of the case…because he has not had time to analyze it.” But he issued the statement, “Romanelli & Hughes is an award-winning builder that over the course of more than 40 years has built a reputation for client service and satisfaction.”
Construction defects listed in the suit include “failure to install or improper installation of flashing, ice shields, roofing paper, shingles, control joints in stucco and weather-resistant barriers.”
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