Constructive Change Directives / Directed Changes
June 06, 2018 —
David Adelstein - Florida Construction Legal Updatesrime contracts typically contain a constructive change directive clause. A constructive change directive also goes by the acronym CCD (and for purposes of this article, such changes will be referred to as a CCD), however it can also be known as a Work Change Directive, Interim Directed Change, or Directed Change, depending on the type of contract beign utilized. An owner can order a CCD, versus issuing the contractor a formalized change order, as a mechanism to direct the prime contractor to perform work if there is a dispute as to contract amount, time, or scope. Just because an owner issues a CCD does not mean the owner is conceding that it owes the contractor a change order. Rather, the owner is ordering the CCD as a mechanism to keep the project moving forward notwithstanding a disagreement with the contractor as to the price or time impact. Standard form construction agreements such as the AIA, EJCDC, or ConsensusDocs, will have a standard provision dealing with change directives where the owner can order the contractor to proceed with work in the absence of a change order. In the federal government context, most construction contracts will contain a changes clause that authorizes the government to formally direct changes; and, there is authority for contractors to equitably pursue a constructive change based on certain directives or instructions issued by the government. Naturally, from the contractor’s perspective, this CCD provision is an important consideration as it could likely require the contractor to finance a change to the owner’s project, particularly if there is a scope dispute where the owner does not believe the contractor is entitled to any change order.
Read the court decisionRead the full story...Reprinted courtesy of
David Adelstein, Florida Construction Legal UpdatesMr. Adelstein may be contacted at
dadelstein@gmail.com
It Pays to Review the ‘Review the Contract Documents’ Clause Before You Sign the Contract
March 11, 2024 —
Alan Winkler - ConsensusDocsIt is fairly common for a construction contract to include a provision requiring the contractor to perform some level of review of the plans and specifications and perhaps other contract documents as part of their responsibilities. Typically, this provision is found in a section of the contract on the contractor’s responsibilities, although it can be anywhere. Owners and contractors are, with reason, focused on three main issues in reviewing contracts: (1) price, costs, and payments, (2) time and scheduling, and (3) scope of the work. Eyes may glaze over the contractor’s responsibilities section. Not only does it seem to be boilerplate, but industry professionals know what a contractor is supposed to do; in a nutshell, build the project.
An old school type of contractor may regard this role as strictly following the plans and specifications, no matter what they provide. That could lead to a situation where construction comes to a complete stop because, for example, two elements are totally incompatible with each other. If that happens, the contractor would then turn to the owner and architect to ask for a corrective plan and instructions on how to proceed. That may also be accompanied by a request for more time and money while the problem is resolved. The ‘review the contract documents’ clause is designed to avoid this. It is intended to address an understanding that everyone makes mistakes, even architects and engineers whose job it is to design a buildable, functional project. The clause also addresses the understanding that a contractor is more than a rote implementer of plans and specifications because its expertise in building necessarily means the contractor has expertise in understanding the documents that define the construction and how things are put together.
Read the court decisionRead the full story...Reprinted courtesy of
Alan Winkler, Peckar & Abramson, P.C.Mr. Winkler may be contacted at
awinkler@pecklaw.com
The Woodland Hills Office Secures a Total Defense Award on Behalf of their High-End Custom Home Builder Client!
June 04, 2024 —
Dolores Montoya - Bremer Whyte Brown & O'Meara LLPPartner Daniel Crespo and Associate Theresa Mallen secured a total defense award in arbitration. Our client is a high-end custom home builder with a decades-long flawless record of museum quality construction. Our client was accused of performing substandard construction and the homeowners asserted a multiple million-dollar cost of repair. We took a zero-liability position and argued that the alleged defects were not defects at all but were rather mere reflections of an incomplete project. In sum, our client was forced to terminate the contract and cease construction due to the homeowners’ failure to make progress payments as they became due. The arbitration endured 16 days of testimony scattered over the course of 7 months.
Ultimately, the arbitrator ruled that there were no construction defects at the project and that the homeowners “shall take nothing.” The arbitrator also ruled in favor of our client on its affirmative claim for monies owed by the homeowners’ breach of contract plus interest. A total victory for our client.
Read the court decisionRead the full story...Reprinted courtesy of
Dolores Montoya, Bremer Whyte Brown & O'Meara LLP
Gilroy Homeowners Sue over Leaky Homes
February 10, 2012 —
CDJ STAFFTwo years into a lawsuit against Shapell Homes, the builder of a subdivision called Eagle Ridge in Gilroy, California, homeowners have joined or left the lawsuit. About fifty homeowners are still in the suit, which contends that construction defects have lead to water intrusion in their homes. The lawyer for the homeowners contends that more than a hundred homes have construction defects.
One homeowner said that soon after he joined the suit, Sharpell sent workers to his home who repaired problems to his satisfaction. “They came in within two weeks and fixed everything,” said Frank Lowry. Another homeowner, Wilson Haddow, said that he was “quite happy” after Shapell repaired problems.
Others weren’t quite so happy. Greg Yancey said that problems had “been a nightmare” and that “it just doesn’t feel like home.” He said that his “house is possessed,” with problems that include walls that bow out and a balcony that drips rainwater to the front door. His home is currently worth far less than the $700,000 he paid in 2007.
Read the full story…
Read the court decisionRead the full story...Reprinted courtesy of
Circuit Court Lacks Appellate Jurisdiction Over Order Compelling Appraisal
August 21, 2023 —
Tred R. Eyerly - Insurance Law HawaiiThe Eleventh Circuit determined it lacked appellate jurisdiction over an order issued by the district court compelling an appraisal. Breakwater Commons Association, Inc. v. Empire Indem. Ins. Co., 2023 U.S. App. LEXIS 14459 (11th Cir. June 9, 2023).
Following Hurricane Irma, Breakwater Commons Association filed a claim with Empire Indemnity Insurance Company for property damage. Empire agreed to cover some of the damage to buildings, but a dispute arose over the amount of loss. Breakwater sought to invoke the appraisal provision in the policy. Empire refused to engage in an appraisal. Breakwater sued, and filed a motion to compel appraisal and to stay the proceedings pending the completion of the appraisal process.
Read the court decisionRead the full story...Reprinted courtesy of
Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Mutual Or Concurrent Delay Caused By Subcontractors
March 23, 2020 —
David Adelstein - Florida Construction Legal UpdatesHow are delay damages treated when two subcontractors cause a mutual or concurrent delay to the project?
Assume multiple subcontractors concurrently contributed to an impact to the critical path resulting in a delay to the project. The delay caused the prime contractor to: (1) be assessed liquidated damages from the owner and (2) incur extended general conditions. The prime contractor will be looking to the subcontractors for reimbursement for any liquidated damages it is assessed along with its extended general conditions costs.
There is really no great case that addresses this point when two (or more) subcontractors mutually or concurrently delay the project. It is also not uncommon, and frankly expected, that a subcontractor will point the finger at another subcontractor for the cause of the delay or that another subcontractor was concurrently delaying the project.
The prime contractor should absolutely, without any exception, undertake efforts with a scheduling consultant to allocate the delay caused by subcontractors. Taking an approach that joint and several liability applies between multiple subcontractors and/or not trying to apportion delay because the subcontractors concurrently delayed the critical path at the same time is probably not the best approach. The prime contractor should have an expert render an opinion as to the allocation of the delay period amongst responsible subcontractors that delayed the critical path. Not doing so, in my opinion, is a mistake.
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
Remembering Joseph H. Foster
April 20, 2016 —
White & Williams LLPWe are saddened to share the news of the loss of our longtime partner and good friend, Joseph H. Foster.
Mr. Foster was a nationally recognized trial attorney who began his career at White and Williams LLP in 1958, becoming a partner in 1963, and continued to practice law, coming into the office every day, until he was hospitalized before his passing. A true giant in the Pennsylvania legal community, Joe exemplified the best of the legal profession and was widely admired and respected among the bar and bench for his lasting and impactful contributions.
Mr. Foster served as the Chair of the Litigation Department and a member of the firm’s Executive Committee. During his tenure at White and Williams, he grew to become one of the most respected trial lawyers in Pennsylvania. He promoted a culture of excellence in client services and was the proverbial lawyer’s lawyer, treating his adversaries with courtesy and respect and always looking to find justice in the matters he handled. He was active in training at the firm, mentoring generations of trial lawyers and personally moving for the admission of hundreds of new attorneys at the firm, including an annual ceremony in Federal Court.
Read the court decisionRead the full story...Reprinted courtesy of
White & Williams LLP
The General Assembly Adds Some Clarity to Contracts and Unlicensed Contractors
March 28, 2018 —
Christopher G. Hill – Construction Law MusingsFor years, the statute regarding performing construction without a valid license (
Va. Code 54.1-1115) was a bit murky. While that statute listed several prohibited acts, among them contracting without the proper class of license or use of the license of another, the consequences of such activity, in particular the effect that such action would have on the enforcement of a construction contract (Section C of the statute), were less than clear.
Read the court decisionRead the full story...Reprinted courtesy of
Christopher G. Hill, The Law Office of Christopher G. Hill, PCMr. Hill may be contacted at
chrisghill@constructionlawva.com