FAIRFIELD CONNECTICUT BUILDING EXPERT
DIRECTORY AND CAPABILITIES

Terms of Your Teaming Agreement Matter

July 30, 2019 — Christopher G. Hill - Construction Law Musings
These days in construction, and other pursuits, teaming agreements have become a great method for large and small contractors to work together to take advantage of various contract and job requirements from minority participation to veteran ownership. With the proliferation of these agreements, parties must be careful in how they draft the terms of these agreements. Without proper drafting, the parties risk unenforceability of the teaming agreement in the evewnt of a dispute. One potential pitfall in drafting is an “agreement to agree” or an agreement to negotiate a separate contract in the future. This type of pitfall was illustrated in the case of InDyne Inc. v. Beacon Occupational Health & Safety Services Inc. out of the Eastern District of Virginia. In this case, InDyne and Beacon entered into a teaming agreement that provided that InDyne as Prime would seek to use Beacon, the Sub, in the event that InDyne was awarded a contract using Beacon’s numbers. The teaming agreement further provided:

The agreement shall remain in effect until the first of the following shall occur: … (g) inability of the Prime and the Sub, after negotiating in good faith, to reach agreement on the terms of a subcontract offered by the Prime, in accordance with this agreement.

InDyne was subsequently awarded a contract with the Air Force and shortly thereafter sent a subcontract to Beacon and requested Beacon’s “best and final” pricing. Beacon protested by letter stating that it was only required to act consistently with its original bid pricing. Beacon then returned the subcontract with the original bid pricing and accepting all but a termination for convenience provision. Shortly thereafter, InDyne informed Beacon that InDyne had awarded the subcontract to one of Beacon’s competitors. Beacon of course sued and argued that the teaming agreement required that InDyne award the subcontract to Beacon. Read the court decision
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Reprinted courtesy of The Law Office of Christopher G. Hill
Mr. Hill may be contacted at chrisghill@constructionlawva.com

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City in Ohio Sues Over Alleged Roof Defects

October 29, 2014 — Beverley BevenFlorez-CDJ STAFF
The city of Worthington “is suing the architect and general contractor responsible for constructing the addition to the Worthington Community Center in 2002,” according to ThisWeek Community News. The city is demanding $1.3 million “to replace the roof on the fitness center and pool addition, which is 12 years old.” Moody-Nolan, the architect, and Apex/M&P, the general contractor, have been named as defendants in the case. According to the complaint (as reported by ThisWeek), “experts retained by the city found that the roof has failed ‘due to unknown latent design defects and construction defects that have resulted in property damage.” Read the court decision
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Insurer's Attempt to Limit Additional Insured Status Fails

December 01, 2017 — Tred R. Eyerly - Insurance Law Hawaii
The court disagreed with the insurer's attempt to limit additional insured status based upon the contract between the parties. Mays v. In re All C-Dive LLC, 2017 U.S. Dist. LEXIS 185874 (E.D. La. Nov. 9, 2017). Five employees of C-Dive LLC filed a lawsuit after belng injured in a pipeline explosion aboard a vessel servicing a pipeline owned by Gulf South Pipeline Company. During the work, there was a release of gas that caused an explosion and injured the employees. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Insurer’s Optional Appeals Process Does Not Toll Statute of Limitations Following Unequivocal Written Denial

September 22, 2016 — Christopher Kendrick & Valerie A. Moore – Haight Brown & Bonesteel LLP
In Vishva Dev, M.D., Inc. v. Blue Shield of Cal. (No. B270094, filed 8/31/16), a California appeals court confirmed that the unequivocal denial of a claim, in whole or in part, commences the running of the statute of limitations for suit on the claim, notwithstanding the insurer’s offer to reconsider on new or additional evidence. Reprinted courtesy of Christopher Kendrick, Haight Brown & Bonesteel LLP and Valerie A. Moore, Haight Brown & Bonesteel LLP Mr. Kendrick may be contacted at ckendrick@hbblaw.com Ms. Moore may be contacted at vmoore@hbblaw.com Read the court decision
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Foundation Arbitration Doesn’t Preclude Suing Over Cracks

March 28, 2012 — CDJ STAFF

The Louisiana Court of Appeals has reversed the decision of a lower court, allowing a construction defect case to go through. In Greer v. Town Construction Company, the Greers hired Town Construction to build a home in Baton Rouge. The business relationship went sour, with disputes over “costs, change orders, workmanship, and timeliness issues.”



Town Construction filed an arbitration claim for the unpaid contract balance. In the counterclaim, the Greers made claims of mold and mildew problems, and wall cracks that they attributed to a “structural defect in the foundation.” In arbitration, Town Construction was awarded the full contract balance plus extra costs and interest, while the Greers were awarded for their structural claims.



Three years later, the Greers found additional cracks and filed a suit against Town Construction. Town Construction argued that the Greer’s lawsuit should be dismissed, as the claims had already been through the arbitration process. The district court agreed with Town Construction and dismissed the suit.



The appeals court noted that the Greers would have no ground for a suit if the arbitration was a “valid and final judgment,” and went on to note that there was no evidence in the trial record that the arbitration met this qualification. The court noted that although it was clear that both parties had agreed to the decisions of the arbiter, under Louisiana law, arbitration is not final until it has been “rendered by a court with jurisdiction over subject mater and over parties.”



The court remanded the case to the lower court, noting that “the district court is obligated to first determine whether a valid arbitration award is in existence and had been confirmed before considering the merits of the exception. The court noted that their decision “should not be read to express any opinion as to the merits of the claims or as to the propriety of damages sought in the Greer’s lawsuit.”

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Washington Court of Appeals Upholds Standard of Repose in Fruit Warehouse Case

August 04, 2011 — CDJ STAFF

On July 28, the Washington Court of Appeals ruled in Clasen Fruit & Cold Storage v. Frederick & Michael Construction Co., Inc. that more than six years had passed since a contractor had concluded work and so granted a summary dismissal of the suit.



Frederick & Michael Construction Co., Inc. (F&M) was contracted to construct several buildings for Clasen Fruit and Cold Storage. These were completed in March, 1999. The buildings suffered wind damage to the roofs in 2001, 2003, 2005, and 2006. In the first two incidents, F&M repaired the roofs with Clasen paying for repairs.



In 2005, Clasen hired Continuous Gutter to make repairs. The final incident was the collapse of the roof of one building. This was attributed to “excessive moisture in the roof’s vapor barriers.” At this point, Clasen demanded that F&M pay for repair and replacement costs. In 2008, Clasen sued F&M for damages for breach of contract and negligent design and construction of the roof.



The decision then covered the meanings, in Washington law, of “termination of services” and “substantial completion.” The panel concluded that construction was “substantially completed in 1997” and “relevant services” by 2001. “But Clasen did not sue until 2008, some seven years after termination of any roof related services.”



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Kaboom! Illinois Applies the Anti-Subrogation Rule to Require a Landlord’s Subrogating Property Insurer to Defend a Third-Party Complaint Against Tenants

December 13, 2021 — Ryan Bennett - White and Williams LLP
In Sheckler v. Auto-Owners Ins. Co, 2021 IL App (3d) 190500, 2021 Ill. App. LEXIS 593, Auto-Owners Insurance Company (Insurer) paid its insured, Ronald McIntosh (McIntosh), for property damage following a fire in an apartment he rented to Monroe and Dorothy Sheckler (the Shecklers). Insurer filed suit against Wayne Workman (Workman), who performed service work on an oven in the Shecklers’ apartment that leaked gas and resulted in a fire. Workman filed a third-party complaint against the Shecklers for contribution and the Shecklers tendered the defense of the claim to Insurer. Insurer refused the tender and the Shecklers filed a declaratory judgment action. In the court below, the Shecklers argued that, as tenants, they were co-insureds on McIntosh’s property insurance policy. Following a liberal interpretation of precedent from the Supreme Court of Illinois in Dix Mutual Insurance Co. v. LaFramboise, 597 N.E. 2d 622 (Ill. 1992), an Illinois appellate court ruled that Insurer – who provided property insurance – must defend the tenants of a rental property from contribution claims if the tenants are co-insureds under the landlord’s policy. In Sheckler, the Shecklers hired Workman to fix a broken burner on a gas stove. Finding that additional parts were needed, Workman left while the Shecklers waited inside. While waiting—and despite the smell of gas filling the kitchen—Mr. Sheckler lit the stove. “Kaboom!” wrote the appellate court when describing the scene. A fire erupted and caused substantial damage to the apartment. Read the court decision
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Reprinted courtesy of Ryan Bennett, White and Williams LLP
Mr. Bennett may be contacted at bennettr@whiteandwilliams.com

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Taking Advantage of New Tax Credits and Prevailing Wage Bonuses Under the Inflation Reduction Act for Clean Energy Construction Projects

September 02, 2024 — Abby Bello Salinas, Jennifer Harris & Sahara Mokhtari - ConsensusDocs
Introduction: IRA Boosts U.S. Construction Industry On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022 (the “IRA”) into law.[1] The IRA marked a legislative milestone for clean energy in the United States in part by providing funding mechanisms for clean energy infrastructure projects. This new emphasis on green projects has already created a surge of opportunities across the construction industry—the Internal Revenue Service (“IRS”) estimates that IRA clean energy projects will create over 1.5 million jobs over the next decade.[2] But what can contractors do to take advantage of IRA incentives to reduce costs, build a reliable workforce, and gain a competitive advantage in the new infrastructure landscape created by the ever-increasing number of IRA-related projects? The IRS Final Rule, 89 FR 53184 (29 CFR 1), effective August 26, 2024, provides some guidance by outlining the increased credits and deductions available to taxpayers that satisfy the criteria under the IRA, such as prevailing wage and registered apprenticeship requirements. Reprinted courtesy of Abby Bello Salinas, Peckar & Abramson, P.C., Jennifer Harris, Peckar & Abramson, P.C. and Sahara Mokhtari, Georgetown Law Class of 2025 Ms. Salinas may be contacted at asalinas@pecklaw.com Ms. Harris may be contacted at jharris@pecklaw.com Read the court decision
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