Cambridge Massachusetts Building Expert Directory

Lump Sum Subcontract? Perhaps Not.

August 20, 2019 — David Adelstein - Florida Construction Legal Updates
Lump sum subcontract? Perhaps not due to a recent ruling where the trial court said “No!” based on the language in the subcontract and contract documents generally incorporated into the subcontract. This is a ruling on an interpretation of a subcontract and contract documents incorporated into the subcontract that I do not agree with and struggle to fully comprehend. The issue was whether the subcontract amount was a lump sum or subject to an audit, adjustment, and definitization based on actual costs incurred. Of course, the subcontractor (or any person in any business) is not just interested in recouping actual costs, but there needs to be a margin to cover profit and home office overhead that does not get factored into field general conditions. In United States v. Travelers Casualty and Surety Company, 2018 WL 6571234 (M.D.Fla. 2018), a prime contractor was hired to perform work on a federal project. During the work, the Government issued the prime contractor a Modification that had a not-to-exceed value and required the prime contractor to track its costs for this Modification separate from other contract costs. In other words, based on this Modification, the prime contractor was paid its costs up to a maximum amount and the prime contractor would separately cost-code and track the costs for this work differently than other work it was performing under the prime contract. Read the court decision
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Reprinted courtesy of David Adelstein, Kirwin Norris, P.A.
Mr. Adelstein may be contacted at dma@kirwinnorris.com

Vacant Property and the Right of Redemption in Pennsylvania

April 06, 2016 — Suzanne Prybella – White and Williams LLP
In Pennsylvania, pursuant to the Municipal Claims and Tax Liens Act (53 P.S. §7293(a)) (the Act), the owner of a property sold under a tax or municipal claim may redeem the sold property at any time within nine months after the date of acknowledgment of the sheriff's deed by, in general, paying the amount of the debt. However, there is a caveat contained in the Act with respect to vacant property, which states that “there shall be no redemption of vacant property by any person after the date of the acknowledgment of the sheriff's deed.” (53 P.S. §7293(c)). In Brentwood Borough School District v. HSBC Bank USA, N.A., 111 A.3d 807 (Pa. Commw. Ct. 2015), a case of first impression before the Commonwealth Court of Pennsylvania, the court addressed the definition of “vacant property” under the Act and the timing of a petitioner to invoke the right of redemption with respect to vacant property. Read the court decision
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Reprinted courtesy of Suzanne Prybella, White and Williams LLP
Ms. Prybella may be contacted at prybellas@whiteandwilliams.com

Public Works Bid Protests – Who Is Responsible? Who Is Responsive?

December 14, 2020 — Eric Divine - Porter Law Group
Most Public Works Solicitations Are Low Bid The process for awarding public works projects in California is controlled by the Public Contract Code. Generally, regardless of whether the public agency is the State, a county, a city or a local district, the project is awarded to the contractor who is “responsible” and submits the least expensive “responsive” bid. This is generally known as a “low bid” contract. In the context of public works, the terms responsible and responsive have very important meanings. As a result, State and local governments have gotten into very expensive trouble for not following the law. So, to understand how to best present a bid protest on a low bid solicitation, you, as a contractor should have a good understanding of the meaning of these terms. Note: There are other methods of contracting for public works that are not low bid, which are typically called “best value” contracts because the procurement process considers factors other than just price. These methods are typically used for large projects because the added complexity and expense of the procurement process only makes sense when the project is itself complex and expensive. Read the court decision
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Reprinted courtesy of Eric Divine, Porter Law Group
Mr. Divine may be contacted at edivine@porterlaw.com

The Comcast Project is Not Likely to Be Shut Down Too Long

July 13, 2017 — Wally Zimolong - Supplemental Conditions
Jan Von Bergen at the Philadelphia Inquirer reported that work on Comcast’s new tower came to a halt this morning when striking members of Local 542 picketed the Comcast tower project and other union trades refused to cross the picket line. However, this show of solidarity (during the afternoon on the Friday before the Fourth of July) is unlikely to last past the long weekend. Why? Because any conduct by Local 542 aimed at encouraging a work stoppage by other union members is illegal and the companies that employ the sympathetic union members are in breach of contract if they do not work on Tuesday. Any actions by Local 542 to encourage members of a different trade unions to honor their picket line is a secondary boycott. The National Labor Relations Act prohibits secondary boycotts. Specifically, the NLRA prohibits a union for inducing employees of an employer not subject to a labor dispute to refuse to work. Read the court decision
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Reprinted courtesy of Wally Zimolong, Zimolong LLC
Mr. Zimolong may be contacted at wally@zimolonglaw.com

Chinese Brooklyn-to-Los Angeles Plans Surge: Real Estate

April 01, 2014 — Nadja Brandt and John Gittelsohn – Bloomberg
It took just one 15-minute phone call in July to persuade Ifei Chang to join Shanghai-based developer Greenland Holding Group Co. and lead a U.S. expansion. Within three months, she was running $6 billion of projects as part of a record push by Chinese investors into American property. Greenland reached a preliminary agreement in October to buy a 70 percent stake in the $5 billion Atlantic Yards development in Brooklyn, New York. That followed a July deal to acquire a $1 billion residential-and-entertainment project in downtown Los Angeles. Chang, who took charge of that site upon arriving in the U.S., is now on the hunt for more investments. “In China, you climb a ladder where everything is floating and moving so fast,” Chang, 49, said in an interview at her sparsely furnished 46th-floor L.A. office overlooking the empty lot where the Metropolis project will be built. “We come from a country of 1.4 billion people and a lot of economic growth. This kind of project and investment speed is very normal in China. That’s why we are so confident we will deliver this project.” Greenland, like other Chinese companies, is committing to a growing number of multibillion-dollar developments outside of its home market. Chinese investments in U.S. commercial properties jumped almost 10-fold last year from 2012, with Manhattan the biggest area for purchases, followed by other New York City boroughs and Los Angeles, according to research firm Real Capital Analytics Inc. Ms. Brandt may be contacted at nbrandt@bloomberg.net; Mr. Gittelsohn may be contacted at johngitt@bloomberg.net Read the court decision
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Reprinted courtesy of Nadja Brandt and John Gittelsohn, Bloomberg

After Breaching Its Duty to Defend, Insurer Must Pay Market Rates for Defense Counsel

October 30, 2023 — Tred R. Eyerly - Insurance Law Hawaii
After breaching its duty to defend, the insurer could not take advantage of a California statute allowing insurers to establish rates for defense counsel. S. Cal. Edison Co. v. Greenwich Ins. Co., 2023 U.S. Dist. LEXIS 151695 (C.D. Cal. July 28, 2023). Edison was an additional insured under a policy issued by Greenwich Insurance Company to Utility Tree Service, Inc. (UTS). UTS contracted with Edison to provide vegetation management services near Edison's transmission lines. The Greenwich policy provided additional insured coverage to third parties to the extent of UTS's obligations under the contract. Edison was sued in numerous lawsuits for property damage caused by the Bobcat wildfire in the Angeles National Forest (Bobcat Wildfire lawsuits). Edison tendered the defense in each lawsuit to Greenwich. Coverage was denied, however, based on a lack of underlying allegations or extrinsic evidence that Edison's liability resulted from UTS's negligent actions. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Damon Key Leong Kupchak Hastert
Mr. Eyerly may be contacted at te@hawaiilawyer.com

Joint Venture Dispute Over Profits

January 27, 2020 — David R. Cook - AHC Construction and Procurement Blog
A recent Georgia Court of Appeals case demonstrates the risk of joint ventures failing to carefully define accounting rules in their joint venture agreement. Two trade contractors teamed up to accomplish certain tasks on a job at a wastewater lift station at Fort Gordon. A joint venture agreement provided for an equal split of the profits and losses. Unfortunately, the parties did not define “profit,” and particularly did not define what cost would be deducted in calculating profit. They disputed in particular whether certain large payments to individuals and 15% overhead charges should be deducted in calculating profits. One party presented the expert testimony of an accountant while the other did not. The party presenting expert testimony asked the court to dismiss the other party’s claim because it was not supported by expert testimony of an accountant. The trial court granted the motion and dismissed the claim. Read the court decision
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Reprinted courtesy of David R. Cook, Autry, Hall & Cook, LLP
Mr. Cook may be contacted at cook@ahclaw.com

Apartment Projects Fuel 13% Jump in U.S. Housing Starts

May 19, 2014 — Michelle Jamrisko and Hui-yong Yu – Bloomberg
A surge in construction of multifamily dwellings in April propelled U.S. housing starts to the highest level in five months, helping overcome slack demand for single-family homes. Housing starts climbed 13.2 percent to a 1.07 million annualized rate following March’s 947,000 pace, according to figures released today by the Commerce Department in Washington. Another report showed a measure of consumer confidence unexpectedly declined from a nine-month high. An almost 40 percent increase in construction starts on projects such as condominiums and apartment buildings accounted for almost all of the April gain, as single-family activity was held back by declining affordability. The report highlights a shift in demand for housing in the wake of the financial crisis, which left many Americans wary of taking on new debts. Michelle Jamrisko may be contacted at mjamrisko@bloomberg.net; Hui-yong Yu may be contacted at hyu@bloomberg.net Read the court decision
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Reprinted courtesy of Michelle Jamrisko and Hui-yong Yu, Bloomberg

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