NYC Design Firm Executives Plead Guilty in Pay-to-Play Scheme
June 18, 2019 —
Engineering News-RecordTwo former top executives of New York City-based engineer HAKS pleaded guilty in city court May 13 to bribe charges related to efforts to gain municipal water infrastructure contracts, according to court filings, an attorney for its ex-chief financial officer and plea agreements provided to ENR by the Manhattan district attorney's office.
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Engineering News-RecordENR may be contacted at
ENR.com@bnpmedia.com
Application Of Two Construction Contract Provisions: No-Damages-For-Delay And Liquidated Damages
February 14, 2022 —
David Adelstein - Florida Construction Legal UpdatesA recent Florida opinion between a prime contractor and a Florida public body touches upon two important issues: (1) the application of a no-damage-for-delay provision; and (2) the application of a liquidated damages provision. Both provisions find there way into many construction contracts. Unfortunately, the opinion is sparse on facts. Nevertheless, the application of these provisions is worthy of consideration.
In this opinion, Sarasota County v. Southern Underground Industries, Inc., 2022 WL 162977 (Fla. 2d DCA 2022), a county hired a contractor to install sanitary and water piping underneath a waterway. During construction, a nearby homeowner complained that vibration from the drilling caused damage to his home. As a result, the county stopped the contractor’s work to address a potential safety issue, as it was contractually entitled to do. The contractor hired a structural engineer to inspect the house and the engineer issued a report determining that any alleged damage was cosmetic and that there was sufficient monitoring of the vibrations to prevent future damage. The contractor also had an insurance policy to cover any homeowner claim for damage. However, upon receipt of the engineer’s report, the county did not lift its stop work order. Rather, the stop work order remained in place for an additional 71 days.
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David Adelstein, Kirwin Norris, P.A.Mr. Adelstein may be contacted at
dma@kirwinnorris.com
Construction Warranties: Have You Seen Me Lately?
February 07, 2022 —
Christopher D. Cazenave - ConsensusDocsA construction contract typically contains many different types of warranties. Owners expect contractors to explicitly warrant their workmanship, contractor-provided materials and equipment, and in many instances to assume other warranty risks that may obligate the contractor years after the project is completed.
No contractor wants to be surprised years after a project is completed by the existence of warranty obligations that were not considered or negotiated at the outset of the project. To help avoid this situation, warranties should be treated similar to other critical risk-sharing provisions in the contract in concert with other bargained-for provisions, including for example price and schedule.
This article provides a brief overview of warranty obligations found in typical construction contracts followed by a few practical considerations for contractors to consider when negotiating warranty obligations.
Reprinted courtesy of
Christopher D. Cazenave, Jones Walker, LLP (ConsensusDocs)
Mr. Cazenave may be contacted at ccazenave@joneswalker.com
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Renters Who Bought Cannot Sue for Construction Defects
October 08, 2013 —
CDJ STAFFA Wisconsin couple that leased then bought a home cannot sue the couple that built the home for construction defects. The court rejected the claims made by Niksa and Kelly Ivancevic that the sellers, Ronald and Debra Reagan, had breached contract or that the contract represented a mutual mistake.
The Ivancevics initially leased the home, with an agreement that said the house would be “delivered in clean condition and good repair, free of mold and toxic substances, suitable for habitation in compliance with all laws.” Before the purchase, no defects were found. After the purchase, the Ivancevics had problems with the air conditioning, leading to water leaks on the second floor.
The court found that the actual sales contract did not guarantee a defect-free residence. Therefore the Ivancevic’s claim of a mutual mistake, in which “both parties of a contact are unaware of the existence of a past or present fact material to their agreement” did not apply, since the presence of construction defects was not “material to their agreement.”
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Can a Receiver Prime and Strip Liens Against Real Property?
September 20, 2021 —
Ben Reeves - Snell & Wilmer Real Estate Litigation BlogCourts overseeing receivers generally enjoy broad discretion in directing and approving a receiver’s proposed actions. But does that authority extend to a receiver not only granting a super-priority lien ahead of existing liens, but also selling the real property free and clear of all liens? In County of Sonoma v. Quail, 56 Cal.App.5th 657 (Ct. App. 2020), the California Court of Appeals answered that question in the affirmative.
Quail involved a 47,480 square-foot lot with two houses, a few garages, several outbuildings, and numerous trailers surrounded by a veritable junk yard. Despite many of these structures being uninhabitable, unsanitary, and dangerous, multiple families resided on the lot. Although Sonoma County (the “County”) ordered the owner to remediate the property several times, he failed and refused to do so. After several years of these violations going unabated, the County ultimately sought and obtained the appointment of a receiver over the real property.
To obtain funds necessary to repair the property, the receiver asked the court for permission to borrow money through the issuance of a receivership certificate to be secured by a super-priority lien—i.e., a lien ahead of all other liens—against the real property. Although the trial court initially declined to prime existing liens, when the receiver could find no one to lend money (since the land lacked equity), the trial court relented and approved a super-priority lien despite the senior secured lender’s objection (the “lender”).
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Ben Reeves, Snell & WilmerMr. Reeves may be contacted at
breeves@swlaw.com
Texas LGI Homes Goes After First-Time Homeowners
May 13, 2014 —
Beverley BevenFlorez-CDJ STAFFAccording to Big Builder, while many consumers have “gone to rentals…as the homeownership rate fell,” that hasn’t stopped Texas-based builder LGI Homes from marketing to the entry-level buyer: “We do not believe that we’re becoming a renter society,” Eric Lipar, LGI CEO told Big Builder. “We believe there is a need and a desire for homeownership.”
“The real growth will be powered by an aggressive sales and marketing operation that aims to pull renters out of their apartments (or single-family rentals) and into LGI homes,” reported Big Builder. “So far this pitch has worked in Texas (Dallas, Houston, San Antonio, and Austin), in addition to Phoenix and Tampa, Fla.”
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Contract And IP Implications Of Design Professionals Monetizing Non-Fungible Tokens Comprising Digital Construction Designs
December 26, 2022 —
Colin C. Holley - ConsensusDocsThere is an emerging market that appears poised to increasingly provide opportunities to monetize architectural and other construction designs through the sale of non-fungible tokens (NFTs). Last year, artist Krista Kim reportedly made the first sale of a digital home design via an NFT marketplace, for over $500,000. With some NFTs selling for millions of dollars, monetizing digital designs is undoubtedly an enticing prospect for architects, engineers, and other design professionals. It is thus critical to understand the application of intellectual property rights to NFTs and to address those rights in contracts involving design professionals.
What is an NFT?
To understand the market for NFTs it is necessary to first understand blockchain technology. A blockchain is a decentralized system of recording information via a digital ledger of transactions duplicated and distributed across many computers. The manner in which each block of the ledger chain is created—using a cryptographic mathematical algorithm tied into the previous block, a timestamp, and transaction data—prevents it from being changed retroactively without a change to all subsequent blocks and consensus of the decentralized network.
An NFT is a ‘token’ secured to a blockchain. It can represent ownership of any item that is non-fungible, i.e., any item that has unique qualities that add value and make the item non-interchangeable. NFTs can take unlimited forms, including, for example, tokens representing unique artwork, music, fashion items, in-game items, essays, collectibles, memorabilia, furniture, and real estate.
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Colin C. Holley, Watt, Tieder, Hoffar, & Fitzgerald, LLP (ConsensusDocs)Mr. Holley may be contacted at
cholley@watttieder.com
Washington’s Court of Appeals Protects Contracting Parties’ Rights to Define the Terms of their Indemnity Agreements
March 19, 2024 —
Margarita Kutsin - Ahlers Cressman & Sleight PLLCIt has long been the law in Washington that contracting parties are free to draft contractual indemnity agreements to allocate risk arising from performance of the work, and Courts will generally enforce those agreements as written. This well-settled principle was recently reaffirmed in King County v. CPM Development Corp., dba ICON Materials[1] a decision from Division I of the Washington Court of Appeals, wherein one party to an indemnity agreement attempted to evade its contractual obligations by arguing that certain common law indemnity principles supersede the written terms. This appeal followed a multi-week jury trial from which the client and Ahlers Cressman and Sleight legal team, including Lindsay Watkins, Klien Hilliard, and Christina Granquist, obtained a seven-figure judgment in the client’s favor, including an award of all attorneys’ fees and costs.
ICON was the general contractor on a Vashon Island Highway Pavement project for King County. Part of the work on the project involved hauling away and disposing of ground milled asphalt (the “millings”) at King County-approved sites. ICON and D&R Excavating Inc., (“D&R”) executed a subcontract for D&R to perform that work. The subcontract incorporated the contract between ICON and King County, including the obligation to stockpile millings only at approved sites. D&R, however, did not obtain the requisite approvals from King County, and placed the millings at various sites on the Island, including locations that King County explicitly rejected.
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Margarita Kutsin, Ahlers Cressman & Sleight PLLCMs. Kutsin may be contacted at
margarita.kutsin@acslawyers.com