SEATTLE WASHINGTON BUILDING EXPERT
DIRECTORY AND CAPABILITIES

A Primer on Suspension and Debarment for Federal Construction Projects

August 10, 2020 — Hal J. Perloff - Construction Executive
We’ve all heard the expression that those who deal with the government must turn square corners. This is because the government has a broad array of tools at its disposal to motivate, coax and cajole contractors and federal grant recipients to play by the rules. Those tools include harsh measures such as criminal prosecution and civil false claims act enforcement on the one hand and poor CPARS ratings on the other. A seemingly less severe administrative option available to the government is suspension and debarment. However, any entity that has been suspended or debarred knows that these measures can prove harsh and disruptive. While the numbers of suspensions and debarments have declined from the all-time high in 2011, there is still significant activity. In its FY 2018 report, the Interagency Suspension and Debarment Committee reported 2444 referrals, 480 suspensions, 1542 proposed debarments and 1334 debarments. The number of referrals for suspension and debarment in FY 2018 is almost exactly the same as the number of GAO bid protests filed that year. WHAT IS SUSPENSION AND DEBARMENT? Suspension and debarment are the government’s tools to avoid entities it views as a high risk for poor performance, fraud, waste and abuse. Suspension and debarment preclude a business entity or individual from contracting with the government or from receiving grants, loans, loan guarantees or other forms of assistance from the government. A suspension is a temporary exclusion when the government determines immediate action is necessary pending the completion of an investigation or legal proceeding. A debarment is an exclusion for a defined, reasonable period of time—often three years. Reprinted courtesy of Hal J. Perloff, Construction Executive, a publication of Associated Builders and Contractors. All rights reserved. Read the court decision
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Mr. Perloff may be contacted at hal.perloff@huschblackwell.com

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Stucco Contractor Trying to Limit Communication in Construction Defect Case

November 13, 2013 — CDJ STAFF
South Carolina State Plastering claimed in the South Carolina Court of Appeals that communication between attorneys and residents of a retirement community could undermine the judgment in the case. Residents of Sun City had filed a class action lawsuit over problems with stucco in the community. Phillip Segul, the plaintiffs’ attorney, noted that plasterer was “directly communicating with the class members and getting them to sign opt-outs and releases of their claims,” although this was something that Everett Kendall, the plasterer’s attorney denied. The lawsuit has been grinding along for six years. Some residents fear they won’t outlive the construction defect lawsuit. Read the court decision
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Architecture, Robotics, and the Importance of Human Interaction – An Interview with Prof. Kathrin Dörfler

September 21, 2020 — Aarni Heiskanen - AEC Business
We sat down with Professor Kathrin Dörfler of the Technical University of Munich (TUM) in advance of WDBE 2020. We discussed the importance of innovation and how her research focuses on the need for practical and productive solutions when it comes to on-site support. Digital and technical innovation plays an essential role in optimizing the modern built environment. Now leading the Augmented Fabrication Lab (AFAB) in TUM, Professor Kathrin Dörfler quickly saw the need for practical solutions early in her career. The Importance of ‘Need’ “I’m originally an architect,” she says. “I studied digital art and architecture and my tendency to go toward digital fabrication came from this proximity to computational design and the need to use robots for fabrication. There was no other way to build the things you created in your virtual space without using machinery.” Read the court decision
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Reprinted courtesy of Aarni Heiskanen, AEC Business
Mr. Heiskanen may be contacted at aec-business@aepartners.fi

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Federal District Court Continues to Find Construction Defects do Not Arise From An Occurrence

May 10, 2012 — CDJ STAFF

Coverage for construction defects continues to be hotly contested in Hawaii state and federal courts. In a recent decision, Judge Mollway felt bound to follow the Ninth Circuit’s decision in Burlington Ins. Co. v. Oceanic Design & Constr., Inc., 383 F.3d 940, 944 (9th Cir. 2004), where the court found construction defect claims arise from breach of contract, not from an occurrence. Judge Mollway’s most recent decision on the issue is Illinois Nat. Ins. Co. v. Nordic PCL Constr., Inc., 2012 U.S. Dist. LEXIS 58464 (D. Haw. April 26, 2012).



Nordic constructed a grocery store for Safeway. In addition to the grocery store, Nordic built a 165-space rooftop parking deck, retail shops and related improvements. After opening for business in 2007, Safeway experienced significant leaks. Safeway demanded that Nordic repair the parking deck. Nordic sent the demand letter to the insurer, who agreed to appoint counsel subject to a reservation of rights.



Safeway filed suit against Nordic in state court alleging, among other things, breach of contract and negligence. The insurer provided Nordic with a defense, but Nordic hired independent counsel.



The insurer filed for declaratory relief in federal district court.



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OIRA Best Practices for Administrative Enforcement and Adjudicative Actions

November 23, 2020 — Anthony B. Cavender - Gravel2Gavel
On March 2, 2020, the Environmental Protection Agency revised its “On-Site Civil Inspection Procedures” in accordance with Executive Order 13892 . (The rules are located at 40 CFR Part 31.) These rules set forth the components of an appropriate inspection procedure. Briefly, the rules require that, after the inspector’s credential are made available, the object of the inspection will be discussed (and most inspections will be held during regular working hours), consent to enter must be obtained, there should be an opening and a closing conference with facility representatives, safety protocols must be observed, confidential business information must be protected, and there will be an opportunity for split sampling. Once the report is completed, it will be shared with the facility. A few months later, on August 31, 2020, the Office of Management and Budget’s Office of Information and Regulatory Affairs (OIRA) circulated a memo to the heads of all federal agencies to implement the principles of fairness in administrative enforcement and adjudication. This directive implements Executive Order 13924, and includes a comprehensive list of “best practices” that should be employed in their administrative enforcement and adjudicative actions. Briefly, these best practices (which are framed in broad terms) are: 1. The government has the burden of proving a violation of the rules or other authorities; Read the court decision
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Reprinted courtesy of Anthony B. Cavender, Pillsbury
Mr. Cavender may be contacted at anthony.cavender@pillsburylaw.com

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Remodels Replace Construction in Redding

September 09, 2011 — CDJ STAFF

The Record Searchlight reports that while new construction is down in Redding, California, residential and commercial remodel permits are up 17 percent. By August 2010, there had been 63 housing and commercial business starts in Redding, while this year has seen only 15.

One such remodel, that of Parkview Market, will cost about $201,000. Safeway is planning on two $80,000 remodels of its grocery stores in Redding. In all, the 150 building permits for remodels are worth a total of $2.8 million.

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Auburn Woods Homeowners Association v. State Farm General Insurance Company

January 11, 2021 — Michael Velladao - Lewis Brisbois
In Auburn Woods HOA v. State Farm Gen. Ins. Co., 56 Cal.App.5th 717 (October 28,2020) (certified for partial publication), the California Third District Court of Appeal affirmed the trial court’s entry of judgment in favor of State Farm General Insurance Company (“State Farm”) regarding a lawsuit for breach of contract and bad faith brought by Auburn Woods Homeowners Association (“HOA”) and property manager, Frei Real Estate Services (“FRES”) against State Farm and the HOA’s broker, Frank Lewis. The parties’ dispute arose out of the tender of two different lawsuits filed against the HOA and FRES by Marva Beadle (“Beadle”). The first lawsuit was filed by Beadle as the owner of a condominium unit against the HOA and FRES for declaratory relief, injunctive relief, and an accounting related to amounts allegedly owed by Beadle to the HOA as association fees. The second lawsuit filed by Beadle was for the purpose of setting aside a foreclosure sale, cancelling the trustee’s deed and quieting title, and for an accounting and injunctive relief against an unlawful detainer action filed by Sutter Group, LP against Beadle. The complaint filed in the second lawsuit alleged that Allied Trustee Services caused Beadle’s property to be sold at auction and that Sutter Capital Group, LP purchased the unit and obtained a trustee’s deed upon sale. Beadle claimed the assessments against her were improper and the trustee’s deed upon sale was wrongfully executed. Beadle sought an order restoring possession of her unit and damages. The HOA and FRES tendered both lawsuits to State Farm. As respects the first lawsuit, State Farm denied coverage of the lawsuit based on the absence of alleged “damages” covered by the policy issued to the HOA affording liability and directors and officers (“D&O”) coverages. State Farm agreed to defend the HOA under the D&O coverage in the second lawsuit. However, State Farm denied coverage of FRES in both lawsuits as it did not qualify as an insured under the State Farm policy issued to the HOA. Subsequently, the HOA and FRES filed an action against State Farm arguing that a duty to defend was triggered under its policy for the first lawsuit and a duty to defend FRES was also owed under the D&O policy for the second lawsuit. After a bench trial, the trial court entered summary judgment in favor of State Farm based on the failure of the first lawsuit to allege damages covered by the State Farm policy under the liability and D&O coverages afforded by the policy. As respects the second lawsuit, the trial court held that FRES did not qualify as an insured and State Farm did not act in bad faith by refusing to pay the HOA’s alleged defense costs in the second lawsuit before it agreed to defend the HOA against such lawsuit. Read the court decision
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Reprinted courtesy of Michael Velladao, Lewis Brisbois
Mr. Velladao may be contacted at Michael.Velladao@lewisbrisbois.com

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The Connecticut Appellate Court Decides That Construction Contractor Was Not Obligated To Continue Accelerated Schedule to Mitigate Its Damages Following Late Delivery of Materials by Supplier

April 11, 2022 — Robert M. Barrack - Gordon & Rees
In United Concrete Prods. v. NJR Constr., LLC, 207 Conn. App. 551, 263 A.3d 823 (2021), the Connecticut Appellate Court has issued a decision that should be of interest to the Connecticut construction industry and the construction bar. The lawsuit arose out of the late delivery of materials on a construction project, which is a frequent problem on construction projects. In United Concrete Products, the defendant general contractor, NJR Construction, LLC (“NJR”) was retained by the State of Connecticut Department of Transportation (“DOT”) to replace a bridge over the Hockanum River (“Project”). Id. at 555-58 (2021). The Prime Contract provided that NJR with an eight-week time-frame to perform the work, at which time the road would be closed to traffic. Id. The Prime Contract also provided for a bonus of $3,000 for each day the road was opened to traffic prior to the eight week deadline of August 8, 2016, and for liquidated damages of $3,000 for each day the road remained closed beyond the deadline. Id. NJR subsequently entered into a purchase order (“Subcontract”) with the plaintiff, United Concrete Products, Inc. (“United”), whereby United agreed to provide certain concrete components for the Project, including ten pre-stressed concrete beams. Id. The Subcontract required that United deliver the concrete beams by June 7, 2016, but, NJR did not actually schedule the delivery until June 29, 2016. Id. Nevertheless, even with that schedule NJR could have reopened the road by July 19, 2016, which would have allowed it to receive the full $60,000 incentive bonus. However, United did not deliver the concrete beams until July 26, 2016, which caused NJR to lose the incentive bonus, be assessed liquidated damages by the DOT, and to incur additional delay damages. Id. After deducting the amount of $179,500 in damages that it incurred due to United’s late delivery of the beams, NJR paid United the balance of $66,074.75. Id. Read the court decision
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Reprinted courtesy of Robert M. Barrack, Gordon Rees Scully Mansukhani, LLP
Mr. Barrack may be contacted at rbarrack@grsm.com

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