Cambridge Massachusetts Building Expert Directory

Novation Agreements Under Federal Contracts

November 29, 2021 — Hal Perloff - Construction Executive
A unique aspect of doing business with the federal government is the built-in limits on a contractor’s right to assign the contract or the right to payment under the contract to third parties. The Anti-Assignment Act (41 U.S.C. § 6305) prohibits the transfer of a government contract or interest in a government contract to a third party. An assignment of a contract in violation of this law voids the contract except for the government’s right to pursue a breach of contract remedies. What’s a contractor to do when it is acquired/merged with another firm, is restructured or goes through a variety of other types of corporate transaction? The Federal Acquisition Regulations recognize that firms involved in government contracts get bought and sold from time to time and includes procedures for the novation of contracts in certain situations to avoid a potential violation of the Anti-Assignment Act. What Is a Novation? A novation is a three-party agreement between the United States, the original contractor and the new contractor offering to assume the government contract. The purpose the novation is to allow the government to recognize a new contractor as the successor-in-interest to a government contract and avoid a violation of the Anti-Assignment Act. Reprinted courtesy of Hal 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

The Future of Airport Infrastructure in a Post-Pandemic World

March 21, 2022 — Cait Horner & Adam J. Weaver - Gravel2Gavel Construction & Real Estate Law Blog
In the wake of the COVID-19 pandemic, many service industries are reevaluating their physical footprint, and the aviation industry is no exception. Opportunities abound for developers, designers, and contractors to update and expand airport terminals to accommodate traditional needs while also meeting the growing demand for more open space (including larger outdoor areas in terminals and larger cargo facilities to meet the needs of Amazon, FedEx and UPS). The Future of Passenger Terminals In nearly every service industry, safety and hygiene policies are being overhauled, with a specific emphasis on the desire for more space across the board. Even before the pandemic caused a seismic shift in the way individuals interact with each other, airports and airlines had started reducing the number of unnecessary interactions between travelers and employees by introducing self-service check-in kiosks and contactless ordering at restaurants. The automation inside the airport will only continue to advance. Reprinted courtesy of Cait Horner, Pillsbury and Adam J. Weaver, Pillsbury Ms. Horner may be contacted at cait.horner@pillsburylaw.com Mr. Weaver may be contacted at adam.weaver@pillsburylaw.com Read the court decision
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“To Indemnify, or Not to Indemnify, that is the Question: California Court of Appeal Addresses Active Negligence in Indemnity Provisions”

April 05, 2017 — Steven M. Cvitanovic & Omar Parra – Haight Brown & Bonesteel LLP
In California, it is well-established that the extent of a party’s obligation under an indemnity agreement is an issue of contractual interpretation, and it is therefore the intent of the parties that should control. What is the parties’ intent, then, when a subcontractor (indemnitor) agrees to indemnify the general contractor (indemnitee) “except to the extent the claims arise out of the general contractor’s active negligence or willful misconduct”? Does this mean the general contractor is barred entirely from recovering any indemnity if its active negligence contributed to the injury? Not according to the First Appellate District of the California Court of Appeal, which recently held that an actively negligent general contractor may still recover indemnity for the portion of liability attributable to the fault of others. Oltmans Construction Co. v. Bayside Interiors, Inc., No. A147313, 2017 WL 1179391, at *1 (Cal. Ct. App. Mar. 30, 2017). In Oltmans Construction, an employee of O’Donnell Plastering, Inc. (“O’Donnell”), a sub-subcontractor of Bayside Interiors, Inc. (“Bayside”), which was a subcontractor to Oltmans Construction Company (“Oltmans”), sustained injuries when he fell through a skylight opening in the roof of a building under construction. The employee filed suit against Bayside, Oltmans, and the building’s owner, arguing Oltmans negligently cut and left unsecured the skylight opening. Oltmans subsequently filed a Cross-Complaint against Bayside and O’Donnell, contending it was entitled to indemnification under the governing agreements. Reprinted courtesy of Steven M. Cvitanovic, Haight Brown & Bonesteel LLP and Omar Parra, Haight Brown & Bonesteel LLP Mr. Cvitanovic may be contacted at scvitanovic@hbblaw.com Mr. Parra may be contacted at oparra@hbblaw.com Read the court decision
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D&O Insurer Must Cover Mortgage Broker’s $15 Million Settlement of Alleged False Claims Act Violations

November 15, 2022 — Michael S. Levine, Geoffrey B. Fehling & Matthew J. Revis - Hunton Insurance Recovery Blog
A Delaware court recently granted summary judgment to a mortgage broker targeted in a federal government investigation for alleged False Claims Act violations, holding that the company’s directors and officers liability (“D&O”) insurer was required to indemnify more than $15 million in settlement costs with the U.S. Department of Justice. Guaranteed Rate, Inc. v. ACE American Insurance Company, No. N20C-04-268 MMJ CCLD (Del. Super. Ct. Sept. 6, 2022). We previously reported on the policyholder’s earlier victory in this case, in which the court held that a Civil Investigative Demand (“CID”) from federal authorities triggered the insurer’s obligation to pay defense costs under the D&O policy. Reprinted courtesy of Michael S. Levine, Hunton Andrews Kurth, Geoffrey B. Fehling, Hunton Andrews Kurth and Matthew J. Revis, Hunton Andrews Kurth Mr. Levine may be contacted at mlevine@HuntonAK.com Mr. Fehling may be contacted at gfehling@HuntonAK.com Mr. Revis may be contacted at mrevis@HuntonAK.com Read the court decision
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Insurer Must Defend Where Possible Continuing Property Damage Occurred

January 13, 2017 — Tred R. Eyerly - Insurance Law Hawaii
The California Court of Appeal overturned the trial court's issuance of summary judgment based upon the possibility of continuing property damage during the insurer's policy period. Tidwell Enters. v. Fin. Pac. Ins. Co., 2016 Cal. App. LEXIS 1038 (Cal. Ct. App. Nov. 29, 2016). Financial Pacific insured Greg Tidwell, Tidwell Enterprises, Inc. and Tidwell Enterprises Fireplace Division (Tidwell) under CGL policies issued between March 2003 and March 2010. In 2006 or 2007, Tidwell installed a fireplace in a home. On November 11, 2011, 20 months after the end of the last policy period of Financial Pacific's coverage, the home owned by Kendall Fox, was damaged by fire. Fox was insured by State Farm. State Farm's attorney advised Tidwell of the fire, and Tidwell forwarded the information to Financial Pacific. State Farm hired an investigator who reported that the fire was caused by the installation of an "unlisted shroud at the top of the chimney chase". This prevented the fireplace from drafting properly, resulting in overheating of the fireplace and heat transfer to the surround wood framing members. This resulted in the ignition of the framing members at the sides, top and bottom of the fireplace. State Farm sent the report to Financial Pacific. 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

Ten Firm Members Recognized as Super Lawyers or Rising Stars

September 16, 2019 — Jonathan Schirmer - Ahlers Cressman & Sleight PLLC
While we avoid using this blog as a platform for self-promotion, long-time readers will know we make an exception to recognize the Super Lawyers of the firm, each of whom is humbled to receive this peer-rated award. Super Lawyers recognizes attorneys who have distinguished themselves in their legal practice as recognized by their peers. Attorneys are selected through a patented selection process combining peer nominations and independent research. Results are based on legal excellence, industry involvement, and civic leadership. Only five percent of lawyers in Washington State are selected for the honor of Super Lawyers, and no more than 2.5 percent are selected for the honor of Super Lawyers Rising Stars. John P. Ahlers, one of the firm’s founding partners, was again recognized as one of the Top 10 Lawyers out of all Washington lawyers. Founding partner Paul R. Cressman Jr. was again recognized as one of the 100-Best Lawyers considering Lawyers State of Washington wide. In addition, four other firm members are also recognized as Super Lawyers: Founding Partner Scott R. Sleight, Brett M. Hill, Bruce A. Cohen, and Lawrence S. Glosser. Partners Ryan W. Sternoff and Lindsay (Taft) Watkins, and associates Ceslie A. Blass and Scott D. MacDonald are all recognized as Super Lawyer Rising Stars, which recognizes attorneys either 40 years old or younger, or in practice 10 years or less. Read the court decision
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Reprinted courtesy of Ahlers Cressman & Sleight PLLC

The (Jurisdictional) Rebranding of The CDA’s Sum Certain Requirement

April 15, 2024 — Jordan A. Hutcheson and Stephanie Rolfsness - Watt Tieder
The Contract Disputes Act (the “CDA”), 41 U.S.C.A. §§ 7101 et seq., which has provided the statutory framework for resolution of most contract disputes between the federal government and its contractors since 1978, has recently been the subject of changes in judicial interpretation, despite no corresponding statutory changes. The CDA’s implementing provisions in the Federal Acquisition Regulations (FAR), require that contractors submit a claim to the government in the form of written demand to a contracting officer requesting a final decision and seeking the payment of money in a sum certain prior to pursuing resolution via board or court. However, with respect to the sum certain requirement, the United States Court of Appeals for the Federal Circuit issued an opinion in late 2023 determining that this requirement “should not be given the jurisdictional brand” as it has categorically received in the past. Rather, the court concluded that the sum certain requirement is merely an element of a claim for relief under the CDA that a contractor must satisfy to recover. This rebranding does not debase the sum certain requirement, but it does indicate a renewed focus on what constitutes “jurisdictional” in government contracts litigation. Reprinted courtesy of Jordan A. Hutcheson, Watt Tieder and Stephanie Rolfsness, Watt Tieder Ms. Hutcheson may be contacted at jhutcheson@watttieder.com Ms. Rolfsness may be contacted at srolfsness@watttieder.com Read the court decision
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Mitsui Fudosan Said to Consider Rebuilding Tilted Apartments

October 28, 2015 — Katsuyo Kuwako – Bloomberg
Mitsui Fudosan Co., Japan’s biggest developer, is considering rebuilding an apartment complex in Yokohama after one of the four buildings started to tilt, according to a person familiar with the situation. Kiyotaka Fujibayashi, president and chief executive officer of Mitsui Fudosan Residential Co., on Thursday explained the plans to residents, according to the person, who asked not to be named because the information is private. Another option the company is studying is buying back the apartments from the residents at a price higher than what they had paid, the person said. The project was sold in 2006. Mitsui Fudosan is the latest developer to come under scrutiny for defects at residential projects in the Tokyo area. Mitsubishi Estate Co., Japan’s biggest developer by market value, said last year it would rebuild a residential complex in the upscale Aoyama neighborhood after finding faults. Also last year, Sekisui House Ltd. said it would reconstruct a residential complex that was being built by Taisei Corp. after finding some columns were missing reinforcing metals. Read the court decision
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Reprinted courtesy of Katsuyo Kuwako, Bloomberg

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